Leading policy-makers and scholars explain how market forces, deregulation, and consumer choice can work to improve health care for all Americans.


Do politicians know better than patients?
Jon Kyl, Real Clear Politics, 4-18-07

Senator Jon Kyl (R, AZ) argues that a recent senate vote on drug price negotiations for the Medicare Part D drug benefit illustrates two very different approaches to health care: one that offers consumers more choices and more control over their health care, and one advocating that bureaucrats should make those choices for them.

Polls show that Americans want more affordable health care options. This week the Senate will debate health care legislation that provides an important window into how the two political parties believe we should address accessibility to health care.

Republicans support a consumer-driven health care system that harnesses the competitive market to lower costs, expand access to coverage, and maintain individual control over health care decisions. In fact, we proved that the competitive model works with the new prescription drug bill.

Republicans passed a prescription drug benefit that uses market competition to provide critical medications to seniors at much lower costs than were projected. This "Part D" benefit for the first time is providing seniors with affordable access to a broad range of prescription drugs. Due to robust competition among health plans, the average senior is saving more than $1,200, with many saving much more. Average monthly premiums for seniors are only $22—40 percent less than expected.

Over 90 percent of Medicare beneficiaries are now receiving comprehensive prescription drug coverage, and polls show that more than 80 percent of seniors are happy with their drug coverage.

Proponents of government intervention say they simply want to use the market power of the large number of Medicare beneficiaries to lower prices. But private pharmacy benefit managers (PBMs) already use this same market clout to negotiate lower prices. In fact, according to a report by the Congressional Research Service, the three largest PBMs already negotiate on behalf of four times as many beneficiaries (200 million) as the entire Medicare population (44 million).

The choice is clear: a government-run health care bureaucracy that restricts choice and rations care or a consumer-driven health care system that expands health care options while controlling costs. The prescription drug legislation has put this choice to the test, and seniors have proven that they prefer the Republican model. Seniors have independently chosen plans that provide more health care options at lower costs. For example, 88 percent of seniors who enrolled in a prescription drug plan in 2007 chose a plan that offered coverage other than the standard benefit, and this year seniors have chosen plans with 13 percent more available medications than last year.

The debate on "non-interference" is, therefore, a proxy for whether we should pursue health care reform with more or less health care options for consumers, more or less government control, and more or less interference between the government and patients. Seniors have made their choice clear by making the prescription drug benefit a resounding success. The question is whether politicians know better than the patients.

Project FDA.
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