Close to 24 million Medicare beneficiaries enrolled in Part D coverage for prescription drugs in the first two enrollment cycles. According to the Centers for Medicare and Medicaid Services (CMS), more than 75 percent of beneficiaries are satisfied with the program. However, evidence suggests that seniors who were uncovered in 2005 benefited more than other enrollees in 2006. HHS has announced that more than 90 percent of Medicare beneficiaries in a stand-alone prescription drug plan will have access to at least one plan with a lower premium in 2008[1]; and the third open enrollment period is now upon us – November 15 through December 31, 2007.
There is mounting research highlighting poor quality of care and inefficient spending in our health care system. At the same time, diagnostic and treatment options proliferate at an accelerating pace.
Medicare covers nearly 44 million beneficiaries who are elderly, including 37 million seniors and 7 million younger adults with permanent disabilities, and end stage renal disease. The program cost the federal government approximately $375 billion in 2006, accounting for 13 percent of federal spending. Why is Medicare important for congressional staffers to know about?
Suddenly, Capitol Hill is talking about health issues again. Incoming House Speaker Nancy Pelosi promises that Democrats will roll back the prohibition against the federal government negotiating drug prices on behalf of Medicare beneficiaries. (A Kaiser Family Foundation poll released today found broad bipartisan support for this idea.) Incoming Senate Majority Leader Harry Reid says one of his three top priorities will be more funding for stem cell research. Others want to revisit the importation of prescription drugs from Canada. Additionally, the 110th Congress will consider whether to continue the State Children’s Health Insurance Program in its present form.
Come January, we can expect to see some new approaches to health legislation. Sen. Harry Reid, incoming Senate majority leader, says one of his top three priorities will be more funding for stem cell research. House Speaker-to-be Nancy Pelosi wants a vote early on to roll back the prohibition against the federal government negotiating prescription drug prices for Medicare beneficiaries. And these are just two of the health issues likely to be debated in the new Congress. The White House too will have a definite voice in the debates to come.
Biotechnology accounts for only one percent of insurers’ costs, but those costs are growing at a double digit rate. As science produces increasingly sophisticated and expensive medical products and procedures based on the manipulation of living organisms, payers will increasingly struggle with managing their use.
The Medicare prescription drug program offers coverage for prescription drugs through competing private plans, within a framework established by law and through rules established by the Centers for Medicare and Medicaid Services. In contrast, other countries, including Australia, the UK, and Canada, provide similar prescription drug programs, but within different regulatory structures.
The Medicare Savings Programs provide assistance with premiums — and in some instances, cost sharing requirements — to Medicare beneficiaries of limited income and resources who do not qualify for full Medicaid benefits. Medicare Part B premiums currently amount to over $1,000 annually — which can be a large sum for some beneficiaries.
Medicare now covers nearly 42 million beneficiaries who are elderly, or who have a severe disability or end stage renal disease. The Medicare Modernization Act of 2003 made many changes to the program – including the addition of an outpatient prescription drug benefit (“Part D”), which will become effective in January 2006. Understanding this new benefit is of paramount importance to the many people who advise senior citizens, and to millions of Medicare beneficaries who will be scrutinizing different prescription drug plans available in their area.
Medicare now covers nearly 42 million beneficiaries who are elderly, or who have a severe disability or end stage renal disease. The Medicare Modernization Act of 2003 made many changes to the program – including the addition of an outpatient prescription drug benefit (“Part D”), which will become effective in January 2006. Understanding this new benefit is of paramount importance to the many people who advise senior citizens, and to millions of Medicare beneficaries who will be scrutinizing different prescription drug plans available in their area.
Vaccines are among the greatest triumphs of medical science over illness and disease in the past half-century. In the United States, vaccine use has virtually eradicated smallpox and polio and has drastically reduced the incidence of the dangerous—and formerly common—childhood illnesses measles, mumps and rubella.
