The NYT has a good piece about how some of the insurance companies in the Medicare drug plan failed to notify seniors of changes in their plan. These changes often involve higher prices and the dropping of some drugs from the plan. Of course, even seniors who did get notified would have to read through 30-40 page booklets. That sounds like a great holiday present for elderly people, many of whom have bad eyesight and problems concentrating. It will be interesting to see if the new Congress takes any substantive steps to fix this nonsense. The obvious way to have created the drug benefit would have been to let Medicare offer its own plan as an add-on to the traditional program. The insurers within Medicare could do the same, with an equal subsidy and they could compete in the market. This would have made a simple low cost option available to all Medicare beneficiaries. The brave men and women who occupy Congress say that the insurance and drug industry have too much power to allow for a Medicare sponsored drug plan. So, we compromise. We put in place an efficient user-friendly system and then cut the insurance and pharmaceutical industries checks for the amount of profit that they would have made off the taxpayers under the current system. The system is called "Temporary Assistance for Needy Corporations (TANC)." The companies that are unable to compete in the market will get checks for their lost profits from the government for 10 years. This will allow their CEOs to still get multi-million dollar compensation packages and their shareholders will still get big dividends, the big benefit for the public will be that seniors won't have to deal with so much nonsense when trying to get the health care that they need. Oh yes, the other benefit is that we won't have to continue to pretend that policies that redistribute income upward have anything to do with the free market.
--Dean Baker
