The Media and Politics

Between the media and congressional politics, it’s a wonder any free-market ideas survive.

First, there were two major newspaper articles published last weekend that really were off the mark.

The Los Angeles Times carried a big story about the private drug card programs that pharmaceutical companies have created to help lower-income seniors without drug coverage get access to their products at very affordable prices. The Times story said the drug cards are essentially useless.

I sent a letter to the editor and then wrote a commentary article saying that the companies are spending millions to create these programs, using the tools they have to provide real help to seniors. Meanwhile, Congress continues to use the issue as a political football with no chance of final action this year.

The reporter didn’t bother to find a single person who has been helped by the drug card programs among the many tens of thousands who have signed up in the few months they have been operating. Instead the article featured a 62-year-old woman whose HMO covers eight of her prescriptions, but she can’t get coverage through the drug programs for the ninth. Give me a break!

What else does The Los Angeles Times expect the pharmaceutical companies to do? Stand on street corners and hand their drugs out for free? Here’s my commentary:

And The Washington Post was almost as bad with a story about the latest missile from Families USA saying that refundable tax credits for health insurance also are useless – or worse.

Post Reporter Ceci Connolly extensively quoted this awful survey in which Families USA went to eHealthInsurance to get quotes for a policy with a $250 deductible and the lowest co-payments they could get. Not surprisingly, the premium prices were higher than the tax credits of $1,000/individual and $3,000/family.

But she didn’t cite a single of the many good studies available that demonstrate how real people are getting real insurance at affordable prices and for whom the tax credit could make the difference in whether they can afford to buy the coverage.

We have good data we can send you if you are writing about this issue. I also sent a commentary article to the Post pointing out how one-sided the article was. You can find it at:

No word, of course, about whether any of these articles will be published.

And then, on Capitol Hill, we see tax credits being strangled in the Senate debate over trade legislation. It remains to be seen whether this legislation is getting so loaded with extraneous amendments that it will ultimately sink.

Unfortunately, the tax credit provisions in the bill are really awful: Senate Finance Chairman Max Baucus (D-MT) and Ranking Finance Committee Republican Charles Grassley (R-IA) have come up with a deal to provide a 70 percent health care tax credit to workers displaced by international trade.

The credit could be used only for COBRA coverage or pools set up by the states — including SCHIP and Medicaid programs. Displaced workers would have only a six-month window to purchase an individual plan on their own. (The legislation doesn’t sunset until 2007.)

What a set-up to draw more and more people into government-run or “pooled” programs! And to make it worse, the state pooling arrangements would have to include guaranteed issue rules, community rating requirements, and a prohibition on preexisting condition exclusions – all GUARANTEED to drive up the cost of coverage significantly.

Many conservatives are rebelling, as they should. This is NOT the way to do tax credits.

And speaking of rebellion, House Republicans appear to be disgruntled by the $350 billion Medicare package that Chairman Bill Thomas put together. This package attempts to build a foundation for a program that relies on competition and consumer choice. It would, for example, strengthen the Medicare+Choice program, increase provider payments, and include a voluntary, competitive prescription drug benefit that offers choices of private plans.

But The Wall Street Journal says today that many Republicans who weren’t part of the drafting process want to use the whole $350 billion just for a drug benefit. “Some Republicans figure nothing will pass Congress this year anyway, so the House GOP should just go on record for a bill most appealing to voters,” the Journal’s “Washington Wire” says.

Oh, mercy. From the highs of Milton Friedman last week to this.

Grace-Marie Turner


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