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Legislation on Drug Benefit Assistance Stalls

For Benjamin Yuh, managing pharmacist at Nichols-Hill pharmacy in downtown Oakland, the implementation of the Medicare drug benefit has brought nothing but headaches. His elderly, uninsured customers previously able to obtain prescriptions free of charge under Medi-Cal are suddenly faced with $1 to $5 copayments at the pharmacy counter.

“We have customers screaming at our staff,” he said. “For people on limited incomes, the copayments are really a lot to ask.”

Indeed, life under the Medicare drug benefit can be grim for some chronically ill beneficiaries too poor to afford the program’s copay requirements. But legislative efforts to address the onerous fees have uniformly failed and advocates don’t expect to see much movement on the issue at the state or federal level any time soon.

One such aborted effort, SB 503 by Sen. Liz Figueroa (D-Fremont), stalled in
the Assembly before it was gutted and amended at the last minute to exclude all provisions referring to the drug benefit. The bill was originally intended to address licensure and regulation of accountants and, according to Figueroa spokesperson Jeff Barbosa, the unpopular copay subsidy provisions were removed to ensure that the Board of Accountancy requirements passed.

“We beat our heads against the wall to get [SB 503] passed,” says Gary Passmore, director of the California Congress of Seniors and supporter of several legislative efforts to assist dual eligibles — seniors who qualify for both Medicare and Medicaid. “The legislative leadership just did not support it this year.”

Squeezing Water From a Stone

Unfortunately, dual eligibles are among those who can least afford to wait for a legislative solution to the copay situation. Nearly three-quarters of these low-income residents live on annual incomes of $10,000 or less and many are plagued by multiple chronic conditions requiring complex drug therapy.

When they were automatically enrolled in Medicare prescription drug plans in 2005, dual eligibles suddenly found themselves saddled with new out-of-pocket costs. Seemingly trivial copays of $1 to $5 can add up quickly for seniors on fixed Social Security Insurance income of approximately $850 per month. That’s because dual eligibles generally take several, and sometimes more than a dozen, medications. ¬They use, on average, at least 10 more prescription drugs than other Medicare beneficiaries, according to the Kaiser Family Foundation.

Unlike state Medicaid programs, the Medicare drug benefit does not provide beneficiaries with any assurance that they will have access to their medications if they can’t to afford to pay the fees. Pharmacists can, but are not required to, waive the copay, but the pharmacy itself, not Medicare, must eat the cost — a favor many smaller pharmacies are unwilling to extend given the drug benefit’s lower reimbursement rates.

The net result is that approximately one million California seniors might be forced to choose between paying for their medications and other necessities, such as food, housing and transportation costs, says Jeanne Finburg — directing attorney for the National Senior Citizens Law Center, a not-for-profit organization that represents some dual eligible clients.

“This is really difficult for people on multiple medications,” agrees Claire Matthews — a technical advisor for the California Health Insurance Counseling and Advocacy Program, a network of largely volunteer counseling organizations. “I tell people that we don’t have the financial resources to help but that they should ask their doctors for drug samples or look into the drug companies’ assistance programs.”

Such strategies, however, can add to some beneficiaries’ confusion about how to access drugs under the new federal program.

“The great irony is that the sicker you are, the more you are going to pay,” notes Passmore, who blames the failure of SB 503 on the Schwarzenegger Administration’s ideological belief that copays reduce overuse of unnecessary services and curb health care costs. “The logic is faulty. This is not discretionary income. These patients are prescribed these medications by their doctors.”

No Resolution on the Horizon

Lawmakers’ reluctance to address the copay issue stems from an unwillingness to clean up the federal government’s mess, says David Lipschutz, staff attorney with California Health Advocates. “We hear legislators say over and over again, ‘Why should the state be left holding the bag on this? Why should we pay for it?'”

The state already allocated funds to pay for emergency medications when the drug benefit first suffered from a series of implementation glitches. This relief program, the California Emergency Drug Benefit, was originally drafted to include copay assistance, but that provision didn’t make it into the state budget and the EDB is set to expire in January 2007.

Finburg of the National Senior Citizens Law Center thinks the copay issue is unlikely to get much play in the upcoming session: “From a legislative standpoint, the issue is dead as a doornail,” she says.

A similar silence pervades congressional committees at the federal level.

“There isn’t anything moving through or gathering steam at the moment,” says Jack Cheevers, spokesman for Medicare Region 9.

But Passmore of the California Congress of Seniors says his organization plans to push for a solution to the copay situation in January 2007. “This will be one of our highest priorities,” he says. “The state should hold harmless seniors and people with disabilities — the poorest and sickest people in our state.”

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