GOP: Obama's Medicare drug plan costly and ineffective

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Three senior Republicans are blasting the Obama administration’s new proposal to overhaul the way Medicare pays for prescription drugs, warning that the plan is too costly and ineffective.

The trio of GOP chairmen warned that the proposal, which was announced Tuesday and would be piloted later this year, could “limit access to the critical care the sickest Medicare beneficiaries rely on.”

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“This decision was made with a complete lack of transparency and clear disregard for the people and stakeholders who will be impacted the most,” said a letter signed by Senate Finance Committee Chairman Orrin HatchOrrin HatchInternet companies dominate tech lobbying Senate panel approves pension rescue for coal miners Overnight Tech: GOP says internet fight isn't over | EU chief defends Apple tax ruling | Feds roll out self-driving car guidelines | Netflix's China worries MORE (R-Utah), House Ways and Means Committee Chairman Kevin BradyKevin BradyWhy Obama needs PhRMA US wins aerospace subsidies trade case over the EU Republican Study Committee elders back Harris for chairman MORE (R-Texas) and House Energy and Commerce Committe Chairman Fred Upton (R-Mich.).

They argued that “all policy decisions should be made in the light of day,” and each vowed “aggressive oversight” over the plan.

The Centers for Medicare and Medicaid Services (CMS) announced its long-awaited proposal Tuesday, after it had been previously leaked weeks earlier.

Under the pilot model, the reimbursement rate in Medicare Part B would be slashed by more than half, but with a new flat rate per prescription. Currently, doctors are paid by the Medicare Part B program based on a drug’s average sales price plus 6 percent. That rate will drop to 2.5 percent under the model, with a flat payment of about $16.

In the last 24 hours, the pilot model has been condemned by groups such as the American Society of Clinical Oncology and Pharmaceutical Research and Manufacturers of America. It was applauded by groups like the Center for American Progress for encouraging higher-value drugs with an eye on overall spending.

Dr. Patrick Conway, chief medical officer for the CMS, stressed that the new formula was not an attempt to undermine doctors’ authority in the exam room.

“Nothing in this proposed payment model will prevent doctors from prescribing exactly the treatment they think their patient needs,” Conway told reporters Tuesday, adding that Medicare Part B would continue to reimburse “all providers for every drug.”

One cancer group, the Community Oncology Alliance, called it “an inappropriate, potentially dangerous, and perverse experiment” on cancer care.

Officials from the CMS specifically said they were thinking about cancer drugs when designing the model. Conway specifically said he had heard from “oncologists who feel pressure to pick higher-cost drugs.”