SO WHAT'S THE DEAL?
Medicare's drug discount card program went into effect in June with the promise of cheaper prescriptions for the elderly, but a Tribune survey suggests those promises are overstated for all but the poorest of patients.
While the cards available in the county do provide a marginal markdown, ordering drugs online and getting them at Canadian pharmacies can be far less expensive -- and in some cases could save patients thousands of dollars a year over the federal program.
For a patient on hormone replacement therapy suffering from high cholesterol, high blood pressure and arthritis, the monthly drug bill could top $700, for example. The best Medicare card deal runs about $690. A major Internet drug retailer, however, offers the same regimen for about $400, and a major Canadian pharmacy offers the medications for a total of $300.
The Bush administration unveiled its multiyear plan to overhaul the federal health-care system for seniors with last December's signing of the Medicare Modernization Act. The drug discount card was the program's first major step, with full prescription benefits becoming available in 2006 and a $600 credit available now to the poorest seniors, those whose monthly income is less than $776.
While it advertises some benefits, however, not everyone thinks the plan is helpful.
"We took a position on the president's Medicare Modernization Act, and we felt it was worthless," said Joyce Littman, director of the Area Agency on Aging. "For the hundreds of billions of dollars it costs, there's not going to be enough true health care for senior citizens. In my experience, when seniors find out about the details, they find out it isn't helpful."
Some experts say there aren't that many low-income seniors living in the costly Central Coast who even qualify for that bonus, and federal law prohibits drug importation from outside the country, where pharmaceuticals often sell for prices well below those offered stateside.
Democratic presidential candidate Sen. John Kerry has blasted the Bush administration in recent weeks for prohibiting drug importation from Canada -- a ban Kerry says puts more money in the hands of drug companies. The Bush camp maintains its stance is based on safety concerns. Reports by various government bodies have called into question the authenticity and safety of mail-order medicines.
Under the program, seniors can apply for one of about 73 different drug discount cards, all sponsored by various competing companies. Each card covers its own set of drugs, so not all cards cover every medication. Seniors can only apply if they don't already have prescription coverage, and they need to research which card offers them the best price on the specific drugs they take.
One card might cover Lipitor, a cholesterol-lowering drug, and Diovan, which controls hypertension, but won't cover Bextra, a new anti-inflammatory. Another might cover Lipitor and Bextra, but not Diovan.
What's more, the variety of card offerings depends on region; San Luis Obispo seniors have about 35 from which to choose.
Using the Medicare drug card does have its advantages. Beneficiaries can get their prescriptions at their local pharmacy without having to worry about online or mail-order fraud. The cards do offer cheaper prices than retail and, for certain combinations of medicines, cheaper prices than the free senior discount cards offered by various pharmacies. Also, single seniors with incomes of less than $12,569 a year and couples with income less than $16,862 could qualify for a $600 prescription credit.
Experts say it's those low-income seniors who stand to benefit from the federal program. Those seniors are also eligible for programs from drug manufacturers, who team up with discount card sponsors to offer free or deeply discounted medicines to those living below the poverty line and who have used up their $600 credit.
On the other hand, for more well-off seniors, the cards aren't the best deal out there, and some patients with expensive monthly drug bills could save a lot by shopping elsewhere.
"To be honest with you, the drug company can give you a price for $50 one day and two weeks later increase it to $70," said Bill Storm, a regional representative with the AARP. "There's no guarantee it'll hold that price for the year."
Beneficiaries are only allowed to switch cards annually -- so if they suffer a heart condition in the middle of the year and need a new prescription not covered by their card, they'll have to buy it another way. The Medicare cards cost up to $30 per year, and seniors will have to spend time researching which one to use.
What's more, said San Luis Obispo pharmacy worker Jan Ratterree, not many of her customers are eligible because they already have retirement or military prescription benefits.
"They did a big splash for this program, but I've counted maybe five people who signed up; maybe 1 percent have been eligible," she said. "I've only encountered one person whose income was low enough to get the $600 benefits."
She did note, however, that the prices offered were discounted for those who applied.
