Info, savings key to Medicare discount

By Eleni Berger
CNN

(CNN) - The cost of prescription drugs could be going down for millions of Americans on Medicare if a new discount plan announced by the Bush administration takes effect as expected.

On Thursday, President George W. Bush said he was addressing "Medicare's most pressing challenge" by providing a way for seniors to pay less for prescription drugs.

The program he unveiled would allow Medicare recipients to join existing discount prescription drug programs that had been endorsed by Medicare. These programs would provide members with a card they could present to a pharmacy to receive their discount.

VIDEO Highlights from President Bush's Medicare announcement Play video (QuickTime, Real or Windows Media) CNN's Kelly Wallace reports Democrats say Bush's plan is only a Band-Aid (July 12) Play video (QuickTime, Real or Windows Media)   MORE STORIES Bush unveils drug cut plan for seniors   Group blames marketing for drug costs     RESOURCES CNN Access: Sec. Thompson details Medicare changes, drug discounts   Transcript of Bush's remarks   Message Board: Health care   More information about the discount drug card program will be available in the fall at www.medicare.gov  or by calling 1-800-MEDICARE or 1-800-486-2040 for TTY/TDD

The program could save Medicare beneficiaries 15 to 35 percent, according to White House officials, though a statement from the Department of Health and Human Services put the figure slightly lower, at 10 to 25 percent.

Medicare is the federal health insurance program that provides care for people 65 and older, some younger people with disabilities and people with chronic kidney failure. About 39 million Americans are enrolled.

Medicare provides inpatient hospital care at no cost, while doctor visits and some other services are provided for a monthly premium ($50 in 2001). The program does not, however, cover the cost of prescription drugs. Medicare recipients must either buy supplemental insurance that provides this coverage, or they must pay their drug costs out-of-pocket.

More than 10 million Medicare recipients do not have prescription drug coverage, according to HHS.

These people in particular would benefit from the new plan, Bush said, but all Medicare recipients would be able to use the discount cards.

The cards could allow those recipients who do have drug coverage to get more drugs for the same amount of money, or perhaps not reach their out-of-pocket limits as quickly, said a spokesman for HHS's Center for Medicare and Medicaid Services (CMS), the agency that administers Medicare.

The key feature of the program, he added, is providing information and education to consumers.

The discount drug companies endorsed by Medicare would form a consortium to provide service to Medicare recipients that would be separate from their other commercial services. The consortium companies would be responsible for administering the program and for supplying information to members about the comparative benefits of the participating providers.

Members could use these materials to select the discount provider that best suits their needs. The companies would be allowed to charge a one-time enrollment fee no higher than $25.

Several major pharmacy benefit management companies have expressed support for the administration plan, including Caremark Rx, Inc., Wellpoint, Express Scripts, and Advance PCS.

More information on the program and participating companies is expected to be available in the fall.