Md. drug plan offers seniors cost savings

Tens of thousands of Maryland seniors could save hundreds of dollars a year on prescriptions under a new state program that began enrolling members yesterday, but state officials and advocates warned that the plan won't be enough to help everyone who needs it.

Participants - with annual incomes of up to $15,715 for an individual or $21,210 for a couple - will get their prescriptions at 65 percent of the cost the state Medicaid program pays. Since Medicaid gets bulk-purchasing discounts, the seniors could be paying as little as half of the retail cost.


Gov. Robert L. Ehrlich Jr., who officially launched the Maryland Pharmacy Discount Program yesterday at a Glen Burnie senior center, said the state believes that as many as 50,000 seniors may participate, and they're expected to save an average $750 per year each on prescriptions.

The state is putting up $8 million, which is matched by the federal government, to pay for the 35 percent of the cost that is not paid by the patient. But, with the state's discount, Ehrlich said, seniors could save $34 million.


"This is a very cost-effective program," he said. "The state government needs to know every way to leverage federal dollars."

Nelson J. Sabatini, state health secretary, who joined Ehrlich at the kickoff, said the program will not be enough to meet the prescription needs of all seniors.

"Ultimately, the solution is going to have to be a federal solution - a Medicare program that includes coverage for prescription drugs," he said. "But we in Maryland can't wait."

Congress is debating a Medicare pharmacy benefit, but that would not begin before 2006.

In conjunction with other state programs to help seniors pay for prescriptions, the new program "gives us another way to help," said Susan Knight, director of the Senior Health Insurance Program for the Anne Arundel County Department of Aging. "But as many programs as there are, we can't help everyone."

She said the new program should be particularly helpful for seniors who exceed the income ceiling or asset test for the state's Pharmacy Assistance Program.

That program offers much more generous benefits, covering all prescriptions with only a co-payment of $2.50 for generic drugs and $7.50 for brand-name drugs. It serves people who earn up to 116 percent of the federal poverty level, compared with 175 percent for the new discount program.

About 40,000 people are enrolled in pharmacy assistance, about 35 percent of them elderly, according to Joseph Fine, director of pharmacy programs for the state health department.


The two programs will share a single application. Interested seniors can call 800-226-2142.

Maryland also offers a prescription program that enrolls seniors who earn up to 300 percent of the poverty level.

Participants pay $10 a month in premiums and can get up to $1,000 in pharmacy benefits in a year. Co-payments per prescription are $10, $20 or $35. There are 32,628 seniors enrolled, according to CareFirst BlueCross BlueShield, which administers the program for the state.

The discount program that began enrollment yesterday was approved by the state legislature in 2001. The state then sought federal permission to operate the program in conjunction with Medicaid, and that was granted last year.

According to the National Conference of State Legislatures, 26 states have pharmacy subsidy programs and 16 states have discount or bulk purchasing programs.

"It's working as far as bringing some prices down," said Richard Fiesta, director of government and political affairs for the Alliance for Retired Americans. "But at some point, no matter what a state does, the prices are going to eat up the programs."


Said Jocelyn Geyer, associate director of the Washington-based Kaiser Commission on Medicaid and the Uninsured: "Maryland is making a noble effort to move forward. But for many low-income seniors, the program will likely fall short. It will take the edge off of prescription costs, but it will not solve the problem."

According to a study by her organization, the average senior incurs $2,322 annually in prescription costs, of which $999 is paid out-of-pocket. The remainder is paid by retiree health coverage, government programs, charity or privately purchased insurance.

About 5 percent of seniors run up $4,000 a year or more in drug costs, the study found, and 47 percent of those have no prescription coverage.