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Study find saving using medicare card

Posted - Jul. 28, 2004 at 3:40 p.m.



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WASHINGTON -- Medicare-approved drug discount cards provide substantial savings over retail prices for medicines, but there are wide differences in their benefits, an independent report released Wednesday said.

The report, prepared for the non-profit Kaiser Family Foundation by Health Policy Alternatives Inc., a private company, found that "at least some cards offer value when compared to cash customer prices." But it noted that beneficiaries must carefully choose which card is best for them in terms of discounts offered on their specific prescriptions and at their local pharmacies.

Discounts for the 10 drugs most commonly used by the elderly ranged from a combined 17 percent to 24 percent below retail depending on the card and the location of the pharmacy. The study did not compare the prices offered by discount cards to those offered in Canada.

The report is the most comprehensive, independent analysis of the discount card program since it began June 1. The program is a temporary benefit that is scheduled to expire when the new Medicare drug program begins in 2006.

Critics of the card program have argued that the benefits are minimal and that they do not match discounts offered by mail-order, online, or Canadian-based pharmacies.

The report used a list compiled by the Maryland attorney general's office as its basis for retail prices and examined seven national drug cards which offered comprehensive benefits on a broad range of drugs.

Among the 10 commonly used drugs, including Celebrex, Fosamax and Lipitor, the report found individual savings ranging from 8 percent to 61 percent below retail prices.

The report found that cards offering the best discounts on the group of 10 commonly used drugs for the elderly also provided better discounts at the retail counter than common mail-order providers. The cards were comparable to online drug provider drugstore.com.

However, it noted significant differences among the cards. Using four hypothetical examples of typical drugs taken by elderly patients, the report found a wide variance -- in some cases more than double -- between the card with the highest price for those drugs and the card with the lowest price for the same drugs in a specific location.

A separate report released Wednesday by the Centers for Medicare and Medicaid Services found that on brand-name drugs, the cards provided discounts of 11 percent to 18 percent over the typical retail price paid for drugs by the general public -- including those with private insurance. It found savings of 37 percent to 65 percent for generic drugs. The CMS study also found that mail-order prices using the discount drug card were slightly lower than those offered by drugstore.com and by giant retail discounter Costco.

The Kaiser study noted that the large number of drug cards available -- 39 national cards and 33 regional cards -- inundated beneficiaries with too much complex information and made choosing a card difficult.

"What we've learned from this experience so far is that excessive choice is confusing," said Michael M. Hash, one of the report's authors.

Although Medicare has devoted considerable effort to providing drug price comparisons on its Web site, the authors noted that roughly 70 percent of beneficiaries don't use the Internet for information.

Dr. Mark McClellan, head of the Centers for Medicare and Medicaid Services, said more than 4 million beneficiaries have enrolled in a card program, but most of those were automatically enrolled through their health maintenance organization or through a state pharmaceutical assistance program.

Recently, voluntary enrollments have been occurring at the rate of 20,000 to 25,000 a day, McClellan said.

Although nearly all 40 million Medicare beneficiaries are eligible for the program -- except a relatively small number who also are covered by Medicaid -- Medicare officials have predicted that less than 8 million are likely to enroll in a drug card because they already have private drug insurance benefits.

On the Web:

Medicare: (www.medicare.gov)

Kaiser Family Foundation: (www.kff.org)

Larry Lipman's e-mail address is (llipman@coxnews.com) Editor Notes:ENDIT

c.2004 Cox News Service

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