Monday, November 28, 2005
The Medicare monster turns on its creators
When the Medicare prescription drug coverage bill was being passed in 2003, I railed against both the process (chin-deep in deception, corruption and political gamesmanship) and the ugly creature it spawned (politically motivated, unnecessarily expensive and unwieldy and a windfall for drug and insurance companies). Now that the behemoth has emerged from its den and stands before, we find it’s even more grotesque, more misshapen, more dangerous than we’d thought.
Few dare mention it, but the Medicare drug coverage makes the baby boomer’s golden years a lot more expensive – and paying that tab is already one of our biggest budget problems. From 2005 to 2015, the drug benefit will cost $858 billion, estimates the Congressional Budget Office. But let’s back up: The uglier truth is that this never had to happen.
The goal of the drug plan was never improving health care, it was luring senior citizen votes in an election. The bill was boldly, blatantly political. President Bush embraced congressional demands for a big drug benefit from, that wouldn't apply just to poorer seniors, because Medicare has always applied to all seniors and seniors are people who vote. (To be fair, Democrats groveled with equal abandon, and their drug plans were generally costlier.)
The drug plan's features confirm its political nature. First, Republicans declined to pay for it; most costs (literally trillions of dollars) must be covered by borrowing or future tax increases. Second, there's the "doughnut hole" -- the standard benefit provides coverage up to $2,250 of drug costs and then no coverage for the next $2,850. Of course, this makes no sense as health or social policy. The purpose was political: to provide benefits for lots of people while limiting total costs.
Bush and Congressional Republicans rejected a simple add-on of drug coverage to Medicare. Instead, they preferred a so-called "market-based" system that has private insurance companies offer plans that are, in turn, subsidized by Medicare. Congress set a minimum benefit (including a $250 deductible and 25 percent premiums on coverage up to $2,250) and invited insurers to provide that plan or something "actuarially equivalent." The result: many plans -- and much confusion.
In 46 states, Medicare beneficiaries can choose from at least 40 plans, reports the Kaiser Family Foundation. People feel overwhelmed. It's hard to compare plans, which often cover different drugs and have varying deductibles and premiums. One monthly premium is $1.87, another $99.90. A survey by Kaiser confirms the bafflement: Only 35 percent of Medicare beneficiaries say they understand the drug benefit "somewhat well" or "very well"; a dismal 61 percent say they understand it "not too well" or "not well at all."
That’s not going to translate so well at the polls -- and that’s poetic justice.
Few dare mention it, but the Medicare drug coverage makes the baby boomer’s golden years a lot more expensive – and paying that tab is already one of our biggest budget problems. From 2005 to 2015, the drug benefit will cost $858 billion, estimates the Congressional Budget Office. But let’s back up: The uglier truth is that this never had to happen.
The goal of the drug plan was never improving health care, it was luring senior citizen votes in an election. The bill was boldly, blatantly political. President Bush embraced congressional demands for a big drug benefit from, that wouldn't apply just to poorer seniors, because Medicare has always applied to all seniors and seniors are people who vote. (To be fair, Democrats groveled with equal abandon, and their drug plans were generally costlier.)
The drug plan's features confirm its political nature. First, Republicans declined to pay for it; most costs (literally trillions of dollars) must be covered by borrowing or future tax increases. Second, there's the "doughnut hole" -- the standard benefit provides coverage up to $2,250 of drug costs and then no coverage for the next $2,850. Of course, this makes no sense as health or social policy. The purpose was political: to provide benefits for lots of people while limiting total costs.
Bush and Congressional Republicans rejected a simple add-on of drug coverage to Medicare. Instead, they preferred a so-called "market-based" system that has private insurance companies offer plans that are, in turn, subsidized by Medicare. Congress set a minimum benefit (including a $250 deductible and 25 percent premiums on coverage up to $2,250) and invited insurers to provide that plan or something "actuarially equivalent." The result: many plans -- and much confusion.
In 46 states, Medicare beneficiaries can choose from at least 40 plans, reports the Kaiser Family Foundation. People feel overwhelmed. It's hard to compare plans, which often cover different drugs and have varying deductibles and premiums. One monthly premium is $1.87, another $99.90. A survey by Kaiser confirms the bafflement: Only 35 percent of Medicare beneficiaries say they understand the drug benefit "somewhat well" or "very well"; a dismal 61 percent say they understand it "not too well" or "not well at all."
That’s not going to translate so well at the polls -- and that’s poetic justice.
