The Negative Impact of SMART Act Cuts

This post originally appeared as a letter from Age Options to the IL House of Representatives human Services Appropriations Committee, submitted on Feb. 20, 2013

The cuts to Medicaid that were implemented July 1, 2012 as a result of the SMART Act have had a serious negative impact on the lives of our clients. In particular, we would like to bring to your attention the hardship caused by the elimination of the Illinois Cares Rx program. Illinois Cares Rx provided critical pharmaceutical assistance to more than 160,000 older adults and people with disabilities in Illinois. Without this program, many of these individuals are struggling to pay for their medications.

Contrary to popular belief, implementation of the Affordable Care Act has not resolved the need for a state pharmaceutical assistance program. The ACA does not close the Medicare Part D “donut hole” until 2020. Further, Illinois Cares Rx provided much needed assistance with expensive Medicare Part D deductibles and copayments – the ACA does not do anything to address this.

To illustrate the difficulties that older adults are facing without this critical program, we would like to share with you the story of one of our clients. Lillian is an 89 year old resident of Berwyn, Illinois.  A widow for 53 years, Lillian worked multiple jobs to support her two children and pay off her mortgage. She had no money left over to save for retirement. Now, Lillian’s income of $1,648/month puts her above the income limits for assistance programs like Medicaid and the Part D Extra Help program, but is barely enough for Lillian to make ends meet with her expenses. She pays premiums each month for her Medicare and Part D prescription coverage. She also pays for an expensive Medicare Supplement Plan to cover her injections for macular degeneration, which cost $4,000 every two weeks, and bills for dental services out of pocket (Medicare does not provide dental coverage). In addition to all of her health care expenses, Lillian must continue to pay her utility bills, property taxes, and homeowner’s insurance. At the end of each month, Lillian has no extra money left in her bank account. In fact, lately she has had to put some of her bills onto a credit card, and then she skimps on groceries the following month to pay off the credit card bill.

Since Illinois Cares Rx was eliminated, Lillian has been unable to afford the costs of her medications. She takes nine prescription drugs every month, including two drugs that cost $70/month each in Part D copayments. Lillian has not been able to afford her three most expensive medications since January, so she has been going without them. These drugs help control Lillian’s blood pressure, cholesterol, and hypothyroidism; going without these medications is dangerous for her health and has the potential to instigate expensive emergency room or hospital care.  Unfortunately, without Illinois Cares Rx, Lillian has no other option to pay for her medications, so these are risks that she has been forced to take.

As a result of the SMART Act, thousands of older adults and people with disabilities in Illinois are in situations just like Lillian’s. They must make difficult choices every month regarding whether to pay for food, utility bills, or medications. The elimination of Illinois Cares Rx has created a tremendous financial burden for these individuals, and it is likely to create a significant financial burden for the state via costly emergency room and hospital care for individuals who cannot afford their prescription drugs.

We ask that the committee consider these burdens in future action regarding cuts to Medicaid, as well as in considering restoration of pharmaceutical assistance for older adults and people with disabilities. AgeOptions and the Illinois Association of Area Agencies on Aging fully support HB1286 (sponsored by Representative Jakobsson and cosponsored by Representatives Beiser and Burke), which would reinstate a pharmaceutical assistance program of this nature.