The Medicare Prescription Drug Benefit Boondoggle

Now, why did we need a Medicare Prescription Drug Benefit again?

“The justification for a broad drug benefit was always flimsy. When Congress passed it, about three quarters of Medicare recipients already had drug coverage: the poorest had it through Medicaid; many retirees had it from their former employers; some had it through Medicare managed-care plans or policies (Medigap) they purchased. For Medicare recipients, all out-of-pocket costs—including drug costs—have remained remarkably stable. In 2001, they averaged 9.9 percent of income; the comparable figures for 1977, 1987 and 1996 are 8.1 percent, 9.4 percent and 8 percent. In 2002, 55 percent of Medicare recipients had out-of-pocket costs of less than $1,000; another 26 percent were under $2,499. Drug costs are oppressive mainly for a small minority of uninsured poorer recipients with large bills.” — Robert Samuelson

So, we didn’t need really need a Medicare Prescription Drug Benefit in the first place. Then, why don’t we dump the program or at least start over?

“…(T)here’s a second political problem—outrage among conservatives over the new spending and the biggest expansion of Medicare since its creation in 1965. From 2005 to 2015, the drug benefit will cost $858 billion, estimates the Congressional Budget Office. Similarly, many conservatives ridicule the role of private insurance companies. “This is not a market-based system. It’s central planning,” says Robert Moffit of the Heritage Foundation. “You have [more] red tape and bureaucracy”—all the rules and subsidies that regulate the insurance plans.

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Republicans deserve the backlash, because their motives were so blatantly political. President Bush embraced congressional demands for a big drug benefit from, among others, House Speaker Dennis Hastert. “He was pushing for a program that wouldn’t just apply to poorer seniors [Bush’s original plan],” says John Feehery, Hastert’s former press secretary. “Medicare has always applied to all seniors. That’s the political reality. They are the people who vote.” To be fair, Democrats groveled with equal abandon; their drug plans were generally costlier.” — Robert Samuelson

Let’s just call it like it is.

We’re going to be adding $858 billion dollars to the deficit over the next decade and trillions more in the future, for a largely unnecessary government program, mainly so that the GOP could gain a minimal advantage over the Democrats in the 2004 elections and to be frank, we’re not even sure the GOP got any political benefit out of the program at all.

The program doesn’t officially take effect until 2006 so there’s still, just barely, time to put this program off and retool, or better yet, dump it. That’s exactly what should be done.

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