Prescription drug coverage needed

Currently, some of the most expensive health care costs that come with old age and disability are not covered by Medicare.

The costs of prescription drugs causes financial hardship and impairs the health and well-being of millions of older Americans. Older people account for 13 percent of the U.S. population, but more than one-third of the drug expenditures. Nearly one-third of older Americans, 11 million, lack drug coverage of any type in the course of a year.

Medicare beneficiaries with disabilities have poorer health and require a greater number of, and more expensive, medications than the Medicare population as a whole. Although many qualify for Medicaid, 28 percent lack drug coverage from any source.

Those who do buy their own prescription drugs pay twice as much or more for prescription drugs as the drug manufacturers' most favored customer—health insurers, managed care plans and the federal government. In 1999, the pharmaceutical companies producing the 50 drugs most used by older Americans made a median net profit of 18 percent. This is 3.6 times the 5 percent median profit for all Fortune 500 companies.

Without a universal prescription drug benefit, Medicare cannot provide the comprehensive health care coverage that defines a minimum or adequate health plan. However, such a universal benefit must be affordable for all low- and moderate-income Medicare beneficiaries. To accomplish this, drug prices must be moderated and federal revenues and portions of the surplus must be used to subsidize the cost of the program.

Food or Medicine? From America@Work

Prescription Drug Fact Sheet

New Medicare Prescription Drug Plan Falls Short! 06/10/03

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