For those who are interested in the Medicare program, the Health Insurance Counseling and Advocacy Program (HICAP) is offering a free service to help seniors pick out which card they want to use.
Customers can call the HICAP hot line, give a volunteer their prescription regimen, and the representative will do the legwork to help the patient select the most appropriate card.
"If they did want a card and they wanted to go to the medicare.gov site, it's not easy," said spokeswoman Dianne Timmerman. "My overall view is that people are a little reluctant to apply for a card because there are so many different cards."
THE TRIBUNE SURVEY
The Tribune used the prescription needs of three aging patients to compare drug prices offered by the best Medicare plan available in San Luis Obispo to major online pharmacy, drugstore.com, a major Canadian pharmacy, canadadrugs.com, and -- when possible -- to the prices offered to seniors with the senior discount cards at various local retailers.
The patients included an elderly man with high blood pressure, an elderly woman with gastric reflux and arthritis, and an elderly woman with incontinence and eczema.
The survey used the cost of generic equivalents whenever possible. The Medicare cards and drugstore.com in all cases could fill the prescriptions. The Canadian pharmacy did not have certain medication or doses available for export, such as blood pressure medicines Toprol or triamterene/hydrochlorothiazide. The Tribune assumed patients on those drugs would order most of their drugs from Canada and the rest online.
In almost all cases, according to the Tribune survey, the medicines were cheapest from the Canadian pharmacy -- and in some cases, drastically cheaper.
The elderly man's regimen was the cheapest, and it's the one spot where the Medicare plan shined. With the cheapest drug discount card, he'd pay about $107 per month. He'd pay about $10 more per month online or from Canada.
The second patient -- with gastric reflux disease and arthritis -- would be best served buying from Canada. She'd pay about $300 per month, including about $20 worth of medication from drugstore.com. If she bought solely from drugstore.com, she'd pay $404. Her senior discount card at her local pharmacy would result in a monthly bill of $465, and she'd shell out $692 with the best Medicare card -- a full 130 percent higher than the Canadian pharmacy.
That means she'd save $4,700 per year by going to Canada over using her Medicare card.
The differences weren't so pronounced for the third patient. Her cheapest option came from Canada at $149 a month, followed by the online pharmacy, which cost $178, or 20 percent more. With the Medicare discount card, the cost would be $185, or about 23 percent more expensive than the Canadian medication.
LEGAL AND SAFETY ISSUES
While purchasing from Canadian pharmacies is inexpensive, it's also illegal under the Bush administration's Medicare revision. But those rules aren't strongly enforced, and some seniors who order from abroad prefer to risk it.
One Orcutt woman interviewed at an area senior center recently said that she just didn't care about breaking the law when she ordered her cancer drugs from Canada. Her Tamoxifen prescription cost her about $200 a month here, she said, but just $45 per month there.
"I think it's all a lot of hooey," she said. The woman did not want to be identified because her purchases are against the law.
The drug companies appear to be fighting back. One patient of Dr. David Harris, a local general practitioner, recently brought in a letter received from a Canadian pharmacy saying Pfizer -- maker of Lipitor and other drugs -- was limiting its exports.
As a result, the patient's pharmacy had been forced to raise its rates for Lipitor, but in turn decreased its rates on generic drugs that also fight high cholesterol.
Rate wars aside, some health experts warn that ordering from online or Canadian pharmacies can be dangerous. The Government Accounting Office, an investigating arm of Congress, released a report in June outlining the risks of foreign drug purchases. It warned against pharmacies in Pakistan, Mexico and Thailand, for example, but said Canadian companies were more reputable. It also said some pharmacies had unreliable business practices and were selling drugs without prescriptions.
But the Orcutt patient was not too concerned.
"I'd be more comfortable if the FDA checked the drugs," the woman noted, "but I'm not going to get them from Colombia or anything."
Storm, with the AARP, said his organization is pushing for the Dorgan-Snowe legislation, a bipartisan bill now stalled in the U.S. Senate that would legalize importation but subject it to FDA approval and oversight.