Wednesday, July 26, 2006
Editorial: Medicare Part D gets an 'F'
The prescription drug plan benefits pharmaceutical and insurance companies, not customers. Start over.
From the RoundTable blog
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Congress should recognize Medicare Part D for what it is: an expensive failure.
Some in Congress have offered a proposal to eliminate the so-called "donut hole" -- a more-than-Munchkin-sized gap in coverage in most of the plans offered through Part D.
That gap can leave seniors on the hook for thousands of dollars in prescription drug costs each year.
Filling that hole would be a good thing. Wiping the slate clean and starting over, though, would serve the public better.
The problem is that Part D was never really intended to serve the public. One provision in the enabling legislation makes that abundantly clear: Medicare is prohibited, by law, from using its substantial purchasing power to negotiate lower prices for drugs.
That's absurd.
Drug and insurance company profits are rising because of Part D. UnitedHealth Group Inc. reported a 26 percent increase in second quarter profits, attributed to its Part D business.
Pfizer saw sales of cholesterol-lowering drugs skyrocket under the plan.
The plan's transfer of millions of elderly low-income prescription drug users from Medicaid to Medicare's Part D will likely result in a $2 billion windfall for pharmaceutical companies this year alone.
Meanwhile, cost estimates for American taxpayers continue to rise: from $400 billion over a decade, when the Bush administration was selling the idea to Congress, to $750 billion as the true costs have become more clear. Prescription drug prices have shot up since the plan took effect, meaning the price tag will only increase more.
Dozens of plans through private insurers were supposed to give consumers more choices than a simple benefit. But a recent investigation by the Government Accountability Office found that most of the plans, and Medicare's own hotline, gave out inaccurate information 70 percent of the time.
Informed choices can't be made with misinformation.
Congress should go back to the drawing board with the goal of producing a simple plan that offers real savings to seniors on vital medication -- rather than billions of dollars in windfall profits to pharmaceutical companies and the insurance industry.
