PRESCRIPTION DRUG COVERAGE IN TRADITIONAL MEDICARE

WHEREAS, Americans over age 65 are nearly 13 percent of the U.S. population but account for 34 percent of all prescriptions dispensed and 42 cents of every dollar spent on prescription drugs; and

WHEREAS, the Medicare program has provided secure, universal and affordable healthcare coverage for Medicare beneficiaries for 45 years; and

WHEREAS, the Medicare Modernization Act (MMA) of 2003 created a prescription drug benefit provided through stand-alone drug plans or Medicare Advantage-managed care plans administered by private insurers and not the Medicare program; and

WHEREAS, Medicare beneficiaries without other drug coverage will pay a late enrollment penalty of 1 percent on their premiums for each month they do not enroll; and

WHEREAS, many "dual eligibles—those who are both Medicare and Medicaid beneficiaries—are worse off because they have lost better state Medicaid drug benefits and are auto-enrolled in Part D plans that do not cover all their medication needs; and

WHEREAS, the coverage gap (also known as the donut hole) is $3,610 in 2010, and in 2007, an estimated 3.4 million Part D enrollees (14 percent of all enrollees) reached the coverage gap; and

WHEREAS, the health reform law will reduce the amount that Medicare Part D enrollees are required to pay for their prescriptions when they reach the coverage gap, gradually phasing in different levels of subsidies for brand-name and generic drugs in the gap beginning in 2011:

RESOLVED, that the American Federation of Teachers work to see that the Part D prescription drug benefit should be provided through and administered by the traditional Medicare program, just as Medicare Parts A and B are administered by Medicare;and

RESOLVED, that to ensure effective cost containment, the AFT work to effect the repeal of the prohibition against Medicare negotiating drug prices and work to require the Secretary of Health and Human Services to negotiate prices with pharmaceutical companies.