Medicare Part D squashes charity drugs

The government decision is expected to add to seniors' confusion about the new drug benefit.

By David Glendinning, AMNews staff. Dec. 12, 2005.

Washington -- Millions of low-income seniors and disabled people have come to rely on free or discounted medications offered by drug companies through their patient assistance programs. With the start of the Medicare drug benefit less than a month away, this might be about to end.

The Dept. of Health and Human Services Office of Inspector General recently released a special advisory bulletin that puts new restrictions on how drug firms can give away medications to Medicare beneficiaries. If a senior who has been getting free drugs directly from a manufacturer signs up for the new Medicare drug benefit, he or she no longer will be able to accept charity prescriptions.

If seniors accept both drug donations and Medicare-subsidized drugs, they run the risk of inadvertently participating in what the government would view as a kickback scheme designed to enrich drugmakers, the OIG stated.

Patient assistance programs offer drugs made by the sponsoring companies. The agency argues that if drug firms fill gaps in the Medicare benefit, it could drive seniors to use certain medications. When federal coverage kicked in, the government would be left footing a potentially larger bill.

The ruling threatens to cut off a source of drug assistance on which many Medicare-eligible people have come to rely, said Ken Johnson, senior vice president of the Pharmaceutical Research and Manufacturers of America. The OIG rules generally make it more difficult for these programs to help low-income Medicare beneficiaries, he said.