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Medicare Part D’s challenges and problems

It will come as no surprise that the war over the Medicare Part D program (free subscription required) is continuing to heat up, with Republicans touting the benefits for seniors while Democrats describe the program as a giveaway to the large pharmaceutical firms on the backs of the taxpayers.
As I have noted before, the entire Medicare Part D program, from the original budget estimates (remember the Medicare Chief Actuary was threatened with dismissal by the Administration (subscription required) if he revealed the true cost of the program before the Congressional vote) to the hold-harmless provisions protecting private companies from losses to the failure of the legislation to allow the Feds to negotiate drug prices to the cumbersome, complex, confusing program itself to the likelihood for adverse selection due to the benefit design is enough to make your head spin. And that’s exactly what is happening amongst potential beneficiaries.
An article in the New York Times on Part D describes the problems politicians of all stripes are facing when attempting to educate their constituents about this program

One thought on “Medicare Part D’s challenges and problems”

  1. The shoe is on the other foot. During the long Republican minority period, so many issues framed up this way: Democrats forced to defend complicated legislation born of compromise–the kind of compromise in which the majority party must engage to get anything done. The minority gets to stand back and snipe about how complicated and unwieldy the legislation is. Upshot: the minority’s argument is simple and understandable by a confused electorate. Much to the Republicans’ chagrin, unlike something like welfare reform, this time the complicated issue affects the most vocal and easily angered voting bloc. This issue is bad news for Republicans and likely bad news for the publicly traded managed care companies, whose market prices include a premium that anticipates a successful roll out of the program without major change.

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Joe Paduda is the principal of Health Strategy Associates



A national consulting firm specializing in managed care for workers’ compensation, group health and auto, and health care cost containment. We serve insurers, employers and health care providers.



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