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September 22, 1999

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"Across the nation, co-payments and premiums are going up, while benefits are going down. Many of our seniors in HMOs are finding themselves shut out of affordable prescription drug benefits in many cases, the very benefits that enticed them to join an HMO in the first place."

Vice President Al Gore
Wednesday, September 22, 1999

Today, in an address to the American Medical Association in Washington, DC., Vice President Gore released a new report showing that many Medicare families who rely on health maintenance organizations (HMOs) are facing new limits on their coverage and higher out-of-pocket costs for prescription drugs. The Vice President emphasized the need for Medicare reforms that protect beneficiaries and provide the option of a prescription drug benefit. The Vice President also called on Congress to pass a strong, enforceable patients' bill of rights.

Unveiling a New Report on Medicare HMOs and Prescription Drug Benefits. Vice President Gore released a new report by the Department of Health and Human Services which shows that HMOs are leaving Medicare beneficiaries with increasing out-of-pocket costs and more limited coverage for prescription drugs. The report, based on data submitted by HMOs themselves, finds that:

  • Prescription drug benefits for Medicare beneficiaries in HMOs are becoming more restrictive;
  • More managed-care plans are charging Medicare beneficiaries higher co-payments for prescription drugs;
  • More Medicare beneficiaries in managed-care plans are paying higher premiums;
  • Many states will have a significant increase in the number of beneficiaries who no longer have access to a managed-care option for prescription drugs; and
  • Rural beneficiaries will continue to have limited access to managed care plans and fewer plans with prescription drugs
There are about 63 million beneficiaries in Medicare HMOs more than double the number four years ago. Findings from today's report have troubling implications for these beneficiaries, such as:

  • Disabled and older Americans are particularly vulnerable to current volatility in the Medicare HMO market;
  • Medicare beneficiaries cannot be assured an affordable prescription drug benefit without a prescription drug option for both fee-for-service and managed care, and explicit financing for it
  • Beneficiaries in rural communities cannot be assured managed care plans will be offered at all; and
  • Uncertainty about reliability of HMOs undermines confidence and participation in these plans

Addressing the Current Shortcomings of Medicare. The Clinton-Gore Administration's plan to strengthen and modernize Medicare addresses current shortcomings by:

  • improving the payment system to help stabilize managed care;
  • providing an affordable, voluntary prescription drug benefit to all beneficiaries; and
  • assuring beneficiary protections when managed care plans withdraw

Urging Congress to Pass a Strong Patients' Bill of Rights. The Vice President emphasized the fact that the Administration and the AMA are united on the patients' bill of rights, and reiterated the call on Congress to pass the Norwood-Dingell legislation when it is called up for a House vote during the week of October 4th. He urged the House to reject the approach taken by the Senate bill that excludes over 110 million Americans and does not assure critical protections, such as access to specialists and a strong enforcement provision.

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September 30, 1999: Public Education

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