The President today will renew his call for his own comprehensive reform plan that includes a voluntary drug benefit accessible to all Medicare beneficiaries. Some Republicans propose to expand prescription drugs through a block grant to states to cover low-income seniors. Over half of Medicare beneficiaries who lack prescription drug coverage have income above 150 percent of poverty. In Ohio, most seniors would not qualify for a low-income block grant.
Governors oppose shifting responsibility of drug coverage for seniors to states.
Although some states have extended Medicaid coverage to additional low-income seniors, the National Governors Association, at its meeting last month, called on Congress not to shift the cost or responsibility of any new prescription drug benefit for seniors to states. Others in Congress propose solving the prescription drug problem by expanding private Medigap insurance and through tax breaks rather than creating a voluntary Medicare prescription drug benefit. And because they do not promote group purchasing, these approaches cannot leverage price reductions for seniors. In all but 12 states, Medigap insurers can charge premiums based on age. As a result of age-attained rating, younger seniors, who are healthier and wealthier, sign up for coverage but get priced out of Medigap as they age and just as they need coverage most.