Congressional Democrats’ Drug Plan Trades Bipartisan Solutions for Political Gamesmanship
Speaker Nancy Pelosi and Congressional Democratic leaders held a press conference to unveil their much-ballyhooed drug pricing legislation, billed as the Lower Drug Costs Now Act.
“Something needs to be done,” explained House Majority Leader Steny Hoyer (D-Md). “There is plenty of room to secure fair prices and protect innovations … the time is now.”
On this, Americans can agree. When a patient cannot afford their prescriptions, it is a crisis on a deeply personal level; one that members of Congress should address as they have promised.
There are indeed an array of solutions offered by lawmakers and advocates that could make a meaningful difference for patients at the pharmacy counter while also hewing to the principles that Democratic leaders described.
For example, many are pushing solutions like outcomes-based pricing. If a costly new drug fails to do its job and keep a patient well, drug companies would be held to account and a consumer could get their money back. Such a policy shift could save a whopping $36 billion annually in total health care costs.
Unfortunately, the latest proposal being championed by Democratic House leaders does not live up to their own test; instead turning the prescription drug marketplace into a wholly owned and controlled government regime.
Supporters claim the bill allows the federal government to “negotiate” with drug companies for lower costs. In truth, the proposed legislation would allow bureaucrats to effectively set prices for a suite of up to 250 drugs – both in Medicare and private health plans. If drug companies fail to acquiesce to the government’s rates, they could be slapped with a crippling new tax of up to 95 percent. Americans outside of the Beltway bubble call this government coercion – not a “negotiation.”
To set prices for these medications, the bill would adhere to an index of what six foreign countries charge for the same treatments. Putting the U.S. drug market at the mercy of our competitors abroad is seldom a good idea but, if lawmakers insist on mimicking other nations’ drug policies, they could have at least chosen differently.
One-half or more of new therapies on the market elsewhere today are unavailable to patients in Australia, Canada, France, and Japan – four of the countries named in Congressional Democrats’ bill. If supporters of the deceptively named Lower Drug Costs Now Act get their way, the U.S. would soon find itself suffering from the same lack of access to medicines.
These policy flaws in Speaker Pelosi’s drug package are overshadowed by the bill’s most fatal error: it simply won’t happen.
In a sharply divided Washington, members of Congress are sometimes forced to choose: do they want an issue that they allow to fester for the purpose of jamming their political opponents and cutting campaign ads, or do they want a law that earns the requisite votes in Congress and the signature of the President to solve a problem. With this bill, its proponents have chosen the former path, and it shows.
Republicans on the powerful House Energy and Commerce Committee have announced their unanimous opposition, with Ranking Member Greg Walden (R-Ohio) divulging that his members were “completely excluded” from the drafting process.
Senate Majority Leader Mitch McConnell (R-Ky) declared the bill dead on arrival in the Senate, saying “we’re not going to be calling up a bill like that.”
These are not the makings of a bipartisan legislative victory, but rather a partisan political exercise.
This is not due to a shortage of proposals that could garner bipartisan support. Plenty of groups and members of Congress remain focused on consensus-based reforms that would leverage competition to lower drug costs while protecting the innovation that is the linchpin of our health care system. For example, the work on outcomes-based pricing has broad bipartisan interest in both the House and Senate.
Aside from the aforementioned efforts around outcomes-based contracting for prescription medications – which enjoys broad support in both chambers of Congress – there is also bipartisan agreement on expanding real-time benefit tools to doctors’ offices nationwide; allowing patients to see their out-of-pocket costs for a drug before they leave the exam room.
This would eliminate sticker shock at the pharmacy that, too often, leads to patients abandoning their medications altogether and would empower consumers to have a conversation with their doctor about lower-cost options when necessary. One industry study found that patients have saved as much as $8,032 on a single prescription thanks to this technology.
Perhaps the proposal with the most support is capping out-of-pocket costs in Medicare Part D, so that no patient in Medicare goes bankrupt due to high costs if they develop cancer or other costly diseases. Congressional Democrats’ drug package includes this positive step but the details of how it is structured and a host of other poison pills in the legislation are holding back this good idea.
Members of Congress are right: something needs to be done on prescription drug costs, but if that “something” involves the government setting prices, it will leave patients and taxpayers worse off than where they started. It’s past time to get back to a bipartisan effort to lower drug costs.
Joel White is the former Republican Staff Director of the Ways and Means Health Subcommittee, during which time he helped draft the Medicare Part D law.