Health Policy: Understanding Medicare Part D

Answer

Health Policy: Understanding Medicare Part D

Introduction

In the United States, politics has always played a role in most policies and policy making process, and the healthcare sector has not been spared. Politics and political climate, the influence of stakeholder and lobby groups, and the state of the nation, have an impact on the policies, reforms and amount of support that a given policy may rally (Gray, Lowery, & Benz, 2013). Health policies in the US have more often than not centered or focused around quality, financial implications or affordability, and accessibility (Moonesar, I2013).  The leadership of the day and the political and economic climate play a role in influencing the health policies that the nation makes. The degree to which political climate and the role of various interest groups can have on health policies is best illustrated by the Medicare Prescription Drug, Improvement, and Modernization Act ( MMA), which can into force in 2003. This law, which was passed under the Bush administration resulted to unprecedented overhaul of the in America’s Medicare systems that had not been witnessed in over thirty years of Medicare’s existence (Lichtenberg & Sun, 2007). MMA was the centerpiece of the then controversial provision that came to be referred to as Medicare part D, which was officially implemented in 2006 (Lichtenberg & Sun, 2007).

The Medicare part D was passed ostensibly to make prescription drugs accessible and affordable to America’s most vulnerable groups, that is the elderly, or the seniors (Lichtenberg & Sun, 2007). In other words, the policy was at the time of its passing, meant to benefit mostly the elderly and the disabled, by providing them with a cover for a number of selected prescription drugs (Huynh & Guterman, 2006). The main initiators and players in the policy was the government, then under the Bush administration, and most of the republicans. The process of passing of the Medicare part D bill into law was just as controversial as the policy itself, and many stakeholders, players, and various interest groups took sides, based on their direction of interest in the matter (Gray et al, 2013). For the government, elections time was approaching, and they had to win at all cost with this policy. Debates raged regarding the cost of the whole policy which provided and optional outpatient prescription drug which was to be covered by various insurance and private companies that had Medicare’s own approval (Huynh & Guterman, 2006). The country was running on a huge deficit, the Medicare plan was seen by some concerned parties as spelling disaster for the already worse economic situation that was prevailing, yet to the government, the bill was a policy that had to be implemented, apparently for the benefit of the vulnerable.  This essay shall examine the Medicare part D legislation, paying close attention to the various influence groups of the policy, the policy process and policy environment, and key payers and stakeholders of the policy and how they shaped the process and outcome of the policy. The strategies and tools that were used most effectively to pass the policy shall also be discussed.

Understanding Medicare Part D

The MMA of 2003 is the main Act that resulted to the creation of the Medicare part D legislation whose main focus at its implementation in 2006 was to address the medication challenges of the senior populations and the disabled, since these had been identified as vulnerable (Huynh & Guterman, 2006). According to Medicare part D, the elderly and the disabled would be provided with Medicare cover for outpatient drugs by means of a private and stand alone medical plans (Huynh & Guterman, 2006). From 2006, date in which the Medicare part D plan was implemented, beneficiaries would be covered for a number of selected drugs through their private insurance that had the approval of Medicare (Votour, 2015). The beneficiaries also were able to spend less from their pockets to buy prescription drugs since they were covered, so that those that had high medical expenses, could see their expenses significantly slashed (Votour, 2015). Since other care plans and Medicare discount cards were previously provided through the Medigap plans, individuals with lower income had their medical costs actually become higher than it was before the implementation of the Medicare part D and before the replacement of Medigap plans (Donohue, 2014). This piece of proposed legislation also forbade Medicare into entering price negotiations with manufacturers providing cheaper drugs or import drugs even if they were cheaper. The implication of this move is that any additional costs to drugs covered is actually passed to the beneficiaries (Donohue, 2014). Enrolling for Medicare part D is optional.

