Commentary Magazine


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A Plan Everyone Hates

Mort Kondracke makes a powerful case that the model for healthcare reform should be the much-criticized Medicare Part D drug plan, and not a public option model or another individual-mandate plan. He explains:

The Medicare Part D program is based on competition among private insurance plans, whereas they are determined to model health reform on government-run, price-controlled Medicare Parts A and B or on Massachusetts’ individual-mandate plan.

But, as the latest Medicare trustees report warned, Medicare’s hospital insurance plan (Part A) is scheduled to go bankrupt in 2017. And Part B, which pays doctor bills, is experiencing “steep cost increases” for taxpayers and will demand “unusually large premium increases” for seniors who can afford to pay.

Meanwhile, Massachusetts’ heavily regulated plan, while covering 355,000 previously uninsured residents, is costing much more than expected – 32 percent more in its first year and an anticipated 20 percent more this year.

Many conservatives think of Medicare Part D as a disaster, a Republican-conceived entitlement plan. But it is one that actually works and is popular:

That’s partly because premiums are lower than expected. The monthly average for this year originally was expected to be $44. It’s actually $28, up just $3 from 2008.

The secret of Part D is that private insurance companies are competing for customers and offering them a wide array of choices. Seniors can switch plans once a year.

Some conservatives think they can stop ObamaCare simply by saying “no.” But if they want to maximize their chances of derailing a government-run nationalized and rationed healthcare system, then Medicare Part D offers the “compromise.” Liberals hate it because there is no price-fixing and it is fraught with competition. But that’s precisely why it works and why, if critics of Obama’s approach were smart, they’d take another look at the most effectively run and popular healthcare legislation we have.