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Public Statements

Seniors Taking Advantage of Medicare Drug Choices

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Seniors taking advantage of Medicare drug choices

Just over two years ago, Congress passed the new Medicare plan that enabled beneficiaries to take control of their prescription drug benefit by providing them with greater flexibility and more choices with the goal of creating competition among plan providers.

Over the years, I have always fought to provide senior citizens with access to affordable health care and have steadfastly rejected calls to cut Medicare and Medicaid spending. I believe it is essential that we provide our seniors and those most in need with quality health care at the lowest possible cost.

There is no doubt that the launch of the program came with initial bugs and hiccups, which resulted in confusion and early discontent. It is important to remember that when the original Medicare program was established in 1966, similar confusion and ambivalence surrounded its launch. Many called for Medicare to be abolished in its infancy. Thankfully, those who were committed to seeing the program through resisted calls for its termination. As a result, for nearly 40 years seniors have benefited from the Medicare program.

Despite similar frustration with implementation of the new prescription drug benefit, more than 26 million seniors with Medicare have enrolled and now have prescription drug coverage. In addition, premiums today are lower than Congress had originally expected because of the differences between prospective prescription drug plans and the competition created by free market forces. The average premiums paid by senior citizens for their prescription drug benefits are a third less than expected at $25 per month, substantially lower than the prior estimate of $37 per month.

In New Jersey alone — from Jan. 21 through March 18 — more than 225,000 seniors enrolled and have federally subsidized drug coverage for the first time. These are people who signed up for the stand-alone prescription drug plans, presumably because they didn't have access to creditable coverage through federal or private employer retiree drug coverage, Medicare Advantage or Medicaid.

By the end of the enrollment period, the Department of Health and Human Services estimates that 89 percent of New Jersey's Medicare beneficiaries will have prescription drug coverage. That figure increases to 93 percent in the 4th District that I represent. I am optimistic they are right.

A survey by Ayres McHenry and Associates found that nine out of 10 seniors eligible for Medicaid and Medicare ("dual eligibles") reported having no problems using the new Medicare prescription drug benefit. Eighty percent said the program covers the prescription drugs they need, while three-fifths of seniors say they are saving money with the new benefit.

Despite some of the difficulties caused by the setup of the program, two-thirds of self-enrolled seniors said that benefits are worth the time and effort they put in to evaluating the many drug plans. Nearly 70 percent of those who have enrolled would recommend that other seniors sign up for the benefit. Self-enrolled seniors would recommend that other seniors sign up by a 65 percent to 8 percent margin (18 percent say it depends on the circumstances), up from a 56 percent to 9 percent margin in December.

It is important that seniors, including the 1.2 million Medicare beneficiaries in New Jersey, who are deciding whether to join the new program examine some critical factors that will help them make an informed decision that is best for their own needs and those of their families. Retirees who are already covered by a generous employer prescription drug plan might not wish to give up their existing plan to enroll in Part D. That is another benefit of a program that offers choices and flexibility — people are empowered to choose an option that best fits their individual needs.

With the onset of a new federal program as large as Medicare Part D, which provides $800 billion for prescription drug coverage for our nation's seniors, there will be some initial growing pains. There is little doubt, however, that such an infusion of federal support will ensure that many will receive medications they otherwise would have not been able to afford. These are real people getting real drugs because of the creation of this plan.

Today, I will welcome U.S. Secretary of Health and Human Services Mike Leavitt to the Brick Senior Center and Nutrition Site. We will have counselors from Ocean County Senior Services, the state Health Insurance Program and the Center for Medicare and Medicaid Services available from 1 to 4 p.m. to provide guidance and assistance to any senior citizen who has questions about the new Medicare Part D benefit.

I hope anyone with questions about Medicare will take advantage of this opportunity to help clear up any confusion before the May 15 deadline to sign up for the benefit. I will work to ensure that Congress continues to monitor the program and amend and enhance its implementation as needed. In the interim, it is critical that we all work together to overcome the program's weaknesses and maximize its benefits — just as we have for all of Medicare since 1966.

http://www.house.gov/apps/list/press/nj04_smith/opedmedicare.html

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