Why then do you continue to defend Part D, which was completely unfunded?
I didn't support the creation of Part D for that very reason.
I've just pointed out, time and again, that of all the government run health care programs, it is the best -- largely because of the structure which uses private insurance companies to provide the service rather than a bloated government plan like is being proposed for our "health care reform". If the liberals in Congress would propose something like Part D for the health care reform they'd have a lot of support for it, and if Part D is any indication, they'd end up with an affordable program that wouldn't bankrupt the country.
Part D has consistently provided great service at relatively low cost, coming massively under budget every single year since its inception.
It seems to have achieved the impossible -- cost effective provision of drugs to about 90% of Medicare beneficiaries, at a cost which decreases every year rather than increase.
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For Immediate Release: Tuesday, July 11, 2006
Contact: CMS Office of Public Affairs
202-690-6145
MEDICARE PART D SPENDING PROJECTIONS DOWN AGAIN, PART A AND PART B INCREASES HIGHLIGHT NEED FOR FURTHER REFORMS
Summary
Medicare Part D expenditures are now projected to be $34 billion lower over 5 years (2006-2010) than in the President’s Budget, and $110 billion lower than in the Mid-Session Review one year ago. The average Part D premium is almost 40 percent lower than had been projected a year ago as a result of strong competition, and 90 percent of Medicare beneficiaries are receiving prescription drug coverage.
Medicare Part A and Part B expenditures are higher, primarily because of continuing rapid growth in the use of Medicare services. Part A projected expenditures over 5 years (2006-2010) are $17 billion higher and Part B projected expenditures over 5 years are $30 billion higher than in the President’s Budget. Rapid growth in physician-related services and hospital outpatient services are the main factors responsible for a projected increase in the Medicare Part B premium of 11 percent for next year.
The continued rising costs in Medicare Part A and Part B highlight the need for reform of the original Medicare program to pay more accurately and especially to pay more for better care, not simply more services. The President’s Budget proposed building on MedPAC’s recommendations for more accurate payments to health care providers, and the adoption of performance-based payment systems.
Part D
The costs of Medicare Part D continue to turn out to be much lower than had been expected. Since the President’s Budget in February, projected Federal costs for the Part D program have declined again, by roughly $34 billion for 2006-11 and $76 billion for fiscal years 2006-2016. The reductions since last year’s Mid-Session review are much larger, $110 and $302 billion, in part reflecting lower costs per beneficiary enrolled in the program than had been expected. The drug plans competing for Medicare beneficiaries have been able to establish greater than expected savings from aggressive price negotiation, very low-cost coverage for generic drugs and less costly brand-name drugs, and other steps to keep drug costs down.
In addition, beneficiaries have overwhelmingly selected less costly drug plans. While the average premium expected a year ago was $37, enrollees are actually paying premiums that average less than $24. Some of the estimated cost reductions result from more refined enrollment assumptions, which take into account actual Part D participation rates for 2006. As of June 11, 2006, more than 38.2 million people with Medicare were receiving coverage for prescription drugs through Part D or other plans that provide coverage as good as or better than Part D. Thus, 90 percent of all Medicare beneficiaries have good drug coverage, including 3.5 million Federal retirees (in the Federal Employees Health Benefits program and TRICARE) and 5.4 million beneficiaries who are continuing other sources of coverage (such as job-related coverage and VA coverage). Finally, the lower Part D cost estimates also reflect lower actual growth in drug costs in 2004 and 2005 than had been expected, with single-digit percentage increases for the first time in more than a decade and a continued expectation of slower growth in actual drug prices and costs in the next few years, as more generic drugs become available and aggressive steps to keep down drug costs continue.
State payments for a portion of the costs for drug coverage for Medicare-Medicaid “dual eligible” beneficiaries that the states would have incurred under Medicaid are projected to be more than 25 percent lower than had been projected one year ago. State payments are now estimated to be $111 billion for fiscal years 2006-2016, which is about $2 billion lower than the estimates in the President's Budget and about $45 billion lower than last year's MSR.
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