How many people do you know who pay three health insurance premiums to three plans? The only ones I know have gray hair.
They pay one premium to Medicare itself, another for Medigap insurance (to plug many of the holes in Medicare), and a third for drug coverage (Part D).
Even after all that, senior citizens still do not have the health insurance coverage the average person under age 65 has. The elderly and the disabled on Medicare potentially face bankrupting medical bills if they need expensive drugs or if they have a long hospital stay.
One unsuspecting victim of Medicare’s byzantine reimbursement formulas is Rita Moore, a 65-year-old kidney cancer patient. She was stunned when a pharmacist told her that a month’s supply of chemotherapy pills would cost her $2,400. That’s more than her income!
Moore is not alone. One recent study found that one in every six beneficiaries is not filling a prescription. All too often these are not drugs for which it is appropriate for patients to exercise discretion; instead, they are the treatment of choice for life-threatening conditions. Consider that:
• While almost 16 percent of Medicare beneficiaries do not fill their initial oral cancer drug prescriptions, the figure is only 9 percent for patients with private insurance.
• While 46 percent of Medicare beneficiaries face drug copayments of $500 or more, only 11 percent of privately insured patients face copayments that high.
• And, among all patients with $500 or higher out-of-pocket charges, one in four cancer patients do not fill their prescriptions!
Three developments in health policy make this condition especially surprising:
• First, remember when President Obama encouraged everyone to send the White House their horror stories about insurance company abuses? That invitation apparently didn’t apply to Medicare.
• Second, remember Barack Obama’s promise that Americans will no longer have to live in fear of bankruptcy from crushing medical bills? Turns out, that promise also only applied to young people.
• Third, the administration has missed no opportunity to remind everyone that the Affordable Care Act (ObamaCare) added new Medicare benefits (a free annual checkup, other preventive tests, etc.) that almost all seniors could easily afford to pay for out of pocket. Yet the act did nothing about their vulnerability to tens of thousands of dollars of catastrophic costs.
John C. Goodman is President of the Goodman Institute and a Senior Fellow at The Independent Institute. He is the author of the widely acclaimed book, Priceless: Curing the Healthcare Crisis. The Wall Street Journal and National Journal, among other media, have called him the "Father of Health Savings Accounts.”