Large Majority of Seniors Who Qualify Fail to Sign UP for Medicare Rx Drug Benefit.

The Medicare Prescription Drug Health Insurance Benefit introduced several years ago was widely hailed as a great example of a federally funded low-cost health insurance plan that can work. Yet despite the low-cost prescription drug benefit being widely advertised and promoted, it seems that a vast majority of seniors who qualify and can really use the assistance, have not taken advantage of it.

According to estimates, while direct mail campaigns, advertising, public service announcements, and automatic enrollment have gotten about 10 million seniors who qualify to sign up for the medical benefits, 75% of those who qualify have failed to sign up. It is an ongoing problem with many federally funded programs, often millions who qualify for a given benefit, do not take advantage of it, simply because they are not aware of the entitlement, or are unsure about how to obtain it – leaving behind untold billions of dollars earmarked to help them.

The Medicare Prescription Drug Benefit is one of the most generous supplemental insurance benefits programs ever initiated by the government. Under the health insurance plan Medicare will pay for 85-93% of the cost of prescription drugs for low-income seniors. According to the Social Security Administration that can amount to almost $4000.00 for some seniors. Yet, it has been difficult to reach more than 3.3 million low-income seniors who could receive the benefit, and are not.

No Federally funded need-based assistance program is ever 100% utilized, but it seems traditionally seniors who qualify for such programs do not participate at a far greater rates than other groups. For example while 60% of those who qualify for food stamps sign up and receive the benefit, only some 30% of seniors who qualify for food stamps obtain them. Similarly, according to the Congressional Budget Office only about 13% of qualified seniors are enrolled in a health insurance program that will cover 100% of their Medicare Part B premium.

While the phenomenon is well known, it is not easy to explain. But health benefit experts suggest it is a combination of seniors who are just not aware of the programs, those that feel the application process is too confusing or difficult, and those that are of a generation that looks down on what they see as a “Government Handout”.

Democratic Representative Lloyd Dogett of Texas has recently introduced a bill that can help. Under the proposed legislation the IRS will be given permission to share income data with the Social Security Administration that determines eligibility for the prescription drug benefit program. It is hoped in this way the SSA could contact those that qualify, or even enroll them automatically. The measure has bi-partisan support and the support of several senior advocacy groups including the AARP.