America’s biopharmaceutical sector is the most innovative in the world. Today, medical progress – new cures, break-through therapies, and access to 21st Century medicine – is stamped ‘Made in the U.S.A.
America’s innovative drug companies represent – the science, investment, and dedication – an original American success story. What’s more, patients – from Boston to San Diego – have access to the world’s most advanced, cutting-edge medicines. It’s not hyperbole to say with confidence that American biopharma innovation is the envy of world.
And so, it makes no sense that the Biden-Harris administration is putting American patients in jeopardy by mandating the very worst of what has plagued European healthcare systems for decades – i.e., innovation-crushing price setting policies that threaten access to new, pioneering medicines.
Why, is the Biden-Harris administration looking to kill ‘the goose that laid the golden eggs’?
Joe Biden and Kamala Harris had hoped to run in 2024 on assumed successes in health policy – specifically the Inflation Reduction Act (IRA). However, the IRA offers up a price-fixing racket that patient advocates and health experts worry will kill innovation and limit access to new drugs. What’s worse, The Biden-Harris price-control scheme targets Medicare.
Now, after the sudden decision by President Joe Biden to abandon the campaign, Vice President Harris – soon to be her party’s nominee – is left holding a bag of unpopular, wrongly adopted health policies that threaten America’s seniors with less choice, limited access, and higher costs.
When the Biden-Harris White House pushed the IRA through a Democratic-controlled Congress ( VP Harris was the tie breaking vote in the Senate), they promised:
- The law would lower Medicare costs for America's seniors. Not True.
- Savings would be passed on to seniors. Not True.
- Setting prices for popular drugs in Medicare would not limit access medicine. Not True.
Regrettably, Biden-Harris avoided the whole truth vis-à-vis who is really paying for these changes to Medicare. The truth is seniors are footing the bill themselves through skyrocketing premiums. In fact, a group of leading policy organizations sent a letter to Speaker of the House Mike Johnson (R-LA) and Republican Leader Mitch McConnell (R-KY) highlighting the dangerous, expensive flaws in the law. Their fundamental concern: a new 95% tax on drugs has led to record premium hikes and higher copays.
The truth is that the IRA is destroying Medicare's Part D drug benefit by allowing the government to interfere in price setting. Part D is enormously popular with seniors because costs have been kept in check through competition and market discipline. The IRA imposes a tax on medicines if the drug manufacturer will not comply with the mandated price issued by government bureaucrats. The result is higher costs for seniors.
Policy experts warn:
President Biden's Inflation Reduction Act has been an across-the-board failure. The law arguably made inflation worse by wasting billions on progressive boondoggles such as Green New Deal tax credits that benefit China, electric vehicle giveaways, and bigger handouts to insurance companies and affluent families who enroll in Obamacare. The law imposed costly new taxes on U.S. businesses that employ millions of Americans.
The IRA also raided $300 billion from Medicare to fund President Biden's progressive wish list. At a time when millions of seniors across the country are struggling, cutting Medicare for current and near retirees is the last thing we should be doing. Savings in Medicare should be used for Medicare reform, to extend the life of the program and avoid a costly taxpayer bailout. It should not be a slush fund for the Left
The economy and health care remain major concerns for the American people. America's New Majority commissioned a poll that showed a ‘significant majority of Americans say health care and other essential goods and services have become more expensive under Biden.’ Now that Vice President Harris is the Democratic party’s presumptive nominee for president, she must answer for the false promises made around the IRA – polling shows that 2-in-3 voters say the Inflation Reduction Act has not helped them, and a plurality of voters say the group who benefited most from the IRA was politicians – politicians like Kamala Harris and Joe Biden.
Not only do seniors believe that the law has not helped them, but they have also witnessed price hikes on health care. Medicare Part D premiums have gone up by about 21% according to the Kaiser Family Foundation. The Council for Affordable Health Coverage estimates that those premiums could go up by 50% or more by next year. The Biden-Harris price fixing scheme has forced up monthly premiums for the coverage of prescription drugs. When government uses the power to tax to force a change in behavior, it rarely considers the unintended consequences.
The IRA’s interference in Medicare is threatening Medicare Part D’s viability. “In 2006, the first year that Medicare Part D was available, insurers offered 1,429 plans to seniors nationwide. This year, insurers offered just 709—a decline of more than 50%. In the past year alone, the number of plans that seniors could choose from dropped by 11%.”
The IRA’s price setting is bad for Medicare and it’s bad for innovation. What we know – from industry experts – is that the IRA “will steer investment away from drugs for conditions common in seniors and disabled people.”
Americans just cannot afford the IRA’s interference into our biopharma sector. It’s an election year and our politics is extremely heated. However, health policy is a place where both the Left and Right can find compromise. The IRA’s price fixing scheme is bad medicine – and a political blunder. Congress needs to act; and both Kamala Harris and Donald Trump must not demagogue the issue. We need our politicians to tell the truth – the Inflation Reduction Act is a threat to medical progress and seniors’ health.
Jerry Rogers is editor at RealClearPolicy and RealClearHealth. He hosts 'The Jerry Rogers Show' on WBAL NewsRadio 1090/FM 101.5 and the Federal Newswire's ‘The Business of America’. Follow him on Twitter @JerryRogersShow.
