US Representative Benjamin
Cardin (D-Maryland), a long-time pension and benefits activist,
said in a statement that the Medicare prescription law "clearly
harms retiree benefits and seriously jeopardizes the health care
of millions of American retirees."
Prompting Cardin’s ire was a report from the US Department of
Health and Human Services (HHS) predicting that 3.8 million
retirees could lose their prescription drug benefits when a new
Medicare law provides drug coverage to Medicare beneficiaries in
2006. HHS also estimates that the number could
grow to 4.1 million retirees by 2010 (See
Medicare Bill has Implications for Plan Sponsors).
"Because the new Medicare law
does not fully reimburse employers for the cost of the drug
benefit and since the new drug benefit cannot be coordinated with
retiree prescription drug coverage, it encourages companies to
drop drug coverage for their retirees,” Cardin railed in the
statement. “As a result, millions of retirees will see their drug
benefit reduced or completely eliminated."
In January, Cardin introduced
the Preserving Medicare for All Act, HR 3702, which he said will
fix the "structural flaws" contained in the Medicare law. The
measure would fully reimburse employers for the cost of their
retiree drug coverage.
It also would lower
prescription drug costs by:
allowing HHS to use the purchasing power of 40
million Medicare beneficiaries to negotiate lower drug costs
with pharmaceutical companies
provide a guaranteed, universally available
drug benefit option through Medicare
repeal the provisions that will threaten
eliminate excess payments to private health
repeal the expenditures cap that will result in
harsh cuts to Medicare providers and patients.
Cardin said a ruling by the
Equal Employment Opportunity Commission (EEOC) that allows
employers to reduce or eliminate retirees' health benefits when
they become eligible for Medicare at age 65 compounds the problem
EEOC Approves ‘Erie County’ Exemption).
Cardin also released a
research report on the potential extent of the drug coverage
problem at http://www.cardin.house.gov/SupportingFiles/documents/cardin_drug_card.pdf.