The insurance companies claim that they can no longer afford to offer the unlimited benefit. Of the 199,221 seniors enrolled in Medicare in Massachusetts, about 19,000 are estimated to be effected by the drug cap. Massachusetts had attempted to block the pharmacy cut by taking its case for jurisdiction into federal court. On October 30, Judge Richard H. Stearns struck down the Massachusetts law which mandated the benefit. Judge Stearns cited the Balance Budget Act of 1997, as having granted the exclusive right to determine Medicare benefits to federal, not state, agencies.
Federal law allows the prescription cap to be set by the insurer.
Until recently, federal law allowed the states to set their own rules as to what types of benefits HMOs had to offer as part of their Medicare supplement plans. Massachusetts was the only state in the nation to require the HMOs to provide an unlimited prescription drug benefit. Standard co-payments will still apply. Both Cellucci and Kennedy have called on the state's HMOs to continue the unlimited benefit for one year, while the state and federal governments work on a permanent solution. However, Harvard Pilgrim, the state's largest Medicare HMO carrier, declined to continue the benefit.