HARRISBURG Bill to expand state drug-coverage plan

Passage of state and federal drug bills raises questions about coverage.
HARRISBURG (AP) -- While the U.S. Senate made history Tuesday by approving a prescription-drug benefit for Medicare, politicians in Harrisburg celebrated the state Senate's passage of a bill to expand a state program that provides low-cost prescription drugs to elderly, low-income Pennsylvanians.
State officials have not determined whether senior citizens will have to choose between the state and federal programs or whether they could receive benefits from both.
The bill that the state Senate sent to Gov. Ed Rendell will widen eligibility for the state programs, the Pharmaceutical Assistance Contract for the Elderly and a companion program called PACENET. It would become effective Jan. 1, boosting the number of low-income senior citizens enrolled in the program from 224,000 to an expected 324,000. Rendell said he plans to sign the measure today.
Federal bill
President Bush plans to sign the federal bill, which represents the most sweeping change to Medicare since it was created in 1965 and will benefit 40 million older and disabled Americans.
It will be phased in through 2006 and could mean that the PACE and PACENET programs will change again.
For instance, if some PACE or PACENET participants jump to a Medicare drug plan, it would free up state dollars that could be used to further expand eligibility for the state programs.
Or the newly available state money could be used to plug holes in Medicare coverage.
"It's going to take awhile to sort this out and figure out where we're going to reach common ground," said Tom Snedden, the director of the state's PACE and PACENET programs.
Paul Feenstra, a spokesman for U.S. Rep. John Peterson, R-Pa., said that the federal law was written so that state benefit programs, such as PACE, could fill in gaps in Medicare coverage.
PACE/PACENET
Tuesday's Senate vote for the PACE/PACENET bill was unanimous.
The expansion was made possible by PACE/PACENET surpluses; new lottery games such as Powerball and scratch tickets that have increased funding for the programs; and provisions in the bill that demand manufacturers, pharmacies and some participants to shoulder more of the cost.
Of about 2 million residents 65 and older in Pennsylvania, about 1 million will be eligible for PACE and PACENET benefits under the bill, while some 600,000 qualify now, Snedden said.
PACE and PACENET do not enroll every eligible senior because some seniors do not use prescription drugs, and some are covered through retirement plans or other prescription-drug plans, Snedden said.
The new income limits for participants in PACE, which has no deductible, would increase from $14,000 to $14,500 for individuals and from $17,200 to $17,700 for married couples.
The new income limits for PACENET, a related program for seniors with higher incomes, would change from $17,000 to $23,500 for individuals and from $20,200 to $31,500 for couples.
Additionally, the $500 annual deductible that participants must pay to receive the benefit would changed to $40 per month.
To help pay for the increased benefits, the PACE copayment amount would increase from $6 to $9 per prescription for name-brand drugs, but the $6 copayment for generic drugs would remain intact. PACENET participants have a higher copayment -- $8 and $15, respectively -- that would not change.