Medicare Prescription Drug Provisions of S. 1, as Passed by the Senate, and H.R. 1, as Passed by the House

Publication Date: July 2003

Publisher: Library of Congress. Congressional Research Service

Author(s):

Research Area: Health

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Abstract:

On June 27, 2003, the Senate passed the Prescription Drug and Medicare Improvement Act of 2003 (S. 1) by a vote of 76-21. Later that same evening, the House passed the Medicare Modernization and Prescription Drug Act of 2003 (H.R. 1) by a recorded vote of 216 - 215 with 1 voting present.

Title I of both bills would add, effective January 1, 2006, a new prescription drug benefit for Medicare beneficiaries under a new Medicare Part D. Both bills would rely on private plans to provide the benefit and assume some of the financial risk. Both measures would be designed to assure access to plans in all areas; increased federal assistance would be authorized where necessary to encourage participation. The Senate bill, but not the House bill, would include a fallback mechanism in areas where private plans were not available. Under the fallback mechanism, Medicare would contract with a private plan to provide the benefit in the area; the plan would not be at financial risk, except for a small portion of management fees tied to performance.

Both S. 1 and H.R. 1 would require plans to provide "standard coverage" or "actuarially equivalent coverage" (i.e., a package with the same dollar value); however, the definition of standard coverage is quite different between the two. Both measures would provide additional assistance to the low-income. In addition, both bills would establish a temporary drug discount card endorsement program under which the Secretary would endorse card programs offered by prescription drug card sponsors meeting certain requirements; these programs would be discontinued after Part D was implemented.

There are considerable differences in the specifics of the prescription drug provisions in S. 1 and H.R. 1. These differences are at issue in a pending conference between the two Houses.

This report provides a side-by-side comparison of the Title I provisions of both bills. It will be updated as events warrant.