Well he went back to the White House anyway….
So the Medicare bill is signed into law, and Bush used the occasion to point out that a poor diabetic who couldn’t afford $6,000 in drugs and needles will now only need to be unable to afford $3,000. OK that’s a little cynical of me. If you click here and got to Chart 7, you’ll see that 43% of the Medicare population have incomes below $15,000 a year and this bill will help most of them….but it doesn’t give them everything for free. Click through to chart 9 in the same file, and you’ll see that 15% already have Medicaid and most of the rest have some variety of either employer or individual drug insurance. While this bill is good news for the 15% without any drug insurance, it’s neutral to bad for everyone else. That will be the political impact but probably not until people understand the bill in late 2005, which amazingly enough is after the next election.
And as usual when this White House announces financial data and gives human examples (and no I won’t give you a Krugman-esque diatribe here), the numbers Bush gave anticipated a best case scenario in the negotiations between the as yet unformed Medicare PBMs and the drug companies, expecting them to get a 20% price discount. We’ll see, but few serious observers are anticipating the PBMs to turn into Wal-mart any time soon.