A worldwide discussion is under way on the role of evidence-based medicine in evaluating the relative effectiveness of prescription drugs. Publicly funded health programs, large employers and managed care plans all are working to learn more about how the costs and benefits of one drug compare with those of another. At the same time, these payers of health care want to make sure that their beneficiaries have access to new pharmaceuticals that offer measurable improvements over older products.
The 2004 election featured debates on major health issues including costs, access, and affordable prescription drugs. These issues will likely be subjects of continued focus during the upcoming Congress.
Health care didn’t prove to be a make-or-break issue in most races during the 2004 election. But post-election polls showed the public still thought our health care system had major problems, and a substantial number of people wanted action from Congress on health issues – especially costs, access and affordable drugs.
Congressional interest in prescription drugs was by no means exhausted once the Medicare drug bill passed in December 2003. A continuing focus on the Hill is whether to encourage reimportation of drugs to the U.S. from other countries, notably Canada. The secretary of Health and Human Services has had the right to authorize reimportation since the Clinton administration, but no secretary has yet exercised the right, citing safety concerns.
After passing a Medicare drug benefit in 2003, a number of key lawmakers have turned their sights to expanding health insurance coverage, to reduce the 43 million Americans who remain uninsured. Proposals to expand coverage vary widely, including tax credits and limited public coverage expansions.
On June 1, 2004, Medicare beneficiaries were able to use their new drug discount cards for the first time. But around the country, many Medicare beneficiaries, family members and service organizations were asking questions about how to choose a card and exactly how the cards will help beneficiaries reduce their drug costs.
The health care sector has languished behind almost all other industries in adopting information technology, which has the potential of vastly improving quality. For example, a variety of studies have found that prescribing drugs through a system known as computer physician order entry, compared with a handwritten prescription, greatly reduces the incidence of the wrong medication being prescribed or the wrong dose dispensed. There are significant barriers to the adoption of information technologies in health care. These barriers include technical and infrastructure obstacles, initial implementation costs, provider resistance, current reimbursement structures and a lack of more uniform standards that would allow products from different vendors to work together.
Low-income Medicare beneficiaries are a vulnerable population because of their disproportionately high medical and long-term care needs. Among low-income beneficiaries are nearly seven million individuals who are considered “dual-eligibles,” with coverage from both Medicare and Medicaid. They represent around one in six Medicare beneficiaries and one in seven Medicaid beneficiaries.
After years of discussion and debate, Congress has passed legislation providing prescription drug coverage for Medicare beneficiaries. The President is expected to sign it shortly.
National polls and opinion surveys consistently show that health care is an important issue for voters. In a June 2003 survey by Harris Interactive, health care ranked third after economy/jobs and war/defense as an issue needing government action. A Gallup poll in September 2003 found that 85 percent of respondents considered presidential candidates’ positions on health care issues to be either extremely important or very important in influencing their votes.
Dual eligibles are low-income Medicare beneficiaries who are also eligible for Medicaid. They are a vulnerable population because of their disproportionately high medical and long-term care needs. At any given time, nearly seven million individuals are considered dual eligibles, representing around one in six Medicare beneficiaries and one in seven Medicaid beneficiaries.
Rising unemployment, persistent double-digit increases in health premiums and record state budget deficits are only the latest in a wide array of barriers that are keeping tens of millions of Americans from getting health insurance coverage.
Medicare has made invaluable contributions to the health and financial security of the elderly and other vulnerable populations. However, its long-term financial stability is the subject of spirited debate, and various aspects of the program are being reassessed. Now, more than ever, with active consideration of an additional prescription drug benefit, proposals to improve and strengthen the program should receive serious attention.
Much of the early health reform discussion in the administration and new Congress will focus on Medicare. On the agenda: Both the possible addition of a prescription drug benefit and the need for structural changes to the program itself.
The 107th Congress adjourned with many health issues unresolved. The House passed a Medicare drug bill, but the Senate didn’t follow suit. Medicare provider givebacks likewise got through the House, but not the Senate. The Senate, but not the House, passed a bill to restrain health costs by making generic versions of prescriptions drugs available sooner. Tax incentives for health insurance that would have been part of an economic stimulus package never saw the light of day.
