If imitation is the greatest form of flattery, then the federal government should be flattered that states have begun using the market-based structure of the highly successful Medicare Part D program as a model for their Medicaid programs. Peter Pitts, a former associate commissioner with the Food and Drug Administration (FDA) and the president of the Center for Medicine in the Public Interest, addresses examples of states providing Medicaid services through private insurers in an op-ed appearing in The Philadelphia Inquirer.
It is the competition from private insurers in the Medicare Part D program that has contributed to reduced costs, and just as importantly, to healthcare that works for the seniors who rely on it.
Medicare Part D provides affordable outpatient prescription drug coverage for seniors and people with disabilities and has been hugely successful by many measures. According to the Congressional Budget Office (CBO), the Part D program has cost the government 45 percent less than initially expected when Congress approved the Medicare Modernization Act of 2003. Ninety percent of Part D beneficiaries are satisfied with the program. And according to a study released earlier this year, improved medication adherence associated with expansion of drug coverage under Part D led to nearly $2.6 billion in reductions in medical expenditures annually among beneficiaries diagnosed with congestive heart failure and without prior comprehensive drug coverage, of which over $2.3 billion was savings to Medicare.
In his analysis, Pitts goes on to question why some politicians are now proposing changes to Medicare Part D to “substitute government price controls for the competitive marketplace that has been so effective in keeping costs down.” We agree. Medicare Part D is a federal program that has produced impressive, meaningful cost savings and greater access to the medicines that patients need – medicines that in some instances have likely prevented more significant and costly health issues. The fact that Medicare Part D may serve as a model for some states to emulate in their Medicaid programs is just one more reason not to mess with success.