Saturday, Dec. 8, 2012 | 2:02 a.m.
Capitalism and competition is the American way. It’s what keeps innovators innovating and sets prices. It’s what keeps us, as a country, moving forward.
Interestingly enough, the Medicare Part D program was founded on this same principle.
Established in 2006, Medicare Part D gives more than 29 million Americans access to prescription drugs at prices they can afford. Before its creation, many medications were too expensive for as much as a third of the elderly population.
Medicare Part D works because of the competition within it. Numerous insurers participate in the program, and all Medicare recipients have access to a minimum of 28 drug plan options. Former Department of Health and Human Services Secretary Mike Leavitt agrees. In a May 2011 Washington Post op-ed, he stated (among other things) that “competition is working to hold down costs.”
As they say, the proof is in the pudding. Already, nearly 900,000 patients have used the Medicare Part D discounts to save $461 million. These savings will only continue to grow, bridging the gap until people with high drug costs leave the doughnut hole. According to HHS, people with Medicare in the doughnut hole will receive greater savings in 2013, as discounts rise to 53 percent of the cost of brand-name drugs and 21 percent of the cost of generic drugs. (Savings on Medicare coverage of prescription drugs will gradually increase until 2020, when the doughnut hole will be closed.)
Since its inception, Medicare Part D has come in under budget, costing 40 percent less than originally proposed, thanks to competition among plans. It reduces federal spending by $12 billion by covering medications that are keeping seniors out of the emergency room.
Yet, there’s a movement in Washington that would institute a new tax-like fee on pharmaceutical firms. Research by Douglas Holtz-Eakin, former director of the Congressional Budget Office, found that Part D premiums could increase by 20 to 40 percent if this effort succeeds.
As an organization promoting the interests of more than 1,500 members, as well as Nevada’s 7,000 Hispanic-owned businesses and 500,000 Hispanic residents, we at the Las Vegas Latin Chamber of Commerce are discouraged by these efforts to reduce the effectiveness of this program that has done so much good for so many. (Recently released polls show that Medicare Part D enrollees are overwhelmingly satisfied with their Part D coverage; 84 percent of Part D enrollees are satisfied with their coverage, and 95 percent say their coverage works well. Additionally, vulnerable beneficiaries who are dually eligible for both Medicaid and Medicare exhibited the highest satisfaction.)
In Nevada alone, 33,300 Hispanics are beneficiaries of Medicare. Total, there are 337,100 Medicare beneficiaries in Nevada, according to 2009-10 data. These numbers will only continue to increase as Nevada’s population ages and as an increasing number of retiring Baby Boomers from throughout the country move here seeking an area free of natural disasters with a warmer climate and inexpensive home prices.
Therefore, it is in our best interests to do everything we can to protect the programs, like Medicare Part D, that benefit our community. I encourage all businesses, individuals and organizations to do the same.
Otto Merida is the president of the Latin Chamber of Commerce.