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Automatic Medicare Drug Enrollment Urged

May 25, 2004

Medicare Drug Cards • Confusion as deadline nears • Scam artists target drug cards • Report calls for automatic enrollment • Medicare.gov • Medicare News

Automatic enrollment of people who already have proven their eligibility for Medicare’s new $600 annual transitional drug assistance program would help low-income consumers secure needed medicines and help the Bush Administration reach its enrollment goals for the controversial Medicare-approved drug discount cards, according to a new report released today by the Medicare Rights Center, a national consumer organization.

In addition, the report recommends that consumers be allowed to switch cards whenever a card sponsor changes the drugs it offers or the discounts it provides. Currently, the program allows card sponsors to change covered drugs and discounts on a weekly basis, but consumers are locked into the card they choose for an entire year, the report says.

“The past few weeks have shown drug prices swinging both upwards and downwards,” said Robert M. Hayes, president of the Medicare Rights Center. “There is no free market principal that locks a consumer into a service or product that can change the minute the consumer lays out her money. It’s a prescription for a rip-off.”

Mr. Hayes called on the Administration to request authorization to waive the consumer lock-in that, he said, is causing callers to the Medicare Rights Center’s consumer hotline much anguish.

MRC’s report, Medicare-Approved Drug Discount Cards: A Prescription for Improvement, predicts that “only a small percentage of those entitled” to the $600 annual low income drug benefit will sign up given the “confusion” and “short time frame” for the program.

The report says that people “who are known to qualify for the $600 transitional assistance because of their participation in other low income programs would be automatically enrolled in transitional assistance.”

The report points to under-enrollment in existing low-income Medicare programs – 40 percent of those eligible are still not enrolled after ten years of outreach and education – as evidence that eligible low income people will not get the transitional assistance that they are entitled to receive.

The Medicare Rights Center’s report lists four key problems in the drug discount card program:

1. The discount cards do not offer as good a savings as many other available alternatives and may deter people from exploring ways of getting the best prices for their drugs.

2. The drug card program's complexity makes it difficult to navigate and near impossible to make an informed choice.

3. The program’s opt-in enrollment procedure for low-income benefits limits the number of people who will access the $600 transitional assistance.

4. The discounts available through the cards change weekly, preventing consumers – who are limited to one card choice a year – from selecting the card with the best discount on their drugs.

Founded in 1989, MRC helps older adults and people with disabilities get good, affordable health care.

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