NCPA - National Center for Policy Analysis

Gore Proposes A Costlier Medicare Drug Benefit

February 24, 2000

Responding to criticism that his proposal to add a prescription drug benefit to the Medicare program would not aid those who need it most, Vice President Al Gore has upped the ante by proposing additional prescription drug coverage for seniors.

Former Sen. Bill Bradley (D-N.J.), Gore's rival for the Democratic Party presidential nomination, had criticized Gore's original plan, which was similar President Clinton's and would have capped the amount the federal government would contribute toward seniors' prescription drug costs.

Medicare doesn't cover out-of-hospital prescription drug costs.

  • Under Gore's original plan, Medicare would pay half the drug expenses of seniors who paid a $44 monthly premium, and benefits were capped at $5,000 a year.
  • Under the expanded plan, Medicare would finance all drug costs after a beneficiary had paid $4,000 in out-of-prescription expenses a year.
  • About 7 percent of Medicare beneficiaries -- about 3 million people -- spend more than $4,000 a year in out-of-hospital prescription costs, according to Gore aides.
  • Seniors with incomes below about $11,000 a year wouldn't have to pay the premium or copayments.

The additional benefit would cost $35 billion over 10 years, in addition to the $118 billion price tax on the original plan, say Gore aides.

Under Bradley's plan, seniors who pay a $25 monthly premium would receive drug benefits after meeting a $500 annual deductible.

Source: Susan Page, "Gore Drug Plan Would Aid Seniors," USA Today, February 24, 2000.

 

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