Rx Drug Card Appeals to Congress

Published November 1, 2003

Congressional conference committee negotiators working to hammer out a Medicare reform bill have agreed a discount prescription drug card may be the only way to get a drug benefit into the hands of seniors by the end of the year.

A team at the Centers for Medicare and Medicaid (CMS) is working with legislative aides to flesh out the details of a drug card program. If a more comprehensive drug benefit is approved by the Medicare reform conference committee, the cards will be used as a temporary prescription benefit program until the Medicare drug coverage plan takes effect. Alternatively, the cards could be offered as a stand-alone benefit if no Medicare reform measure is passed.

CMS Administrator Thomas Scully hopes to have cards ready by April. “We’ve been champing at the bit to get this done,” he said.

Proven Track Record

Some 18 million Americans already use prescription drug cards, according to the General Accounting Office. The cards are offered by trade associations, pharmaceutical manufacturers, pharmacy chains, large employer groups, and some state governments.

Under the drug card plan currently being developed by CMS, all senior citizens–not only those who are low income or disabled–would be able to choose among at least two card programs, which would differ in the copayments they require and the discounts they offer. Discounts likely would range between 10 and 25 percent, similar to the discounts offered by private-sector discount card programs.

The drug card program would be administered by health insurance companies or private pharmaceutical benefit managers (PBMs). Plan participants would be charged an annual fee–$30 is the figure currently under consideration.

In addition to the discounts, Medicare beneficiaries with incomes below $12,123 would be eligible for $600 a year to spend on medications. They would pay a 5 or 10 percent co-payment when filling prescriptions, depending on their incomes.

Details, Details

Important elements of the plan–whether PBMs would be reimbursed by Medicare for their administrative costs, for example, and whether they would be required to pass on to consumers some or all of the discounts they negotiate with drug companies–still are being worked out in Congress. For that reason, the PBMs aren’t committing themselves to support the plan.

Jeff Simek, a spokesman for Medco Health Solutions, noted, “The details behind the card program are critically important. But the company is very interested in being part of the solution.” According to business trade journals, ExpressScripts, Advance PCS, and other benefit managers are taking the same wait-and-see posture.

Merrill Matthews Jr., director of the Council for Affordable Health Insurance, told Health Care News he favors President George W. Bush’s prescription drug card proposal.

“The President’s discount drug card, which would include an annual subsidy of up to $600 for low-income participants, is the best way to get help to seniors,” Matthews said. “It won’t cost anywhere near $400 billion (over 10 years), it is not a costly new entitlement being piled on top of an already financially troubled system, and it won’t undermine the prescription drug coverage that 75 percent of seniors already have.

“Best of all,” Matthews concluded, “the conferees have already agreed to the program as a way to get help to seniors immediately. So when will Congress and the President realize that the drug card isn’t part of the solution; it is the solution?”

Conrad F. Meier is managing editor of Health Care News. His email address is [email protected].