Dean Baker: Insurers Whack Elderly to Celebrate New Year

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Insurers Whack Elderly to Celebrate New Year
By Dean Baker
t r u t h o u t | Perspective

Monday 07 January 2008

What better way to start the new year than to sock it to grandma and grandpa with big price increases? That may not have been the exact nature of the conversation at the insurance companies that participate in the Medicare prescription drug plan, but it sure was the outcome, as premiums are scheduled to rise by an average of almost 25 percent in 2008. The sharp price hikes for 2008 could mark the beginning of the end of the relatively good news in the drug plan's first two years of existence.

The first two years could be viewed as reasonably successful, since most seniors were covered by the plan. According to the Centers for Medicare and Medicaid Services (CMS), nearly 80 percent of the eligible population either signed up for the plan directly or are covered indirectly through an employer-sponsored plan. While enrollment is 10 percent less than had been projected, and many of those enrolled had already been covered by employers or Medicaid, Part D still provided benefits to more than 10 million seniors who previously had to pay for their drugs out of pocket.

The cost of the plan in the first years has also been somewhat lower than had been projected by either the CMS or the Congressional Budget Office. Based on lower than expected costs, both agencies have revised downward their projections for the program's cost by more than $100 billion over its first ten years.

Of course, even this good news is relative. The program still leaves many seniors with hefty drug bills. A recent study by the Kaiser Family Foundation found 8 percent of Part D beneficiaries had drug bills of more than $300 a month and nearly one-fifth reported either delaying or not a filling a prescription due to the cost. Among beneficiaries with three or more chronic conditions, nearly a quarter either delayed filling a prescription or did not fill it due to the cost. In other words, for a very substantial portion of the elderly, Medicare Part D is proving insufficient to allow them to get the drugs they need. ......(more)

The complete piece is at: http://www.truthout.org/docs_2006/010708B.shtml