USA Today Pans Candidates’ Prescription Drug Plans

In a review of both presidential candidates' Medicare prescription drug benefit proposals, a USA Today cover story reports that both plans will primarily benefit corporations and potentially bankrupt Medicare in the future. Vice President Al Gore's plan would extend Medicare to absorb 36% of seniors' drug costs in 2003, rising to 46% in 2010, according to the Congressional Budget Office. Texas Gov. George W. Bush's (R) plan, which would pay private insurers to provide the benefit, "probably would subsidize slightly less" than Gore's plan, but "precise estimates are not possible because of the plan's lack of details," USA Today reports. Still, both plans would cost "roughly the same" -- $600 per beneficiary in the beginning -- and would cover 25%-50% of total drug costs for seniors. But "[n]either candidate," USA Today reports, "has mentioned that the biggest windfall from their plans would go to employers that provide prescription drug coverage for retired workers." USA Today reports that a recent Kaiser Family Foundation study states that "companies, mostly major corporations, would save about $50 billion over five years by having the government fulfill part of their promise to pay retirees' prescription drug expenses." Urban Institute economist and former Medicare trustee Marilyn Moon added, "We're basically saying, 'Employers who were chumps enough to offer good prescription drug coverage are off the hook.'" USA Today also considers whether all seniors need medication coverage, and whether a plan that would cover all seniors -- rather than just those who most need it -- would be spreading Medicare funds too thin. "Despite this year's political rhetoric," USA Today states, "most Americans older than age 65 don't have budget-busting prescription drug bills." According to the National Academy of Social Insurance, "[t]wo-thirds of all seniors will pay less than $500 out-of-pocket this year for prescription drugs. ... [and] only 7% will pay more than $2,000." Furthermore, among the one-third of seniors who currently lack prescription drug coverage, "many are poor enough to qualify for Medicaid coverage ... or affluent enough to pay their own bills." USA Today says that because Gore and Bush "want to cover every senior, including many who are wealthy or well-insured, those with the highest costs still would be left with drug bills costing thousands of dollars." Cato Institute Director of Health Care Policy Tom Miller added, "Under no circumstances should the door be opened to universal subsidies to seniors for routine drug expenses." While targeting the eight million seniors who spend more than $1,000 a year on drugs could eliminate nearly all of those seniors' out-of-pocket medication expenses, "such a narrowly tailored benefit could be a political death sentence." USA Today compares such a plan to the 1988 Medicare Catastrophic Coverage Act that former President Ronald Reagan signed and then repealed in 1989 before it took effect. That act would have helped 16% of seniors who had the highest drug costs, covering 50% of the costs beyond a $550 deductible. Seniors also would have paid $1.94 per month for the insurance. Calling the plan "a political disaster," Michael Gluck of the National Academy of Social Insurance said, "Seniors were outraged that they were forced to pay a premium but might not get a benefit." Candidates Woo Swing Voters By touting their approaches to addressing prescription drug costs, the presidential candidates are tapping into the concerns of this election's "swing voters," USA Today reports. Meanwhile, America's 11 million uninsured children have gone largely unnoticed in the campaign. "It's good that we're talking about prescription drug coverage for the elderly. But it makes you wonder why we hear almost nothing about [uninsured children]. Children don't vote is the obvious answer," Alan Sager of the Boston University School of Public Health said. Boston University economist Larry Kotlikoff added, "This is an immoral act we are inflicting upon our children. We're creating a tidal wave of liabilities for the next generation. ... We're sitting on financial dynamite and pretending it's not there." Moreover, USA Today argues that the presidential candidates have failed to address "the thorniest issue of all: How will the government pay for Medicare as it exists now, much less cover a new and expensive prescription drug benefit?" Robert Helms, director of health policy at the Washington, D.C.-based think tank American Enterprise Institute, surmised, "We have hard choices to make [for Medicare]: raise taxes or cut benefits? But instead, all they're talking about is adding benefits" (Cauchon, USA Today, 11/1).