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Obamacare Blamed by Seniors for High Costs, Medicare Changes

More than half of senior citizens surveyed mistakenly attributed rising costs of their medicines to Obamacare, according to Express Scripts Holding Co. (ESRX), a misunderstanding that is contributing to the law’s unpopularity.

While the Affordable Care Act lowers drug costs for Medicare recipients who fall into a coverage gap and provides certain vaccines and preventative screenings for free, about half of those surveyed are cutting back spending on food, travel and health care in anticipation of higher medical expenses, according to the survey released today by St. Louis-based Express Scripts, the biggest U.S. processor of prescriptions.

Medicare has been providing taxpayer-funded health care to the elderly since 1965, while the 2010 Affordable Care Act targets working-age adults. A major provision of the new law is the creation of insurance exchanges where people under 65 years old can buy coverage starting Oct. 1. About 20 percent of seniors surveyed thought they would be able to shop on the exchanges.

“They don’t understand that Medicare is different and isn’t really changing with the exception that there has been a move to preventative care and more use of medications,” said Rebecca Rabbitt, vice president of government programs at Express Scripts. “That message has been lost, if not absent, from a lot of the dialogue.”

Largest Overhaul

The $1.3 trillion Affordable Care Act is the largest regulatory overhaul of health care since the debut of Medicare in the 1960s. Kathleen Sebelius, the U.S. secretary of Health and Human Services, and other Obama administration officials have said that Republican lawmakers opposed to the law have been contributing to “misinformation.”

For many seniors with Medicare, the law will save them money rather than increase their costs, Rabbitt said. By 2020, the so-called doughnut hole, a gap in prescription drug coverage that increases out-of-pocket costs, will be eliminated and is already being reduced. The law also includes free preventative care like certain vaccines and screenings, Rabbitt said.

More than 6.6 million Medicare beneficiaries saved more than $7 billion on their prescription drugs since the law was enacted, the Department of Health and Human Services said in July. The law requires drugmakers to discount covered brand-name Part D medicines sold to beneficiaries in the coverage gap and provides subsidies for the covered therapies to those beneficiaries that rise to 25 percent in 2020 from 2.5 percent in 2013.

Skipping Care

Yet 20 percent said they are skipping doctor appointments and delaying medication refills in anticipation of higher costs, the survey found. Almost half are considering temporary employment to help cover new expenses.

Though the law makes no changes to Medicare eligibility or enrollment, about one-third of seniors mistakenly believe it raises the eligibility age, the survey found. About 17 percent said it was likely the exchanges would replace Medicare.

The supporters of the law have focused on getting information out to those without insurance who will be required starting Jan. 1 to buy coverage or pay a penalty. The supporters have particularly targeted the young and healthy, who need to enroll in insurance to help offset costs from older, sicker populations expected to flood the markets.

Express Scripts commissioned the survey in August of more than 1,000 seniors enrolled in Medicare or who will soon be eligible for the program.

To contact the reporter on this story: Shannon Pettypiece in New York at spettypiece@bloomberg.net

To contact the editor responsible for this story: Reg Gale at rgale5@bloomberg.net

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