A Better Prescription Plan for Seniors - April 30, 2003

When President Lyndon Johnson created Medicare - the nation's health insurance program for the elderly -- he said, "No longer will older Americans be denied the healing miracle of modern medicine."

Yet 38 years later, the lack of a comprehensive prescription drug benefit does, in fact, deny the healing miracle of modern medicine that was promised by the President.

As Alaska's 44,000 seniors know, one of the miracles of medicine today is the dazzling array of drugs that do everything from mitigate the pain of arthritis to fight the terrible scourge of Alzheimer's. But in far too many cases America's 40 million seniors can't afford the expense of their medicines.

Seniors in Alaska face two additional hurdles. They must fight for access to care because of the state's smaller medical community spread thinly around our state, and they must deal with the higher cost of health care in Alaska - health care that many times costs patients from 25 to 70 percent more than in the Lower 48. This reality makes the cost of prescription drugs that much more unaffordable for Alaska's seniors, whether they fill their prescriptions in Anchorage or Barrow.

For that reason the Senate this summer voted to offer seniors two new Medicare options, both of which will provide access to affordable prescription drugs. Seniors will be able to either keep the coverage they have in the traditional Medicare fee-for-service program and enroll in a drug only insurance plan, or alternatively, they can join a new privately run health insurance plan, similar to the ones federal employees enjoy, that will offer a broader range of preventive care options and an integrated drug benefit.

I am pleased that the Senate Medicare bill does two very important things: it gives seniors access to affordable prescription drugs immediately, and also provides the greatest assistance to seniors who need it most. While the full prescription drug benefit is expected to take about two years to implement, seniors immediately would get a prescription drug card that is expected to reduce their costs for drugs by 25 percent. Low-income seniors would additionally receive an annual payment of $600 to help them offset the cost of drugs. The drug card would be phased out after two years to make way for the full Medicare prescription drug benefit.

Under the full benefit seniors, if they pay a monthly fee and after a yearly deductible, would pay about 50 percent of their drug costs, up to $4,500 a year. Seniors with catastrophic drug costs of more than $5,800 a year would have 90 percent of their costs paid for by the government. Low-income seniors, those with incomes at or within 60 percent of the poverty level, will see the government pay all or part of their monthly drug plan premiums and cover up to 95 percent of their prescription drug costs.

The plan, it should be noted, doesn't bust the federal budget since its $400 billion cost over the next decade was built into the federal budget when it was crafted earlier this year.

The Senate plan, as a result of efforts by myself and Alaska's senior Senator Ted Stevens, also includes a variety of Alaska-related provisions. The bill includes a provision that would set up a Frontier Extended-Stay Clinic demonstration project. This project is designed to improve the ability of primary care clinics in remote and isolated parts of the state to continue providing high-quality care to residents by making Medicare pay for services these clinics already provide, but currently refuses to pay them for offering.

The bill also includes amendments that are important to the survival of many hospitals around Alaska. These provisions will increase the Medicare payments to small rural hospitals such as those located in Petersburg, Wrangell, Sitka, Valdez, Cordova, Nome and Kodiak. The bill also allows nurse practitioners to direct care to home health and hospice care, while providing more equitable payments for home health, hospice, and air ambulance services. These provisions are particularly important because they improve the care for seniors. The bill also ensures that Alaskans, whether living in Anchorage or Klawock, can get their drugs conveniently at a local pharmacy.

Without forcing seniors to give up their current Medicare coverage, the Senate-passed Medicare bill will provide drug benefits to the 40 percent of seniors who currently have no help with paying for vital prescription drugs. It is an important first step to moving Medicare into the 21st Century, and towards adding a tangible benefit that will improve the quality of life for our senior citizens. I'm hopeful that by autumn, Congress will work out the complex differences between the Senate and House versions of the bill.

No American should ever be forced to decide whether to put food on the table or pay for life-sustaining drugs.