Private competition in Medicare Part D has led to lower prices and more choices for seniors, and the program is saving money for taxpayers as well.
That’s not a statement you see often in the health reform debate, where prices continue to climb above the rate of inflation year after year.
But the Medicare drug benefit is breaking new ground. Part D represents the first significant initiative to rein in health spending by restoring personal responsibility and incentives for savings to Medicare beneficiaries. In doing so, it shows that government can leverage free-market forces to cut costs while giving seniors more choices.
The average basic premiums for Medicare prescription drug plans are half what they were expected to be at this point when the program was enacted in 2003 – about $30 a month vs $60 a month from the initial estimates.