Medicare is reformed! Long live Medicare! Whoopee!

The New York Times bold headline said it all: "Sweeping Medicare Change Wins Approval in Congress; President Claims a Victory," with the subhead, "Measure Provides Drug Benefits for Millions of Elderly People."

Even as I read this glowing account in the paper of record, however, a TV playing in the background told a more nuanced story about this alleged legislative triumph. C-SPAN host Brian Lamb was interviewing NPR health policy correspondent Julie Rovner when a call came in from a senior citizen in Boca Raton, Fla.

The caller identified himself as a Republican who had worked in the first Bush administration as a political appointee. He said that, as far as he was concerned, there is less than meets the eye in the first major overhaul of Medicare.

"What I find interesting, for instance, is that for $5,000 of drug costs, under this bill seniors are going to pay about $4,000 net out of pocket. They're going to have to pay a $420 premium annually, about $35 a month, plus a deductible of $250. Then there's that doughnut hole [where Medicare pays nothing more until the beneficiary has paid a total of $3,600 out of pocket].

"Now, in Canada, what Canada's government does is that they pay for their seniors essentially, and they purchase drugs as a 30-million-person economy. They use their purchasing power and they drive the cost down.

"The U.S. drug companies will still sell to Canada, even though they're selling at much lower prices. So the Canadian pharmaceuticals are able to resell the product into the U.S. and still make a profit.

"If we had the same purchasing power in the U.S., we could buy drugs like Canada does. That $5,000 [worth of drugs] I'm speaking about we could buy for about $1,500 on average.

So, what could have been done here? Congress could have given the purchasing power to the government. We could be buying $5,000 in drugs for $1,500 or lower because [there are 40 million Americans on Medicare.] We could have driven the cost much further down, not incurring these costs for future [taxpayers]. And it wasn't done."

Brian Lamb, as well versed as anyone in America on the ins and outs of legislation, turned to his guest and, in a surprised tone, asked, "Is it true that $5,000 worth of prescription drugs will cost you $4,000?"

"Yes, that's true," said Rovner, "because those are the people who fall right into the doughnut hole. They're estimating the premium at $35 a month. We'll see."

"That's just an estimate?" Lamb asked.

"That's just an estimate," Rovner said. "That's not written into the legislation."

"Who decides?" Lamb asked.

"The companies that offer the coverage," Rovner said. "So, we'll see.

"But taking the estimate of $35, that's $420. There's a $250 deductible. Then of the next $2,000, you get $1,500 of it paid, but then you fall into the doughnut hole. So, it's true, at $5,000 you pay $4,000."

Lamb asked, "Is the cost of the [monthly premium], the $35, is that regulated by anyone?"

"That's not in the statute," Rovner said. "Again they are talking about 'actuarially equivalent benefits' so there could be some variation in what's offered.."

Their exchange sheds more light on the true nature of this so-called "historic reform" than a thousand press releases patting Congress and the President on the back.

Medicare has worked well for millions of Americans because of the buying power of the federal government.

Yet, Congress refused to consider a single-payer system in which the government would use its clout to get the lowest prescription drug prices. To the contrary, the Medicare bill prohibits the government from negotiating prices.

The bill also attempts to cut off the stream of low-priced drug imports from Canada, saying that drug reimportation would be allowed only if the Department of Health and Human Services certifies their safety, which the department has refused to do.

The big winners are drug companies, insurance companies and employers paying for prescription benefits for retirees - all of whom happen, not coincidentally, to be big campaign contributors to President Bush and to Republicans (and some Democrats) in Congress.

According to one study cited by the St. Petersburg Times, total spending on drugs will rise 9 percent, or $13 billion, in the first year of the new benefit. And they call this reform? The $400 billion, 10-year cost will be passed on to future taxpayers.

Flushed with pride over their accomplishment, members of Congress are taking a long Thanksgiving break. If you see one of your senators or your congressman over the holiday, you might pose this question: "Would you trade your taxpayer-funded health-care coverage and prescription drug plan for the one you just passed for the rest of us?"

Brazaitis, formerly a Plain Dealer senior editor, is a Washington columnist.

© 2003 The Plain Dealer

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