Senate Republican Policy Committee Releases Policy Paper: 'Early Milestones Point to Success for Medicare's Prescription-Drug Benefit'

WASHINGTON, Oct. 26 /U.S. Newswire/ -- Following is an executive summary of a Senate Republican Policy Committee Policy Paper titled "Despite Critics' Predictions, Early Milestones Point to Success for Medicare's Prescription-Drug Benefit":

Executive Summary

-- The Medicare prescription-drug benefit has been the subject of much scrutiny since it became law in 2003.

-- Critics have questioned the viability of the program, charging that few private-sector insurers would participate. However, many more companies than anticipated are participating.

-- Due to competition among participating insurers, beneficiaries will save more than expected.

-- Critics have argued that the new drug benefit would give further impetus to employers to discontinue their prescription-drug coverage for their Medicare-eligible retirees. That, too, has not held true due to the law's significant incentives for employers to maintain coverage for retirees.

-- Some also charged the government with stalling tactics, suggesting that the program ought to be implemented in less than two years. Yet, an analysis by the Congressional Budget Office shows that this program's implementation timeline has been reasonable.

-- Critics have also labeled as overly harsh the penalty that the law imposes on eligible beneficiaries who don't enroll when they first become eligible. Yet, this type of penalty is intended to provide seniors with an incentive to enroll early, rather than wait until their drug costs rise; meanwhile, a similar penalty has long been place for Medicare Part B.

-- Others have pointed to the benefit's gap in coverage as being unfair, but the gap will affect only about one-quarter of all beneficiaries. And those affected by the gap still may get assistance from their plans or from state resources that will help pay the out-of-pocket expenses.

-- Some critics charge that prices could be reduced if the Secretary of Health and Human Services would enter into price negotiations with the drug providers. However, studies have shown that market forces, not government interference, will lead to lower drug prices.

-- A prescription drug benefit that is completely cost-effective and perfect for every beneficiary is an impossibility, but Congress created a comprehensive, affordable, and generous benefit structure that will help modernize Medicare and provide beneficiaries with the drug coverage that they need. It deserves support.