Drugmakers Bargain Doesnt Bind Congress In Health-care Debate
Democratic lawmakers pushing health-care legislation, including House Speaker Nancy Pelosi and House Energy and Commerce Committee Chairman Henry Waxman, both California Democrats, have said Congress isnt bound by the agreements negotiated by the Obama administration and six industry groups to help cut a total of $2 trillion from medical spending over 10 years.
“Their agreements dont bind me whatsoever,” Democratic Senator Tom Harkin of Iowa said Aug. 6, just hours after Senate Democrats questioned top White House aides about the agreement with Pharmaceutical Research and Manufacturers of America, the Washington-based industry trade group known as PhRMA. “We can do what we want.”
Secrecy surrounding the talks between Obama aides and health-care representatives may have created confusion over the contents of the agreement with drugmakers and upset lawmakers as they learned about it in news reports.
“When I read about it, it gave me some heartburn,” Senator Charles Schumer, a New York Democrat, said Aug. 6 after the New York Times reported the administration stood by its deal to protect the drugmakers from cuts beyond the $80 billion in government-spending reductions on medicines over a decade.
Prescription-Drug Prices
Already, Waxmans Energy and Commerce Committee has included in its version of health-care legislation a provision long opposed by PhRMA to empower Medicare to negotiate drug prices for the government health programs “Part D” prescription-drug benefit for senior citizens.
House leaders, seeking to gain support for a health-care overhaul from a bloc of fiscally conservative Democrats known as Blue Dogs, have sought deeper cuts in spending for government health-care programs.
Nadeam Elshami, a spokesman for Pelosi, said in an e-mail that “the speaker supports the work” of three House committees that have approved legislation “to squeeze more money out of the system, including from the pharmaceutical industry.”
The legislation being drafted in Congress would extend health-insurance coverage to as many as 47 million uninsured people and aims to cut spiraling medical costs. Congress is also considering setting up a public insurance plan to compete with private insurers as part of an effort to lower premiums.
The House Ways and Means Committee version of the legislation would empower the so-called “public option” insurance program to negotiate with drug manufacturers over the prices for prescription medicines.
Negotiating Power
At the Aug. 6 meeting with Senate Democrats, White House Deputy Chief of Staff Jim Messina told lawmakers the agreement between the administration and the drugmakers didnt require Obama to discourage Congress from requiring price negotiations for the Medicare program, according to Harkin and Senator Sherrod Brown, an Ohio Democrat.
Deal or Not
“Whether the White House made a deal or not,” Congress would still be free to impose such a requirement, Brown told reporters.
It is unclear whether giving the Medicare program authority to negotiate drug prices would save the government money even though the proposal is pushed by Democrats as a cost saver.
Democrats, citing lower per-patient drug costs for the government program for military veterans, argued that $358 in government savings for each patient in 2006 resulted from the power the Veterans Affairs Department has to negotiate drug prices.
Still, the nonpartisan Congressional Budget Office has told Congress that such price negotiations wouldnt result in significant savings to the Medicare program.
“The impact on Medicares overall drug spending would likely be limited,” the CBO said in an April 10, 2007, letter to Democratic Senator Ron Wyden of Oregon.