Our health care system costs too much, wastes too much, makes too many mistakes and gives us back too little value for our money. That’s why AARP, on behalf of our 40 million members, believes Congress must pass health care reform that provides all Americans with affordable health care choices.
AARP is calling on Congress and the President to find common sense solutions this year that will lower prescription drug costs and provide affordable health choices to Americans age 50 to 64.
We believe any health care reform bill must address the following six priorities:
1) Guaranteeing access to affordable coverage for Americans age 50 to 64;
2) Closing the Medicare Part D coverage gap or "doughnut hole";
3) Creating access to generic versions of biologic drugs used to treat cancer and other serious diseases to reduce the price of these costly treatments;
4) Preventing costly hospital readmissions by creating a follow-up care benefit in Medicare to help people safely transition home after a hospital stay;
5) Increasing federal funding and eligibility for home and community based services through Medicaid so older Americans can remain in their homes and avoid more costly institutions as they age; and
6) Improving programs that help low income Americans in Medicare afford the health care and prescription drugs they need.
Coverage for People Age 50 to 64
Even before the recession began, the AARP Public Policy Institute says 7.1 million adults age 50 to 64 were uninsured in 2007 – 1.9 million more than in 2000 – a 36 percent increase in the number without coverage. Americans age 50-64, who will make up nearly 20 percent of the entire population by 2015, are being priced out of affordable health insurance. Unless we are able to provide this age group with access to affordable health insurance, the ranks of the uninsured will keep going up, and their costs will continue to skyrocket.
Since people develop health problems as they age, and people with insurance tend to be healthier, failing to provide affordable health care choices to people age 50 to 64 will mean they’ll be sicker and their coverage will cost more when they become eligible for Medicare.
That’s why AARP is calling on Congress to provide Americans age 50 to 64 with a choice of health care plans they can afford – even people with pre-existing conditions. We’re fighting to ensure that people in this age group can get adequate coverage for no more than 10 percent of their income (5 percent if they are low income), including both premiums and out-of-pocket costs.
Specifically, we are supporting two bills that would help people in this age group get the coverage they need. They include: the "Medicare Early Access Act of 2009" (S. 960) and the "Pre-existing Condition Patient Protection Act" (H.R. 1558).
The "Medicare Early Access Act of 2009" would allow Americans age 55 to 64 who can’t find affordable insurance to buy into Medicare. It would also provide a tax credit that would cover 75 percent of the cost of an individual’s premium, a critical part of making insurance affordable to people in this age group.
The "Pre-existing Condition Patient Protection Act" would prevent insurance companies from denying coverage to any individual with pre-existing conditions.
Closing the "Doughnut Hole"
Nearly 20 percent of people who get their drug coverage through Medicare delayed or did not fill a prescription because of cost – higher than any other insured group. That’s why AARP is calling on Congress to close the Medicare Part D coverage gap or "doughnut hole."
In 2007, 3.4 million people in Medicare fell into the "doughnut hole," meaning they’re responsible for their entire drug costs, but they still have to pay their Part D premium. Countless others skip taking their medications just to stay out of the hole. And, because drug prices continue to outpace inflation, the hole keeps growing larger.
AARP believes Congress should close the doughnut hole so people have more of their drug costs covered and aren’t forced to pay premiums while at the same time paying full cost for their drugs.
Lowering Drug Costs through Generic Biologics
Today, one in two Americans say someone in their family skipped pills, or postponed or cut back on needed medical care due to cost. This is especially true with biologic drugs, which are used to treat serious conditions like cancer, multiple sclerosis, anemia, and rheumatoid arthritis, but can cost $10,000 per month.
Generic prescription drugs save consumers and health care providers billions of dollars each year and 69 percent of all prescriptions filled in the U.S. are for lower cost generic prescription drugs. But unfortunately, no lower cost generic alternatives are available for biologic drugs. This means that companies can continue to charge unreasonable prices for their products long after their patents have expired.
That’s why AARP has endorsed the "Promoting Innovation and Access to Life-Saving Medicine Act" (H.R. 1427/S. 726).
The "Promoting Innovation and Access to Life-Saving Medicine Act" would create an FDA approval process—similar to that for traditional prescription drugs—for generic biologic drugs.
Cracking Down on Wasteful Spending with a Medicare Follow-Up Benefit
To put Medicare on stable financial ground and lower health care costs for people in Medicare, we must crack down on wasteful spending. We can start by providing follow-up care benefit in Medicare, which would help people transition home safely after a hospital stay preventing costly, unnecessary hospital readmissions. Such a benefit can help save some of the more than $17 billion Medicare spends on largely preventable hospital readmissions and significantly reduce the 20 percent of people in Medicare who are readmitted to the hospital within 30 days of their discharge.
The goals of the benefit, which would target the most at-risk individuals, would include delivering the services individuals need following a hospital stay so they don’t have to return, managing their medications and helping family caregivers with resources and support.
Long-Term Care (LTC)
Today, millions of Americans who want care at home are struggling; care is often uncoordinated and people frequently end up in costly institutional care settings. AARP believes all Americans should have the choice to get needed services and supports at home, since 89 percent of Americans 50+ say they want to remain in their own homes as long as possible.
Developing a better system for LTC and people with chronic conditions would save money, improve quality of life for individuals who need these services, and better enable them to live at home where they want to be.
Steps to improve long-term care include: removing certain income limits on home-and-community-based services (HCBS); increasing the federal match rate for home and community based services so that states can expand these programs; improving quality and coordination for individuals receiving both Medicare and Medicaid; and helping the 34 million family caregivers who support their loved ones.
AARP supports two bills that would improve access to long-term care, they include: the "Empowered at Home Act" (S.434) and the "Retooling the Health Care Workforce for an Aging America Act" (H.R. 468/S. 245).
The Empowered at Home Act would expand eligibility for services and provide states with additional federal money so more Americans could receive care at home.
Retooling the Health Care Workforce for an Aging America Act would provide training and support for family caregivers and improve training for the long-term care workforce.
Helping Low-Income Americans
The current patchwork of programs for the most vulnerable people in Medicare is so cumbersome that millions are not getting the help they need.
In fact, the programs are so complicated that 4 million people who need help with paying for their prescriptions can’t get it. And, two-thirds of those who are eligible for assistance with preventive care, which would help them avoid costly re-hospitalizations and unnecessary nursing home admissions aren’t getting the care they need because the process is too complicated.
Specifically, AARP believes Congress should eliminate the asset test, which penalizes those who did the right thing and built up a small retirement nest egg. We must also expand eligibility to more people with low incomes, standardize eligibility rules and strengthen efforts to inform our most vulnerable older Americans about these valuable assistance programs.