I agree with just about everything Dean Baker says here:
The dirty secret in this story is that drugs are cheap. They only get expensive when the government gives drug companies patent monopolies that allow them to sell drugs without competition. They get more expensive when the government creates a convoluted benefit scheme in which seniors buy their drugs through private insurers.
The logical way to design a prescription drug benefit is to have Medicare negotiate the price directly with the drug companies. This method has brought price reductions of 40 percent or more at the Veterans Administration and in other rich countries. These savings would allow seniors to have a simple low-cost prescription drug benefit. Rep. Jan Schakowsky, D-Ill., has proposed a bill that sets up a system along these lines.
In addition to creating a real drug benefit for seniors, the Schakowsky bill is an essential step in reaching universal health care coverage. Why? As the most efficient part of the nation's health care system, expanding Medicare would be the most obvious way to reach universal coverage. However, no one would want to be in a Medicare system that doesn't have a workable prescription drug benefit. For this reason, we must first reform the prescription drug benefit before we can expect the public to take “Medicare for All” seriously. If the forces that turned back the Republican assault on Social Security turn their attention to pushing for a real Medicare drug benefit, they will both be advancing the cause of providing more security for seniors and advancing the cause of universal health care.
That last is a particularly important point. The Medicare Prescription Drug Benefit isn't just a bad bill, it's a Trojan Horse. After a year or so of implementation, so many enraged seniors will pour out of the program and return to the private market that Medicare's entire reputation could conceivably be wrecked. If, on the other hand, we could excise Part D, replacing it with a logical drug benefit of the sort Schakowsky proposed, we'd have gone far towards creating a model universal system within the country, one that could conceivably be expanded to cover the nation.
The question will be perception: if the right spins the drug programs into a government failure, liberalism and dreams of universal coverage lose. If the left is able to convince the country that Part D's flaws are the inevitable aftermath of a bill written by and for Big Pharma, the private market's perverse incentives take the hit. And given the potency of the elderly electorate, this is a battle that's going to play out richly and fully as we speed into 2006. The only question is whether or not Democrats are ready. Baker says they are, and notes that some of the coalitions that fought Social Security privatization are gearing up for this battle too. They'd better. Democrats will never find an easier, more fertile issue than this monstrous betrayal of seniors. If they can't launch a counteroffensive on that, the party's about as doomed as it can be.
