The recent funny headline and blog post in the Washington Post crediting George W. Bush -- rather than Obamacare as President Obama claims -- for the slowing of United States Medicare trust fund outlays opened the left to lay out its old canard that Part D wasn't funded.
Forget the fact that by the left's logic, it's own 2000 and 2003 programs for funding self-administered drugs under Medicare also were not funded, the so-called new post 2006 Medicare Part D expenditures (usually tied by the left to the huge increase in the Federal debt under President Obama) were almost totally cost shifts:
- About half of the spending now coming out of the Medicare Part B Trust Fund (right hand bar) for all pharmaceuticals -- including previously not covered self-administered drugs -- came out of Medicaid (left hand bar in image) prior to 2006, half state and half federal (NOTE: Medicare previously and continues to fund drugs administered by providers out of Part B, which is why the new drug benefit was funded from that source.)
- To a lesser extent the VA and a few other Federal programs that previously funded most drugs for seniors and those with disabilities was shifted but not completely to the Part B Trust Fund (amounts not shown in image because of scale).
- Much of what is now upper donut hole and catastrophic coverage was covered by state pharmaceutical assistance programs (green in left-hand bar) but that was not available in all states; other state/county programs and charity also often made up the difference depending on where one lived but whatever what the left calls unfunded Part D was just more cost shifting within government.
- There clearly was some incremental expense to the Trust Fund but according to GAO and/or CBO, better drug coverage is lowering other Part B Medicare expenses such as ER visits so that money is still coming out of the same Trust Fund but being "charged" to Part D--again no real net new expense.
- The out of pocket expense to seniors and the disabled (blue in both bars) has been cut in half or more but is still substantial on average (as it should be in my opinion); Medicare beneficiaries pay about a quarter of their drug costs unless those costs are very high -- less than 10% of the time -- in which case the cost drops down to below 10%
In addition and not shown in illustration, some of the incremental cost of Part D was covered by a surtax on high-income seniors' Part B premiums (the Democrats have now frozen the indexing of that surtax so many middle income seniors are now paying that surtax to fund PPACA) . Back at the time Part D was passed, all (or almost all) Democrats opposed it not because it was not funded but because it was not as generous (that is, even more costly and more "unfunded" than) as President Clinton's proposal that led to Part D.
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