Problems With Part D - Part 1,223..

Krugman covers the many start up problems, summing it up with:

But Part D's bad start isn't just another illustration of the administration's trademark incompetence. It's also an object lesson in what happens when the government is run by people who aren't interested in the business of governing.

Here are examples:

Even Mr. Bush has acknowledged that signing up for the program is a confusing process. But, he says, "there is plenty of help for you." Yeah, right.

There's a number that people needing help with Part D can call. But when the program first went into effect, there were only 300 customer service representatives standing by. (Remember, there are 43 million Medicare recipients.)

There are now 7,500 representatives, making it easier to reach someone. But should you believe what you're told? Maybe not. A survey by the Government Accountability Office found that when Medicare recipients asked for help in determining which plan would cover their medications at the lowest cost, they were given the right answer only 41 percent of the time.
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Adding drug coverage as part of ordinary Medicare would also have saved a lot of money, both by eliminating the cost of employing private insurance companies as middlemen and by allowing the government to negotiate lower drug prices. This would have made it possible to offer a better benefit at much less cost to taxpayers.

But while a straightforward addition of drug coverage to Medicare would have been good policy, it would have been bad politics from the point of view of conservatives, who want to privatize traditional social insurance programs, not make them better.

Moreover, administration officials and their allies in Congress had both political and personal incentives not to do anything that might reduce the profits of insurance and drug companies. Both the insurance industry and, especially, the pharmaceutical industry are major campaign contributors. And soon after the drug bill was passed, the congressman and the administration official most responsible for drafting the legislation both left public service to become lobbyists.

So what we got was a drug program set up to serve the administration's friends and its political agenda, not the alleged beneficiaries. Instead of providing drug coverage directly, Part D is a complex system of subsidies to private insurance companies. The administration's insistence on running the program through these companies, which provide little if any additional value beyond what Medicare could easily have provided directly, is what makes the whole thing so complicated. And that complication, combined with an obvious lack of interest in making the system work, is what led to the disastrous start-up.