- The Washington Times - Wednesday, June 7, 2006

Conservatives are squeamish about taking credit for the success of the new Medicare drug benefit. For all its success, they remain angry that it passed. So angry that some of the pundits who used to extol the ability of new medicines to save lives and reduce the use of other health services assert that prescription drug spending will simply overwhelm other forms of health care expenditures.

We in the benefit’s “cheering section” have never believed that prescription drugs would be a panacea for Medicare’s ills, particularly the lack of market competition in the program. However, medical essayist Lewis Thomas observed: “There is no important human disease for which medicine possesses the outright capacity to prevent or cure where the cost of the technology is itself a major problem.” The cost of drugs is never as high as the cost of treating the same disease using a combination of surgery, lab tests, hospitalization and so on.

Two studies underscore this dynamic contribution of medicine and why it is critical for conservatives to understand that unleashing technological change in health care is as important as consumer-driven transformation. One is by researchers at Kaiser Permanente, which finds that spending caps on prescription drugs in Medicare don’t save insurers money, and that people with such caps don’t pay for medicines themselves and wind up being hospitalized, which costs everyone more. Similar restrictions on drug choices — favored by Speaker-in-waiting Nancy Pelosi — lead to the same perverse outcomes.

The “jeering” section claims such associations deliver no health or economic gain overall. But when Medicare examined what health seniors “cost” Medicare compared to chronically ill elderly of the same age they discovered that the healthy individuals, even though the lived three years longer, accumulated $10,000 in Medicare spending. If every senior’s health were improved to delay the onset of one chronic illness by three to five years — high blood pressure, Alzheimer’s, depression, diabetes — the cumulative saving to Medicare would be hundreds of billions of dollars. That does not count the increased wealth and productivity generated from longer life.

Ultimately, we agree with what one conservative politician said: “The scene is only too easy to picture. An elderly couple, perhaps one has a very long stay in the hospital; the other forced to empty the savings account, to skimp on groceries. And even for those never actually forced into this situation, there’s the gnawing worry, the fear, that someday it might just happen. This legislation will change that, replacing worry and fear with peace of mind.”

That was Ronald Reagan in 1988. Today’s market-driven drug benefit — savings and all — fulfills his vision and secures his legacy.


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