The New Medicare Prescription-Drug Benefit — A Pure Power Play

Abstract

On December 8, President Bush signed the Medicare Prescription Drug Improvement and Modernization Act of 2003. In this Health Policy Report, Iglehart discusses the new drug benefit and the contentious political process that led to this major reform of Medicare. Beginning in 2006, Medicare will cover 75 percent of a beneficiary's first $2,250 in annual drug expenses. Medicare will also pay 95 percent of expenses above $5,100. The program is voluntary and requires payment of a monthly premium and a $250 deductible. Coverage will be more generous for low-income elderly persons.