Guinea pigs

May 23, 2004

THE FEDERAL government is trying to prove that if it acts as broker, then smart shoppers with lots of time, patience, determination and, ideally, computer access and savvy can save money on medicine through the forces of competition.

The experiment might prove successful, but it's hard to imagine a more unsuitable test market than low-income elderly people.

Medicare has assembled a dizzying array of offers from companies selling drug discount cards to retirees who lack insurance coverage; in some cases, the mere posting of comparative prices on Medicare's Web site has already driven them down.

It's too soon to know whether these savings will actually materialize and reach the needy Americans the program was intended to help. What's clear is that their convenience wasn't the top priority in designing a process so confusing that the typical Medicare beneficiary can't navigate it alone.

Instead, Medicare's 17-month drug discount card program is structured as a shakedown cruise to help the government and the industry prepare to offer prescription drug coverage beginning in 2006.

The government is learning how to be a clearinghouse for information from pharmaceutical benefit companies seeking to pick up a share of the Medicare business. The drug insurance companies are trying to connect with potential customers and build brand loyalty.

The senior Medicare beneficiaries are the guinea pigs trying to make their way through the maze of Web sites and toll-free numbers.

Those who have the most to gain - individuals not poor enough for Medicaid but who make less than $12,569 a year, or $16,862 for a couple - are probably in the worst position to take advantage of it. They can get $600 worth of drugs a year free through the discount card program. But how many of the 7 million Americans in that group are likely to learn of the opportunity?

No one can say the Bush administration isn't trying to get the word out - though the General Accounting Office has condemned some of its extensive advertising as political propaganda. The administration has also filled phone banks around the country with nearly 2,000 operators politely taking the flood of inquiry calls to 1-800-Medicare.

But those who find a deal and sign up for it can't be assured that the advertised prices will last longer than a week - even though they can pick only one card and make no substitution until open enrollment at the end of the year.

The good news is that the risk for beneficiaries is small (a $30 maximum annual enrollment fee), and that companies offering the cards are likely to be on their best behavior because they are trying to win lasting customers.

A far bigger gamble is being taken by Mr. Bush, who is risking the wrath of the nation's most faithful voters by tampering with one of the nation's most popular programs.

Already one improvement seems justified: automatic enrollment for low-income beneficiaries eligible for the $600 credit. Mr. Bush should support that change and be ready to further alter course as the experiment goes on.

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