WASHINGTON — As Democrats approach the biggest Medicare prescription drug benefit review in 20 years, they are ignoring a glaring health equity issue: unequal treatment for low-income adults age 65 and older in Puerto Rico.
Puerto Rico residents pay the same Medicare taxes as other Americans, but are eligible for less help than other older adults when it comes to paying their pharmacy drug premiums and their prescription drug costs. Despite all the Democrats talking about health equity in this Congress, they didn’t incorporate a bill that would level the playing field.
Currently, only adults age 65 and older, below 85% of the federal poverty level, or $11,552 a year, are eligible for extra help in Puerto Rico. If the same patient lived in a state like Florida, he would qualify even if he reached 150% of the poverty level, or $20,385. A group representing insurers in the territory estimates that approximately between 120,000 and 150,000 people fall into this subsidy gap now.
“There is a human side to it. Is a grandmother’s health status in Florida, Alaska, Texas or Tennessee more valuable than in Puerto Rico? Morally, the answer is no,” said George Laws García, executive director of the Puerto Rico State Council.
Residents of Puerto Rico are US citizens, but they may be treated unequally in many federal programs because they live in a territory rather than a state. The legal authority for Congress to establish discriminatory policies for residents of territories comes from a set of Supreme Court decisions that are based on racist stereotypes but persist as the law of the land today. The Insular Cases, as they are known, establish a legal framework that says the Constitution does not fully apply to residents of US territories. The first cases were decided in 1901.
One case held that residents of Puerto Rico did not have the full rights of U.S. citizens, in part because the territories’ citizens are “alien races, differing from us in religion, customs, laws, methods of taxation, and ways of thinking.”
Puerto Rico residents continue to struggle to obtain equal federal benefits. In one case earlier this year, José Luis Vaello-Madero sued the government because his federal disability benefits were withdrawn when he moved from New York to Puerto Rico. The Supreme Court ruled resoundingly against him in an 8-1 decision, but Conservative Justice Neil Gorsuch indicated that there may be an opening to overturn the Island Cases in the future.
“The Insular Cases have no foundation in the Constitution and are based on racial stereotypes. They deserve no place in our law,” he wrote in a concurring opinion.
Democratic lawmakers have repeatedly introduced legislation, starting in 2014, to correct the prescription drug subsidy gap in Puerto Rico. The latest version is led by Senator Bob Menendez (D-N.J.).
The extra benefits can make a big difference to people who qualify. Subsidies help seniors pay tuition, meet their annual deductibles, and pay their out-of-pocket costs when they pick up medication over the pharmacy counter.
The Social Security Administration estimates the fringe benefits are worth about $5,100 a year. This is not a definitive number for all patients, as some people with higher income levels may receive partial help. This year, patients who received full subsidies paid no more than $3.95 for a generic drug or $8.85 for any branded drug.
Currently, adults age 65 and older in Puerto Rico who have an income below 85% of the federal poverty level receive some subsidies to help with prescription drug costs, but it is not equal to the level that state residents receive, said Roberto Pando Cintron, president of the Medicaid Products and Medicare Advantage Association of Puerto Rico. About 120,000 and 150,000 low-income beneficiaries in Puerto Rico who are not receiving any aid now could benefit if residents of the territory received equal subsidies, he said.
Despite pleas from advocates, the policy must be ignored at the most critical time for Medicare prescription drug benefit in two decades.
Menendez believes the Democrats’ household spending package is not perfect, a spokesman said, but acknowledges that he is making investments to lower drug prices, extend insurance subsidies and fight climate change.
“He will continue to be a champion for Americans in Puerto Rico, whether in Medicare, Medicaid or other areas,” the spokesperson said.
If Congress manages to completely redesign the Medicare Part D program, which it seems likely to do soon, it may not reform the program again for a long time.
The broader drug pricing reform includes elements that would no doubt also benefit residents of the territories, such as a $2,000 annual cap on direct costs, a negotiation mechanism that could reduce the costs of some expensive drugs, and penalties. for drug makers who raise prices quickly.
However, it does not address the issue of equity and leaves the status quo to residents of territories who work with limited resources and try to pay for their medicines.
“Puerto Rico is a big blind spot in these political debates,” García said.
The Supreme Court’s permission to treat residents of Puerto Rico and other territories differently under federal programs has also fundamentally shaped the access that residents of the territory have to health care.
Puerto Rico receives less Medicaid funding than it would if it were a state, due to Congress maintaining unequal payment formulas. And unlike the states, Puerto Rico’s Medicaid funding is also limited. Medicaid funding for the territory will drop starting December 13 unless Congress intervenes.
This means that it is difficult for doctors and hospitals to plan ahead and invest in their facilities. Uncertainty about funding also makes it difficult to recruit and retain doctors, and the government has less funding to improve patient benefits.
And it’s not just people born and raised in Puerto Rico who receive fewer health benefits. A US citizen could live, for example, in New Jersey for most of their lives and pay Medicare taxes, but that person’s federal benefits would be cut if they decided to retire to Puerto Rico.
“This different treatment leads to health disparities that are tangible. They have become permanent and discriminatory treatment,” said Jaime Torres, president of Latinos for Healthcare Equity.