Friday, Dec. 5, 2003 | 6:02 a.m.
Mike O'Callaghan is the Las Vegas Sun executive editor.
WEEKEND EDITION Dec. 6 - 7, 2003
THE RECENTLY PASSED Medicare prescription drug bill has had an immediate political impact on our nation, but its true test will not occur for another four years. Only then will we know if our ailing senior citizens are winners.
We already know that the drug industry dodged the bullet that would have made them less profitable. There was some hope that the Medicare bill would allow the government program to buy drugs in large quantities at lower prices. This attempt was lobbied to death and there is no provision to slow down the fast-rising costs of drugs.
The Wall Street Journal noted: "For the drug industry, the legislation is good news, at least in the short run. The benefit would be administered through private insurance plans or pharmacy benefit managers. Drug makers believe individual private buyers are less able to push down prices than a centralized government purchaser with a pool of 40 million patients.
"In another victory for the drug industry, the Medicare package, at least as it stands now, doesn't make it easier to import cheaper drugs from Canada."
So we know that the drug producers and insurance companies come out as winners. Both industries are well known for having excellent lobbyists with plenty of campaign money to spread around during election years.
The lobbying voice of the seniors, the AARP, came out in support of the new law with the same vigor as the lobbyists for drug and insurance companies. This action immediately drew fire from critics who pointed to the close financial ties of the AARP with the insurance business.
In the middle of that fight, author Dale Van Atta, an AARP critic, wrote: "Regardless of where you stand on this proposed act, AARP has no business doing unauthorized lobbying for its membership. Its chimerical lobby wholeheartedly represents only what a few paid staff leaders decide is best for all older Americans.
"If anything, those heartened by the endorsement of the moderate Republican-oriented bill should be aware that in the last two decades AARP has never once had a clear victory on any major controversial health-care legislation. Though it has often been described as the fearsome '800-pound gorilla' of lobbies, it has proved adept at slipping on its own big banana peel."
After the bill was passed and signed by President George W. Bush, the AARP found it necessary to buy expensive full-page ads in The New York Times, Los Angeles Times, New York Post and USA Today justifying its actions. It also stressed several benefits many seniors will receive for the payment of prescription drugs.
What remains to be seen is how the bill affects the pocketbooks of seniors with private health plans and those who purchase a quantity of drugs that isn't covered by the bill. Yet to be learned is whether or not the cost of prescription drugs will continue to climb and benefits will have to be reduced by a future Congress. Also, will this new flirtation with HMOs provided in the law fail like past efforts? Remember it was but a few years ago that large numbers of seniors were dumped when their HMOs left the market. We must also learn if private health insurers will 'cherry-pick' healthy seniors and discourage the enlistment of the most sick and in need of care.
In the meantime, political observers are watching Thomas Scully, who heads Medicare, in flight from his present position into private industry. Robert Pear of The New York Times writes: "Mr. Scully has made no secret of the fact that he has been looking for jobs outside the government for more than six months -- even as he spent hundreds of hours in closed sessions with House and Senate negotiators working out countless details of the legislation, which makes the biggest changes in Medicare since creation of the program in 1965."
Scully went into the federal service from the presidency of the Federation of American Hospitals. Now he is discussing employment with private health care industry people who scored big with the new drug bill.
We all have to learn more about this new law, which will cost taxpayers billions of dollars. What we will learn over the next few years is exactly who it has helped and who it has hurt. I don't know the answer at this time, but hope that the bill is as good as the AARP and President Bush predicts it will be.
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