A health care overhaul law cuts costs for seniors in the Medicare coverage gap
POSTED: 1:30 a.m. HST, Jan 10, 2011
LAST UPDATED: 11:24 a.m. HST, Jan 10, 2011
Congress is expected to debate soon whether to repeal the sweeping health care reform law as a new provision for Medicare recipients takes effect.
As of Jan. 1 the new law gives a break to seniors who previously had to pay 100 percent of their prescription drug costs when they fell into a coverage gap known as the "doughnut hole."
Under the new law, seniors in the doughnut hole will get a 50 percent discount on brand-name drugs and a 7 percent break on generics.
Jean Sugihara, 70, a volunteer at Lanakila Multipurpose Senior Center, has hit the doughnut hole every year for the past decade.
"I paid over $500 a month" for prescription drugs last year, said Sugihara, who is on prescriptions to control a liver condition and high blood pressure. Sugihara said she started bulk purchasing through a mainland vendor late last year to save money. "They are very expensive. I can afford it but some (seniors) can't. I don't know how they pay for it."
Before Arizona Rep. Gabrielle Giffords was shot Saturday, the U.S. House of Representatives was scheduled to vote this week to repeal the Affordable Care Act, which created the benefit for seniors in the doughnut hole. The vote has yet to be rescheduled.
Republicans, who won control of the House in November, are expected to vote to repeal they law, which they say is too costly and opposed by most Americans. The Democratic-controlled Senate has said it would not support a repeal.
The average senior paid $309.61 out of pocket monthly for brand drugs in 2008, according to national data from the Centers for Medicare and Medicaid Services.
Hawaii is ranked ninth nationally for the highest percentage of seniors in the doughnut hole as of Nov. 14, according to AARP. In 2010, 18.6 percent -- or 17,959 -- of Medicare Part D enrollees in Hawaii reached the coverage gap by Nov. 14.
The state has 96,759 seniors, or 72.2 percent of its 128,000 Medicare Part D enrollees, who could fall into the coverage gap this year, AARP said. The forecasted increase is due in part to greater prescription drug use by seniors who avoided drugs because of the high cost and to an increase in the number of seniors.
"By discounting the brand-name drugs by 50 percent and generic drugs by 7 percent for those in the doughnut hole, our kupuna will no longer have to split pills or do without," said Barbara Kim Stanton, AARP state director, who supports the new health reform law. "With the boomer population on the rise, we can only expect the number of seniors on the Medicare Part D (drug coverage) to increase."
Mary Rydell, Pacific area representative for the Centers for Medicare and Medicaid Services, said those who tend to fall into the doughnut hole are the most sickly, such as patients on dialysis.
"That's where I hear about it the most because they fall into the doughnut hole quickly, in February or March," she said. "They often have other diseases like diabetes and heart disease."
Mitsuko Horiuchi, 94, takes about nine different prescriptions, with one drug costing around $145 for a month's supply once she falls into the coverage gap, according to her daughter, Mary Sueda, 71.
"That's why I carry a substantial amount of money," Sueda said. "There have been times when I paid like $300 at one time for about two prescriptions. So if this is what's going to happen, at least it's going to be half."
The health reform measure intends to narrow the coverage gap by getting drug manufacturers to agree to discounts. The discounts will increase gradually until the doughnut hole is completely closed by 2020 and Medicare recipients pay 25 percent of the cost of brand-name drugs from the start of coverage until reaching $6,448 in drug use in one year. Once past that level, Medicare recipients pay 5 percent for prescriptions in most cases.