This letter was sent by Comptroller Howard S. Weitzman to members of the joint House-Senate Conference Committee.

Honorable Bill Thomas
Chair, Conference Committee
2208 Rayburn House Office Building
Washington, DC 20515

Dear Congressman Thomas:

Over the past few months, you and your colleagues in both houses have been working hard to craft legislation that will extend Medicare benefits to include prescription drug coverage for seniors. I applaud you in this effort and earnestly hope that the final legislation that emerges from the Conference Committee provides our seniors with much needed relief from skyrocketing drug costs.

I am writing today to emphasize a pressing issue related to this legislation, i.e., the need to provide relief to state and local governments, which, as employers, bear the crushing burden of ever-higher insurance premiums to cover the cost of prescription drugs for their retirees. This can be done by ensuring that Medicare is the primary mode of insurance coverage for prescription drugs, as it currently is for hospital insurance. Employer coverage should supplement Medicare coverage. Contributions from employers' plans should also be allowed to count towards meeting Medicare deductibles.

Nassau, with more than 1.3 million residents, is one of the country's most populous counties and among the nation's most mature suburbs. With more than 9,500 employees and nearly 12,000 retirees, plus their spouses and dependents, we are struggling to keep up with the effects of higher prescription drug costs on our employee and retiree health benefits. For our retired employees and their families, approximately 60 percent of the expense goes just to pay for premiums for prescription drug coverage - a number equal to just under $35 million last
year.

If the final legislation does not designate Medicare the primary payer of prescription drug costs, before public or private employer insurance plans, financially stressed local governments like ours will have no relief in sight. Moreover, many employers around the country will have a strong incentive to drop retiree drug coverage altogether, leaving millions of retirees with poorer coverage and lower benefits. Virtually all private insurers who cover prescription drugs currently provide more comprehensive coverage than would either Medicare bill as currently constituted.

I know that you and your colleagues will give serious consideration to how the final legislation will affect employers, public and private, throughout the nation. It is my hope that, in the end, Medicare will become the insurer of first recourse for prescription drugs.