How many Medicare beneficiaries lack prescription drug coverage? Does the absence of coverage adversely affect access to needed outpatient drug therapy? These two questions lie at the heart of the current debate over whether Congress should add outpatient drug coverage to the Medicare program.
A recent National Economic Council report argues that only one-quarter of beneficiaries have any "meaningful" prescription coverage and that the number is declining each year. Others claim, however, that two-thirds of beneficiaries have some form of drug benefit and that coverage rates are rising. Which is right? In fact, both figures are somewhat misleading. This issue brief examines the reason behind the discrepancy and demonstrates that the methods used to count individuals with drug coverage have important policy implications, particularly where the health status of Medicare beneficiaries is concerned.