The rising cost of prescription drugs is particularly difficult for older residents in New Jersey, and nationwide, studies show, prompting worry for the majority of seniors and forcing some to ration their medications or skip costly treatments entirely.
To help offset this burden, the Garden State will invest more than $55 million over the next fiscal year to help seniors and disabled residents pay for their prescription drugs through a pair of programs, the Pharmaceutical Assistance for the Aged and Disabled and Senior Gold. The programs, available to residents that meet certain income restrictions, work with Medicare’s drug benefit to reduce premium and out-of-pocket costs for those enrolled.
As of June, the programs were benefiting close to 135,000 of New Jersey’s most vulnerable residents, according to the state Department of Human Services, which oversees both PAAD and Senior Gold.
“They play an important role in attempting to address the serious and growing disparity between prescription drug needs and one’s ability to pay for those drugs,” said Ev Liebman, director of advocacy for AARP of New Jersey, which has long advocated on behalf of the programs. PAAD, created in 1975, is among the nation’s oldest initiative of its kind, she said; Senior Gold was launched in 2001, with funds from the state’s share of the 1998 agreement reached between dozens of attorneys general and five major tobacco companies in the wake of lawsuits that focused on the health hazards associated with smoking.
According to the National Conference of State Legislatures, as of 2018 New Jersey was one of 16 states to operate a prescription subsidy program; discount programs are available in a handful of additional jurisdictions. At one point, some three dozen states ran prescription-assistance programs of some kind, but support for these has declined since the passage of the Affordable Care Act, in 2014, the group found.
Cost of medication keeps rising
But while political interest in these programs may have diminished in recent years, the cost of medication keeps rising. Spending on prescription drugs rose by 27 percent between 2012 and 2016, according to an analysis of claims data commissioned by the New Jersey Health Care Quality Institute, well outpacing the 18 percent escalation in spending on care overall.
Much of this reflects a rise in drug prices, as use of these medications has increased only slightly, studies show. According to AARP, the average annual cost of prescription drug treatment in New Jersey rose nearly 58 percent between 2012 and 2017, adding as much as $1,000 to the cost of some brand-name medications alone. On average, older Americans take at least four medications, often for chronic conditions, AARP found.
“While [PAAD and Senior Gold] are critically important, the relentlessly increasing costs of prescription drugs have become an urgent problem for people of all ages and income levels,” Liebman said. Earlier this year, AARP launched its national ”Stop Rx Greed” campaign in an effort to control prices; the organization has found that three out of four seniors are concerned about these costs and 40 percent end up either rationing their medication or not picking up a prescription at all.
In New Jersey, the DHS’s Division of Aging Services is seeking to ease enrollment in PAAD, Senior Gold and other support services for eligible residents. Last November, the division launched NJSave, a one-stop online application to help elderly and low-income New Jerseyans connect with benefits.
In May, the state won a national innovation award for its design and creation of the NJSave e-portal, which also connects users with Medicare savings programs and initiatives that can help pay for hearing aids and utility bills.
Ways to apply
“Before NJSave, individuals had to fill out a paper eligibility application for each of the various programs,” said division director Louise Rush. “The paper application process remains available for those without computer access.”
The division also created an outreach campaign about the e-portal that has involved county agencies, senior centers, hospitals, public housing, pharmacies and libraries, DHS said; the division is continuing this work and adding features to make the system more compatible with mobile phones. By mid-July, the state had logged more than 3,500 new online applications for various services, which can save residents more than $1,000 a year in some cases.
“The Division is committed to helping older New Jerseyans learn about and access the services and supports that improve their health and well-being while saving them some money,” Rush said.
PAAD participants, on average, saved more than $1,100 annually in premium reductions and pharmacy savings, DHS said. Those on Senior Gold saw their prescription costs reduced more than $160 a year. Both programs are limited to New Jersey residents over age 65 or those between 18 and 64 who are eligible for federal disability programs.
To qualify for PAAD, individuals must earn less than $27,951 a year if single, or $34,268 if married, according to the website. The program covers a portion of the recipient’s Medicare Part D premium and any out-of-pocket cost at the pharmacy above $5 for generic medications, or $7 for brand-name medications.
Senior Gold is designed to help those with slightly higher incomes; eligible residents can earn between $27,951 and $37,951 as individuals, or $34,268 and $44,268 if married. Participants pay a $15 co-pay and half of the remaining cost of the medicine. Once they have spent $2,000 a year as an individual, or $3,000 as a couple, they are only responsible for the $15 co-pay.