Impact of Rx Discount Cards, HSAs Under Medicare Law Examined
The new prescription drug discount cards established under the Medicare legislation (HR 1) signed into law on Monday by President Bush could lead to "confusion with a generous helping of anxiety," USA Today reports (Wheeler, USA Today, 12/9). The cards, which will become available in April 2004, will provide discounts of 10% to 25% on at least 200 of the most commonly prescribed prescription drugs for beneficiaries at a cost of as much as $30 per year for beneficiaries (California Healthline, 12/8). The Medicare law allows drug companies, pharmacy benefit managers and membership organizations such as AARP and American Automobile Association to offer the discount cards. Medicare beneficiaries can use only one of the discount cards at a time and must use the card that they select for at least one year. However, beneficiaries can continue to use other discount cards not sponsored by Medicare; about 18 million U.S. residents, many of them Medicare beneficiaries, use such cards. According to USA Today, pharmacists have concerns that "much of their time will be consumed explaining the new benefit, especially the discount card, to elderly and disabled customers." In addition, pharmacists have concerns that Medicare beneficiaries will ask them to determine which combination of their discount cards will provide them with the lowest price on prescription drugs, Susan Winckler of the American Pharmacists Association said. "I think we will have some painful conversations with beneficiaries who say it is not enough," she added. Forest Harper, an executive with Pfizer, which offers a discount card, said, "Seniors told us they don't want to calculate anything. They want to come in, present their card, get their discount (and) get their medicine" (USA Today, 12/9).
At least two of the largest health insurers in the nation are "ready to seize the opportunity" presented by a provision in the Medicare law that allows the establishment of health savings accounts, the New York Times reports (Freudenheim, New York Times, 12/9). The bill would allow the establishment of HSAs for individuals with health plan deductibles of at least $1,000 per year and couples with deductibles of $2,000 per year (California Healthline, 12/1). UnitedHealth Group, the largest health insurer in the nation, only days before Congress passed the Medicare legislation purchased Golden Rule Insurance, which sells medical savings accounts, for $500 million. In addition, Aetna on Monday released a proposal to add 100,000 more individuals to the 45,000 members currently enrolled in high-deductible health plans with a savings account. However, Charles Boorady, a securities analyst at Smith Barney, said that HSAs also could attract new competitors -- such as life insurance and property-casualty companies, 401(k) retirement administrators and others -- "while draining profits from many current health insurers," the Times reports (New York Times, 12/9).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.