November 30, 2006


Medicare Part D (Michael Barone, 11/30/06, US News)

It was an article of faith with Democratic politicians and political consultants that seniors would be dissatisfied with Part D. They would find the array of choices too complicated and hard to figure out. They would be angry at the "doughnut hole"–the fact that out-of-pocket drug costs from $2,250 to $3,600 are not covered. But it turns out that seniors, even if not as Internet-savvy as the rest of the population, were able to deal with the array of choices and were able to find plans they liked. There are even insurance policies available that cover the doughnut hole. Choice and competition turn out to work better, and more inexpensively, than centralized command and control. Don't take my word for it; the Post quotes a leading Democratic policy analyst:

Urban Institute President Robert D. Reischauer, a former director of the Congressional Budget Office, called that a remarkable record for a new federal program.

Initially, he said, people were worried no private plans would participate.

"Then too many plans came forward," Reischauer said. "Then people said it's going to cost a fortune. And the price came in lower than anybody thought. Then people like me said they're low-balling the prices the first year and they'll jack up the rates down the line. And, lo and behold, the prices fell again. And the reaction was, 'We've got to have the government negotiate lower prices.' At some point you have to ask: What are we looking for here?"

All of this is vindication for the people who in 2003 put Part D together–especially outgoing House Ways and Means Chairman Bill Thomas and Thomas Scully, then head of the Centers for Medicare and Medicaid Services, the Medicare-regulating agency–and for those who got Part D up and running: Mark McClellan, who recently resigned as head of CMS, and Health and Human Services Secretary Mike Leavitt. And it's a vindication of the Bush administration and the House and Senate Republican leaders who put together the just barely successful campaign to pass the 2003 Part D bill.

Interestingly, the Post notes that a couple of leading Democrats on healthcare issues, incoming health subcommittee Chairman Pete Stark and incoming Senate Finance Chairman Max Baucus, don't seem to be interested in the kind of sweeping changes Democrats called for during the campaign.

The GOP should have been running on this success. Instead the wingnut Right treated it like a defeat.

Posted by Orrin Judd at November 30, 2006 9:01 PM

Neither party is talking about it because both have been well-compensated to create Part D, which is estimated to cost the federal government $534 billion over ten years, 61% of which is estimated to stay with the drug manufacturers.
The fact that the plans are difficult to understand is something that falls on the shoulders of care-givers and competant pharmacies; what should be of more concern, to the tax-payer, is how royally ripped off we are/will be with this plan.
Working in a pharmacy that gets paid mostly
through Medicaid, it is easy to be both pleased at how it can take care of those who truly need it (the mentally ill and disabled) and pissed off at how it squanders billions of dollars on those who abuse it (morbidly obese, cigarette-smoking junkies feigning illness to get both their oxycontin (legal heroin) and blood pressure/cholesterol medications).
All while the drug dealers are laughing all the way to the bank.

Posted by: Macduff at November 30, 2006 9:35 PM

Yes, such trivial costs to buy a culture change are a signal conservative victory.

Posted by: oj at November 30, 2006 9:39 PM

A culture change? What, making billionaires out of pharmaceutical company execs?

Posted by: Macduff at November 30, 2006 9:40 PM

No, pharma will do fine regardless--the culture change is forcing Americans into HSAs.

Posted by: oj at November 30, 2006 9:55 PM

Exactly, the pharm industry would do fine without this; but sheer greed on their and others' behalfs is screwing over the American tax-payer.
HSA's will not save money, they will not reduce costs; I could come up with a very long list of reasons; even though I doubt the reasons would mean very much to you.
Regardless, if the plan was such a success, as you claim, wouldn't you think at least someone (beside you) would be bragging about it? And it doesn't bother you at all the Part D was practically written by the pharmaceutical/insurance/health care industry?

Posted by: Macduff at November 30, 2006 10:25 PM

The costs are trivial. No, I expect people who understand legislation to write it. Were you expecting fishery managers to do so?

Posted by: oj at November 30, 2006 11:17 PM

I don't know how you can say the costs aren't big. Have you looked at any pie charts recently? Huge slices.
Well, I suppose you wouldn't mind if defense contractors were in charge of declaring war, either. Incidentally, who do our elected officials work for?

Posted by: Macduff at December 1, 2006 12:20 AM

--, the pharm industry would do fine without this; but sheer greed on their and others' behalfs is screwing over the American tax-payer.--

Don't forget our "good friends and historic allies" who not only ride on our pharma, but our military.

HSAs are working. Medicaid as a %age is down, Wal-Mart's offering $4/per fill,.

$50B/yr is peanuts to keep the boomers happy.

Posted by: Sandy P at December 1, 2006 12:54 AM


Look at your own number: $500 billion over ten years in a $12 trillion a year economy. It's chump change. We have a prescription drug plan because 75% of American voters wanted one. We have the cheapest one possible and it bought HSAs. That's how government works at its very best.

Posted by: oj at December 1, 2006 1:09 AM


Is there one good reason why the Left (and some on the Right) attacks "Big Pharma"? I have always thought preferring lawyers, bureaucrats, and accountants over doctors was just a political choice, but now I think it's a character defect.

Would you prefer that the drug companies be socialized? Or legislated out of business, so that the FDA would become responsible for all drug development?

Is it profit that upsets you, or success?

Posted by: jim hamlen at December 1, 2006 10:05 AM

Mr. Hamlen, It's the same Socialist dream of controlling the "Important" industries in a country. As their touch despoils everything they handle, the industries that are important keep changing. They keep picking on "Big Pharma" because erosion is how they take control of stuff. They keep whining and bringing stuff up, until you give up because you are bored and annoyed. You have better stuff to do. They don't.

Posted by: Robert Mitchell Jr. at December 1, 2006 12:10 PM