Saul Anuzis

Ask Americans to name a problem with our healthcare system, and you’ll hear a range of answers, from insurance bureaucracy to overbooked doctors to the inadequacies of Medicaid. Only a very few will name Medicare’s drug benefit, known as Part D.

In one recent survey, 87% of seniors said their Part D plan “provided good value,” 93% said the plan was “convenient to use,” and 89% said the plan “delivered what it promised.”

It is the rare government program that works better than advertised, costs less than estimated, and is wildly popular with the people it serves.

And yet, though the program has successfully delivered prescription drug coverage to seniors for 15 years, some of our political leaders want to dismantle it. Democrats in Congress aim to repeal a key part of Medicare Part D, known as the non-interference clause. This clause has protected patients’ access to critical medicines by making sure that government officials don’t get to decide which medicines are “worth” covering.

Currently under Part D, insurance companies offer a variety of plans from which seniors can pick and choose.

The non-interference clause prevents government agencies from swooping in to limit access. Insurers aggressively negotiate with drug companies to get the widest variety of medicines for their patients. The drug companies, in turn, compete with one another to make sure their products are included on formularies.

Proponents of getting rid of the non-interference clause believe that if the feds could only step in, they would push prices lower than those achieved through competition.

The problem is, they’re wrong. Nixing the non-interference clause would have long-term downsides for seniors’ health, even as the politicians pat themselves on the back for an illusory win — and move on.

Today, depending on their state of residence, seniors and people with disabilities have between 25 and 35 Medicare Part D prescription drug plans to choose from, with nearly 1,000 separate plans available nationwide. Since the program launched in 2006, the Centers for Medicare and Medicaid Services have repeatedly lowered Part D’s estimated cost, a rare occurrence in the world of government spending. Public opinion polls, meanwhile, have repeatedly found that more than 80% of seniors are happy with the program.

All jest aside, getting four out of five seniors to agree on anything is a notable achievement.

Medicare Part D’s success did not arrive in spite of government’s absence from negotiations and price-setting, but because of it. The buying power of 46 million diverse customers drove down prices and expanded coverage.

The federal bureaucracy could only extract savings through “negotiation” if it were willing to severely restrict access to drugs. Indeed, the Congressional Budget Office has studied this issue and concluded that negotiations would only yield savings if the Secretary of Health and Human Services could “establish a formulary.”

So if this measure were to pass, many seniors and people with disabilities would find themselves suddenly without coverage for drugs they rely on. Some would pay out of pocket. Many would skip their unaffordable medicine — and get sicker. Quality of life could suffer, and lives would be lost. We would pay in dollars, too, as government intervention would end up costing the system much more money down the road.

In practice, government price “negotiations” are no different than price controls. And such limits have a well-documented record around the world of stifling investment in new drug research. That would severely hurt not just today’s seniors, but tomorrow’s, who have every right to hope for new cures for Alzheimer’s disease and cancer — if reinvestment into research remains robust.

Instead of rationing drugs and limiting innovation, Congress should focus its efforts on lowering out-of-pocket costs for beneficiaries. This will expand access for beneficiaries — and there is significant, bipartisan support for plenty of proposals to do just that. As just one example, lawmakers could create an “out-of-pocket” cap so that patients on Medicare will be fully insured once they’ve spent a certain amount.

If the changes to Part D go through, our forecast is that investment will dwindle. This shouldn’t just alarm the seniors reading this. The concern isn’t confined to a narrow age-group. Be worried if you’re younger, too. For your senior days lie ahead of you.

Saul Anuzis is president of 60 Plus, the American association of senior citizens.


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