USA Today has a must-read editorial supporting our position that Medicare should be allowed to negotiate with drug-makers for lower prescription drugs, just as the Veterans Affairs department currently does.
“Part D already costs about $80 billion a year and is on track to double by 2022 as benefits improve and Baby Boomers retire. For two reasons, a significant chunk of that money is wasted on overpayments to drug companies: When Part D began, millions of patients were shifted over from Medicaid, the state-federal program for low-income people that gets far lower drug prices than Medicare. Suddenly, the cost of providing drugs to the same people shot up. Congress barred Medicare from negotiating the way Medicaid and the Department of Veterans Affairs do with drug makers to get lower prices. Instead, lawmakers insisted the job be done by private insurance companies.”
The fact that Medicare is forbidden in the law that created Medicare Part D to negotiate lower prices is no accident. The drug lobby worked hard to ensure Medicare wouldn’t be allowed to cut into the profits which would flow to big Pharma thanks to millions of new customers delivered to them by Part D. Even some Republican House members (this was a GOP sponsored bill), including Rep. Walter Jones from North Carolina and Rep. Dan Burton from Indiana, were aghast at the whole process:
“The pharmaceutical lobbyists wrote the bill,” says Jones. “The bill was over 1,000 pages. And it got to the members of the House that morning, and we voted for it at about 3 a.m. in the morning,” remembers Jones.
Why did the vote finally take place at 3 a.m.?
“Well, I think a lot of the shenanigans that were going on that night, they didn’t want on national television in primetime,” according to Burton.
Unfortunately not much has changed since 2003. Roll Call has this wrap-up of what drug companies spent during the last quarter alone on lobbying Congress:
Five pharmaceutical companies have reported million-dollar increases in their spending on lobbying the federal government during the first quarter of 2014. Pfizer Inc., Novartis, Johnson & Johnson Services, Bayer Corporation, and Merck & Company have each boosted their lobbying of the executive and legislative branches.
Here are the top pharmaceutical spenders in the first quarter of 2014:
Pharmaceutical Research & Manufacturers (PhRMA) $4,680,000 – up from $4,050,000 in 2013 Q4.
Pfizer Inc. $3,190,000 – up from $2,090,000.
Novartis $2,580,000 – up from $920,000.
Amgen USA Inc. $2,560,000 – up from $2,330,000.
Eli Lilly & Co. $2,086,000 – down from $2,430,000.
Johnson & Johnson Services $2,110,000 – up from $860,000.
Bayer – $2,040,000, up from $1,000,000.
Merck & Co. $2,000,000 – up from $820,000
These are the same companies which claim any attempts to rein in their overpayments in Medicare will kill their research and development of new drugs:
“The drug companies say they must impose higher prices in the U.S. to pay for research that enables them to innovate and develop new drugs that save our lives. But that’s not true. Half of the scientifically innovative drugs approved in the U.S. from 1998 to 2007 resulted from research at universities and biotech firms, not big drug companies, research shows. And despite their rhetoric, drug companies spend 19 times more on marketing than on research and development.” Healthcare for America Now
Meanwhile, in their opposing USA Today editorial big Pharma also argues that people like Part D so it shouldn’t be changed and, by the way, prescription drugs help people stay healthy.
“Surveys show 90% or more of Part D enrollees are satisfied with their coverage and say it works well. The use of medicines under Part D also helps to reduce spending on other health care services in Medicare, a fact that was recently acknowledged by CBO.”
Of course, access to prescription drugs helps people stay healthy but what does that have to do with whether or not Medicare should be forced to overpay for those drugs? Naturally, seniors like Part D. Why wouldn’t they when before its passage they had absolutely no drug coverage? That doesn’t mean Americans support paying more than they, or the government, should in order to pad drug makers’ pockets.