Gov. Ed Rendell announced legislative proposals yesterday aimed at combining prescription drug benefits from the new Medicare Part D program with the state's drug assistance programs, PACE and PACENET.

At a senior center in Canonsburg, the governor said the combined program, PACE Plus Medicare, would likely add 120,000 older Pennsylvanians to the 310,000 people already enrolled in PACE and PACENET.

"This program will save 430,000 Pennsylvania seniors thousands of dollars in out of pocket expenses," the governor said.

The enrollment increase, however, would not occur because of any changes in the state drug programs' income eligibility guidelines. Rather, the additional people would likely be people who meet current income guidelines but use few prescription drugs and thus never bothered to enroll.

The new combined program would offer benefits that likely would entice even these people to sign up, said PACE program director Tom Snedden.

Under the governor's proposal, the state would pay monthly Part D premiums for PACE recipients. Those enrolled in PACENET, a program for people with somewhat higher incomes, would pay a $30 monthly premium instead of the current $40 deductible in monthly drug costs.

The proposal announced yesterday would require legislative action, and the governor planned to include it in his proposed budget.

Under the combined program, PACE and PACENET also would cover other costs not paid for under Part D plans, including a coverage gap known as the doughnut hole and certain drugs excluded under federal law.

Because PACE and PACENET would share the cost of providing drugs with the new Medicare program, the state would save an estimated $180 million a year, the governor noted.

Mr. Snedden said the governor did not propose relaxing eligibility guidelines because of a projected $600 million gap in the budget, primarily from costs in Medicaid, the state-federal program serving certain groups of low-income people. But state lawmakers may take action to expand eligibility, he said.

In his proposed budget, the governor may suggest directing some of the savings from the combined drug program to cover the gap in Medicaid spending, particularly for nursing home care, Mr. Snedden said.

Because they currently lack authority to pay monthly Part D premiums for PACE and PACENET recipients, state officials have urged those recipients to not sign up for Part D unless they have incomes and assets low enough to qualify for federal subsidies.

If the governor's legislative proposals are approved, Mr. Snedden said PACE and PACENET would work to assign its members to Part D plans that cover the drugs they need and the pharmacies they use.