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Drug Benefit Mini-Moves

August 25, 2003

What a difference a summer makes. Only three months ago, the House and Senate passed bills to provide prescription drug coverage to the elderly. The two versions both were acknowledgments that drugs were now a much bigger part of medical care than in 1965 when Medicare began.

Legislators trying to sell the pending bills in their home districts over the summer recess, however, have found their constituents asking surprisingly sharp, skeptical questions about whether the bills are comprehensible and affordable, given growing deficits and spiraling costs in Iraq. (The short answer: no and no.)

Specific objections to the messy, complicated and costly legislation have also been powerful. Early last week, an almost unheard-of coalition -- all 50 state governors -- denounced a provision in the Senate-passed bill requiring states to subsidize half the costs of providing prescription drugs to some low-income Americans. And on Thursday, the New England Journal of Medicine published a study by Harvard Medical School researchers that undermined the key tenet in the House bill: that privatization is the best way to control drug costs.

The study documented how the United States spends nearly one-third of each health-care dollar on paperwork and other administrative costs -- nearly three times the amount spent per capita in Canada. Because such costs are far lower in public health plans, researchers concluded that establishing a federally managed national health insurance program would generate enough administrative savings to cover all 41.2 million uninsured people in the country.

The growing concern has slowed the progress of a House-Senate conference committee trying to iron out details of a drug benefit. In this case, slow is good. However, there are smaller ways for Congress to quickly help seniors pay for prescription drugs:

* Let generic drug companies fairly compete with brand-name manufacturers. One of the few provisions to enjoy broad bipartisan support would close loopholes that brand-name drug makers exploit to delay generic competition.

* Let Americans legally and freely mail- order price-controlled prescription drugs from Canada. Bush administration officials contend that drug importation could allow counterfeit and often unsafe drugs into the flow of mail orders. However, the cost benefits are high. As Donald Kennedy, editor of Science magazine, put it in an Aug. 15 editorial, legalizing drug importation may be "a bad idea whose time has come."

* Provide drug coverage now to the most needy. Many legislators are afraid to touch this reform, which they worry could be seen as abandoning the middle class just before an election year. Sen. Trent Lott (R-Miss.) is pushing for it, however, and President Bush himself proposed the idea in 2001.

Even if the right Medicare compromise has faded into the distance, Congress need not settle for doing nothing.

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