Policy Forum The Medicare Prescription Drug Law: Implications for Access to Care

expansion in Medicare’s history. Since its beginning in 1965, Medicare has never covered prescription drugs. Medicare recipients have had to seek drug coverage from a variety of other sources, including the joint federal/state Medicaid program which serves low-income individuals. But under the MMA, elderly and disabled participants will be able to obtain coverage for outpatient prescription drugs beginning in January 2006 through Medicare Advantage or private stand-alone drug plans. General skepticism about the adequacy of the benefit conferred through the newly enacted “Medicare Part D, ” however, has raised the question of whether it really improves the elderly’s access to prescription drugs. Medicare Part D, which includes government subsidies for prescription drug coverage and guaranteed ability to enroll, will no doubt be helpful to some. The new law will effectively result in the government’s paying 75 percent of the cost of a benefit that will, in turn, cover about half of all drug costs for those who enroll. But since the drug benefit is not fully comprehensive, its overall impact will be mixed. How much it will improve the situation for a given Medicare beneficiary will depend on that individual’