Medicare drug benefit sign-up slow

Washington, D.C. – Congressman G. K. Butterfield said that slow enrollment figures for the new Medicare prescription drug program show the need to give people more time to enroll.

“With so many options and other considerations, it only makes sense to give people the time they need make the best choice,” Butterfield said. “We’re less than a month away from the deadline, but just a little more than half of the 16 million Medicare beneficiaries previously without drug coverage have signed up for the benefit so far. That’s a clear indication that people
need more time.”

Butterfield explained that there are 7 million Medicare beneficiaries without drug coverage who still haven’t signed up. This is despite the fact that the enrollment period began on November 15, 2005 and that millions have been spent to encourage people to enroll.

Those beneficiaries who sign up past the May 15 deadline will face a significant penalty – an increase in monthly premiums of 1 percent for every month past the deadline. Furthermore, any beneficiary who misses the deadline cannot enroll until the fall for coverage starting in January 2007. For those people missing the deadline, this means being subjected to a 7
percent minimum penalty.

The penalty, Butterfield said, is permanent, and beneficiaries “would be forced to pay every month for the rest of their lives.”

Butterfield said that as the deadline approaches, he is hopeful that the Bush Administration will push it back to give people the time that they need. Butterfield is a co-sponsor of legislation that would extend the enrollment period through the end of the year without penalty. The bi-partisan “Medicare Informed Choice Act” has 164 co-sponsors and also seeks to allow Medicare beneficiaries the opportunity to make a one-time change in prescription drug plan enrollment at any point this year.

“Seniors and people with disabilities are finding this process extremely confusing,” Butterfield said. “We need to provide beneficiaries extra protections and time during the first year of this complex new program so that they won’t feel pressured into making a bad choice.”

Butterfield said the provision protecting beneficiaries against bad choices is also important.

“Marketing has been very aggressive and people may make a bad choice,” Butterfield said. “Given the importance of the decision they make, it is appropriate to give beneficiaries a one-time chance to correct a mistake made during the first year of implementation.”

Butterfield said that he would also like to see passage of another bill he is co-sponsoring that would allow the government to lower the cost of Medicare drugs by negotiating prices with manufacturers, which has worked successfully with the Department of Veterans Affairs.

“Unfortunately, the Medicare program has failed to substantially reduce the costs of prescription drugs so far,” Butterfield said.

In all, about 35.8 million people are eligible to participate in the Medicare Part D prescription drug program. Of those people, about 20 million already had prescription drug coverage before January 1, 2006 either through Medicare, a Medicare Advantage (HMO/PPO) plan, an employer or union plan or through the Department of Veteran Affairs.

Only 8 million of the 35.8 million with drug coverage are those who didn’t have drug coverage before and have signed up for coverage voluntarily. Another 1 million qualifying for the low-income subsidy have been automatically enrolled in the last couple of weeks by HHS – bringing the total number of beneficiaries with new coverage to 9 million. Of the 9 million, 8.1 million are in stand-alone drug plans and about 950,000 are newly enrolled in Medicare Advantage plans.