Verdict on Medicare’s “Part D” Prescription Program
Competition among more than 1,000 drug plans has resulted in:
- Costs that are 32 percent less than what the Congressional Budget Office originally estimated.
- Spillover benefit: Part D has lowered retail prices for non-Part D commercially insured patients by $2.6 billion per year.
- Spillover benefit: Part D has lowered retail prices for non-Part D elderly by 8.5 percent (19 percent for generics and 0.9 percent for brands).
- Health benefit: for conditions sensitive to medication adherence, hospitalization for Medicare beneficiaries declined by 77,000 per year.
- Efficiency benefit: Medicare Part D enrollees that had no drug coverage had increased their monthly drug spending by $41, but that outlay was roughly offset by a decrease of $33 in their monthly medical spending.
Full Congressional Testimony by Scott Gottlieb.
Very interesting. If they had done the right thing, the Bush administration that is, the program would have saved money. By doing the wrong thing they are helping bankrupt the country.
Ditto Joe’s comment.
Huge waste of money.
The policy lesson here is that competition and ecnomic incentives work in health care. Too many health policy people are instinctively opposed to the economic model of human behavior.