Health CARE: Prescription for Disappointment.(prescription drug plans)(Brief Article)

The current bidding war in Washington over prescription-drug benefits for seniors illustrates what's wrong with our health-care system, and our politics. Americans pay for their health care mostly indirectly, through lost wages and higher taxes. They have no incentive to control costs, which therefore balloon. When the government is picking up the tab, as in the drug-benefit debate, economic reality is left even further behind. Earlier this year, President Bush proposed that $77 billion be spent on these benefits over the next ten years. House Democrats have upped the ante for the same period to -- $1 trillion.

When it comes to courting the growing senior vote, nothing is ever enough. Premiums, co-payments, and deductibles must be pushed ever lower. Prescription-drug expenses are a problem for some seniors, but of course the subsidy proposals are not limited only to those in need. The administration initially wanted to combine its new drug benefit with a reform of Medicare that would help pay for it. House Republicans, however, concluded that voters were very interested in the benefits and not much interested in reform. They are behind in the bidding, but no doubt will catch up with time.

To the extent the government pays for prescription drugs, demand for those drugs will increase, as will the cost of the program. We know, from the experience of Medicare, how the federal government will react: by imposing price controls. ...