Imagine turning 65 and finding a letter tucked in your mailbox offering unlimited movie tickets for just $25 bucks a month. You read through the fine print, and amazingly, the offer isnt a scam. Its a new federal program called MovieCare.
Not a bad deal. Its estimated that seniors spend between 5 and 6 percent of their income on entertainment, and this new programfunded by the governmentwould cover most of those expenses.
In some ways, Medicare Part D provides the same service, albeit for goods more important than movie tickets. Seniors used to spend about 3.2 percent of their total income on drugs. Thanks to Part D, those expenses have plummeted, and 20 million seniors who previously lacked prescription drug coverage now have it.
Not surprisingly, more than eight in 10 beneficiaries are pleased with the drug benefit.
If MovieCare were modeled on the Medicare drug benefit, more seniors than ever before would be able to go to the movies, the vast majority of movies would be available, and beneficiaries would likely enjoy the program as much as they enjoy Part D.
But before long, its also likely that some congressional lawmakers would decide that MovieCaredespite its enormous popularitywas costing taxpayers too much because of heartless movie studio bosses.
Wed see speeches vilifying studio moguls and their massive profits. Wed see breathless reports of seniors who went to to see Flags of Our Fathers on a Friday night but ended up trapped in a showing of Man of the Yearthe horror!
Mostly, though, wed hear endless reports about how movieseven subsidized onescost too much. Naturally, it would be the governments job to do something about it.
Soon enough, some fiery populist in Congress would take center stage, declaring that the government needs to step in to negotiate movie prices. Pundits would write angry columns with headlines like Lower Movie Prices Now! and sneeringly refer to anyone who defended industry pricing as a corporate shill.
Others would call for the nation to adopt the VAs program, VetFlix, which offers lower prices, but only to movies starring Chevy Chase.
And maybe such negotiations would actually succeed in bringing down ticket costs at first. But with the movie industrys revenues forcibly curtailed, it would become a shell of its former self. And in an effort to contain costs, the array of movie choices that made the plan so popular at the start would disappear.
Heres why: The government would only have leverage for a negotiation if it were willing to exclude certain movies from coverage. As such, government negotiations would close off viewing options, sticking beneficiaries with a movie formulary. Wed have an Office of MovieCare filled with cinematically clueless bureaucrats trying to put together a list of available movies.
Want to see the latest Steven Spielberg film? Tough. MovieCare doesnt cover Spielberg anymore.
Want to see this years Oscar-nominated documentaries? Too bad; they werent popular enough to demand coverage.
There would inevitably be controversy over so-called Me-Too movies, with some claiming that the industry just repeats the same ideas every few years. So sequels would be cut (so much for The Godfather Part II), and the plan would only cover one or two films out of every genre each year.
No need for more than one action film, one romantic comedy, or one comic book movie, right? Who needs Spider-Man and X-Men when Ghost Rider and The Punisher will do? Nevermind that theyre only superficially similardesigned to fill the same genre niche, but not remotely similar in terms of effectgovernment bureaucrats at the Office of MovieCare get to decide what movies are just expensive rehashes of the same old thing.
Naturally, the end result would be the decimation of the nations thriving, innovative, world-leading movie industry. Wed see fewer films each year, and those we did see would be cheaply produced and less original.
Breakthrough special effects, edgy young filmmakers, risky independent films and big-budget summer blockbusters would all get tossed off the production charts as studio revenues declined. Studios would be forced to tailor more and more of their films to meet the limited criteria of the MovieCare formulary.
As absurd as it sounds, this is what proponents of price negotiations want for the drug industry: less availability, less access, less innovation, less individual choice. It wouldnt work for the movies, and it certainly wont work for prescription drugs.
Peter J. Pitts is director of the Center for Medicine in the Public Interest and a former associate commissioner of the FDA.
from the July 5-10, 2007, issue