[Pharm-policy] NYTimes Editorial: The Bush Prescription Drug Plan "is inferior"

[Paul Davis]

pdavis@CritPath.Org wrote:

> The Bush Prescription Drug Plan
> 
> September 7, 2000
> 
> Gov George W. Bush announced a proposal on Tuesday to provide
> prescription drug benefits as an option under comprehensive
> Medicare reform. But since he does not expect such reform to happen
> anytime soon, he wants state governments to deal with the problem
> while a new White House task force works out the details of future
> reforms.
> 
>  Mr. Bush, like Vice President Al Gore, hopes to court elderly
> voters with a plan to help pay for the escalating costs of drugs.
> But unlike Mr. Gore, Mr. Bush would not create a universal drug
> benefit for all retirees under Medicare. Instead he lays out a
> rough Medicare reform plan, with few details, that may or may not
> make drug coverage more accessible in the future. The Bush plan is
> inferior because it relies on uncertain action by states and the
> private sector, and would leave too many people without coverage
> for now.
> 
>  Mr. Bush takes a complicated two-track approach. He would first
> create a four-year transitional program that places the onus on
> states to provide drug coverage for the elderly while the federal
> government works on comprehensive Medicare reform. He would provide
> $48 billion over four years to help states pay for full drug
> coverage for retirees with incomes below 135 percent of the poverty
> line, or about $12,000 a year for an individual. Those earning up
> to 175 percent of the poverty level, about $15,000 a year, would
> get a partial subsidy.
> 
>  The trouble is that more than half the states currently do not
> provide such assistance, and many would have to create new
> bureaucracies to administer a new drug insurance program. State
> participation would be voluntary, and states would be allowed to
> set different premium levels and benefits. Once any retiree has
> spent $6,000 a year on prescription drugs, additional costs would
> be paid for by federal funds. Otherwise, people earning more than
> 175 percent of the poverty line would get no help under this
> interim plan. This would leave a big population unprotected, since
> nearly half of those without drug coverage now are middle-income
> people, with incomes above the cutoff for subsidies.
> 
>  Mr. Bush is far less specific about how drug coverage would work
> in the long term, leaving the details to a task force that would be
> convened next year. He would not create a universal drug benefit
> that would be available to all the elderly at the same cost.
> Instead he would rely primarily on private insurers. Low-income
> people would be heavily subsidized, as under the Gore plan. But Mr.
> Bush's plan does not spell out a minimum drug benefit package or
> maximum premiums for middle- and higher- income retirees. Instead,
> government would help pay 25 percent of their drug coverage
> premiums.
> 
>  Mr. Bush says he wants to spend an additional $110 billion over 10
> years to modernize Medicare by having private insurance plans
> compete against traditional fee-for-service Medicare. Presumably,
> many of those plans would provide drugs as an optional benefit.
> 
>  Mr. Bush hopes that as more retirees choose these plans, fewer
> will be left without drug coverage. But achieving that goal is
> uncertain. Without a new Medicare drug program, people who stay in
> fee-for-service Medicare would still have to buy separate drug
> coverage on the private market. In that respect, the Bush plan
> faces the same problem as the flawed bill that passed the House in
> June. That plan relies on private insurers to sell prescription
> drug policies. Yet many insurers have said they will not be able to
> offer affordable policies even with a subsidy because only people
> with high drug expenses would buy the coverage. Mr. Gore's plan
> does not have this problem because his program would offer uniform
> drug coverage to all the elderly at $25 a month, without relying on
> private insurers to sell affordable policies.
> 
>  Mr. Bush's reform proposal does add an interesting element to the
> debate. He says he would use the $6,000 cap that would initially
> apply to drug expenses for all out-of-pocket Medicare costs as part
> of long-term reform. This is a positive proposal, provided he
> identifies a way to pay for it.
>    
> 
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