Representative Pete Stark
Democrat of California

YES: The cost of pharmaceuticals to Medicare beneficiaries is growing faster than nearly any other segment of health care. When we last legislated in this area, more than 10% of seniors spent up to $5,000 a year on prescriptions. Yet 25% of Medicare beneficiaries are living on less than $600 a month.

Fewer and fewer Medigap options have drug benefits as part of the plan. If seniors are not forgoing drugs, they are forgoing safe housing or good food for the sake of drugs.

Drugs are where the biggest medical advances are likely to come from over the next decade, so look for costs to accelerate. They are also part of the continuum of medical care. Excluding them from basic benefits makes no more sense than excluding medical or surgical care.

When people can't buy pharmaceuticals, society ends up paying--for acute MI care because cholesterol didn't get reduced, for instance, or for amputations because of uncontrolled diabetic complications.

In my own case, my high cholesterol level persisted despite pristine diet and exercise. Then a drug dropped it down in 30 days. It costs my federal employee benefit plan about $800 a year, even after discounts--a small price to pay to keep me out of the CCU.

The pharmaceutical industry has opposed drug benefits because it feels the government's buying power would push profits so low as to depress research. But when we buy pharmaceuticals for the VA, we pay a fair price and generally do not get as good a deal as some of the managed-care plans do.

Including pharmaceutical benefits in Medicare is the right thing to do, both for the sake of compassion for our senior citizens and to improve the public health.

Robert B. Helms
Director of Health Policy Studies
American Enterprise Institute

NO: To talk about more benefits at a time when the country is facing a major calamity with Medicare financing is absurd. According to the latest trustees' report, bringing Part A into actuarial balance over the next 25 years would require an 18% drop in outlays or a 22% rise in taxes, or some combination.

On the Part B side, outlays are expected to continue to grow faster than the whole economy over the next few years. Besides higher taxes or lower benefits, some say Medicare could be helped by clamping down on fees to hospitals and physicians. But that would cause major problems with access and quality.

Others claim a drug program under Medicare would be cost-effective because Medicare could use its buying power to purchase drugs much more inexpensively than individuals or HMOs can. But the prospect of handsome rewards drives drug companies to take the big risks that have resulted in so many great new drugs.

One way to make drugs available under Medicare is a defined-contribution approach in which Medicare sets spending levels for individuals, who could then use the money to purchase a plan. That could generate competition from health plans, and some might offer a drug benefit in order to attract customers and hold down costs.

Some argue that the cost of not providing drugs is higher than that of providing drugs, because diabetics, heart patients, and others end up in acute care when they can't afford drugs. But when all drugs are available without control, some are used much more than needed. A defined-contribution approach would give health plans and consumers incentives to use drugs only when they are most beneficial.

Robert B. Helms is a resident scholar at AEI. Pete Stark represents California in the U.S. Congress.