February 03, 2006

Bush Administration Touts Great Savings From Drug Plan

Kevin Drum comments on the HHS report that the new Medicare Plan D prescription drug program is coming in under budget. As Kevin notes, that seems to only be true if you use their latest numbers which were set to be almost double the originally promised program. According to HHS, the estimate they are using is $720 billion in its first ten years. But you need to remember that they lied about the original estimate (because conservative Republicans wouldn't vote for anything more than $400 billion) and only later fessed up that their own estimates at that time put the cost at $500-$600 billion and then finally settled on a cost of $720 billion. Based on the first month's data, it seems that they say it will cost "only" $650 billion. Sounds like moving the goal posts to me.

And then again, do you think perhaps that one of the reasons the federal program is doing so well in costs is because a good chunk of it was shifted to the states? It seems like California is finding the cost more than just a little upsetting.

Lockyer said the law is supposed to save California millions of dollars it used to spend on prescription drugs under its Medi-Cal program, but it could instead end up costing Californians more than $750 million over the next three years.

At that rate, California's cost will be a cool $2.5 billion over a decade to cover those on Medi-Cal (the program for the poor). California is planning to sue the Feds over this foobar program and Republican Governor Schwarzenegger has shown he stands with the state over the feds.

“When Congress passed this federal drug program, states were promised we would save 10 percent of what we otherwise would have paid to provide prescription drugs to this population,” Schwarzenegger said in a statement. “I have worked in good faith with the federal government for more than a year to address this issue. Despite these efforts, California still stands to be charged $183 million more each year than Congress intended when they passed this legislation. Our state is poised to take action to ensure California does not pay more than its fair share.”

California is royally pissed. Not only had they negotiated much better rates with the drug companies, but also now the overhead of running the program costs 20% more than California's program did.

This report is another shining example of the Bush administration cheering about their wonderful successes when the reality is, they've created a colossal f*ck-up. I know at my company, if someone so flagrantly misrepresented their results, they'd be fired with cause.

Posted by Mary at February 3, 2006 12:02 AM | Health/Medicine/Health Care | TrackBack(1) | Technorati links |