Whistles Toot in New Medco Suit

More recently, Medco snagged the former head of Medicare himself to provide the keynote address at a company-hosted symposium on Medicare reform. Thomas Scully, until recently charged with policing the Medicare program, expressed no concern about oversight of the PBM industry in excerpts from his speech.

"More regulation is not the answer," Scully stated in a press release issued last month by Medco. "More market consolidation, more patient information and patient purchasing of Medicare -- which is the real key missing ingredient -- is what we think is going to drive change."

In the end, Scully predicts that the reforms will prove significant.

"This is going to have a much bigger impact on your lives than a lot of people realize," Scully stated in the release. "We really didn't look at this as Medicare reform. We looked at this as health care reform. It's designed to be a much more sweeping bill than a lot of people realize."

So far, however, the program is off to a shaky launch. The Medicare discount drug cards -- which represent the introduction of Medicare reforms -- have so far received a cool welcome at best. The Miami Herald, headquartered in a state with a huge Medicare population, reported this week that only a fraction of those who inquired about the cards actually signed up for them.

"They found them confusing," a volunteer told the Herald.

Scully was nevertheless upbeat even after the tepid response from Medicare recipients.

"We are hoping that a lot of individuals were window-shopping during the month of May," he said in a news conference covered Tuesday by the Herald. "This [card] is a very good deal."

But Medpin, a nonprofit agency catering to the California poor, had warned in advance that the new cards would stir confusion and, in fact, should be delayed pending further examination. The group conducted a study on behalf of seniors that determined some Medicare cards would actually cost, rather than save, existing Medicare customers money.

"A large portion of our patients are enrolled in Medicare, and nearly all are low-income," said Marty Lynch, executive director of a California clinic that works with Medpin. "They already have significant difficulties understanding their health benefits, and the Medicare drug discount cards are simply going to compound the problem."