WASHINGTON – Reacting to a report in today’s New York Times that the U.S. Department of Health and Human Services (HHS) has estimated that 3.8 million retirees could lose their prescription drug benefit beginning in 2006, U.S. Rep. Benjamin L. Cardin today denounced the Medicare prescription law "as clearly harming retiree benefits and seriously jeopardizing the health care of millions of American retirees."

HHS has estimated that 3.8 million retirees -- or one-third of all retirees with employer-sponsored drug coverage – could lose their existing benefit when modest drug coverage is offered to Medicare beneficiaries starting in 2006. HHS also estimates that the number could grow to 4.1 million retirees by 2010.

"Because the new Medicare law does not fully reimburse employers for the cost of the drug benefit and since the new drug benefit cannot be coordinated with retiree prescription drug coverage, it encourages companies to drop drug coverage for their retirees. As a result, millions of retirees will see their drug benefit reduced or completely eliminated," said the Congressman, who voted against the bill when is was considered by Congress in 2003..

"Compounding the problem," stressed Rep. Cardin, "is the recent ruling by the Equal Employment Opportunity Commission (EEOC) that allows employers to reduce or eliminate retirees’ health benefits when they become eligible for Medicare at age 65." In April, the EEOC created an exemption to the Age Discrimination and Employment Act of 1967 by ruling that employers could cut retiree health benefits when they become Medicare eligible.

"I predict that a growing number of retired Americans are going to find their health benefits in serious jeopardy," said Rep. Cardin. "I also predict that because the new Medicare law relies solely on private insurers and does not offer a defined benefit within Medicare that continuity of coverage is not guaranteed for any senior."

In January, the Congressman introduced the Preserving Medicare for All Act, HR 3702, to fix the "structural flaws" contained in the Medicare law. The measure would fully reimburse employers for the cost of their retiree drug coverage. It also would lower prescription drug costs by allowing HHS to use the purchasing power of 40 million Medicare beneficiaries to negotiate lower drug costs with pharmaceutical companies, provide a guaranteed, universally available drug benefit option through Medicare, repeal the provisions that will threaten traditional Medicare, eliminate excess payments to private health plans, and repeal the expenditures cap that will result in harsh cuts to Medicare providers and patients