On Monday, May 15, the first enrollment period for the Medicare (Part D) drug program is scheduled to come to an end, yet the problems with Part D will not.
In the period ahead, Families USA, the national organization for health care consumers, intends to monitor Part D and report on the following issues, which will determine whether Medicare Part D is a success or failure:
* What will happen to skyrocketing drug prices? Drug prices in each Part D plan are allowed to change at any time and by any amount. Currently, drug prices negotiated by the Department of Veterans Affairs (VA) are much lower than the prices available through private Part D plans. A key issue to watch will be how drug prices change in Part D plans across the country.
* What portion of seniors enrolled in Part D plans will enter the so-called “doughnut hole?” In 2006, the gap in coverage that constitutes the “doughnut hole” is $2,850 wide. Seniors who fall into this chasm will have to pay 100 percent of their drug costs from $2,250 and $5,100, with no help from their drug plan, even while they continue to pay monthly premiums. Key issues to watch will be whether seniors can afford their medicines while in the “doughnut hole” and how this experience affects their views of the Medicare Part D program.
* After 2006, how will Part D plans change their drug coverage, including the premiums, deductibles, and copayments? In 2006, each of the competing companies offering Part D plans sought to secure a large share of the market. To do so, many offered attractive plans that included low premiums, low or no deductibles, or fixed cost-sharing. As the market settles, it will be important to monitor whether those companies continue to offer plans with such attractive features.
* How many private Part D plans will drop out of the drug program? Many private insurance companies offered separate Part D drug plans in 2006. Several are likely to drop out next year due to low enrollment. It will be worth monitoring what happens to the people who enrolled in those plans in 2006.
* Will low-income seniors get the drug subsidies they need? As the recent (May 9) Families USA report on low-income enrollment demonstrated, more than three out of every four low-income seniors eligible for special drug subsidies are not receiving them. Now that the Bush Administration has extended the enrollment period and waived the late-enrollment penalty for this group, it will be important to monitor whether enrollment of low-income seniors improves.
* What is the health status of the seniors who enrolled in Part D? At this time, there is little data about the demographic characteristics of those who enrolled in Part D. Are the enrollees disproportionately older and unhealthy seniors, or are they younger and healthy? If it turns out that it was the former, the per capita costs of the Medicare Part D program are likely to be more expensive than originally projected.
“These are critical issues that will need to be carefully examined as the Medicare drug program moves forward,” said Ron Pollack, Executive Director of Families USA. “They will determine whether the program succeeds or fails in being responsive to seniors’ needs.”
Families USA intends to carefully monitor these issues in the weeks and months ahead, and the organization will issue periodic reports about relevant program developments.
