U.S. Rep. Maloney Releases Congressional Report: New Medicare Drug Cards Limit Benefits to New York Seniors

Oct 20, 2004
Press Release
NEW YORK, NY - U.S. Rep. Carolyn Maloney (NY) today released a Congressional study that found new Medicare drug cards provide few and limited discounts to seniors in her New York City district. The drug cards, which require seniors to commit for a full year while allowing insurers to change benefits weekly, are part of the Bush administration’s alteration of Medicare provisions. Rep. Maloney announced the findings while meeting with seniors at a meeting of Selfhelp Queensview / North Queensview NORC (Naturally Occurring Retirement Community).

“Seniors are paying 62% more than prices available on the government’s own supply schedule,” said Congresswoman Maloney, “even though this administration is promising them significant discounts through these cards. Discounts through these new cards are still 46% more expensive than prices available in Canada. This report makes clear that behind all the empty talk of cost-savings for America’s seniors, the simple fact remains that these cards give huge flexibility to big drug companies and push the risk onto seniors.”

The study was undertaken at Rep. Maloney’s request by the Special Investigations Division of the Committee on Government Reform. The report compares the prices available with a Medicare drug card for a 30-day supply of each of the ten most popular brand-name drugs used by seniors with the prices of the same supply of medications available in Canada, available to the Department of Veterans Affairs and other federal agencies through the Federal Supply Schedule, and available through Drugstore.com, a discount online drug provider.

The average prices available to Medicare drug card holders, according to the study, are 46% higher than prices available in Canda, 62% higher than prices available through the Federal Supply Schedule, and barely lower than the prices available through Drugstore.com. The drugs analyzed in the report are the ten brand-name drugs with the highest dollar sales to seniors, including Celebrex, an arthritis medication, Prevacid, an acid reflux medication, Aricept, an Alzheimer’s medication, and Lipitor, a cholesterol reducing medication.

The study did note that Medicare beneficiaries who meet a low-income threshold-an estimated one in six Medicare participants-receive a $600 credit towards the purchase of prescription drugs when they sign up for Medicare discount cards, and thus are likely to realize more substantial savings compared to Drugstore.com prices.

However, Gail Shearer, Director of Health Policy Analysis at Consumers Union, notes, “We took a very careful look at what seniors without drug coverage are paying now and what they will be paying when they have drug coverage when this bill is fully implemented. And we found that if you assume that drug costs continue to increase at the rate they have been increasing, which is fifteen, sixteen, seventeen percent a year, most seniors will be paying more out of pocket when this is fully implemented than they are today.”

The full study announced by Congresswoman Maloney today is available at https://maloney.house.gov/sites/maloney.house.gov/files/documents/olddocs/older/maloney_drug_card.pdf.