Putting drug cards to the test

Times Staff Writer

Pauline Rubin of La Jolla considers herself computer-savvy, and she and her husband, Charles -- at 68 and 75 years of age, respectively -- take a number of prescription medicines between them. Last Monday afternoon, the intrepid Pauline Rubin logged onto Medicare’s newest website and searched for a prescription card that would cut their costs and ease their drug purchasing decisions.

But there would be no “cowabunga” moment.

“Oh, forget that!” cried Rubin after spending hours on the site looking for bargain prices on the drugs that the couple take. It took too long for the website to spit out some answers, she complained. It was confusing to compare the prices of mail-order and corner pharmacies, and to figure in the cost of the card. The prices she was seeing didn’t seem to be any lower than what the Rubins were already paying by shopping carefully by mail order and through local pharmacies.

Rubin’s conclusion after her first day visiting the Medicare site? “It has nothing to do with real drug coverage,” she said. “It hasn’t given me any of the certainty and it’s no savings.”


For seniors who called and logged on to explore the new Medicare-approved drug discount cards, last week was a time of hope, frustration and change. And the next several weeks could be much the same, as private organizations begin to market their Medicare-approved discount cards to 41 million Americans. Medicare beneficiaries can begin using the cards on June 1.

To help seniors and the disabled choose among some 40 national cards and an additional 33 regional cards, the Centers for Medicare & Medicaid Services, or CMS, have rolled out a first-of-its-kind website -- -- that allows beneficiaries to compare prices of card plans and drugs available to them. In the process, they have set off a roiling -- and hotly political -- debate about whether the cards will deliver on a central promise to seniors: that the landmark Medicare reform bill passed by Congress in November 2003 will make prescription drugs more affordable.

Health and Human Services Secretary Tommy G. Thompson last week proclaimed the website “a first” because it can sort through information on about 60,000 drug products and 50,000 pharmacies, providing side-by-side price comparisons never before possible. Such an open competition, with all the transparency that Internet price-posting brings, is also new. And Thompson said it would drive down drug prices for Medicare beneficiaries enrolled in the prescription drug-card programs, because card programs vying to attract enrollees would negotiate and pass on any savings they can offer. The cost of enrolling in a Medicare-approved card program can vary, and some are free. But none may charge more than $30 a year to join.

“The power to save on prescription drugs is now in the hands of seniors and people with disabilities,” Thompson said. “Industry is competing online for the business of millions of Medicare beneficiaries and those beneficiaries have now pooled their purchasing power to demand the best price.”

But critics of the Medicare reform law were also surfing the new website last week. And like Pauline Rubin, they found that the Bush administration’s forecast of savings of 10% to 25% for those who sign up seems to be more hope than reality right now.

Critics, including Democrats and several organizations that favored a stronger government-run approach to prescription drug coverage, last week revisited the debate that took place before passage of the Medicare bill last November. They did so by comparing prices for drugs offered through card programs with prices available to U.S. government agencies, which purchase drugs in bulk and receive sharply discounted prices. They also compared prices available through the card program with prices for drugs purchased in Canada. (Currently, only seniors who travel to Canada may legally buy and import a limited quantity of prescription drugs for their own use. And in adopting the Medicare bill, Republican lawmakers rejected a bid to allow a single purchasing entity to bargain on seniors’ behalf, choosing instead to let commercial organizations offer card programs to Medicare beneficiaries.)


In both cases, drugs available through the prescription-card programs were priced higher. One report, prepared by the staff of Democrats on the House Committee on Government Reform, found that a market-basket of prescription drugs bought through the new Medicare card program would cost, on average, 72% more than if they were bought in Canada, and 75% more than if they were bought by the federal government for use in military and veterans’ hospitals and clinics.

With neither of those options available to most American seniors, one of the most striking cost comparisons turned out to be between drugs offered by the Medicare-approved card plans and those available to almost any savvy shopper. Two groups -- and the House reform committee’s Democratic staff -- found that, in many cases, a senior could get the same price or better by ordering drugs from wholesale suppliers of drugs such as and, which can be used by any consumer with a doctor’s prescription. That was particularly true if a consumer used generic drugs instead of brand names.

The Department of Health and Human Services cautioned last week that such comparisons are not only premature, but they also miss a key point about seniors -- that many would rather buy their medications from a local pharmacy, where they can consult in person with a pharmacist they know.

Julie Schoen, an attorney in the Santa Ana office of the Health Insurance Counseling and Advocacy Program (HICAP), said that when her organization’s staff and volunteers used the Medicare website to help seniors compare card programs last week, three card companies came up most frequently, and drug prices didn’t seem to vary much. Her office is advising seniors to wait a few weeks and compare prices after more information is available on the website. “We hope there’ll be bigger changes in drug prices across the board, but we’ll monitor that,” she said.

HICAP volunteer Rick Pace counseled puzzled seniors calling in by phone last week.

“For a government website, yes, I think they’ve done a pretty good job,” he said. But for computer-wary seniors -- many of whom seemed to think there is a single card for which they must sign up -- the multitude of choices presented by the new program is confusing.

“They just get so overwhelmed by it,” Pace said. “You hit ‘enter’ and then, boom! You get several pages of information.... They say, ‘Oooh! That’s too much!’ ”


To seniors like Pauline and Charles Rubin, the side-by-side comparison of prices from different outlets also misses a more important point: Prices for prescription drugs have risen so steeply in recent months and years that one can’t help thinking, as Charles Rubin put it, that “this is a hijacking ... by the drug companies.”

According to Families USA, a healthcare watchdog group, the prices of the 50 prescription drugs most frequently used by the elderly rose 6% in 2002 -- or 3.4 times the rate of inflation that year. The Rubins say that in the last four months or so, the price of two of their regular prescription drugs has jumped by almost 25%.

“They say you could save up to 30%, but the drug companies have covered themselves: They’ve gone up 40%” to compensate, Pauline Rubin says.

Among the first urged to sign up for the card programs are seniors with incomes less than $12,569 (or $16,862 for married seniors), who in the 18-month life of the drug-card program will receive a $1,200 credit toward their prescription drugs. CMS estimates that about 643,000 Californians are eligible to receive the credit, as well as a waiver of any enrollment fee.

In an $18-million advertising campaign designed to inform beneficiaries about the new cards, the Department of Health and Human Services is stressing -- in English as well as Spanish -- the benefit for low-income seniors.