FOR IMMEDIATE RELEASE
June 11, 2010
Contact: HHS Press Office
HHS Secretary Sebelius Urges Vermont Governor Douglas to Maintain Current Benefits for Vermont’s Seniors
WASHINGTON, DC - U.S. Department of Health and Human Services Secretary Kathleen Sebelius today urged Vermont Governor Jim Douglas to reconsider plans to reduce state benefits to seniors who are enrolled in the state’s VPharm supplemental prescription assistance program, in response to the new Medicare Part D rebate checks.
“The rebate checks are intended to provide fiscal relief to seniors, not states,” said Secretary Sebelius in a letter today to Governor Douglas. “Seniors who enter the “donut hole” have serious illnesses, take more medication, and need additional financial help. They have extremely high out-of-pocket costs; for example, they must personally spend at least $2,830 to qualify for rebate checks in 2010.”
The tax-free federal $250 rebates are being mailed to seniors who enter the Medicare Part D “donut hole” this year, as a first step in closing the coverage gap under the Affordable Care Act. The first federal rebates were mailed to seniors who have fallen into the Medicare Part D “donut hole” yesterday. About 9,000 Vermont seniors are expected to receive the rebate this year.
The text of the letter is below:
June 11, 2010
Hon. James H. Douglas
State of Vermont
109 State Street, Pavilion
Montpelier, VT 05609-0101
Dear Governor Douglas:
This week, the Department of Health and Human Services (HHS) sent the first one-time, tax-free $250 rebate checks to eligible Medicare beneficiaries nationwide who have entered the Medicare Part D coverage gap – referred to as the “donut hole.” The Affordable Care Act (ACA) authorizes these rebates for all beneficiaries in the donut hole except those who have their prescription drug expenses in the coverage gap covered by the low-income subsidy known as Medicare Extra Help. Congress intended these checks to be the first steps towards phasing out the coverage gap by 2020. This is a critically important benefit given the number of Medicare beneficiaries with high prescription drug costs. Last year, roughly 8,920 Medicare beneficiaries in Vermont hit the donut hole, and a similar number are expected to hit it in 2010.
Some states, like Vermont, have established state-only programs that provide supplemental pharmaceutical coverage to low-income Medicare beneficiaries who are not eligible for Medicaid assistance. The Administration applauds Vermont’s leadership in this effort. However, we understand that Vermont is considering reducing these state benefits in response to the new Medicare Part D rebate checks. I ask you to reconsider this action.
Seniors who enter the “donut hole” have serious illnesses, take more medication, and need additional financial help. They have extremely high out-of-pocket costs; for example, they must personally spend at least $2,830 to qualify for rebate checks in 2010. In addition, Vermont’s pharmaceutical program (VPharm) requires beneficiaries to pay premiums and does not cover all of seniors’ drug costs. Many individuals are responsible for co-payments, and certain drugs are excluded from coverage for some beneficiaries.
There is no doubt that states face significant financial pressure this year. So do our most vulnerable Medicare beneficiaries. The rebate checks are intended to provide fiscal relief to seniors, not states. I urge you to reconsider reducing benefits under VPharm as a means of alleviating budget constraints.
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Last revised: May 7, 2011