Senate wants tobacco funds for elderly

By JAMES M. ODATO Albany Times Union Friday, November 19, 1999

Albany -- Majority leader favors using $125M annually to help seniors afford medication.

Senate Republicans Thursday called for using $125 million annually in tobacco settlement funds to help people afford medication.

The Senate plan would more than double the number of elderly people eligible for state help in coping with the cost of prescription drugs.

The state and local governments will be receiving an estimated $5 billion per year payout from tobacco companies that settled lawsuits filed against them from attorneys general. More than $1 billion will be paid over the next six months.

Senate Majority Leader Joseph Bruno wants to use a quarter of the state's share of tobacco settlement money to expand a program known as EPIC. The plan -- still a matter of negotiation among the Assembly, Senate and Gov. George Pataki -- comes as the leaders are competing for uses of the tobacco money. It also comes during a decade of nearly 11 percent annual price increases for prescription drugs and as some health maintenance organizations are dropping prescription coverage.

Bruno, R-Brunswick, said he is in favor of using a substantial portion of the tobacco money on other health care initiatives as well as tax relief programs, without revealing details.

The prescription drug assistance program he announced would use about $125 million annually to allow about 229,000 older persons to enroll in a bolstered state program set up in 1986 to help senior citizens pay for medications.

The proposal was embraced by Assembly Speaker Sheldon Silver, D-Manhattan, who said it follows his conference's plan of last year.

Under Bruno's plan, individuals with incomes less than $35,000 and couples with incomes below $50,000 would be eligible for reduced prescription costs. The state would help pay the cost, reducing co-payments to insurers and deductibles by about 20 percent. The current program operated by the state enrolls about 110,000 and is eligible to lower-income people, so Bruno's plan would add another 119,000 people to the rolls, including some middle-income persons.

Bruno said he also wants to use some of the tobacco settlement funds to help uninsured New Yorkers receive medical coverage and for smoking cessation programs. His colleague in the Senate, Thomas Morahan, R-Rockland County, is proposing legislation to use 20 percent of the state tobacco funds for anti-smoking programs, the remaining 80 percent for other "health-related'' programs.

The Assembly Democrats propose using 10 percent of tobacco settlement plus greater taxes on cigarettes to pay for anti-smoking programs. And the Assembly wants all tobacco funds to go toward health care initiatives, such as a program to help more people gain medical insurance.


Republicans Seek to Widen Aid to Elderly for Medicine

By RAYMOND HERNANDEZ New York Times November 19, 1999

ALBANY -- Republican leaders in the State Senate called on Thursday for expanding a state program that subsidizes prescription drug purchases for elderly New Yorkers, proposing to more than double the number of people eligible for the coverage.

The plan calls for spending $235 million a year, roughly doubling the amount that the state now pays to provide prescription drug coverage for the elderly. That would increase the number of people enrolled in the program to 229,000 from 110,000.

New York is among 14 states that are running a host of programs intended to help the elderly pay for prescription drugs, mainly by focusing on low-income people who do not qualify for Medicaid, according to health care experts.

But New York's prescription drug program would become among the most generous in the nation if the proposal announced today is enacted, the experts said.

Joseph L. Bruno, the Republican majority leader in the Senate, said the proposal was urgently needed to help elderly New Yorkers keep pace with the soaring costs of prescription drugs.

"Rising prescription drug costs are forcing too many seniors to choose between eating and staying warm or buying life-saving drugs," he said. "This plan changes that."

The plan received tempered support from both the Republican governor, George E. Pataki, and Democratic leaders in the State Assembly, increasing the likelihood that some version of it will eventually be adopted.

The proposal, which would take effect next year, is intended to cover New Yorkers who are at least 65 years old. It seeks to broaden the pool of elderly people eligible for drug coverage by expanding the income eligibility limits that now exist.

The proposal would provide coverage for single people with gross incomes under $35,000 a year, compared with the current annual income limit of $18,500. It would also help married couples with annual incomes under $50,000, compared with the current limit of $24,400.

The plan also seeks to reduce out-of-pocket expenses for enrollees by at least 20 percent. For example, a married person earning $17,000 a year now pays an annual premium of about $130 for unlimited drug coverage, along with co-payments and $542 deductible.

But under the plan proposed Thursday, that same person would pay an annual premium of $119, along with co-payments and a $425 deductible. The proposed co-payments would range from $3 to $20, depending on the type of drugs.

The plan was praised by organizations representing elderly people, including the American Association of Retired Persons and the New York Senior Action Council.

"Obtaining affordable drug coverage for older people is a national priority for AARP," said Bill Ferris, one of the group's lobbyists in New York. "The Senate proposal is a strong step in that direction."

Bruno, the Senate leader, said the additional $125 million earmarked for the program would come from the state's share of the national tobacco lawsuit settlement. The settlement is to be paid over 25 years, but the Senate plan would be adopted permanently, with the costs recurring each year.

Bruno did not specify how he intended for the rest of the tobacco settlement to be spent beyond saying that the money should be used for health-related expenses, like providing coverage to people without health insurance.

His comments represented his opening bid in what is widely expected to be a lively debate over how to divide the tobacco settlement. His position was cheered by Democratic lawmakers and health care advocacy groups, both of which want the money to go toward health care programs, like helping the uninsured and reducing the number of people who smoke.

"The good news is that Republicans in the Senate have now joined the Assembly in arguing that 100 percent of the tobacco settlement should be used for health care," said Blair Horner, the legislative director for the New York Public Interest Research Group. "Unfortunately, we are left without a lot of critical details."

The tobacco money comes from last year's settlement of lawsuits filed by the states against tobacco companies to recoup money spent treating people with smoking-related illnesses. The tobacco companies agreed to pay the states $246 billion over 25 years.

New York's share would be $800 million a year at the start, growing to $1.2 billion, for a total of $25 billion. The money will be split up, with the state government getting half and the rest going to New York City and other local governments.