Editorial: Drug plan’s bogus stats

Monday, Feb. 14, 2005 | 9:22 a.m.

Last year the Bush administration announced that the 10-year price tag for the new prescription drug benefit for Medicare recipients would be $534 billion -- much higher than the $400 billion cost that the president had used just a few months earlier. So we can't say that we're too surprised that the Bush administration said last week that its latest 10-year estimate for the cost of the drug plan would be even higher -- $724 billion.

The White House used phony numbers at the end of 2003 in order to get enough conservatives in Congress -- who had concerns about the drug program's cost -- to support and pass the legislation, a key part of the president's re-election campaign. We know the numbers were phony because, several months after the legislation was passed, the Bush administration acknowledged the cost would actually be $534 billion. It subsequently was revealed that the Medicare program's actuary had believed in 2003 -- before Congress voted on the legislation -- that the benefit cost would be between $500 billion to $600 billion. But Medicare program administrator Thomas Scully told the actuary, Richard Foster, that he would be fired if he released this information to Congress. So a realistic estimate of the program's cost was suppressed by the Bush administration -- for partisan political reasons.

Administration officials contend that the reason why the drug program's cost is higher now is that they are measuring a different time frame. The previous 10-year estimate began with the year 2004, but the latest one starts in 2006, accounting for more people receiving the drug benefit and higher drug prices. While that may partly explain the reason, it's been clear throughout this administration that it won't hesitate to use accounting chicanery to further its political aims. For example, Bush refuses to include in his budget the cost of the wars in Iraq and Afghanistan and the start-up funding necessary for his proposal to privatize Social Security. This is all done so that budget deficits, driven higher principally by his reckless tax cuts, appear smaller than they really are.

So what should be done, now that it's widely accepted that the drug program was built on dishonest numbers? Many Republicans say that the program should be scaled back. One way would be to exempt wealthier seniors from getting the drug benefit. This would be dicey, though, especially since Medicare always has been a program that elderly Americans -- no matter their wealth -- have been allowed to participate in equally. Democrats contend that costs could be lowered if Congress got rid of the law's provision that prohibits the government from directly negotiating with pharmaceutical companies for reduced drug prices. The best approach would be to allow the government to leverage its vast purchasing power to get the pharmaceutical companies to sell them drugs in bulk, at reduced prices.

Bush's reaction to these proposals? He said he would veto any changes to the Medicare drug program. The president who created this mess, and who styles himself as a fiscal conservative, won't consider options that could save the program money. Amazing.