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Continuing Policy Issues in Medicare Prescription Drug Coverage

Passage of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 followed years of debate in Congress about adding a prescription drug benefit to Medicare. Although the drug benefit will assist millions of beneficiaries who currently have inadequate coverage or lack coverage entirely, questions remain about many aspects of implementing and administering the benefit. Issues to monitor once the new law is implemented include:

  • adequacy of the benefit
  • dealing with the long-term impact of cost on Medicare unfunded liabilities
  • level of beneficiary access to new private drug plans within and across regions
  • effectiveness of efforts to encourage private plan participation
  • access and affordability of coverage for low-income beneficiaries
  • how states respond to changes in prescription drug financing and coverage for dual eligibles (those enrolled in both Medicaid and Medicare)
  • stability of existing employer-sponsored drug coverage for retirees
  • whether cost containment efforts in the law will be effective, and if so, the effect of cost containment and drug pricing mechanisms on overall levels of drug spending by beneficiaries, private purchasers and plans, and federal and state governments, and
  • ability of the Centers for Medicare and Medicaid Services (CMS) to manage a complicated new benefit with limited funding.

This Issue Brief was prepared for The Commonwealth Fund/John F. Kennedy School of Government Bipartisan Congressional Health Policy Conference, January 15–17, 2004.

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Continuing Policy Issues in Medicare Prescription Drug Coverage, Juliette Cubanski, The Commonwealth Fund, November 2004