State’s MA competitive bidding success a lesson for federal government

ECM Publishers, Inc.
ECM Editorial Board

Minnesota’s two United States Senators, Amy Klobuchar and Al Franken, both Democrats, have made it clear that they will not hesitate in carrying the state’s best practice measures to the halls of Congress.

We hope they were listening and watching this fall as the state of Minnesota released what has to be considered good news. The news is in relation to a bold move by the Dayton Administration to embark on a competitive bidding process for insurers who want a share of the $4 billion annual business to pay for medical assistance costs for state residents.

It is now estimated that the state program will save upwards of $180 million in state taxpayer dollars over the next two years but without any cut in benefits or forcing most enrollee to change their medical providers.

It is also likely that the federal government will also see corresponding savings due to the fact that medical assistance for the most part is funded by both the state and the federal government. Gov. Mark Dayton has held true to his promise to seek reform with such health care initiatives and we applaud the work of his administration.

It makes sense at the state level and it makes minds wonder why it wasn’t tried much sooner.

It’s such plans and principles that can and should work at the national level, too, if only leaders there could be so driven.

In one specific case, the federal government is now projecting that the Medicare Part D prescription drug program will run an unfunded deficit of $700 billion in its first 10 years, according to estimates. Medicare Part D was passed by a Republican-controlled Congress in 2003 and signed into law by President George W. Bush. Under the 2003 legislation, Medicare is not allowed to negotiate drug prices with manufacturers.

We understand the partisan deadlock that is blocking most efforts at meaningful change or reform in Washington. It’s an uphill battle to be sure.

But we believe DFL Sens. Klobuchar and Franken have just the moxie to help push this heavy ball up that steep hill. They are getting some help, too.

The Patient Protection and Affordable Care Act, signed into law in March of 2010 by President Barack Obama, is taking small but progressive steps to shrink the doughnut hole that many Part D participants must face when their benefit limits are reached and the next $4500 in prescription expense is cash from pocket.

More shrinking needs to be done and that can come through competitive bidding and/or outright negotiations with the large pharmaceutical companies, or by looking at reform that would allow the importation and re-importation of prescription drugs. Both could be considered competition to the current system.

According to one estimate from the National Retiree Legislative Network, as much as $730 million or 18 percent of the nation’s Medicare Part D projected $4 billion costs for prescription drugs over the next 10 years could be saved.

Those are meaningful savings and rise to the level of totally wiping away the doughnut hole. It could also make a small but important reduction in the federal budget deficit.

One of the ways to make changes and improve Medicare Part D is with competitive bidding, much like the state of Minnesota has done with its medical assistance costs. We know Sen. Klobuchar and Sen. Franken have voices that are being heard in Washington.

It’s time they speak louder.

— An editorial from the ECM Publishers Editorial Board. The Isanti County News is part of ECM Publishers.