Has there ever been a piece of legislation as mythologized as the Medicare Prescription Drug, Improvement and Modernization Act of 2003?
The answer, of course, is yes. Even last week's failed energy bill had a pipeline full of bull about how huge tax breaks for highly profitable conglomerates were going to secure our energy future when they did no such thing. The Medicare bill may, however, have set a new standard for emotional as well as rhetorical excesses.
This page has done plenty of hand-wringing of its own over this bill, which is filled with enough sops to the special interests that it may have to be revisited in the coming years if for no other reason than fiscal sanity.
With all of this in mind, it is time to address some of the bigger myths about this act, and in so doing perhaps shed a little light into some of its many dark recesses.
Myth No. 1: The bill will lead to the privatization of Medicare. This could happen if all of the stars in the firmament align themselves, but it isn't very likely. Because of last-minute changes, competition between private health plans and traditional Medicare is the subject of a demonstration project that won't even begin until 2010, will last six years and likely will fail. If the premium differential between private plans and traditional Medicare is as large as opponents say, and private plans cherry-pick healthier seniors, leaving older, sicker beneficiaries in the old program, the AARP will rejoin its erstwhile Democratic friends in putting the kibosh on it.
Myth No. 2: This is the best drug benefit we could get given the fiscal realities. As Teddy Kennedy screamed last week on the Senate floor, poppycock! Throw out the $12 billion in just-for-the-hell-of-it payments to health plans, the health savings accounts and all the other junk unrelated to prescription drugs, and the "doughnut hole" in the drug benefit could have been narrowed tremendously. There also was no need for the Scrooge-like asset limits that the poorest seniors will have to meet to get the most help paying for lifesaving drugs.
Myths No. 3 and 4: There are (are not!) meaningful cost controls in the plan. Well, there are some elements of the plan that could save some money, including cutting reimbursement for Part B drugs and giving seniors new drug-discount cards next year. There also are provisions that will give pharmacy benefit managers leeway to negotiate lower prices, and a few generic drug changes that may help. However, compared with what should have been HHS-negotiated, nationwide drug discounts, these savings are a pittance. This is why the $400 billion price tag for this bill simply isn't realistic.
Myth No. 5: The doughnut hole will stop most seniors from getting much of a drug benefit. This one is trickier. The "average senior" is expected to have an annual drug bill of $3,160 in 2006, when the legislation kicks in. After paying the monthly Medicare drug premiums, copayments and deductible, he or she would save a grand total of $1,000. If this person has retiree drug coverage (likely soon to vanish) he or she won't take part. For those with far higher drug costs, this bill may be a good deal, because it pays 95% of drug costs above the out-of-pocket, assuming the person has the $4,000 to get there. The very poorest of the poor-those without assets-may win because they are exempt from most out-of-pocket costs.
Other than that, this is a simple bill that anyone can see is (is not!) going to help all (no) seniors. (If you believe that, we have a used energy bill we'd like to sell you.)
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