Tuesday, March 31, 2009

Medicare Part D is the Best Litmus Test for How Well the Federal Government will Dispense Health care to Americans

The implementation of Medicare Part D is the best case study of how well our modern American government will administrate the new health care reforms. Simply put, this piece of legislation and its ramifications should be on of the most significant factors in the dialogue over health care reform in 2009 because it was health care reform in 2006. The mistakes of three years ago are the best indication of the mistakes to come in reforming health care in 2010.

Yesterday, Congress began to consider the budget resolutions with their health care proposals. They are expected to vote on them this Thursday. In 2010 we will have a new health care system model.

The last time Congress rushed health care reform, they harmed the seniors they were trying to help. Medicare Part D was signed into law on December 8th, 2003 and went into effect on January 1, 2006. The administrative glitches, loss of coverage, and confusion among seniors, pharmacists, and their doctors served as a daily reminder that government could not take care of everyone.

Back in 2003, Congress faced a legitimate problem. Some American seniors could not afford to pay for their prescribed medications and drove up the cost of Medicare for taxpayers. Congress’ solution was Medicare Part D. Part D is a prescription drug entitlement program administered by Medicare as part of the Medicare Prescription Drug Improvement and Modernization Act (MMA) signed into law on December 8, 2003.

Once the MMA was signed into law, the Centers for Medicare and Medicaid Services (CMS) went about the task of creating the final regulations governing the entitlement program. It took until January of 2005 for them to complete that preliminary task. Under the Congressionally mandated timetable, that left less than a year to contact and educate all eligible seniors before enrollment began in November of 2005 and the new program went into effect on January 1, 2006.

The most central problem was that the Medicare bureaucracy could not handle the administration of Part D without expensive administrative glitches. The program was too unwieldy.

For example: CMS needed to hire 500 new employees to administer the drug benefit. At the time, they had a staff of 4,500 employees. In one year they needed to increase their staff by 11%. Any MBA will tell you that employment increase alone would cause integration nightmares and glitches, and it did. One of the most famous was the $50 million mistaken refund to 230,000 enrollees. http://seniorjournal.com/NEWS/MedicareDrugCards/6-10-02-SenateAgingChair.htm

The second problem was the massive disruption of existing drug coverage for poor seniors. State officials repeatedly warned the federal government that the enrollment of 6.4 million very poor seniors faced practical problems like the fact that those seniors are one of the population subsets least likely to open their mail. Please click here for a USA today article from January 2006 detailing the disruption. http://www.usatoday.com/news/opinion/editorials/2006-01-19-our-view_x.htm

Health experts, members of Congress, and seniors all warned that the two year government turnaround was too fast. There were calls from within Congress to slow the advance. A bill (H.R. 1382) was introduced by Jeff Flake (R-AZ) to delay the start by one year and continue with the Medicare drug discount card and subsidies to low income seniors during the education and implementation process. Our current House speaker, Nancy Pelosi (D-CA), called for an extension of the sign up time.

Back in 2003, two years was considered a fast turnaround for government health care legislation. Part D only dealt with 10% of the US dollars spent on health care per year. In 2009, Congress is trying to change how 100% of health care dollars are spent per year in one year. Can you even imagine the glitches that will occur?

Don't take my word for what happened. Google search it yourself. These issues aren't as complicated as they want you to think.

Eat a burger and do some homework.

:0)



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