Letter: Price controls are part of health care

Sunday, July 18, 1999 | 11:15 a.m.

According to the New York Times on June 8, President Clinton will propose "revamping the Medicare program to offer prescription drug coverage to all beneficiaries, and he will contend that such coverage can actually save money for the government by reducing the need for hospital stays and nursing home care." The government would hire private companies to help buy drugs and utilize "pharmacy benefit managers" who "could control costs by obtaining discounts ... and preventing overuse or misuse of prescription drugs, the administration contends. 'We should never do price controls,' a senior White House official said."

Actually the government is already using price controls -- a fundamental reason there is a nursing home "shortage." Washington decided just two years ago to save money in the tottering Medicare program by cutting payments to nursing homes.

Instead of paying based on costs incurred, the Washington Times noted, "the government decided to pay them on what the feds, in their infinite wisdom, thought the service should cost." Some nursing homes struggle to get by with lower profits, though others have decided not to deal with patients who are too expensive. Families find themselves obliged to place patients in more distant homes, the Times observed, or simply leave them in hospitals.

The administration may say it doesn't want price controls, but that's cheap lip service. Anyway, who can believe a syllable from Clintonistas aiming to push subsidized drugs in exchange for senior votes?

FRANK M. PELTESON

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