A Prescription for Disaster
By Richard E. Ralston
November 18, 2003
At a cost of $400 billion over 10 years,
Congressional Republicans have agreed in Conference Committee—with
the enthusiastic encouragement of a Republican President—to the
greatest expansion of government in two generations. This new
Medicare program can only result in what government supplied health
care has always produced in the U.S. and elsewhere: fewer new drugs
and a lot more government. Of course, after a few years in practice
we all know the program will end up costing a lot more.
The stated reason for the plan is to provide
Americans with medicines they could not otherwise afford. The
Republicans don't ask why drugs are out of the reach of so many
customers. Nor do they ask how those who cannot afford their own
drugs will now be able to pay through new premiums for everyone
else's drugs.
Higher costs will be the result of enacting these
prescription drug plans, based on the established track record of
government involvement with health care. Medicare, which cost $3
billion a year in 1967 costs $250 billion today and, according to
the Congressional Budget Office, will cost $474 billion a year by
2012 without any new prescription benefits. The idea that
government involvement will reduce the cost of the development of
anything as complicated and high-tech as life-saving drugs is
ludicrous: The government, as Americans well know, cannot
even control the cost of postage.
Rather than reduce the cost of drugs, like all
government medical plans the new program will just add more of the
poison that created the disease. Rigid controls and the vast
bureaucracies of Medicare and the FDA already add billions of
dollars to the cost of drugs. This, not the market place, is
responsible for the current high cost of drugs. New government
programs and "benefits" will further explode drug costs and result
in rationing, restrictions, regulations, less research, and fewer
drugs. Adding yet more federal bureaucracy to administer another
program will just layer on more expense.
Fewer new drugs will become available as a
consequence of these plans. When the government is "surprised" after
the escalation in drug costs that result from a plan that promises
to pay all of the bills, it will inevitably proceed to price
controls and other new restrictions on drug companies
How do these Republican advocates of less
government and free markets justify this huge new program? The
woefully inadequate fig leaf they provide is the introduction of
competition to Medicare from private insurance companies. However
such competition will be available temporarily in only six cities
during a six year test period beginning seven years from now
(2010). What a triumph for Capitalism! Yet Senator Edward Kennedy
says it will destroy Medicare. Yea. Sure.
There is one minor feature of the bill that would
help seniors pay for their prescriptions. It would allow Americans
to contribute to tax free Health Savings Accounts in conjunction
with the purchase of high deductible health insurance policies. But
this single feature is not nearly enough to make the legislation
palatable.
If the government really cares about the
availability of medicine, it can start decreasing rather than
increasing controls over the pharmaceutical industry. What the
government really needs to expand is not government, but freedom: a
free market that encourages drug companies to develop plenty of new
drugs to compete with the old. Free markets—including such features
as Health Savings Accounts—would provide patients and physicians
with better drugs at a more reasonable cost than the heavy hand of
government.
Americans concerned about the cost of their drugs
and their own health need to reject this crude attempt to bribe them
with their own money.
Richard E. Ralston is Executive Director of Americans for Free Choice in Medicine.
Copyright © 2003 Americans for Free Choice in Medicine. All rights reserved.
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