Editore"s Note
Tilting at Windmills

Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

November 17, 2003
By: Kevin Drum

PRESCRIPTION DRUGS....In a move that probably guarantees passage, AARP has decided to back the prescription drug plan being pushed by congressional Republicans. Apparently their theory is that it can always be fixed later:

William Novelli, CEO of the AARP, said his group would "pull out all the stops" to pass the legislation, including a three-day television advertising campaign this week.

The bill is not perfect, he conceded, "but the country can't afford to wait for perfect. On balance, its the right thing for seniors in America and their families."

I've been known to get suckered by the "half a loaf" theory myself, so I sympathize. On the other hand, this bill is such a byzantine nightmare of benefits that kick in, kick out, and kick in with dizzying speed and no apparent logic that it's hard to view it as even half a loaf.

But here's the part I don't get. The section of the bill that's near and dear to the hearts of Republicans is the part that introduces competition into Medicare. Now, the phenomenon that we rather optimistically refer to as "competition" in the rest of the healthcare industry Adam Smith is probably rolling in his grave to hear the word abused this way has rather famously not done an outstanding job of holding down healthcare costs in America. Still, Republicans are in a lather about it. Gotta have competition. It's the only way to reduce costs.

But here's the problem: in theory, private companies can deliver services more efficiently than the bad old federal government bureaucracy and can therefore deliver those services at a lower cost. But if that's the case, why does the bill have to pay them a bribe of $12 billion to get them to participate?

The answer, of course, is that the idea of competition in the Medicare market is a mirage. Private healthcare companies plainly don't believe that they can, in fact, provide services any more efficiently than the feds, and since the goal of a private company is to make money, that means that the only way for them to maximize profits is to reduce benefits and do their best to insure only the healthiest people.

And that's exactly what the Republicans want to happen: they want to reduce benefits without telling anyone that they're reducing benefits. And while they're at it, they want to provide large bribes subsidies to healthcare providers and pharmaceutical companies who will show their appreciation the old fashioned way: by showering them with campaign contributions. It's a twofer.

And it sucks. I sure hope AARP is right that this boondoggle can be fixed later. It's a big gamble.

UPDATE: Plenty of AARP members seem to be upset with their endorsement....

Kevin Drum 4:38 PM Permalink | Trackbacks

Bookmark and Share
 
Comments




 

 

Read Jonathan Rowe remembrance and articles
Email Newsletter icon, E-mail Newsletter icon, Email List icon, E-mail List icon Sign up for Free News & Updates

Advertise in WM



buy from Amazon and
support the Monthly