Medicare gap could be costly

Gap in prescription coverage means 19,000 seniors pay full price for medication.
Tuesday, October 26, 2004 | 12:00 a.m. CDT; updated 5:36 a.m. CDT, Sunday, July 20, 2008

If the words “doughnut hole” bring pastry to your mind, your thoughts are sweeter than DeForrest Cline’s. For him, as for many seniors and senior advocates, the phrase refers to a gap in prescription drug coverage left by the Medicare Modernization Act of 2003.

Under the new policy, which will begin in January 2006, low-income Medicare recipients will be reimbursed for part of their prescription drug costs if their spending is under $2,250. At that mark, the coverage will stop until costs exceed $5,100 (equivalent to $3,600 in out-of-pocket spending) and catastrophic coverage will kick in — a mark that could leave an estimated 19,080 Missourians paying full price for prescription medications.

Some seniors will have to pay the difference between basic coverage and catastrophic coverage, or $2,850 out of pocket, on top of the $35 monthly premiums, which they must continue to pay even if their spending is within the gap.

“There is no reason for the doughnut hole except that Congress didn’t want to spend that extra money,” said Cline, a retired Labor Department employee, who attended last week’s rally against the Medicare legislation in front of the Social Security office in Springfield, Mo.

“It’s a bill that’s incomplete. It’s just half a bill,” Cline said. “They ought to go back and get Congress to rescind this bill and get something that’s complete.”

The issue is a hot one this election, especially as Missouri prepares to elect a new lieutenant governor, who serves as an advocate for the state’s senior community. Both candidates, former Secretary of State Bekki Cook and Republican Sen. Peter Kinder, say closing the gap is a top priority.

Last March, Kinder led a bipartisan group of senators in crafting legislation that would provide coverage for seniors affected by the gap. The bill proposed that current funds for Missouri’s Senior Rx program, which is due to expire in December 2005, be allocated toward doughnut hole coverage. After a welcome reception in the Senate, the proposal stalled in the House and is still unresolved.

The question of prescription drug coverage is dividing voters, said Cline. An active Democrat, he thinks the race for lieutenant governor is an outlet for seniors’ concerns, and that Democratic candidate Cook has shown her commitment to lowering prescription drug costs in the past.

Cook said that while she supports efforts to give coverage within the gap, she believes that the new Medicare Act will affect only a small percentage of people.

“The idea last year was a good one,” she said, referring to her opponent’s bill. Cook expressed her support for turning the Senior Rx program into one that covers doughnut hole expenses.

“More importantly,” Cook said, “we must use the state’s buying power to get discounted rates for drugs.”

Cook has also advocated for the re-importation of drugs from Canada to reduce costs.

Earl Stuart of Columbia, is placing his confidence in Peter Kinder on Nov. 2. For 20 years after his retirement, Stuart received free prescription drug coverage through his former employer, Mutual Life New York. But last year, Stuart began paying $1,200 annually for the same insurance, which reimburses 80 percent of his prescription drug costs.

“I am more fortunate than a lot of people,” Stuart acknowledged, but said that he may have to look to the Medicare prescription plan if costs keep escalating.

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