Wyden, Snowe Urge HHS Secretary Leavitt to Support Extension of Medicare Drug Benefit Deadline Without Penalty
Senators Send Letter to Secretary Today;Deadline for Seniors to Sign Up for Part D is Set for May 15th, Just Over a Month Away
Washington, DC - Today, U.S. Senators Ron Wyden (D-OR) and Olympia J. Snowe (R-ME), both members of the Senate Finance Committee, urged Health and Human Services (HHS) Secretary Michael Leavitt to support an extension without penalty of the enrollment period for those seniors signing up for the Medicare Drug Benefit through December 31st of this year. The Senators are concerned that without an extension, the cost to seniors could be devastating, leading many to not sign up for the benefit and undermining the program as it gets off the ground. The deadline for signing up is May 15th. "It's time to get the drug benefit on track," said Wyden. "The Administration needs to step up and make the benefit work for seniors, instead of trying to earn a buck off of seniors. By extending the deadline, we can ensure that seniors have the chance to get more affordable access to prescription drugs." "If this Medicare drug benefit is to meet its goal of helping our nation's seniors, then it only makes sense to extend the deadline through December 31st without a penalty," said Snowe. "The potential impact of inaction could be great. We need to ensure that as many seniors sign up for this program as possible - that would lead to a stronger, healthier benefit with a bright future. I know that the Administration wants to ensure that this program is an overwhelming success - as I do - but unless we take some common-sense steps like extending the deadline, the public's confidence in the program could be disastrously undermined." The Senators note that while the Congressional Budget Office (CBO) estimates that the cost of extending the enrollment period without penalty through December 31 will reach $3.4 billion over ten years, this primarily represents lost revenues to the federal government from seniors having to pay late enrollment penalties. CBO also reported that extending enrollment would shift the current risk pool from a relatively high risk to a lower risk profile, as an additional estimated 1.1 million lower risk individuals enroll. This helps avoid adverse selection, and ensures the sustainability of Part D. The following is the full text of the letter Snowe and Wyden sent to Secretary Leavitt today: The Honorable Michael Leavitt Secretary U.S. Department of Health & Human Services 200 Independence Avenue, S.W. Washington, D.C. 20201 Dear Secretary Leavitt: We are writing to express our concern regarding the imminent deadline for Medicare Part D enrollment which confronts America's seniors. As you know, beneficiaries who enroll after May 15, 2006 face a penalty of one percent per month in the cost of their monthly Part D premiums. We are pleased to see so many benefit from assistance with the high cost of medications. Making a prudent enrollment choice takes time, and it is clear that the implementation of the Part D benefit relied upon resources which seniors either do not have, or are reluctant to use. Beneficiaries predominately require personal assistance requiring more time and resources than can be offered by May 15. It is unfair that seniors should be penalized for the complexities and problems which have plagued the implementation. Maintaining the existing deadline would impose a great cost on our seniors. The Congressional Budget Office estimates the cost of extending enrollment without penalty through December 31 will reach $3.4 billion over ten years. This primarily represents lost revenues from the permanent penalties which would otherwise be imposed upon America's seniors. Many seniors who fail to enroll by May 15 will question whether the complexity of this program was designed to their detriment, when they find themselves ensnared in late enrollment penalties for life. The finding that the generation of substantial late enrollment revenues from seniors appears to be a part of the HHS budget forecast is troubling indeed. Part D was designed to help Medicare beneficiaries, not generate budget revenues through such penalties. An unreasonable deadline has another cost as well. CBO has told us that extending enrollment would shift the current risk pool from a relatively high risk to a lower risk profile, as an additional estimated 1.1 million lower risk individuals enroll. This helps avoid adverse selection, and ensures the sustainability of Part D. That sustainability is crucial, and broad participation by seniors is essential to both realize the great potential of a prescription drug benefit and to maintain fiscal responsibility. While a deadline for enrollment is necessary, it must be a realistic one. We urge the Administration to support an extension of the enrollment period without penalty through December 31. Sincerely, OLYMPIA J. SNOWE RON WYDEN United States Senator United States Senator
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