John Baer: Saving taxpayers $100 million: No-brainer? In Pa., no way
YOU'D THINK that our conservative-leaning Legislature would jump at a chance to save $100 million a year in the state welfare budget, wouldn't you?
YOU'D THINK that our conservative-leaning Legislature would jump at a chance to save $100 million a year in the state welfare budget, wouldn't you?
Well, you'd be wrong.
A proposal to do that appears headed for defeat - for the third year in a row.
At issue is a Rendell administration plan allowing the Welfare Department to buy prescription drugs for a million folks on medical assistance, including about 400,000 in Philly.
Currently, the drug benefit is run by multiple managed-care organizations, you know, the health insurance industry, and, of course, the drug companies.
They want to keep it that way.
Those with lots of loot don't easily give it up.
Never mind that the state can get federal rebates (not available through managed care) allowing it to buy drugs for 30 percent less, hence an estimated savings of $95 million to $100 million per year.
Never mind that Welfare already does this for another 800,000 medical-assistance recipients not under managed care, and says it cuts costs doing so.
And never mind that 20 other states, including neighbors Delaware, Maryland, New Jersey and New York have already made the switch.
With medical assistance making up 20 percent of the state's $28 billion budget, you'd think savings would be vigorously sought.
And Welfare Deputy Secretary Michael Nardone says, "We've developed a plan. We will have an infrastructure in place . . . and this has no impact on eligibility."
Nothing changes for recipients: The same doctors write the same prescriptions, and the prescriptions get filled at the same pharmacies.
The only change is that the state saves a boatload of money.
Yet it appears that lawmakers in both parties are ready to again block Welfare from grabbing for the savings.
The Republican Senate has a bipartisan bill to do so. The Democratic House has a similar resolution.
Why?
"When I can't figure out what's going on, my rule is you follow the money," says Rep. Kathy Manderino, D-Philadelphia, who chairs the House Subcommittee on Health and Human Services and supports Welfare's plan.
A good rule.
Taking, say, several hundred million dollars worth of drug buys out of the health-insurance system and compelling drug companies to sell for much less can't be popular with either group.
And the health-care and pharmaceutical industries are powerful political forces with able, efficient and (obviously) successful lobbyists - who don't mind investing.
The Center for Responsive Politics in Washington says that just one insurer, Blue Cross/Blue Shield, has pumped $14 million into politics since 1989.
The Center for Public Integrity yesterday reported that the pharmaceutical industry spent a record $168 million on lobbying just last year.
One company, the giant drug firm Pfizer, spent $13.8 million.
In Pennsylvania, from January 2007 to March 2008, state-required lobbyist disclosure records show that eight health insurers, including Independence Blue Cross, spent $2.6 million on lobbying.
And 15 drug companies, including Pfizer, spent another $1.9 million.
I called a few of the lawmakers opposing Welfare's plan.
None called back.
Arguments I've heard against the plan include: nobody trusts Gov. Ed; Welfare is incapable of running anything well and won't produce the savings; bipartisan opposition ought to tell you something.
The first two might be debatable, but I don't think the third is.
Yesterday, the Coalition of Medical Assistance Managed Care Organizations issued a one-page statement with one argument: "It is important to note that this debate is not a partisan issue."
Duly noted.
But the way I see it, all that means is that neither party wants to tick off the health-care/pharmaceutical lobby.
And the only thing there seems to be much interest in saving here is the sad, self-serving status quo.*
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