Providing Access to Prescription Drug Coverage

AIM is a coalition of organizations representing seniors, doctors, hospitals, small and large businesses, medical researchers and innovators, insurance plans and providers and others dedicated to improving and strengthening Medicare for all Americans.  AIM seeks to ensure that all senior citizens have more health care coverage choices, better benefits (including prescription drug coverage), and access to the latest in innovative medical practices and treatments.  These recommendations provide guidance for developing prescription drug coverage for senior citizens through both the traditional fee-for-service Medicare program and Medicare's managed care program, Medicare+Choice.

Nearly one-third of Medicare's elderly and disabled beneficiaries lack outpatient (Part B) prescription drug coverage.  The balance of Medicare beneficiaries have some level of coverage through retiree health benefits, Medigap policies, Medicare+Choice plans or Medicaid.   AIM believes integrated prescription drug coverage should be offered to all Medicare beneficiaries as part of broader efforts to strengthen and improve both the traditional fee-for-service program and Medicare's managed care program, Medicare+Choice.

Medicare was designed and created in 1965 when hospital-based care was the standard.  Today's standard of care, however, includes a greater reliance upon modern technologies such as prescription drugs to treat patients and reduce the number and length of hospitalizations.  Designed today, Medicare would no more exclude prescription drug coverage from the standard benefit package than it would exclude hospitalization or physician services.

AIM believes all Medicare beneficiaries should be offered prescription drug benefits as an integral part of Medicare health coverage.  Further, AIM believes prescription drug benefits should be designed with adequate financial support and effective management tools to ensure reliable coverage and long-term success. AIM also believes that equal financial resources should be dedicated to both the fee-for-service program and the Medicare+Choice program for the development of prescription drug benefits. Finally, AIM believes health plans should have flexibility in designing prescription drug coverage benefits and opposes bureaucratic prescription drug proposals and government price controls.

Prescription Drug Coverage in Fee-For-Service Medicare

AIM believes fee-for-service Medicare beneficiaries should have private health care coverage options which include prescription drug coverage included as part of the basic benefit package. AIM supports efforts to add prescription drug coverage to the fee-for-service benefit package based upon the following principles:

(1) Provide a Comprehensive Benefit Package

Medicare fee-for-service program beneficiaries should have a comprehensive benefit package which includes basic prescription drug coverage. 
 

(2) ab Include Appropriate Use of Private Sector Management Tools

Private sector health plans have developed proven tools to ensure safe and cost effective use of prescription drugs.  These management tools, including formularies, tiered co-payments, and drug interaction prevention, are essential to high-quality coverage for beneficiaries and should be incorporated into a new comprehensive, fee-for-service benefit package while allowing access to all classes of drugs.
 

(3) ab Avoid Government Imposed Price Controls
 

Prescription Drug Coverage in Medicare+Choice

Congress created the Medicare+Choice program as a health care coverage option for Medicare beneficiaries. The option was designed to offer more health care coverage choices for beneficiaries and to offer beneficiaries organized health care systems. However, Medicare reimbursements which fall below cost increases, severe payment cuts, and increased costs due to excessive regulation have caused many Medicare+Choice plans to reduce or eliminate prescription drug coverage in order to maintain plan offerings in some counties. AIM supports efforts to ensure prescription drug coverage for Medicare+Choice program beneficiaries based upon the following principles:

 (1) Ensure Adequate Payments to Providers to Ensure Prescription Drug Coverage

The current Medicare+Choice payment formula has resulted in inadequate payment levels which have not kept pace with overall medical costs for Medicare+Choice plans in many parts of the country.  Stabilization of the Medicare+Choice program will minimize disruption of benefits, including prescription drug benefits, among beneficiaries.  Recent reductions in funding for Medicare+Choice health plans have caused many plans to reduce the scope of their prescription drug benefits or to increase beneficiary cost sharing.
 

 (2) Ensure Sustainable Funding and Financing Mechanism

The additional Medicare program costs associated with providing prescription drug benefits should be accompanied by a reliable and sustainable financing mechanism.
 

(3) Allow Health Plans Flexibility in Designing Benefits Packages

Beneficiaries should have the option of selecting from among many different plans and plan types to best suit their own coverage needs.