The Environment and Circumstances that Shaped the Policy

At the time of its passage, the Medicare policy attracted a good number of criticisms from different quarter, the bill being criticized as expensive, wrongly conceived, and inappropriate given the political environment and the circumstances that were prevailing at the time. The Bush administration was facing a huge budgetary deficit never seen before in US history in 2003, and elections were just a year away (Votour, 2015). With such historical financial deficit, Bush’s administration’s strategy to modernize the Medicare as it were could not have been a more fiscally irresponsible move (Oliver, Lee & Lipton, 2004). The cost of the Medicare part D policy was projected to be less than $400 billion in a period of ten year, yet even this estimate was critiqued as an underestimation (Mayes & Berenson, 2006). Adding outpatient prescription drugs to cover the seniors and the permanently disabled was in effect, government’s desperate attempt to link such benefits to the republican administration, so that it would be seen that they are making efforts in the restructuring and modernization of Medicare (Oliver et al, 2004). The policy, though beneficial especially to the vulnerable groups of little income, was shaped by the political climate that was prevailing at the moment in which the ruling administration had to come up with a policy that would reflect favorably for them to be reelected in office without considering the fiscal soundness of the policy, or future impact of the policy on the affected groups (Oliver et al, 2004). In actual sense, the modernized health policy as the Bush administration referred to it was meant to guarantee the administration the votes of the seniors and the disabled persons who appeared to benefit more from the policy (Oliver et al, 2004). The original intent of passing the bill into law therefore, while on the surface it appears to have been intended to give Americans a policy that addresses the health needs of the vulnerable groups, its major intention, for the government of day was to gain votes, and that is why it was passed even through some experts in various offices had cast doubts at the soundness of the policy at the time. Such was the environment that shaped the Medicare part D law.

Key Players/ Stakeholders Involved and their Influence on the Policy

The Medicare part D bill attracted the interest of many stakeholders and numerous other interest groups, some supporting the bill while others vehemently opposing it, based on the position in which they occupied (Moonesar, 2013). These stakeholders greatly influenced the policy making process that resulted to the passing of Medicare part D (Moonesar, 2013). Among the key players and stakeholders of Medicare part D included political players such as the white house, the government, under the Bush administration, the seniors or the elderly, the physically disabled, and even opposition or the democrats (Votour, 2015). Other stakeholders included the media, American Hospital Association (AHA), congress, Agency staffs among any others. The main initiators and one of the key stakeholders of the Medicare part D policy was the government, then under the Bush administration with the republicans as the majority members. These provided great support for the policy and engaged in great lobbying to rally support from member of congress to provide the policy with great support (Mayes & Berenson, 2006). The democrats generally opposed the passing of the Medicare bill into law (Huynh & Guterman, 2006). The pharmaceutical companies were also another group of stakeholders who at first opposed the policy, but as it turned out, they became among the greatest funders of the policy and even the greatest beneficiaries than even the original Medicare beneficiaries, that is the seniors and the permanently disabled persons (Votour, 2015). Pharmaceutical companies influenced the policy by providing funds to support the policy and also lobbying of legislators which gave birth to the concept of the donut hole, where by beneficiaries would be covered for prescription drugs that were ranging between $2, 250 and $5, 100 (Moonesar, 2013). At first, the pharmaceutical industry had opposed the bill since lowering of drug price was seen a compromise to their profits (Moonesar, 2013). The stakeholders who were to be positively impacted by the bill through the covering of outpatient prescription drugs, were the seniors, bringing their expenses for the same lower (Moonesar, 2013). Naturally, therefore, the seniors and persons with disability were greatly in favor of the bill. Majority of the republicans applied pressure on the congress to rally behind in support of the bill. The white house under the bush administration made it appear that the main goal of the bill was to create a healthcare policy that placed the rights, health needs, and livelihoods of the seniors in the forefront (Moonesar, 2013). However, as it turned out immediately, the bill was costly, thwarted benefits that patients enjoyed prior to the passage of the bill, and compromised the purchasing and bargaining power of Medicare (Votour, 2015).

