Opinion Editorial | |
| Friday, September 22, 2000 | |
The Best Prescription Drug Benefit: A Dose of Medicare Reform |
Proposals for a prescription drug benefit for the nation's 39 million Medicare recipients are creating so much political fury that legislators and candidates are forgetting three key factors: 1) Only one third of all Medicare recipients receive no coverage for their prescription drugs, 2) Medicare becomes insolvent in 2010, and 3) The National Bipartisan Commission on the Future of Medicare came up with the most sensible solutions for both problems over a year ago.
The 14 million Medicare recipients without prescription drug coverage have become secondary to the perceived problem that pharmaceuticals are too expensive and their costs need controlling. This two-pronged debate is producing a dizzying array of solutions, none of which solve the long-term problems facing Medicare and America's aging population. Block grants to states, re-importation of drugs from other countries, and price controls are on the list of misguided proposals that ignore the pending insolvency of Medicare.
A stand-alone solution for prescription drugs is a bad idea for these reasons:
The National Bipartisan Commission on the Future of Medicare in large part came to the same conclusion in 1999. The Commission resulted from enactment of the Balanced Budget Act of 1997 and called for the creation of a 17-member bipartisan panel to help save Medicare. A super-majority of 11 votes was required to approve any commission recommendations. On March 1, 1999, the commission had only garnered ten votes for the Commission's final recommendation, which included a sensible solution for the long-term solvency of Medicare, including the elusive prescription drug benefit option. However, the Commission's authority and funding expired that day, along with the Commission's popular solutions for prescription drug coverage.
Attempts to revive the Commission's recommendations, the bipartisan Breaux-Thomas-Frist proposal, have stalled in this Congress, leaving the voters to determine next year's Medicare agenda. Breaux-Thomas-Frist was modeled after the Federal Employees Health Benefits Program, the same plan used by Senators, Congressmen, and other federal workers. This proposal would institute a "defined contribution" plan, with the federal government's "defined contribution" being 88% of the cost of the basic plan, and the seniors' share totaling 12%, on average, depending on their ability to pay.
Medicare would have been restructured, using the funds to create a choice of health plans for seniors. Those 14 million seniors without drug benefits would choose among the plans to find the right prescription drug benefit for them. Remember, 25 million Medicare recipients receive prescription drug benefits from either Medicaid, retirement benefits provided by their former employers, or privately purchased Medigap policies covering prescription drugs. Consequently, a new Medicare prescription drug benefit plan should be tailored to the needs of individual seniors, without jeopardizing those existing drug benefits.
Members of Congress would be wise to abide by the Hippocratic admonition, "First, do no harm," when writing prescription drug benefit legislation. Price controls and the easing of safety restrictions on imported drugs will only make things worse. History dictates that price controls never work in America, and weakening the prescription drug standards of the Food and Drug Administration is simply not worth the risk to America's health. Reform Medicare now and include the Commission's blueprint for a prescription drug benefit option.
The NCPA is a 501(c)(3) nonprofit public policy organization. We depend entirely on the financial support of individuals, corporations and foundations that believe in private sector solutions to public policy problems.
The NCPA is headquartered in Dallas, Texas, with an office in Washington, D.C.
Richard Walker, Dallas, TX 972-386-6272 Sean Tuffnell, Dallas, TX 972-386-6272 Joan Kirby, Washington, DC 202-220-3082 Internet: http://www.ncpa.org Home | Support Us | All Issues | Social Security Debate Central | Contact Us |