News > Politics > Democrats: Cheap Drugs for All!

commentary
FRIDAY JANUARY 12 2007 4:00 PM

Democrats: Cheap Drugs for All!

Submitted by legionnaire

Edited by legionnaire

Tags: Democrats, Congress, prescription drugs

One of the biggest complaints with the Republican-sponsored 2003 prescription drug bill is that it gave the government very little bargaining power with pharmaceutical companies in determining the price of drugs for people on Medicare. Which was essentially a giant subsidy to the pharmaceutical industry, since there's no logical reason why the industry's biggest customer couldn't have some say in determining how much it was willing to spend for these drugs. Nevertheless, Bush and other Republicans touted it as the final solution to all of the nation's prescription drug woes and considered the matter settled.

Enter the Democrats. On a legislative binge this past week, one of the items at the top of the list was getting a change implemented in this particular piece of legislation to allow Medicare the right to negotiate the prices of these drugs, and they've already gotten it through Congress.

The idea behind the bill is using the sheer size of the Medicare program to generate steeper discounts than private insurance plans can muster.

"Forty-three million people can have the purchasing power to perhaps encourage these drug houses to give the government and the American retirees a better price," said the bill's author, Rep. John Dingell, D-Michigan.

However, the bill's prospects dim after Friday's vote. President Bush has said he would veto the bill if it makes it to his desk. He said that competition is already reducing prices for seniors and creating an environment that encourages the development of new drugs.

The Senate has held one hearing on the subject this year, and more are expected, with that chamber likely to take a much longer look at the concept than the House did.

The legislation strikes a clause known as the "noninterference provision," which prohibits the secretary of Health and Human Services from participating in negotiations between drug manufacturers and insurers that sponsor Medicare plans. It would require the secretary to negotiate. Insurers still would be allowed to try for steeper discounts than what the government obtained.

Predictably, Bush has decided that keeping the pharmaceutical industry's profits artificially high with taxpayer money is more important than letting the free market decide what drugs should cost (that's how markets work - buyers can use their collective power to force sellers to lower their prices) and is threatening a veto. Granted, Bush didn't use his veto much (only once) in his first six years in office, but this is also the first time he's had to deal with a Congress that didn't bend over backwards to make sure he was happy.

Opponents to the bill claim that sufficient competition between Medicare and private insurers already exists to keep prices down and provide cheaper alternatives to senior citizens, and that the bill will effectively do nothing.

House Republicans pointed to a review by the nonpartisan Congressional Budget Office that found the House proposal wouldn't result in lower prices.
"CBO estimates that [the bill] would have a negligible effect on federal spending because we anticipate that the secretary would be unable to negotiate prices across the broad range of covered Part D drugs that are more favorable than those obtained by private drug plans under current law," acting CBO director Donald Marron wrote in a letter Wednesday to House Energy and Commerce Committee Chairman John Dingell, D-Mich., the author of the bill.

This may very well be true, the CBO is a nonpartisan government organization that evaluates budget and fiscal decisions made by Congress, and so has probably done a fairly thorough analysis of the situation.

That being said, there's no reason to assume that the situation can't change in the future and we'll end up in a place where giving the government some leeway in negotiation drug prices isn't beneficial. There just doesn't seem to be much logic in intentionally hamstringing Medicare like this.

PAGE:

1 | 2

Comments

MschfMayhemSoap

Phoenix, AZ

April 2006

JAN 12, 2007 04:09 PM

So.... if there is no real downside to the bill itself... whats the harm in passing it as a "just in case" measure? Seems the only reason they're saying nay is the thought that whoever would be negotiating wouldn't have the balls to hammer out a cheaper bargin. Even if that's true for the current governmental lackey in the position, who's to say the next guy won't have bigger balls?

Sorry... Logic and common sense came over me.... don't know what I was thinking.

NickFaust

USA

April 2004

JAN 12, 2007 04:16 PM

Fuck, I was hoping this meant that the price of my heroin was going down.

Geisterfaust

Tempe, AZ

June 2006

JAN 12, 2007 04:28 PM

George Bush does not care about old people.

SexyBeast

Covington, LA

July 2004

JAN 12, 2007 04:32 PM

Dammit! You should have started the post with "but don't get too excited."

thestral

Manassas, VA

August 2005

JAN 12, 2007 05:09 PM

If the impact would be negligible then why would the president veto it? Just to be a fucking douchebag and prove he can? I guess to show that those damn dems can't live up to their committments.