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Retirees Matter: Perplexed by the Medicare Drug Plan? You're Not Alone
How complicated is Medicare's so-called prescription drug "benefit" plan? It's so baffling that even the folks in charge don't understand it.
"The administration has created a drug benefit that is so confusing, even the people running Medicare can't get it right," Senate Democratic Leader Harry Reid said after learning that the handbook that's supposed to help all of us figure it out contains a big error about subsidies and monthly premiums.
So what are mere mortals supposed to do? What do we make of the official mailings, the celebrity ads, the pitches from drug companies and the Chamber of Commerce - who want us to believe they're standing up for us, not standing to make billions in profit?
For CWA retirees, the answer may be: nothing. The truth is that many, if not most, senior citizens won't realize any benefit at all from this scheme. Most of those who do will be seniors with incomes below 135 percent of the federal poverty level - that's $12,569 for one senior, $16,862 for a couple.
Here's what the grassroots Alliance for Retired Americans says: "If you have drug coverage from another source (other than state pharmaceutical assistance) or are already getting discounts of 10 to 25 percent through other means, the card probably will not help you."
Still, you need to do your homework to determine whether your former employers' drug plan is better than the Medicare plan. You can't be enrolled in both. The handbook - yes, the one with the mistake in it - lists the various prescription drug plans in your area. To get benefits as of Jan. 1, 2006, you need to sign up by Dec. 31. You can sign up through May 15, 2006, but after that date late penalties will be assessed. Future retirees will have to sign up for this "benefit" at the time they're eligible for Medicare.
The basic plan is this, as spelled out by the Alliance: Medicare-endorsed private companies will offer drug discount cards for an annual fee of up to $30. Savings are estimated to range between 10 to 15 percent. Savings are not guaranteed. Very low-income seniors will get the cards for free and receive a $600 credit, but will still have co-pays of 5 to 10 percent.
The Alliance cautions that the discount cards "may or may not offer you savings on your prescription drugs. Bottom line: seniors better shop around."
Leave it to the government - this one in particular - to come up with a hopelessly complex plan that will cost taxpayers billions of dollars while benefiting almost no one but the drug companies. When you hear Republican leaders in Congress and pundits on cable TV railing against its costs and comparing George W. Bush to Lyndon B. Johnson, keep this in mind: Johnson's genuine concern for the plight of poor seniors led his administration to create Medicare. Bush has pushed for deep cuts in Medicare spending that will hurt our most vulnerable seniors while drug companies laugh all the way to the bank.
Just how big is their windfall? It's estimated that pharmaceutical companies will reap an additional $139 billion in pure profit over the first 10 years of the plan. In contrast, the typical Medicare beneficiary - those who get anything at all - will receive about $800 a year in benefits.
CWA and other unions, along with the Alliance and other activist groups, are fighting for changes in this bizarre and lopsided piece of legislation. A key change would be to allow Medicare to negotiate with drug companies to bring down the costs of prescriptions, as the Veterans' Administration is able to do for its beneficiaries. Stunningly, the new law expressly bars Medicare from negotiating the costs of drugs. How much more clear could it be that this is a boondoggle for drug companies at the taxpayers' expense?
Other needed changes would allow the re-importation of drugs, now sold in other countries for far less, and would fix the "doughnut hole" that leaves seniors responsible for 100 percent of drug costs after they have spent $2,250 but less than $5,100.
These are far from the only problems but they're the three most important. It's going to take all of us - and in all likelihood a new, Democrat-led, Congress next year - to make this right. If we stick together, if we work hard to elect representatives who will put our needs before the greedy drug companies, we can fix this mess.
Sorting it Out
CWA has mailed a flyer to all its retirees about the drug program and it's available here. For further help, go to the Alliance for Retired Americans website at www.retiredamericans.org. It's full of detailed questions and answers that are easy to understand.
"The administration has created a drug benefit that is so confusing, even the people running Medicare can't get it right," Senate Democratic Leader Harry Reid said after learning that the handbook that's supposed to help all of us figure it out contains a big error about subsidies and monthly premiums.
So what are mere mortals supposed to do? What do we make of the official mailings, the celebrity ads, the pitches from drug companies and the Chamber of Commerce - who want us to believe they're standing up for us, not standing to make billions in profit?
For CWA retirees, the answer may be: nothing. The truth is that many, if not most, senior citizens won't realize any benefit at all from this scheme. Most of those who do will be seniors with incomes below 135 percent of the federal poverty level - that's $12,569 for one senior, $16,862 for a couple.
Here's what the grassroots Alliance for Retired Americans says: "If you have drug coverage from another source (other than state pharmaceutical assistance) or are already getting discounts of 10 to 25 percent through other means, the card probably will not help you."
Still, you need to do your homework to determine whether your former employers' drug plan is better than the Medicare plan. You can't be enrolled in both. The handbook - yes, the one with the mistake in it - lists the various prescription drug plans in your area. To get benefits as of Jan. 1, 2006, you need to sign up by Dec. 31. You can sign up through May 15, 2006, but after that date late penalties will be assessed. Future retirees will have to sign up for this "benefit" at the time they're eligible for Medicare.
The basic plan is this, as spelled out by the Alliance: Medicare-endorsed private companies will offer drug discount cards for an annual fee of up to $30. Savings are estimated to range between 10 to 15 percent. Savings are not guaranteed. Very low-income seniors will get the cards for free and receive a $600 credit, but will still have co-pays of 5 to 10 percent.
The Alliance cautions that the discount cards "may or may not offer you savings on your prescription drugs. Bottom line: seniors better shop around."
Leave it to the government - this one in particular - to come up with a hopelessly complex plan that will cost taxpayers billions of dollars while benefiting almost no one but the drug companies. When you hear Republican leaders in Congress and pundits on cable TV railing against its costs and comparing George W. Bush to Lyndon B. Johnson, keep this in mind: Johnson's genuine concern for the plight of poor seniors led his administration to create Medicare. Bush has pushed for deep cuts in Medicare spending that will hurt our most vulnerable seniors while drug companies laugh all the way to the bank.
Just how big is their windfall? It's estimated that pharmaceutical companies will reap an additional $139 billion in pure profit over the first 10 years of the plan. In contrast, the typical Medicare beneficiary - those who get anything at all - will receive about $800 a year in benefits.
CWA and other unions, along with the Alliance and other activist groups, are fighting for changes in this bizarre and lopsided piece of legislation. A key change would be to allow Medicare to negotiate with drug companies to bring down the costs of prescriptions, as the Veterans' Administration is able to do for its beneficiaries. Stunningly, the new law expressly bars Medicare from negotiating the costs of drugs. How much more clear could it be that this is a boondoggle for drug companies at the taxpayers' expense?
Other needed changes would allow the re-importation of drugs, now sold in other countries for far less, and would fix the "doughnut hole" that leaves seniors responsible for 100 percent of drug costs after they have spent $2,250 but less than $5,100.
These are far from the only problems but they're the three most important. It's going to take all of us - and in all likelihood a new, Democrat-led, Congress next year - to make this right. If we stick together, if we work hard to elect representatives who will put our needs before the greedy drug companies, we can fix this mess.
Sorting it Out
CWA has mailed a flyer to all its retirees about the drug program and it's available here. For further help, go to the Alliance for Retired Americans website at www.retiredamericans.org. It's full of detailed questions and answers that are easy to understand.