Conventional wisdom notwithstanding, congressional Dems will begin 2007 with a fairly aggressive policy agenda, and near the top of the list a key health care policy Dems have been itching to implement for a long time: using the government to negotiate lower drug prices for Medicare beneficiaries. The Bush administration opposes the move. This is going to be fun.
Top White House Dan Bartlett got the ball rolling yesterday, explaining on Fox News Sunday that prices have already “come down” and drugs are already cheap enough. It’s a fairly odd argument to make — as Judd noted, taxpayers “could save as much as $190 billion over the next 10 years” if Medicare negotiated prices with drug makers. The Veterans Administration already negotiates with pharmaceutical companies, and it pays a lot less for medication.
Dems want to improve the system. The administration doesn’t.
The Bush administration said on Sunday that it would strenuously oppose one of the Democrats’ top priorities for the new Congress: legislation authorizing the government to negotiate with drug companies to secure lower drug prices for Medicare beneficiaries.
In an interview, Michael O. Leavitt, the secretary of health and human services, said he saw no prospect of compromise on the issue.
“In politics,” Mr. Leavitt said, “most specific issues like this are a disguise for a larger difference. Government negotiation of drug prices does not work unless you have a program completely run by the government. Democrats say they want the government to negotiate prices. What they really want is government-run health care.”
That’s really the only rhetorical trick the Bush gang has on this one. We say we can lower prices for seniors who need medication; the White House says prices are fine the way they are. We say using government buying power save the government money; they White House says, “Socialized medicine! Run for your lives!”
I like our chances on this one.
Today’s Progress Report had a good run down of the broader policy dynamic.
Drug makers have increased the prices on many of the top selling drugs this year by as much as six percent, double the inflation rate. Because Medicare doesn’t require any discount over the list price, “drug makers are being paid as much as 20 percent more for the same drugs that they had already been providing to recipients under Medicaid.” Furthermore, spiraling drug costs are expanding the coverage gap in Medicare Part D, leaving millions of Americans without coverage. The New York Times reports that, with the current Medicare prescription benefit, big drug companies are enjoying “a financial windfall larger than even the most optimistic Wall Street analysts had predicted.”
Secretary Leavitt said yesterday he doesn’t want the power to negotiate drug prices. “I don’t believe I can do a better job than an efficient market,” he said.
Don’t sell yourself short, Mike. The rest of us are plenty sure you can do a better job. If not, you should probably make way for someone who can.
The Dems’ policy proposal is, of course, one of the key items on Nancy Pelosi’s 100-hour agenda. Is Bush prepared to veto a measure that lower spending and lower prices for seniors’ medication? Stay tuned.