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Medicare Part D
Attempting to drive forward while looking in the rearview mirror.
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My dad would look into the rearview mirror to back the family car out of the driveway. We would then go to the neighborhood bakery to purchase “doughnut holes.” They were sweet and tasted great! Mention “doughnut holes” today to my dad’s generation and the response is apt to be a very bitter one!
Medicare Part D began in 2004 and with it the term “doughnut hole” took on a whole new meaning. Unable to pay for a full drug benefit, but wanting for political reasons to cover all Medicare beneficiaries, the legislators limited the government’s expense by establishing the infamous “doughnut hole.” Like the stages of grief, patients often manifest various predictable emotions as they journey into this “hole.”
Stepping into the ‘hole’
The first stage consists of angst and trepidation as they become aware of the approaching “hole” and contemplate their impending fate.
Some of my patients have actually seemed to accept a diagnosis of cancer more easily than the realization that their drug benefit was about to enter a “coverage gap” as Medicare so eloquently puts it. This “gap” can be significant. In the 2009 Medicare handbook example, once Ms. Smith and her plan have spent $2,700 for covered drugs, she enters the “coverage gap.” In order to leave this “gap,” she will have to pay all of her drug costs until she has spent a total of $4,350.
Realization of this quickly leads to the second stage — anger.
Initially, it is usually directed at the President. “Bush is to blame for this!” They are right. After all, he is the President who signed into law the Medicare Drug Benefit which was the biggest expansion of Medicare since its inception. It gives beneficiaries more benefits than those received by any previous Medicare recipients. After Bush, they often focus on the pharmaceutical companies for making such expensive drugs and “ripping all of us off!” Meanwhile, they fail to consider the billions of dollars that the companies voluntarily invest each year to discover and bring to market drugs that are in many cases keeping these same patients alive today.
This brings us to the third stage — bitterness.
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People receiving charity are often grateful and thankful. That is not necessarily the case with entitlements. Like charity, entitlements involve the transfer of wealth from one person to another. But, unlike charity, the transfer can be from a poorer person to a richer one. This occurs when today’s blue collar workers, struggling to support their own families, are forced to pay taxes so that retired millionaires can receive this benefit. Never acknowledged, let alone appreciated, is that not one of the many who became eligible in 2004 for this benefit contributed even one penny in advance for it. Yet, every year, each one entering the “hole” will receive approximately $1,200 of benefits before doing so. All of this is conveniently forgotten. Rather than being thankful that others have paid for a portion of their drugs, beneficiaries often feel bitter when they have to pay for their own.
The fourth stage is groveling.
It occurs about this time of the year but seems to be arriving sooner every year. Fine, respectable, upstanding citizens who worked hard all of their lives and were too proud to even consider accepting charity now are often reduced to coming to my office begging for “free samples” because they are in “the doughnut hole.” One patient even came to me for “free samples” because her insurance company told her to do so! The Medicare Drug Benefit severely distorts the family budget resulting in patients falling unprepared into the “hole.” Early in the year, when they are benefitting from the $1,200 subsidy, family budgets falsely appear to be doing better than they truly are. Based on this, patients wrongly conclude that they have a larger amount of money for discretionary spending then they actually do. This can result in more money being spent on non-essential items than is prudent. Having paid for only a fraction of the cost of their drugs prior to entering the “hole,” upon entering it, they are suddenly financially overwhelmed. Perhaps, had they been budgeting all year long, this would not have happened. This is analogous to going on a vacation, staying at the Ritz until the money runs out and then living on the street for the remainder of it. Never having planned for the “hole,” they now face serious financial problems. This often results in more trips to my office with requests to change to a cheaper drug. More labs then need to be drawn driving up further the cost of Medicare to the taxpayer. Sometimes cheaper choices are not suitable. Switching to a “cheaper disease” might be desirable but unfortunately is impossible.
This ultimately leads to the final stage — frustration.
They have between November 15 and the end of the year to attempt to plan drug purchases for the coming year based on the prior year’s drug use. This leads very quickly to frustration. After all, based on last year’s purchases and not knowing what future sales would occur, could you decide whether to sign a contract to buy exclusively from only Wal-Mart, Target or K-Mart? How much money would you lose if you missed a sale in one store because you signed up with a different store? Likewise, a patient with diabetes might sign up for Plan A because it offers the best diabetes drug formulary. One day after the new plan goes into effect he or she might have a heart attack. Plan B has the better cardiac drug coverage.
Since cardiac meds are much more expensive than diabetic ones, clearly Plan B would have been the better choice. But how does one predict the future? Isn’t this just foolish and frustrating, much like attempting to drive forward while looking in the rearview mirror?
Richard Dolinar, MD, is a Senior Fellow in Healthcare Policy at the Heartland Institute in Chicago, a Clinical Endocrinologist in Private Practice in Phoenix, Ariz., and a member of the Endocrine Today Editorial Board.