Issue Brief No. 833 - The Medicare Drug Benefit: Update on ...

The Medicare Drug Benefit:
ISSUE BRIEFupdate on the l ow-Income Subsidy No. 833
Ma Ry EllE n STahl Man, Principal Policy Analyst July 31, 2009
OVERVIEW — The Medicare drug benefit (Medicare "Part
D"), provides federal subsidies to pay premiums and cost
sharing for low-income beneficiaries—almost 10 million in
2009. Yet there are several policy issues concerning these
low-income beneficiaries under Part D. First, over 2 mil-
lion individuals who may qualify for the subsidies have not
enrolled. Second, in some states, low-income beneficiaries
have little choice of plans (while non low-income beneficia-
ries have dozens of choices), unless they pay out-of-pocket
for premium amounts above what the subsidy covers. And
third, millions of those who have enrolled in the benefit face
the prospect each year of switching drug plans or paying
more to keep their current drug plan. What led to this state
of affairs? Are there lessons to be learned from Medicare
Part D as Congress debates how to provide health insurance
subsidies on behalf of low-income individuals?July 31, 2009 Nat Io Nal Healt H Pol Icy Forum
National Health Policy Forum he Medicare Prescription Drug, Improvement, and Mod-T ernization Act of 2003 (MMA) established a voluntary 2131 K Street, NW
Suite 500 outpatient prescription drug benefit (“Part D”), for Medicare
Washington, Dc 20037
beneficiaries. The Medicare drug benefit began January 1,
T 202/ 872-1390 2006, and is administered through private ...