Douglas against Medicare drug plan late penalties

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(Host) The Douglas Administration is strongly backing new efforts in Congress to eliminate financial penalties for people who sign up late for the new Medicare Drug plan.

State officials believe the penalties will discourage people from participating in the program in the future.

VPR’s Bob Kinzel reports:

(Kinzel) May 15th was the deadline for individuals to sign up for the program.

People who sign up after the deadline face financial penalties. These penalties increase their premiums by 1% for every month after May 15th that they sign up.

So an individual who signs up a year from now will pay a monthly premium that is 12% higher than a person who joined the program by the deadline. The average monthly premium is roughly $30.

Joan Senecal is the deputy commissioner of the Department of Disabilities, Aging and Independent Living.

She says about 30,000 eligible Vermonters still haven’t signed up and she says the elimination of the penalties would be a big help in encouraging these individuals to join:

(Senecal) “There are a lot of folks that needed help. They probably couldn’t get through on the phone lines. They still want to enroll, so being able to give them time to get the help they need and make the decision about enrolling without facing a penalty would be an enormous benefit.”

(Kinzel) Michael Sirotkin represents the Community of Vermont Elders.

He says roughly 50% of the Vermonters who are eligible for the program haven’t signed up because it’s too confusing and he thinks it’s critical to eliminate the penalty.

(Sirotkin) “This is a healthy benefit for Medicare recipients. They should be trying to take advantage of it but a take up rate of less than 50% indicates that there’s something systemically wrong with the program and people need more time to understand it. Probably more important, the program ultimately needs to be simplified. There shouldn’t be 44 choices.”

(Kinzel) Congressman Bernie Sanders is co- sponsoring legislation to eliminate the penalty – he thinks there’s a good chance that the bill will pass in the next few weeks:

(Sanders) “This is something that some of us have been talking about for quite a while now the need to lift that penalty fee. The good news is now is that some of the Republicans in the Senate are now beginning to say exactly the same thing. And I think with an election coming up in 6 months you’re going to see more and more Republicans coming on board and I think we have a reasonable shot to eliminate that penalty and that’s exactly what we should be doing.”

(Kinzel) Last month President Bush said he was opposed to any plan to eliminate the penalties but this week a spokesperson for the Administration said the proposal was now “under review.”

For Vermont Public Radio I’m Bob Kinzel in Montpelier

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