November 26, 2003 at 1:24 PM CST - Updated June 25 at 9:18 AM
The senate approved the new prescription drug benefit program for Medicare today. The $395 billion overhaul is the biggest expansion made to Medicare in 38 years. The plan is geared to making your prescriptions much cheaper. How much cheaper? We found out.
Anyone with more than about $800 a year in total drug spending should save under the new bill. This is how it will work. For the 15.4 million low-income seniors in America who have individual incomes below $13,055 and couples with incomes below $17,619, they'll pay no premium, no deductible, and pay only $1 to $5 dollars for prescriptions. The expected savings is $2600.
The standard deduction available to the 25 million other seniors who make more than the above-mentioned incomes works like this. You purchase drug coverage from a private health plan. You pay a $35 monthly premium for the card and have a $250 deducible. Then the card covers 75 percent of your drug costs. That's a savings of about $1500 a year.
None of this kicks in until 2006. So, in the meantime, seniors will be able to buy a prescription drug discount card. It will be available in April 2004. Here's how that will work. You buy the Medicare-backed discount drug card for $30 and it's estimated that card will save you 15 to 25 percent