Greatest Need

September 2, 2003, Washington - A Medicare drug benefit is most needed in rural areas, where recipients are twice as likely as those in the city to lack any such coverage, according to a report prepared for a think-tank run by a former White House chief of staff.

The report by the Center for American Progress was released as Congress prepares to hammer out differences in House and Senate bills on new Medicare legislation. Center president and founder John Podesta, who worked in the Clinton administration, said the report "tried to point out where improvements are really needed in both bills to make the legislation fair and equitable in rural America."

The report found that fewer Medicare recipients in rural areas have drug coverage through private insurance plans or benefits provided by former employers than those in cities. It also found rural patients spend about 25 percent more on prescription drugs than those in cities.

The recommendations included keeping House provisions that extend benefits to low-income seniors who may also be eligible for Medicaid. The Senate version does not offer the benefit to Medicare recipients who are also eligible for Medicaid.

The report also calls, at a minimum, for keeping Senate provisions that create a government "fallback" for rural areas where no private insurers offer plans.

Finally, it recommends allocating spending so rural recipients don't pay higher costs that support managed-care plans not available where they live. Sen. Max Baucus (D-Mont.) said the House plan to offer Medicare benefits to people eligible for Medicaid was kept out of the Senate plan because "it just saved money, essentially," he said. "But I think the House policy is the better policy."