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Medicare Drug Program News
Drug Costs Threaten to Crack Retirement Nest Eggs,
Tarnish Golden Years
One in three retirees say medical, drug costs far
outpace expectations, takes 10% of income for 25% - Medco offers free
help
Nov. 27, 2007 - Medical and drug expenses threaten
to shatter the retirement nest egg – scrambling even the best-laid
financial plans – according to a new nationwide survey of retirees, many
of whom concede that their under-estimation of the impact of escalating
health care costs has significantly compromised their lifestyle in the
“golden years.”
One in three retirees claim that they are spending
far more on their health care and prescription drugs than they expected,
and 55 percent of retirees admit completely overlooking their health
care and prescription drug needs when they were planning for retirement
expenses, according to new research released today by Medco Health
Solutions, Inc. (NYSE: MHS).
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Not only did a sizeable proportion of retirees fail
to properly plan for health care and prescription drug costs, but nearly
half of all retirees (49 percent) indicate they never assess the impact
health care costs are having on their retirement savings or lifestyle.
The research was culled from “America’s Unhealthy
Nest Egg,” a national survey of 1,000 Americans over age 65 conducted
for Medco by Directive Analytics.
“Retirees have planned for food, shelter, taxes and
entertainment, but too many neglect drug and medical costs – which are
rising far faster than the inflation rate –are jeopardizing the quality
of life they expect to enjoy during retirement,” said Sally Greenberg,
Executive Director, National Consumers League.
“The fact that many seniors have not planned for
increased health expenses, and the fact that many aren’t aware of ways
they may be able to save on their medications, shows a real need for
education about how to build a healthy nest egg.”
The Medco research revealed that for one in four
middle-income retirees, $1 out of every $10 of their monthly retirement
income goes to pay for medications alone.
Furthermore, fewer than half of retirees (48
percent) indicate that they use all of the tools at their disposal to
save money on their medications; and approximately one in four (24
percent) claim to use very few to no cost savings tools available to cut
their medication expenses.
“It’s a notable contradiction that retirees are
facing high drug costs, yet either are not aware of, or choose not to
use, the tools they have available to save,” said Donna DeNardo, senior
vice president, Retiree Solutions, Medco. “Now, more than ever, retirees
are nervous about outliving their ability to afford the escalating costs
of living well.”
In addition to the impact of monthly drug expenses,
the survey also revealed a surprising lack of awareness among retirees
of specific cost-savings tools:
● Discussions with doctors lacking:
Nearly half of retirees stated they infrequently or never discuss with
their doctors ways to save money on their medications; previous research
has shown that doctors are likely to prescribe generic drugs when asked
by patients.
● Savings left out in the cold: Three
out of four retirees (76 percent) indicated they were aware of the cost
savings benefits of getting their drugs from a mail order pharmacy, but
only 40 percent actually use the tool to save money on their
medications.
● Few know about dose optimization: A
miniscule 13 percent of retirees indicated they were aware they could
take fewer pills or capsules at a higher dose to reduce the number of
pills or capsules they would have to buy – an approach known as dose
optimization.
● Women, Northeasterners spending more than
anticipated: The impact of health care and prescription drug costs
on retirement savings is far more acute in the northeast, where 45
percent of seniors are spending more than they anticipated, compared to
only 27 percent of retirees in the western part of the nation. Retired
women are 52 percent more likely than men to indicate they are spending
more than they anticipated.
● Mixed bag on Medicare: According to
the survey, 40 percent of seniors who have reviewed Medicare plans
indicated that their primary factor for choosing a plan is premium
price, while only 15 percent consider the range of drugs offered.
Despite the attention devoted to discussion around the coverage gap in
Medicare, only 7 percent of seniors indicated that such a benefit would
be a deciding factor in their plan choice.
“Prescription for a Healthy Nest Egg:”
Medco Launches National Push to Educate Retirees
on Hidden Drug Savings
Medco also unveiled today a multi-level initiative
aimed at educating retirees about tools to unlock hidden savings that
they can use to reduce their prescription drug expenditures.
The program, “Prescription for a Healthy Nest Egg”
will provide retirees with information about the savings opportunities,
where to look for hidden savings, and how much these tools could
eliminate from their drug bill.
“The symptoms have been diagnosed; the prescription
to cure this problem is information and education,” said Denardo. “We
have to reach out to retirees to encourage them to use all the tools
they have to save, and to educate them about savings tools they may not
even know exist, so that they can protect that nest egg they’ve spent
years building.”
Free help to lower your drug costs
As part of the initiative, Medco has developed a
free consumer’s guide called “Prescription for a Healthy Nest Egg: Half
a Dozen Ways to Lower Your Drug Costs and Stretch Your Retirement
Dollar.”
The free guide presents easy-to-understand
information on savings tools that are largely unknown or underutilized
by retirees including generic alternatives; optimizing dosages; and
eliminating overlapping medications from different doctors.
The Guide
is available free to consumers in a downloadable version at
www.medicaredadvisor.com, or just
click here to download pdf version.by sending a postcard requesting
the Guide to “Prescription for a Healthy Nest Egg”, PO Box 8007
Parsippany, NJ 07054-8007.
About Medco
Medco Health Solutions, Inc., (NYSE:MHS) is the
nation’s leading pharmacy benefit manager based on its 2006 total net
revenues of more than $42 billion.
Medco’s prescription drug benefit
programs, covering one in five Americans, are designed to drive down the
cost of pharmacy healthcare for private and public employers, health
plans, labor unions and government agencies of all sizes, and for
individuals served by the Medicare Part D Prescription Drug Program.
Medco, the world’s most advanced pharmacyTM, has created Medco
Therapeutic Resource CentersTM that are staffed with hundreds of
specialist pharmacists who are trained and certified in specific chronic
and complex conditions and have expertise in the associated medications.
With the 2007 acquisition of Liberty Medical, Medco
is the nation’s largest diabetes pharmacy care practice based on covered
lives. Medco is the largest specialty pharmacy based on net revenues
with the 2005 acquisition of Accredo Health Group, Inc. Medco is also
the highest-ranked independent pharmacy benefit manager on the 2007
Fortune 500 list. On the Net: http://www.medco.com.
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