Medicare Card Revisited
It has been two months since Medicare issued its prescription drug card in a cloud of confusion that baffled most seniors in Frederick and around the country.
Most of the 41 million Medicare enrollees have reacted by failing to sign up for the card.
Of the 3.9 million who have enrolled, most are members of Medicare Advantage plans that automatically enrolled them. And seven states that have plans for the poor automatically enrolled their recipients.
So, seniors given the option basically have said, "Not right now."
Of course, the big question, which the Kaiser Foundation tries to answer in a new report, is: "Do Medicare-approved discount cards offer savings for beneficiaries?
The answer is yes -- but.
Kaiser examined seven card programs right here in Maryland and prices for 10 of the drugs most commonly used by Medicare recipients. It found that the discount cards do offer "significant savings" compared to retail prices. But the discount prices were about the same as ordering from a discount mail order house such as Drugstore.com, which is much easier to negotiate than the Medicare system. The study did not look at Canadian drugs which are even cheaper.
Here are the findings;
Mark McClellan, who runs Medicare, told me last spring that all of the competition would actually lower drug prices. But the study concluded: "In contrast to predictions that market forces would continuously drive prices lower, we did not observe notable changes in reported prices after the initial start up period of the program."
However, even with the savings, confusion, generated by so many choices, continues to plague the program. The study observed that the government wanted to give customers an abundance of choices in picking a drug card.
"While choice helps to insure that beneficiaries can find a plan best suited to their individual needs, excessive choice produces confusion and may discourage enrollment."
How about the internet?
In trying to make price comparisons last June, I found that the Medicare phone number was constantly jammed. Virtually useless. The internet address, www.medicare.gov, worked smoothly. But the report notes that "most beneficiaries are not now using the internet; even their helpers are often finding the web-based information more perplexing than helpful."
I concluded, after reading the report, that there was no reason to change my original decision two months ago. I am not enrolling for a Medicare discount card (some charge an annual $30 fee) despite urgings from such senior-friendly groups like the AARP, National Council on Aging, and American Society on Aging. The groups made a big push for the card at the NCOA-ASA convention in San Francisco last spring. But Rep. Nancy Pelosi (D., CA), who is the Democratic minority leader, objected strenuously saying the program was badly flawed. It looks like she was right.
I will buy either through a discount mail order house not connected with Medicare such as Drugstore.com, or from Canada.
Sorry, do-gooders. It's not that I don't believe this is a not worthy experiment. But at this point, it is just an experiment and I don't want to be the guinea pig. It seems to me that Medicare's intent was good - to help lower prices.
But the confusion generated by developing so many different plans has almost nullified any benefits. Some seniors are already in prescription plans that do provide savings of up to 20 percent. And they are much easier to figure out.
As I mentioned, hardly any one pays the basic retail price. Most places offer a 10 percent discount if you just walk in and say you are a senior.
So, the percentage of saving, advertised by Medicare has been misleading, based on a price that virtually no one pays.
One thing the administration has avoided vigorously: Putting a cap on how much drug companies can charge. Republicans, in fighting off Democratic efforts to provide a cap, have said that was unnecessary. The free market should prevail and prices would be lowered. So far, that hasn't happened.
I will revisit the entire issue in January 2006 when the "temporary" Medicare card expires and the permanent plan goes into effect.
For a copy of the Kaiser report click on www.kff.org or write Henry J. Kaiser Foundation, 2400 Sand Hill Road, Menlo Park, CA 94025 phone: 650-854-9400
E-mail Joe Volz at email@example.com.