Government interference in Medicare Part D endangers seniors
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This week, the U.S. Senate will hold a "Vote-A-Rama" session to consider dozens of amendments to the budget. One of these amendments would allow the government to negotiate the prices of medicines covered under the Medicare Part D prescription drug program.

Proponents of the amendment believe using the government's purchasing power would lower the price of drugs, benefiting patients.

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This is incorrect. The influential nonpartisan, Congressional Budget Office (CBO) already has warned that the government would be "unable to negotiate prices . . . that are more favorable than those obtained [by private insurers]."  

Another analysis suggests that having the government negotiate drug prices directly with pharmaceutical companies would have implications so huge in the marketplace "that it would result in insurers withdrawing and creating less competition."   

Let's review what has made Part D effective for more than a decade with an approval rate of nearly 90 percent among seniors, according to annual surveys.

Medicare Part D provides affordable access to medications for seniors and people living with disabilities. This year, beneficiaries will pay less than $36 each month, on average, for basic prescription drug plans offered by private insurers.  

Insurers compete for beneficiaries' business by offering a wide variety of plans with different premiums, deductibles, and covered medicines. As a result, beneficiaries can pick from 746 plans nationwide and choose one that meets their health needs and fits their budget.

The reason that there's such a diverse choice of plans is strong competition in the program and the negotiations that insurers conduct with drug companies. Insurers negotiate steep discounts that cut an average of 35 percent off the typical medicine's list price, according to a QuintilesIMS study. The list of available drugs differs from plan to plan, which means that patients can find a plan that covers the drugs they need by shopping around.

For instance, a diabetic patient would likely search for a plan that covers the insulin prescriptions they need, while a patient with heart disease would likely search for a plan that covers cardio-vascular medicines.

The amendment would replace this competitive system with a one-size-fits-all model, with government being injected into negotiations already occurring in the program.

To slash costs, the government would have to restrict or eliminate access to certain medications across all plans. That would cause many patients to lose access to their prescriptions no matter what plan they chose.

Unable to afford those drugs out-of-pocket, patients might forego treatment or try to make do with medicines that are not the most efficient or effective. In short, it would push the highly rated Medicare Part D program in the wrong direction, forcing it backward instead of forward!

Medicare Part D's current system of competition and negotiation ensures that insurers and drug makers keep medicines affordable and accessible for patients. This amendment would jeopardize their health by undermining this system. Congress would be wise to reject it — and voters would reward them for doing so.

Look no farther than deep-blue California, where voters rejected a similar proposal by a sizable margin this past November.

Bob Blancato is executive director of the National Association of Nutrition and Aging Services Programs.

 


The views expressed by contributors are their own and not the views of The Hill.