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Senate and House Consider Prescription Drug Bill
Daily Policy Digest

Health Issues / Medicare Coverage of Drugs

Monday, June 16, 2003
The Senate and House of Representatives are considering Medicare bills to add prescription drug coverage. Under the plans, the government would give subsidies to private insurers to offer prescription drug coverage to Medicare patients. Although the details are not fixed, it is expected that a policy would cost a retiree about $35 a month on top of current Medicare premiums.

Highlights of the Senate bill:
  • Individuals must spend $275 before benefits begin.
  • Medicare will pay half the drug costs from $276 to $4,500.
  • No coverage for drug costs from $4,500 to $5,800.
  • Once expenses exceed $5,800, 90 percent of drug costs are covered.
Highlights of the House bill:
  • An individual must spend $250 before benefits begin.
  • Medicare will pay 80 percent of drug costs from $251 to $2,700.
  • No coverage for drug costs from $2,000 to $5,100.
  • When out-of-pocket spending reaches $3,700, 90 percent of drugs are covered.
Over the next decade, health experts predict, seniors will need $1.6 trillion worth of prescription drugs. The president's proposal is designed to cost no more than $400 billion over that period.

Source: William M. Welch, "GOP takes risk with Medicare overhaul," USA Today, June 16, 2003.

 For more on Medicare Coverage of Drugs
http://www.ncpa.org/iss/hea/

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