Drug discount cards pushed

Medicare chief seeks to counter misinformation

But critics doubt savings

Some Web pharmacies are cheaper, they say

May 07, 2004|By Cyril T. Zaneski | Cyril T. Zaneski,SUN STAFF

WASHINGTON - The Bush administration unveiled price comparisons yesterday showing Medicare prescription drug discount cards producing larger-than-expected savings, but the federal study failed to satisfy critics who questioned the findings and insisted that the program would disappoint seniors.

The Centers for Medicare and Medicaid Services' analysis shows discount cards yielding savings of 10 percent to 17 percent off retail prices for name-brand drugs and 30 percent to 60 percent off generic medications. The savings are as good or better than those in private health plans, the agency said.

"There is now clear and convincing evidence ... of significant savings possible through the Medicare-endorsed discount program," Dr. Mark B. McClellan, the centers' administrator, told a gathering here of pharmacy benefit managers whose companies are sponsoring cards and administering the discount program.

"The facts are on our side on this one," he said. "Even though there's a lot of misinformation out there."

Because of the Medicare discounts, McClellan vowed, American seniors "are never again going to pay the highest prices in the world" for prescription medications.

He said "tens of thousands" of Medicare recipients signed up Monday for the optional discount cards, which are intended to help more than 10 million seniors who now pay full retail prices for their medications. The agency does not have an accurate count of seniors who have already enrolled and probably will not be able to report accurate enrollment figures until after the program takes effect June 1.

Medicare's toll-free telephone number (1-800-MEDICARE) received 408,000 calls Monday, almost 8 percent of the total calls the agency received at that number all of last year, and more than 300,000 calls Tuesday, McClellan said. The heavy call volume overwhelmed the agency's telephone lines and left many callers with busy signals.

"There's tons, tons of interest in the program," McClellan said.

All Medicare-eligible seniors can apply for a discount card. While the value of the card for people who already have prescription benefits through employers or other health plans is debatable, the program's assistance for low-income beneficiaries is clear.

Single people with incomes less than $12,569 a year and couples with incomes less than $16,862 get the card free and a total subsidy of $1,200 for medicine this year and next.

Consumer advocates and administration officials alike are urging seniors who want to participate in the program to take their time choosing a card. Seniors can choose just one card, which costs $30 a year, and will be able to switch cards just once - late this year - while card sponsors can change drug prices and even drop medications every week. There is no deadline for enrollment.

There are 73 different discount cards. All are administered by private companies. So far, 56 card sponsors have posted discounts on the Medicare Web site (www.medicare.gov). The site received more than 1.7 million page hits Monday.

Two leading nonpartisan consumer groups that have prepared their own price analyses of the discount card program expressed skepticism about the administration's price comparisons.

Robert M. Hayes, president of the Medicare Rights Center in New York, said his organization compared prices offered by three Medicare discount-cards with deals advertised on two Canadian and U.S. Internet sites and the New York state prescription drug assistance program. The group found the Medicare cards' discounts fell short.

"Some people, especially some very low-income people, can benefit from the Medicare cards, but it's absolutely true that most consumers will find far deeper discounts from U.S. Internet pharmacies," Hayes said. "And virtually everyone can secure the best savings from Canadian Internet pharmacies."

And Ronald F. Pollack, executive director of Families USA in Washington, said the discounts offered by the cards mean little because his organization's survey found that drug companies began raising the price of medicine before the prices were advertised.

"It's the equivalent of a used car salesman saying that he will give you a $3,000 discount, but shortly before you walked into the showroom, he added $4,000 over the sticker price," Pollack said.

"Are seniors suppose to derive satisfaction from knowing that they got a discount even though they're paying more out of pocket than before?"

Hayes further criticized the Bush administration for what he called "huckstering" instead of trying to help seniors make better choices in their drug purchases.

"It should not be about image and politics," Hayes said. "There's a dire need for people to get intelligent, nonpartisan information about drug discounts."

But McClellan maintained in his address to the Pharmaceutical Care Management Association that information about drug prices available in the discount card program would help seniors make better consumer decisions and serve as a model for the Medicare drug program that begins in 2006.

"If we really want choice and competition to work in Medicare," he said. "We need to get seniors the information they need to make informed choices."

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