Drug Costs Will Remain Steep Under House Plan, Emory Study Shows
EDITORS NOTE: For full text of study see
widespread expectations of substantial relief in the offing, Medicare
beneficiaries, overall, will still have to pay 70 percent of the costs
of their prescription drugs under the terms of the Medicare drug plan
passed by the House of Representatives on June 28.
Moreover, 6.8 million of
the elderly and disabled Americans who receive Medicare benefits will
have to pay the full catastrophic limit of $3,700 a year for prescription
drugs, according to an analysis by Kenneth E. Thorpe, PhD, chairman
of Health Policy and Management in the Rollins School of Public Health
at Emory University.
Additionally, 11.7 million
Medicare recipients will have to pay an average of $2,200, says Dr.
Thorpe, using Congressional Budget Office projections for the year 2005,
when the House-approved plan would go into effect. The scale of those
out-of-pocket expenses may be surprising to some retirees who assume
from the headlines that Congress has moved half-way toward relief of
their prescription drug cost burden, one of the dominant issues in the
year 2000 Presidential campaign.
"Much of the debate and rhetoric
over the Medicare drug legislation has led many seniors to expect substantial
financial relief from the high out-of-pocket expenses for their prescription
drugs," says Dr. Thorpe. "For many, the reality of the House prescription
drug bill may indeed constitute a major shock. Indeed, many Medicare
beneficiaries who incur high drug expenses may expect that the House-passed
bill will reduce substantially their out-of-pocket spending. Yet, as
the analysis reveals, this is not likely to be the case. Indeed, nearly
50 percent of Medicare beneficiaries will still face annual out-of-pocket
liabilities that average over $2,750 per year."
The Senate is currently considering
its own approach to the issue. Whatever bill it passes will have to
be reconciled with the House version in conference committee.
Dr. Thorpe is an experienced
health policy analyst who served from 1993 to 1995 as deputy assistant
secretary for health policy in the U.S. Department of Health and Human
In this capacity, he coordinated
all financial estimates and program impacts of President Clinton's health
care reform proposals for the White House. He also directed the administration's
estimation efforts in dealing with Congressional health care reform
proposals during the 103rd and 104th sessions of Congress. He has held
faculty appointments at the University of North Carolina at Chapel Hill,
Harvard University, and Columbia University.