Let me offer a pertinent example — Medicare Part D.
While there’s no question certain issues must still be addressed as they relate to Medicare, Medicaid and the skyrocketing costs in health care more generally, a lingering proposal to implement Medicaid-style rebates for the Medicare Part D component is not one of them. Part D — the prescription-assistance program that is arguably the only portion of Medicare that comes in under budget — is surpassing all expectations, delivering results below budget expectations. The recent open-enrollment period, which ended Dec. 15, demonstrated this point exactly.
What is meant by a Medicare-style rebate anyway, and is it a responsible cost-saving measure for Medicare as a whole?
Unlike the mail-in-rebates most consumers are familiar with — the kind you might receive when purchasing a new retail item — the proposed Medicaid-style rebates serve more like a tax on the manufacturing and research and development of new medicines. If such a levy were to be imposed on the industry producing the medicines, budget experts predict 20 percent to 40 percent increases in Part D premiums, reduced plan choices and more restrictive formularies.
Why increase prices on a program that is already working well?
In March 2012, the Congressional Budget Office reduced its Medicare Part D 10-year spending projections for 2013-2022 by $107 billion — the second consecutive year Part D projections were reduced by more than $100 billion. During this same period, the CBO increased its projected spending for the rest of Medicare. In addition to the overall spending reductions, Part D Plan Bids are lower today than they were in 2006, the first year of the program’s operation.
Furthermore, additional statistics from a recent survey by Medicare Today found that:
• While overall Medicare costs have gone up, Part D projections remain 43 percent below expectations during the initial 2004-2013 forecast.
• 90 percent of Medicare Part D enrollees report being satisfied with the coverage offered through the program.
The Journal of the American Medical Association (JAMA) concluded that Part D results in $1,200 per year reduction in non-drug medical spending for each individual who previously had limited drug coverage — a $13.4 billion saving during the program’s first year alone.
When Congress resumes negotiations on the next round of fiscal cliff talks, it needs to remember: If it ain’t broke, don’t fix it.
Medicaid-style rebates would increase monthly expenses on fixed-income senior citizens and render the program less effective despite a successful history of saving taxpayers billions of dollars. Sounds like a classic case of tampering with something that is better left alone. In fact, nearly 350 organizations agree and recently signed a letter urging Congress to Preserve Medicare Part D as fiscal cliff negotiations entered their critical stages.
I join them in this effort. Part D ain’t broke. Please don’t fix it.
Randy Brinson is a gastroenterologist in Montgomery. He is also chairman of the Alabama Christian Coalition and a former health-care advisor to Republican Gov. Fob James.