Congress Passes Medicare Prescription Drug Bill Which Critics Call a Gift to Pharmaceutical Companies and Moves System Toward Privatization

Seniors to be hit hard by costly premiums and deductibles

Interview with Gail Shearer, director of health policy analysis, Consumer's Union, conducted by Melinda Tuhus

Employing what one Democrat called the most egregious violation of congressional rules in a quarter century, the House and Senate passed a bill authorizing inclusion of a prescription drug benefit for the Medicare program just before Congress adjourned for the holidays. For the first time since Medicare was established in 1965, this bill provides some assistance for senior citizens to pay for their medications, but it also contains many provisions that critics fear could end Medicare as we know it. Some of the most controversial aspects of the 0 billion bill include: a mandate for private companies to administer the drug benefit; continuation of a ban on importation of cheaper prescription drugs from abroad; and a directive for Medicare to compete head-to-head with private health plans in six metropolitan areas starting in 2010. On the plus side, the bill will speed federal approval of generic drugs and provide increased payments to rural hospitals and doctors.

Seniors will get a drug discount card to use in 2004 and 2005, with full benefits beginning in 2006. Beneficiaries must pay 0 a year in premiums and deductibles before starting to save any money on prescriptions. Then insurance would cover three-quarters of drug costs up to ,250. Then Medicare would pay nothing more until the beneficiary paid ,600 out of pocket.

Between The Lines' Melinda Tuhus spoke with Gail Shearer, director of health policy analysis for Consumer's Union, just before final passage of the measure. She explains why her group opposed the legislation, and what seniors can expect down the line with this new bill signed into law.

For more information, call (202) 462-6262 or visit the group's website at www.consumersunion.org

Related links



"Many Retirees Are Opposed to Drug Proposal," by Scott Martelle and John J. Goldman, Los Angeles Times, Nov. 25, 2003. Frustration is also growing with seniors' chief lobbying group, which backs the plan. 'AARP has betrayed us,' says one man.

"Senate OKs Sweeping Overhaul of Medicare," by James Gerstenzang, Los Angeles Times, Nov. 25, 2003. GOP turns Medicare into HMO.

"Divided House Approves Expansion of Medicare," by Robert Pear and Robin Toner, The New York Times, Nov. 22, 2003. GOP rams bad Medicare bill in the middle of the night.

"AARP Ad Touts Prescription Drug Bill," by The Associated Press, Nov. 18, 2003. Democrats attack AARP for supporting Medicare bill.

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