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Medicare Participants Face Changing Drug Plans

With rising up-front deductibles and widening coverage gaps, Medicare beneficiaries search for plans that will include their prescription drugs. A report looks at the changing Medicare benefits and what reforms newly elected Democrats may pursue.

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Notice: Transcripts are machine and human generated and lightly edited for accuracy. They may contain errors.

  • MEDICARE COUNSELOR:

    There's a monthly premium of $47, which is a little bit higher than the one that you have now.

  • SUSAN DENTZER, NewsHour Health Correspondent:

    Last spring, senior citizen Taffy Davis met with a counselor at the Medicare Rights Center in New York to get help finding a new Medicare drug plan.

  • MEDICARE RIGHTS CENTER COUNSELOR:

    But the total cost for the whole year is…

  • TAFFY DAVIS, Medicare Enrollee:

    It's far lower.

  • SUSAN DENTZER:

    Davis, who suffers from chronic lung disease, also takes a brand-name drug to fight depression, so she was thrilled to find a Medicare plan that would cover her costly drug straight through the notorious donut hole, or coverage gap.

    In 2007, that gap will begin once beneficiaries' total drug costs reach $2,400 and last until they've paid $3,850 out of pocket. Now, six months later, Davis is shopping around again, a result of changes her current plan made for its coverage next year.

  • TAFFY DAVIS:

    They raised the monthly premium almost double, and then they would only cover medication in the donut that was generic. If you took a brand name, you were out of luck.

  • SUSAN DENTZER:

    For Davis and 38 million other Medicare beneficiaries who've signed up for drug coverage, it's open enrollment season once again. As this so-called Part D of Medicare approaches its first birthday in January, it's in many respects a whole new program for many.

    Robert Laszewski is a consultant and former insurance industry executive.

    ROBERT LASZEWSKI, Health Policy and Strategy Associates: Now we've got the first renewal; we've got the first chance for seniors to take a look at other options, for seniors who didn't sign up to sign up. And there's a little bit of trauma for a few people because some of these plans have changed materially, and some seniors are going to have to go back and take another look.

  • SUSAN DENTZER:

    Some of the 2007 changes enrollees confront are mandated by law, like the fact that up-front deductibles will rise from $250 in 2006 to $265 in 2007. Others stem from rising drug prices and utilization, which have helped to boost the premiums on the most popular drug plans by 7 percent to 10 percent.

  • PHONE OPERATOR:

    Thank you for calling the AARP Medicare Rx Plan.