Americans United Reacts to Part D Developments

April 12, 2006

Washington Post Poll Shows More Than 1 in 4 Part D Enrollees Pay Premiums But Derive No Savings from Program While New AARP Report Shows Rx Drug Prices Rose at Twice the Rate of Inflation in 2005


Despite Modest Savings for Some, Train wreck lies ahead for

Millions of seniors who soon will fall into Part D's ‘donut hole'


Washington D.C. - Americans United responded today to developments in the debate over Part D, President Bush's embattled prescription drug plan, with a national conference call with U.S. Reps. Jan Schakowsky (D-IL) and James Moran (D-VA) and Diane Archer of the non-partisan advocacy organization Medicare Rights Center.  Today, the Washington Post reported on the results of a public opinion survey which showed that more than 1 in 4 enrollees in Part D derive no savings from the plan despite paying premiums for what has been billed as a money-saving benefit.  In addition, on the heels of the release of the Post's survey results, AARP released a report today showing prescription drug prices in 2005 increased at twice the rate of inflation - a reality that, coupled with Medicare being prohibited by law from negotiating with drug companies for lower prices, stands to wipe out the modest savings which less than two thirds of Part D enrollees are realizing according to the Post poll.


"President Bush was out touting the enrollment numbers for his flawed Medicare drug plan again today, but the truth is that 15 million beneficiaries have yet to enroll, and 25% of those who have enrolled have realized no savings or are even paying more for their coverage," said U.S. Rep. Jan Schakowsky (D-IL).  "If 25% of the cars made by GM or Ford didn't start, they would go out of business.  The President should face the numbers and extend the enrollment deadline before millions of seniors are forced to pay late enrollment penalties that increase throughout their lifetimes."


"This poll unveils a sobering reality about Part D: despite paying costly monthly premiums, more than -in-4 seniors enrolled say they are not seeing a dime of benefit while one third of those enrolled say they disapprove of the program," said Brad Woodhouse, spokesman for Americans United.  "The real proof is in the low sign up rates for those who were not automatically enrolled which make clear that many seniors find this benefit to be confusing or not designed with their needs in mind. 


"This law was supposedly passed to make drugs more affordable for seniors who are paying premiums.  The fact that 1-in-4 are paying premiums but have received no benefit - no savings - shows just how badly flawed this plan is.  And, those who have signed up are in for the shock of their lives when they learn about the limits of the coverage and start to hit the donut hole, and when they figure out that this law lets the insurance companies stop covering their drugs but doesn't let them switch insurance companies when they do.  The fatal flaw in this law is that it prevents the government from using its purchasing power to get the lowest price for seniors -- and every poll shows that the vast majority of Americans think that's wrong," aid Woodhouse.


Americans United is calling on President Bush to look at the numbers:



Further - Americans United is calling on the President to support extending the enrollment deadline until Part D is fixed - including requiring Medicare to negotiate with drug companies for lower prices, closing the donut hole and providing seniors with the option of obtaining their prescription drug plan directly from Medicare instead of a private plan.