| Medicare is Essential to HIV/AIDS
Care
WHY MEDICARE IS IMPORTANT TO PEOPLE WITH HIV/AIDS
Medicare is a vital component of the HIV/AIDS care infrastructure
and is growing in importance. As the second largest source of federal
spending on HIV/AIDS care and treatment, Medicare is not only a
program that serves seniors 65 and older with HIV, but provides
needed care for individuals with HIV/AIDS who are disabled. As the
quality and effectiveness of AIDS care improves, more people with
the disease will be living longer and turning to Medicare for hospital
care, outpatient medical visits, and prescription drugs.
- Nationally almost 20% of people with HIV/AIDS in care have
Medicare.1
- Spending for HIV care in Medicare has doubled over the past
7 years to $2.1 billion.
- Between 11% and 15% of people with AIDS are over age 50.2
- Of all people 50 or over with AIDS 52% are African American
or Hispanic. Seventy percent of all women over 50 with AIDS are
African-American or Hispanic.3
- In New York City, approximately 15,000 people with HIV/AIDS
rely on Medicare for their primary health coverage.
THE MEDICARE REFORM DEBATE
In November 2003, Congress passed Medicare reform legislation that
will make significant changes to the program over the next several
years. The bill adds prescription drug coverage in Medicare and
allows privately run plans to compete with Medicare in 2010. Medicare
Part D, which will be implemented in 2006, uses for-profit drug
plans to administer the benefit with an estimated monthly premium
of $35. In addition to the monthly premium, a beneficiary would
be responsible for a $250 deductible, 25% of drug costs from $251
to $2250 and all of the next $2850 in drug costs (this is commonly
referred to as the "donut hole" where all costs for drugs must be
paid by the individual). After that point, Medicare will provide
95% coverage. Low-income beneficiaries not on Medicaid who earn
less than $12,000 a year with no more than $6000 in assets would
have their premiums, deductibles, and the coverage gap waived. Individuals
with incomes between 100% and 135% of the federal poverty level
and no more than $6000 in assets would not have premiums or deductibles
but would pay $2 for generic drugs and $5 for brand-name drugs.
Those between 135% and 150% of the poverty level with no more than
$10,000 in assets would have a sliding scale premium and a 15% coinsurance
for drugs.
THE MEDICARE DRUG DEBATE AND HIV/AIDS
While the prescription drug debate has evolved, the advocacy principles
for a Medicare drug benefit remain the same: GMHC believes that
a Medicare drug benefit should be available and accessible for all
beneficiaries, comprehensive to meet the health needs of all people,
and affordable for everyone, especially those with the lowest income
levels.
The Medicare bill passed by Congress in November 2003 has ripped
apart the patchwork coverage quilt that keeps people living with
HIV/AIDS alive. The most direct impact is on the 50,000 HIV+ Medicare
beneficiaries that get drug access through Medicaid. These so-called
"dual eligibles" get coverage through both programs. Under the bill,
cash-strapped state Medicaid programs will require duals to get
drug coverage under Medicare. While this may provide some vital
fiscal relief to states, the result is less access for HIV+ beneficiaries
given the inadequacies of the Medicare drug benefit.
Furthermore, the new privately administered Medicare benefit will
utilize formularies that will limit access to only two drugs per
"class" of drugs. This provision is especially troubling given that
state of the art HIV/AIDS therapy requires direct access to all
HIV drugs in that class. The new Medicare benefit will also require
beneficiaries to shell out thousands of dollars for premiums, co-payments,
deductibles and the "donut hole" from their own pockets. Medicaid
programs will be prohibited from using federal dollars to "wrap
around" these gaps in coverage, as they currently do. It is an extreme
irony that a movement to add a drug benefit to Medicare resulted
in the removal of benefits for a group of very low income men and
women that literally cannot live without access to pharmaceuticals.
GMHC'S ADVOCACY AGENDA
The Medicare bill's weaknesses stem from one central issue: the
lack of control over the skyrocketing prices of prescription drugs.
Consumers and our public health care programs are at the mercy of
pharmaceutical companies that routinely increase their prices by
15% or higher — well above the cost of producing the drugs
and outpacing inflation several times over. While drug companies
contend that their prices reflect high research and development
costs, last year drug companies spent almost $20 billion on direct-to-consumer
advertising, phony consumer groups, and legions of detailers. Yet
the Medicare bill explicitly prohibits the program from setting
drug prices, even if it comes at the expense of consumer access
to lifesaving drugs. To address the rising cost of drugs, GMHC plans
to push for the following policy changes in 2004:
- Federal price negotiations: The federal government must consider
using mechanisms to lower the prices of drugs. Americans pay the
highest drug prices in the world, and uncontrolled drug costs
restrict access, drive up health care costs for consumers, and
weaken public programs that provide coverage for the sickest and
oldest Americans.
- Increasing generic drug production and use: Increasing the
development and use of generic drugs that are safe and effective
will save money for Medicare, Medicaid, and all public programs
that purchase drugs.
- Reimportation: Though not a solution, Americans should be able
to reimport drugs from Canada to take advantage of lower prices.
- Repealing the recently-passed Medicare bill: With other advocates,
GMHC will work to repeal the Medicare bill in order to strengthen
the existing program and protect it from market forces that would
make Medicare costs soar.
- State purchasing power: By leveraging the state's purchasing
power to buy drugs in bulk for all of its public programs (Medicaid,
ADAP, EPIC), or by joining with other states to purchase drugs,
New York could greatly reduce its pharmaceutical costs and expand
health care access.
1 "Financing HIV/AIDS Care: A Quilt with Many Holes",
The Kaiser Family Foundation, 2000.
2 National Association of HIV Over 50, 2003.
3 "The Aging of HIV", National Association of Social
Workers.
© 2003 Gay Men's Health Crisis
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