Drug Discount Cards

Q: When are the new Medicare drug discount cards coming out?

A: The federal Department of Health and Human Services says the new prescription discount cards will be out this spring. The first benefit under the new Medicare Modernization law, discount cards promise to help seniors "lower their (drug) costs until the more comprehensive Medicare drug benefit comes into effect in two years."

The government claims that these discount cards will allow seniors to get savings of about 10% to 15% on their total drug costs. All Medicare enrollees, except those who already get drug coverage under Medicaid, will be able to buy a discount card. Cards will be offered by drugstores, Medicare HMOs, insurance companies, and drug benefit managers. Medicare will approve a list of discount cards, and all seniors are supposed to have a choice of at least two discount card programs. Only one card can be held at any time. The cost of signing up for a card cannot exceed $30 a year. If consumers are unhappy with one card, they will be able to switch cards during an open enrollment period. By 2006, these discount cards end.

Medicare plans to create a website that will provide a price comparison between different cards on the market, and help in comparing negotiated prices for drugs, and other program features. The cards will publicize their negotiated prices-which are actually the drug's maximum price in a given geographic area. Actual prices may vary, but will not be higher than the posted price. The government also plans to provide customer service workers to help elders understand the price comparisons. The "Medicare-approved" label on these cards is supposed to mean the firm offering the card is reputable. But Medicare-endorsed discount cards come with something else: a special benefit for low-income seniors. An individual with income less than $12,124 per year ($16,363 for couples) gets a prescription subsidy up to $600 a year towards the cost of their medications. Medicare will also pay for the cost of the enrollment fee for these low-income card holders.

Q: Aren't discount cards already on the market?

A: Yes. There are already a number of drug discount cards you can buy, each with different benefits and costs. AARP, for example, has its "Member Rx Choice" program, as do several drug companies, like Merck and Lilly. CitizensHealth, founded by former Congressman Joe Kennedy, has a medical card that says it can save you 10% to 34% off your drug bills at 40,000 pharmacies. Whatever discount cards are on the market now, they will all probably try to become Medicare-certified, to allow people to take advantage of the low-income $600 discount. When the cards come out, the SHINE program (1-800 Age Info) will be a source of help for seniors seeking the right discount card for their needs.