States Could Solve Problem of Access to Prescription Drugs

Excerpts from: “Prescribe Freedom: The Government Shouldn’t Touch Pill Chest of Elderly”

Investor’s Business Daily

Republicans and Democrats have both come up with plans to make expensive prescription drugs more available to seniors. But both plans have their drawbacks — such as adding yet another entitlement that subsidizes the wealthy as well as the poor to the already financially-strapped Medicare system.

But the real solution may lie in a program similar to the high- risk insurance pools established by some states.

  • Currently, 28 states have such insurance pools — allowing the market to work for 98 percent of the people while providing a safety net for those who can’t get health insurance because of a medical condition.
  • Congress could create a catastrophic drug benefit plan managed by the states that would kick in when a senior spends about $3,000 per year for prescription drugs — about five times what the average senior spends per year.
  • Once the senior reaches the $3,000 threshold — 6 percent of them spend at least that much — the program would begin paying most or all of the additional costs.

Two-thirds of seniors already have a prescription drug benefit through private insurers or managed care plans. Since private insurers offering drug coverage wouldn’t have to meet catastrophic costs any more — only those up to $3,000 — they could lower their premiums, making standard coverage more affordable and more available.

Such a solution would create a safety net, not an expensive new federal entitlement.

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