3 Big Differences – and 1 Awful Similarity – Between Obamacare and Medicare Part D

Keith Speights at The Motley Fool outlines
“3
Huge Differences Between the Medicare Part D and Obamacare
Launches.” As most of us have been lectured by admin officials
and supporters of the president’s health plan, don’t you know that
the prescription drug plan rolled out by the Bush administration in
the mid-Aughts also had a terrible launch? And now, would you
believe it, the seniors who get nearly free drugs from Part D
love the program!

It sure did, but Speights stresses that the sheer magnitude of
the technical difficulties, the centrality of the website to the
program’s success, and the incentives for the targeted audience to
sign up are very different this time around.
Read the whole article for details, but on that last point:

Medicare Part D launched with several incentives for seniors to
enroll: new benefits they didn’t have before, low premiums, and
subsidies for individuals with low incomes. There was even a
penalty for enrolling late — although none for declining to
enroll.

Similar incentives are also present with Obamacare. A big
difference, though, is that many individuals could find
it more
financially attractive to forgo insurance — especially in
the first year or two. And because the health-reform
legislation didn’t
give the IRS any real teeth to go after those who don’t
want to pay the penalties, the “stick” of Obamacare probably won’t
look too threatening to some Americans not enticed by the “carrot”
of health insurance.

Let me add one striking – and awful -similarity to the two
programs: They are both unnecessary and expensive. 

There’s no question that recipients of drugs under Medicare Part
D love the program.
Something like nine out of 10 seniors say so. Why wouldn’t
they? They got $62
billion of free and/or reduced-price drugs under the program in
2010 and that number will bounce up to $150 billion by 2019!
Billion! None of which was paid for by any sort of dedicated
revenue stream at the time of the legislation’s passage. You, me,
and our great-grandkids are the stream! No one it feels like it’s
raining!

And before anyone starts yammering on about seniors choosing
between Purina Cat Chow and a generic statin (as folks such as Al
Gore did back in
the 2000 campaign), remember that when the plan was being
discussed, retirees paid on average a total of 3.2 percent of their
annual income on drugs. That was less than they shelled out on
entertainment.

Rather than, I don’t know, creating a
smaller, targeted plan that might cover low-income/low-wealth
seniors and other poor people regardless of age, Republicans and
Democrats came up with a sop to one of the most powerful and
wealthy voting blocs in the country. Many Democrats voted against
the prescription drug plan because it wasn’t paid for, which at
least was to their credit
at the time. But it’s appalling spectacle to see both parties
now touting a giveaway that wasn’t necessary in the first place and
whose cost will more than double in less than a decade as some sort
of model of anything except stupidity and wastefulness in
action.

Which brings us to Obamacare, whose cost estimate for its first
full decade had doubled even before this awful Healtcare.gov
apparition appeared. As Peter Suderman
noted in 2012, the Congressional Budget Office figures that
instead of boasting a gross operating cost of just (!) $938 billion
for its first decade, the tab for the first decade of actual
coverage is looking closer to $1.76 trillion. Who would have
thought that a government health care plan might have been more
expensive than originally claimed?
Only anyone who actually tracks what past reforms ended up
costing.

Then there’s Obamacare’s great failure when it comes to insuring
the uninsured (let’s leave aside the question of whether insurance,
spending on health care, and actual health outcomes are clearly
related,
which they are not). Of the 50 million folks that don’t have
insurance, Obamacare will, under its most optimistic projections
cover an additional 25 million over the next decade. And it will
leave
31 million uninsured over the same time frame.

When it comes to universal coverage, then, Obamacare is
an-out-of-the-box failure that needs to go back into the box and
stay there. Then we might start a conversation about
what insurance is actually to supposed to do and build a
consensus around how best to design a law that might actually work
and doesn’t just massively increase government’s power and spending
to no clear end.

15-second video, starring Barack Obama, Kathleen
Sebelius, and Mr. T: Time to bring in the A-Team? It’s
always time to bring in The A-Team.