WASHINGTON—With pressure mounting to extend next Monday's enrollment deadline for the Medicare prescription-drug benefit, the Bush administration took another small step in that direction Tuesday, waiving penalty fees for very low-income seniors and people with disabilities who sign up late.
Officials determined that collecting the fees from poor beneficiaries would cost more than the penalties themselves.
To be eligible, individual Medicare beneficiaries must have annual incomes below $14,700 and assets worth no more than $11,500. For couples, the income limit is $19,800 and the asset limit is $23,000.
The move follows a recent administration decision to allow the same impoverished beneficiaries to sign up for Medicare drug coverage until Dec. 31.
"In other words, you can apply after May 15th without penalty. And that's important for low-income seniors to understand," President Bush told a group of older Americans in Sun City Center, Fla., on Tuesday.
The step does little to quiet the growing call for Bush and the Republican-led Congress to extend the enrollment deadline and waive late fees for the general Medicare population. Seniors joined by Democratic lawmakers and a host of advocacy groups will hold a protest rally Wednesday on Capitol Hill to repeat their call for that.
Despite rumors that Republican lawmakers would seek such changes this week, Bush administration officials oppose the move and are crossing the nation this week urging procrastinating seniors to enroll before Monday.
"We want everybody to sign up; we want people to understand that there are really good benefits for seniors," the president said in Florida.
Except for the very low-income group, those who wait longer to sign up for a Medicare drug plan will pay an additional 1 percent per month in premiums for each month that they delay enrolling.
The Congressional Budget Office estimates that extending the deadline through December would bring in 1 million more enrollees. But the government would forfeit $100 million in late fees this year, which would grow to $3.4 billion over 10 years.
By extending the enrollment period and eliminating late fees for impoverished beneficiaries, Medicare officials hope to encourage applications from low-income people, who need coverage the most but thus far have proved the most difficult to enroll in the new benefit.
"They're not going to have to worry about the May 15th deadline, and they're not going to have to worry about paying a penalty if they don't get enrolled right away," said Julie Goon, Medicare's director of outreach.
Some 7.2 million poor beneficiaries qualify for special coverage that pays more than 95 percent of their prescription-drug costs with minimal or no premiums, low deductibles and no gaps in coverage.
But only 1.7 million—about 24 percent—have been approved for the subsidized low-income coverage so far. Many of the estimated 4 million who applied were determined to be ineligible because their personal assets exceeded the program's limits.
Bush administration officials defend the low enrollment figures, saying that other needs-based programs such as food stamps, Supplemental Security Income and the Earned Income Tax Credit also have low take-up rates among eligible adults.
Critics say the drug benefit's rate is well below such other programs.
"Any way you slice it, this is a very disappointing performance, and particularly for an administration that said reaching the low-income (population) was the top priority of this legislation," said Ron Pollack, the executive director of Families USA, a liberal patient-advocacy group.
Monday's enrollment deadline will go down to the wire. Private insurers and Medicare staffers will work till midnight to help seniors sign up before penalty fees kick in.
"Enroll now, start saving and avoid the last-minute rush," Medicare administrator Mark McClellan advised Monday.
Aetna, which provides national drug coverage under Medicare, has increased its phone sales staff by more than 20 percent and will work through the weekend, spokeswoman Elizabeth Sell said.
UnitedHealth Group, which offers Medicare plans through PacificCare along with the AARP MedicareRX plan, has seen a steady increase in calls over the last several weeks, spokesman Dominick Washington said. The company is providing 24-hour phone service through Monday's deadline.
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(c) 2006, Knight Ridder/Tribune Information Services.
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