How Medicare was Passed/the Policy Process

Despite facing strong opposition from the democrats and widespread unpopularity among various stakeholders, the Medicare bill beat the odds and managed to pass both the House and the senate and became law in December, 2003 (Kendall, 2013). The house majority were the republican and they applied all tactics and pressure they could to see to it that the bill carried the day (Oliver et al, 2004). On the June 2003 vote for the approval of the bill by the House ways and means committees, the bill got a 25 to 15 vote win margin (Oliver et al, 2004). This was then followed by another voting following a partisan debate in the House in which the bill narrowly passed with a  216 to 215 vote margin (Oliver et al, 2004). This was uncomfortable for the political proponents of the bill, bearing in mind it was sponsored by the government in which the republicans enjoyed a majority in the House (Oliver et al, 2004). Determined to gain a clear victory, some republican member who were opposed to the bill  were convinced, even reportedly induced, into changing their minds in the last minute and vote in favor of the bill (Votour, 2015). Anomalies preceded the voting of the bill, for example use of undue pressure, and keeping voting period open for hours long after voting had come to a close (Votour, 2015). House cameras were frozen, and after this, four more people changed their mid and voted in favor of the bill.

Strategies and Tools use most Effectively

To ensure they had the votes of the senior in the forth coming elections, the Bush administration had to use all strategies and tools available to ensure the bill was passed. Generally, pressure was applied to congress, and other republicans convinced to change their minds in favor of the bill. Republicans engaged in extensive lobbying to rally support for the bill. Strategies included informational, compensation, and procedural strategies which were all used during the policy making process (Moonesar, 2013). Informational strategies consisted of basically marketing the policy to create awareness about the policy among members of the public (Moonesar, 2013). The media, health and political campaigns, and published reports on the benefits of the plan were some of the tools effectively used to create awareness of the health policy (Moonesar, 2013). Procedural strategies included staging political debates on the policy so as to build support. Compensation strategies involved using as tools, the benefits that would be derived from passing the bill into law, such as reduced costs for the seniors and profits for the pharmaceutical industry (Moonesar, 2013).

In my opinion, while great political manipulation and winning at all cost strategy was used to pass this bill, I am not in the least surprised. Despite the fact that fiscal conditions and the structuring of the bill itself did not allow for the sustainment of the bill given the circumstances of the time, the bill went ahead and carried the day. This is not surprising to me because political regimes are usually influential in policy formulation and a lot of politicking is involved in the process. Policy formulation is largely a political affair, especially if the political career of those in office may depend on it. It is not uncommon for policy making process to create two opposing sides, and creation of political enemies. Why policy making will always be a political affair is because the government of the day is always faced with pressing priorities that need to be addressed. All in all, Medicare part D was passed into law in 2003 and implemented as from 2006, for the benefit of the targeted stakeholders, the seniors and the permanently disabled. Again, the breed of enemies created in policy making process me thinks is healthy for introducing reforms in any policy matter. This could probably be the reason why Medicare part D, despite facing strong opposing from majority of stakeholders, through a series of reforms, turned out to be one of the best healthcare policies of recent times.

Conclusion

In conclusion, Medicare part D, though well intended to benefit the most vulnerable in the society, was a health policy that was hurriedly conceived and improperly structured at first, since the political players saw it as a toll for winning the 2004 elections. The number one beneficiaries of the policy should have been the seniors, but at the end of the day, the pharmaceutical companies derived more financial benefits from the policy hence became the greatest beneficiaries when the bill was passed into law in 2003. The bill had several stakeholders including the seniors, the government, the pharmaceutical companies, among many others. The policy was passed at a time when elections were nearing and the country was facing huge budgetary deficits. In fact, financial projections had shown that the plan would cost more than what had been estimated but the government ignored this, only intending for the bill to pass and win the votes of the seniors. Despite the many challenges that Medicare part D faced, it has hitherto undergone a series of reforms and it can well be considered as one of the most successful policies of recent times.