Elderly people with low incomes may lose some of their food stamps if they sign up for the new Medicare prescription drug benefit, the Bush administration said Saturday.
You know what’s even more wrong? The New York Times was scooped by an astute guy with a blog.
But back to the issues at hand. The Food Stamp Program is designed to help some of the poorest Americans, those who can’t even afford food for their families. We’re talking about folks who have to think twice about paying full price for house brand macaroni and cheese mix. The purpose of the Medicare Drug Benefit was to make it so Medicare recipients didn’t have to choose between groceries and medication — both of which they need to stay healthy and alive. But if you want help paying for your medications, you may loose your help putting food on the table.
What happened? Did Big Ag not pay as much to the Administration’s re-election fund as Big Pharma did?
The official excuse for this robbery is that since these people will have lower pharmacy costs, they will have more to spend on food and actually come out ahead on the whole deal. Let’s look at the cited example:
The drug benefit will be available to individuals with monthly income of $1,197 or less and married couples with income of $1,604 or less.
The guide gives this example of how the new law would affect a hypothetical Medicare beneficiary, Mrs. Smith, who receives $798 a month in Social Security. She does not receive Medicaid. She now pays $147 a month for medical expenses, including $51 for three prescription drugs. Her monthly rent is $421.
Under the Medicare drug plan, Mrs. Smith will not have to pay a monthly premium or a deductible. She will have a $3 co-payment on each drug, for $9 a month. Her medical spending will decline to $105 a month, from $147, for a saving of $42.
But Mrs. Smith’s monthly food stamp allotment, $27, will be reduced to $10 a month, because her “out-of-pocket medical costs have gone down.” The administration says she will come out ahead because “she still has $25 more cash in her pocket – $42 medical savings, less the $17 decrease in food stamps.”
Forgive me for pointing out that Mrs. Smith is paying far too big a percentage of her income in rent each month. Well over half her money goes to rent, when she should really spend no more than a third. Now, I don’t think you can find a decent place to live for $266 a month, so she might consider a roommate.
My second point is what 3 prescription drugs could she possibly be taking that add up to only $51 per month? Remember, she doesn’t have any coverage for that in the “before” scenario, so she’s paying full price. Even generics are going to run more than $17 each for most things that anybody would need to buy monthly. Oh, and keep in mind that last year prescription prices went up between 4.1% and 7.1% depending whose figures you like.
Finally, according to the official “after” numbers, Mrs. Smith is ahead $25 per month. That’s about 3% of her income. Of course she’s still spending over half her money on rent and 15% of her income on medical expenses. Economically she is still behind the 8-ball, particularly if she owns a car.
But hey, maybe she can afford to go crazy and buy a can of sale-priced tuna to go in her house-brand mac-n-cheese.