Before Rene Descartes published his famous
Meditations on First Philosophy, he submitted a manuscript to seven prominent contemporary intellectuals and basically asked them to give him their best shot. He then published the
Meditations with seven objections and replies. Not all of Descartes replies were persuasive, but the important part of his story is that Descartes had the intellectual honesty to take criticisms of his critics seriously, publish them and respond publicly, allowing readers to decide who has the better ideas.
This brings us to the current debate about the Ryan Medicare proposal. Consider the following claims from prominent conservatives.
Part D is popular and successful. It actually beat its cost projections — a near miraculous exception to just about every health care program known to man.
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Charles Krauthammer
They also note that the Medicare prescription drug benefit also uses a competition model. Consumers have been adept at negotiating a complex marketplace, and costs are 41 percent below expectations.
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David Brooks
The prescription drug benefit came in 40% below cost projections because it harnessed the power of choice and competition.
Paul Ryan on Meet the Press
The Ryan plan rests largely on the claim that allowing beneficiaries to negotiate with private insurers on price and benefits will successfully control costs. This promise is bolstered, Ryan and his supporters argue, by our experience with Medicare Part D, otherwise known as the Medicare Prescription Drug benefit passed by the G.W. Bush administration in 2003. At the time, the OMB predicted that it would cost a certain amount, but subsequent experience has shown that the real costs are substantially lower than predicted. Viola! The marketplace does control costs after all.
However, there is a huge problem with this argument. Just Google "Ryan Medicare Part D" and you get a lot of hits with quite serious criticisms of this Medicare-Part-D-Proves-That-The-Market-Works argument.
Ezra Klein offers the
clearest account of these criticisms. These responses concede that the costs of Medicare Part D have been lower than projected, but reject the inference that the
reasons for this have anything to do with market comptetition.
- Based on recent experience, the Medicare actuaries expect the drug benefit to grow by 9.7% annually. Yes, this is lower than the original OMB estimation, but it is still much higher than what it would have to be to make Ryan's plan work. To work the costs cannot grow more than the rate of inflation, which will certainly be well below 9.7%.
- Medicare drug costs have risen slower than expected, but so have drug prices generally. The reason for this seems to be that fewer blockbuster drugs have come on the market since 2003 when Medicare Part D was enacted and several very popular drugs have become available as generics.
- Finally, Medicare Part D costs have been lower than estimated because the original projection expected 93% of Medicare enrollees to take part in the program, whereas only 77% have.
In short, the reasons why the costs of Medicare Part D have risen less than anticipated have nothing to do with the magic of marketplace for individual choice, but rather with boring technical factors.
I don't know if this is the last word on this debate. Maybe there are good conservative responses to these criticisms of the standard defense of the Ryan plan. The important point is that very smart and very well-read conservative commentators such as Brooks and Krauthammer don't even make the effort. They simply pretend that these responses don't exist. They just uncritically parrot Ryan's original talking point about costs coming in lower than expected as though that were all we needed to know.
Perhaps I am naive. I don't expect those who play the role of a public intellectual to always be right. I don't even expect them to publicly admit errors when they are shown to be wrong, though that is nice when it happens. What I do expect is for them to acknowledge and take seriously the positions of their opponents. If they think their opponents are mistaken, then they owe us reasons for why they think this. But simply ignoring opposing views does them and the public a terrible disservice.
