Low-Income Medicare Beneficiary Savings Still Available in the Medicare Drug Discount Card Program: A Nine State Assessment
March 2005
Pharmaceutical Research and Manufacturers of America (PhRMA)
On December 8, 2003, President Bush signed into law the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (MMA). The law modernizes Medicare so that,
beginning in January 2006, seniors and people with disabilities can have coverage for
prescription drugs that have become an important part of quality medical care. This new
benefit improves access to prescription drugs and provides important financial protections to
Medicare beneficiaries. The MMA specified that for the years 2004 and 2005, prior to implementation of the full prescription drug benefit, Medicare beneficiaries would have access to Medicare-approved discount cards, and beneficiaries meeting the low-income thresholds would have access to an additional $600 in annual cash assistance.
In 2002, The Lewin Group conducted a study commissioned by the Healthcare Leadership
Council that examined the potential savings to beneficiaries from using Medicare-approved
discount cards. The Pharmaceutical Research and Manufacturers of America (PhRMA),
engaged The Lewin Group to build upon this prior work to estimate the potential savings
forgone for low-income beneficiaries who do not sign up for Medicare-approved discount cards
in 2005 since these persons have the most to lose by not enrolling in the program.