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Senate Rejects Medicare Drug Benefit
Lawmakers Strip Drug Coverage for Seniors from Generic Drug Bill
 Listen to Julie Rovner's report.
A plan proposed by Senators Bob Graham (D-Fla.) and Gordon Smith (R-Ore.) was the last measure debated -- and rejected -- before the Senate break. Plan details:
Who is Eligible: All Medicare beneficiaries.
Cost to Seniors: A $25 annual fee. No monthly premiums or deductibles.
Catastrophic Coverage: For all plan members, once drug purchases reach above
$3,300 in out-of-pocket spending, the plan kicks in and seniors pay a $10 co-pay per prescription.
Comprehensive coverage: Seniors with incomes below 200 percent of the federal poverty level pay a $1 to $3 co-pay for all of their medications.
Additional Coverage: Seniors above 200 percent of the poverty level qualify for a 20 to 35 percent drug discount, including a 5 percent federal subsidy.
Start Date: January 1, 2005.
Cost: The Congressional Budget Office's preliminary estimate is
$400 billion over 10 years.
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July 31, 2002 --
Senators vow to continue the fight to add a prescription drug benefit to the Medicare program, even after a two-week debate ended Wednesday in deadlock. NPR's Julie Rovner reports for All Things Considered.
The Senate rejected by a wide margin its fourth different Medicare prescription drug plan. Sens. Bob Graham (D-Fla.) and Gordon Smith (R-Ore.) sponsored the measure, which would have helped seniors on Medicare with very low incomes and seniors with very high drug costs. The plan, estimated to cost $400 billion over 10 years, offered varying levels of coverage depending on income and required
no monthly premiums or deductibles.
The measure was planned as an amendment to a bill that would address drug prices by making it easier for generic copies of medicines to get to market. That bill was approved, and the Congressional Budget Office estimates it would save $60 billion in drug costs over the next 10 years.
But the House has not considered a similar drug price bill, which is strongly opposed by the brand-name drug industry. That leaves the Senate no way to work on a compromise with the Medicare drug benefit plan the House passed in June.
While completion of the drug price bill means senators will go home with nothing to show on Medicare for the upcoming August recess, they say they have one last chance in September. Senators are expected to consider a bill that would boost payments to Medicare providers, and Democrats and Republicans are vowing to try to append a drug bill to that.
In Depth
A recent NPR/Kaiser/Kennedy health care poll finds most Americans are in favor of a government-provided prescription drug benefit for seniors. Read the poll results.
Browse for more NPR stories about Medicare.
Other Resources
• Information on the generic drug bill, S.812.
• Medicare Modernization and Prescription Drug Act of 2002 (Approved in the House, June 28, 2002)
• Families USA, a nonprofit health care advocacy group.
• AARP, a consumer organization for people over age 50.
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Medicare's official consumer site, www.medicare.gov.
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