But from their very beginning, negotiations in Congress over adding coverage of prescription drugs were beset by partisan politics that ended up shaping a plan that fell well short of full coverage and perpetuating the everyday struggle with Rx affordability that face many elderly Americans with chronic disease. Conservatives in Congress, with more than a little help from the powerful drug industry's intense lobbying, insisted that Medicare--the U.S. Government--be prohibited from negotiating drug prices with industry. Because of the inability of Medicare to negotiate prices, a free market practice used by every health insurance company in the U.S., experts forecast that Medicare drug coverage would be unaffordable and would threaten the viability of the Medicare program overall.
      To make the total cost of Medicare Part D more palatable to Congress the plan was constructed with a number of cost sharing provisions, including a lack of continuous coverage. And this cost-sharing strategy has worked, at least from the narrow point of view of holding down costs. The total annual Part D expenditures have been less than originally predicted when the plan was presented to Congress. But less expense for the Medicare program has come at a price for seniors covered by the Part D.
      In 2008, the annual premium for a standard Medicare Part D plan averaged around $360 nationally. In addition, most Plans imposed a $275 deductible. So, except for the very poor, whose participation is subsidized, most seniors likely found themselves on the hook for an average of $635 in out-of-pocket costs before seeing the first dollar of Medicare insurance going towards their Rx needs.
      Even after Medicare coverage kicks in, substantial out-of-pocket expenses continue to burden most Part D beneficiaries. Because of the concerns about the effects of cost inflation, the program requires a shared responsibility for payment of drug expenses that exceed the deductible: Medicare pays 75% and the enrollee pays the remaining 25%. Once seniors have filled several thousand dollars worth of prescriptions (the exact amount is set each year), they encounter Part D's greatest shortfall--the "doughnut hole."
      This year the magic number after which Medicare shifts 100% of Rx costs back to a beneficiary is $2,510. This amount represents the aggregate of the deductible, plus both the beneficiary's 25% out-of-pocket payment and the 75% that Medicare picks up. By the time a senior reaches this threshold where insurance coverage stops that senior will already have spent about $1,000 of his or her own money (not including the cost of the premium), while Medicare will have paid out approximately $1,500 of the total.
      This can be a considerable financial burden for many seniors, especially in the current economic climate, as retirement incomes shrink and retirement benefits, like health insurance, disappear altogether. (An important caution; because these calculations are based on national averages, the exact amount spent out of pocket by an individual will vary depending on the specific Part D plan that the individual enrolled in as well as other factors.)
      So seniors who have high drug costs and who have already spent about $1,000 plus the Part D premium, find them selves facing the doughnut hole, which requires that they pay all their drug costs. Why is the doughnut hole there? Well, by cost shifting 100% of several thousand dollars in drug costs from Medicare to seniors the doughnut hole provision effectively caps the government's Part D expenditures. That, in turn, reduces concerns about the impact of the drug coverage plan on the Medicare Trust Find's balance sheet.
      How is this cost shifting affecting America's elderly? According to a new report from the Henry J. Kaiser Family Foundation, www.kff.org, as many as one in four seniors who filled one or two prescriptions in 2007 had expenses high enough to tip them over the edge into the doughnut hole. Those seniors who fall over that edge this year pay for all their prescriptions out of pocket, unless they pay so much that they hit another threshold--the other side of the doughnut hole--at which point so-called "catastrophic" coverage kicks in, and Medicare starts paying for 95% of any additional drug expenses.
      It appears that in spite of Part D (and because of political compromises) out-of-pocket costs for prescriptions are still a concern for older Americans. In 2007 one out of four insured seniors (an estimated 3.4 million) enrolled in a Part D insurance plan fell into the doughnut hole. Of those 3.4 million seniors, 15% spent enough on drugs to emerge from the hole and become eligible for catastrophic coverage. But to do so they first had to have spent around $5,000 of their own money. The U.S. Census estimates that half of all people 65 and older have household incomes of slightly over $28,000. So many seniors with chronic diseases and conditions and taking one or two drugs to manage them will likely end up paying as much as 20% of their total income just on prescription medicines!
      Individual experiences differ and there are Part D insurance plans that cover the doughnut hole. However, they cost more than double the standard plan premium. Because of the cost, fewer than 10% of those enrolled in Medicare Part D plans opt for this doughnut hole coverage.
      Are such hefty out of pocket Rx costs also a health concern for seniors? The Kaiser study found that 15% of seniors who fall into the doughnut hole stop taking their medications. Another 1% reduce their use, and 5% switch to an alternative drug in the same class. There are even some reports that seniors who fall into the hole have higher death rates because they are forced to stop or cut back on their medications.
      Until Washington fixes the problem, and given the current financial crisis that may a long time coming, there is something that seniors can do to be able to better afford necessary medications when Medicare isn't paying. Many drugs to treat common chronic conditions, such as diabetes, heart disease and osteoporosis, are available as low-cost generics. Most, if not all, states permit pharmacists to substitute an equivalent generic drug for a brand name prescription if one is available and if the prescribing doctors have not prohibited substitution.
      Make sure that you doctor writes your Rx for a generic or at least permits generic substitution by the pharmacist. Be aware that prices for generics can vary from pharmacy to pharmacy, so being a prudent shopper is important. Wal-Mart and other big box retailers have vigorously plunged into the generic Rx market, with many prescriptions they fill costing only $4-6 dollars.
      There are other benefits to using a generic equivalent; such drugs are usually better understood, and they often turn out to be safer and just as effective as newer, heavily promoted brand-name products.
      Arthur Levin, MPH is the director of the Center for Medical Consumers in New York City, www.medicalconsumers.org. He is a part-time Hudson Valley resident.