Poor older Americans are missing out on government aid

McClatchy NewspapersApril 12, 2007 

WASHINGTON—Medicare's low-cost prescription drug coverage for needy senior citizens has been universally hailed as a model of compassionate public policy.

But volunteers and counselors who help people apply for the special coverage are having a tough time locating the remaining eligible people.

Of the estimated 4.4 million Medicare beneficiaries that lack prescription drug coverage, nearly 75 percent, roughly 3.3 million people, are believed to be eligible for Medicare's low-income prescription drug subsidy, according to federal data.

It's the latest episode of a recurring problem that has frustrated government officials, researchers and advocates for the poor for decades.

Each year, millions of struggling older Americans leave untold billions in government assistance on the table for no apparent reason other than a failure to enroll in the programs. Some of the benefits can amount to less than $50 a month. Others, such as the Earned Income Tax Credit and the Medicare subsidy, can be worth thousands of dollars and can help lift families out of poverty.

One of the most generous of all federal assistance programs, Medicare's drug subsidy pays between 85 percent and 98 percent of prescription costs for low-income seniors. Depending on a person's drug needs, the coverage could provide savings worth more than $3,700 a year, according to the Social Security Administration, which determines eligibility.

Automatic enrollments, direct mailings, phone calls, public service announcements and community outreach efforts have helped nearly 10 million people get the subsidy.

Yet, the remaining 3.3 million eligible seniors are proving to be an exceedingly tough group to reach.

Federal need-based programs have never been fully utilized by those who qualify for assistance, but participation rates for seniors in those programs appear to be lower than for other groups.

For example, about 60 percent of people eligible for food stamps get the benefit. But the rate among food-stamp-eligible seniors is only 30 percent, according to the National Council on Aging.

In addition, only 13 percent of eligible seniors are enrolled in a program that covers Medicare's entire Part B premium for low-income beneficiaries, the Congressional Budget Office estimated. The value of that benefit is $1,122 for 2007.

While the problem is well documented, it's not very well understood. Some seniors simply don't know about the programs. Some find the enrollment process too confusing or cumbersome. Others may be too proud to accept what they consider a government handout.

In a 2006 memo to Medicare Administrator Leslie Norwalk, Health and Human Services Inspector General Daniel R. Levinson said legislation is needed to allow the Internal Revenue Service to share earnings data with Social Security and Medicare officials. This would help target enrollment information to seniors who might be eligible for the subsidy.

Rep. Lloyd Doggett, D-Texas, recently introduced legislation to do just that. The bill is supported by the AARP, the aging council, the Center for Medicare Advocacy and a host of other groups. More than 160 House Democrats have signed on as co-sponsors, but no Republicans have.

"I expect it will enjoy some bipartisan support when voted upon, but our attempts to secure bipartisan sponsorship in the House have not yet been fruitful," Doggett said.

Republicans, who designed the Medicare drug benefit, have long been reluctant to tinker with the program. At a recent hearing on the low sign-up rates, Sen. Larry Craig, R-Idaho, questioned the appropriateness of "distributing IRS information for purposes of marketing a voluntary program."

"Isn't that a little bit of Big Brother and a step too far?" Craig asked.

But the Medicare Modernization Act, which established the drug benefit, already allows the IRS to share income data with Social Security to determine how much affluent Medicare recipients will pay toward their Part B premiums.

"At some point, it becomes the personal responsibility of the individual" to sign up, Craig added.

But that isn't always easy for seniors, particularly those with modest incomes, limited support and no Internet access. In addition, some 23 percent of Medicare beneficiaries have cognitive impairments, 29 percent live alone and 29 percent are in fair or poor health.

To qualify for the Medicare drug subsidy, seniors must have incomes that are less than 150 percent of the federal poverty level for their household size. In 2007, that's $15,315 for an individual and $20,535 for a couple. In addition, an applicant's total assets must be less than $11,710, or $23,410 for a married couple.

Of the more than 5.9 million who applied for the special coverage, only 2.3 million were approved. The agency denies about 41 percent of applicants because they exceed the program's personal asset limits.

Doggett's proposal would also increase the asset limit for individuals to $27,500 and to $55,000 for couples. Companion legislation was introduced Thursday in the Senate by Jeff Bingaman, D-N.M., and Gordon Smith, R-Ore.

Under the benefit, those with the least resources get full coverage with no monthly premium, no annual deductible and no prescription co-payments. Others pay reduced co-payments of about $2 to $5, but no premiums or deductibles. Still others pay a sliding-scale monthly premium, a $53 deductible and 15 percent of all prescription costs.

"It's not that difficult to enroll them," said Bria Barker Lewis, who manages the Medicare/Medicaid Assistance Program for the Detroit Area Agency on Aging. "The issue is just to find them and get them to understand what the benefits are, then it sells itself."

Lewis' program is part of a national network of State Health Insurance Assistance Programs that helps low-income Medicare recipients apply for the subsidy. Since December 2005, Lewis' program has helped 1,218 Detroit-area seniors, including Roy Hicks, get the special coverage.

A former factory worker, Hicks, 63, was forced to retire because of heart problems. He used to pay about $120 a month for his blood pressure, cholesterol and heart medications under a private health plan. But by 2000, his costs had doubled to more than $200 a month. Hicks tried to cut costs, but his health began to suffer.

"My blood pressure was getting extremely high because I was skipping doses and cutting the pills in half," Hicks said. "It was just terrible. The bottom was beginning to fall out. ... Actually I was looking to die. I really was."

After he was hospitalized several times, Hicks' wife contacted the Detroit Area Agency on Aging, which helped him apply for the Medicare subsidy. Hicks now pays about $2 to $3 per prescription, and his most expensive heart medication is only $9.

He credits the Medicare program for helping to save his life. "It was my last hope and the Lord just blessed me," Hicks said. "It has been a great help to me."

To apply for Medicare's low-income prescription drug subsidy and other federal assistance programs for the needy, go to the benefit check-up Web site of the National Council on Aging at www.benefitscheckup.org

To help seniors apply for the Medicare low-income subsidy, contact a local State Health Insurance Assistance Program at www.hapnetwork.org/ship-locator/

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(c) 2007, McClatchy-Tribune Information Services.

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McClatchy Newspapers 2007

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