Maryland government retirees will get financial assistance from the state to help pay for medications when their prescription drug coverage moves from a state plan to the federal Medicare Part D program next year.
Gov. Larry Hogan and General Assembly leadership announced a one-year transition program in which the state will reimburse all out-of-pocket drug costs exceeding $1,500. That is the limit under the current state plan.
The move to the federal prescription drug plan, which will take place Jan. 1, is part of state pension reform passed in 2011.
Retirees were in an uproar over the looming changes after receiving letters earlier this year from the Hogan administration. Some said the letters, which blamed the changes on the administration of former Gov. Martin O’Malley, were politically charged and sought to pass the blame as the governor seeks re-election.
Retirees from around the state, many on fixed incomes, flooded legislative and local union offices with calls worried about whether the switch will cost them more to pay for critical, life-sustaining drugs. Some complained that the changes were coming too quickly.
The bipartisan announcement, which Hogan made Friday in conjunction with Senate President Thomas V. Mike Miller and House Speaker Michael E. Busch, took a different tone.
“This is another example of the bipartisan solutions we have been able to achieve here in Maryland by working together,” Hogan said in a statement. “I am glad that our administration was able to work with legislative leadership to provide this relief for state retirees who will be affected by this change.”
The lawmakers said they hoped the financial assistance will help ease the transition. Enrollment for the roughly 38,000 state retirees begins in October for the new coverage.
“We have the deepest respect for people who dedicated their careers to public service, and we have an obligation to help them make this transition as seamlessly as possible,” said Miller. “The solution we’re announcing today will honor our commitment to our retirees.”
One retiree welcomed the temporary financial relief, but said it will just delay the inevitable. Beverly McCubbin, 71, and husband Nicholas 77, take about 20 medications between them for illnesses such as depression, high blood pressure and neuropathy. She has considered filling her husband’s prescriptions but not her own to be able to afford them.
“This is going to be a terrible, terrible debacle for everybody,” said McCubbin, who said she has called Miller, Sen. James Brochin and the state’s budget office to complain. She believes the Annapolis lawmakers should do something to prevent the change.
Vincent DeMarco with The Maryland Citizens Health Initiative said the incident shows the need for the state to regulate drug costs. The consumer health group is working to build support for the creation of a state commission that would make drugs more affordable.
“This is great that they are helping retirees, but the real way to help retirees is a drug commission to make high-cost prescription drugs more affordable for all Marylanders,” DeMarco said. “More and more we here in Maryland realize something has to be done here because we don’t know that it will happen on the federal level.”
The 2011 pension reform legislation called for moving retirees to Medicare Part D by July 2019 to coincide with the federal government’s plan to close what is known as the doughnut hole — a gap in Medicare’s prescription drug coverage.
But in its recent budget, the federal government closed the doughnut hole early, starting Jan. 1, so the General Assembly chose to move up the switch date for state retirees. Hogan’s budget officials testified against moving the switch to Jan. 1 and instead pushed to keep state coverage through July 2019.
State lawmakers decided to move the date to Jan. 1 to coincide with open enrollment for health plans. Lawmakers also thought that having people enroll in a state plan for six months and then switch to Medicare in the middle of a Medicare plan year could be chaotic. Switching in July also might be more expensive for retirees if they had to then pay another deductible, they said.
The General Assembly did find a way to maintain state coverage of prescription drugs for spouses and other dependents of retirees by using some of the savings created by switching on Jan. 1, continuing to cover about 4,600 dependents who are not on Medicare.
“The actions taken in Congress left retirees in the untenable position of having to transition to Medicare Part D more quickly than originally planned,” Busch said in a statement. “The Governor, President and Maryland House of Delegates have been working diligently to help ease this transition for our retirees and I am pleased that we have come up with a short-term solution that gives us more time to help those retirees with overwhelming prescription drug costs.”