Healthy Skepticism Library item: 8410

Warning: This library includes all items relevant to health product marketing that we are aware of regardless of quality. Often we do not agree with all or part of the contents.

Publication type: news

Editorial .
Negotiating Lower Drug Prices
New York Times 2007 Jan 12A20
http://select.nytimes.com/gst/abstract.html?res=FB0D16FC38540C718DDDA80894DF404482

Abstract:

From all the ruckus raised by the administration and its patrons in the pharmaceutical industry, you would think that Congressional Democrats were out to destroy the free market system when they call for the government to negotiate the prices of prescription drugs for Medicare beneficiaries. Yet a bill scheduled for a vote in the House of Representatives today is sufficiently flexible to allow older Americans to benefit from the best efforts of both the government and the private drug plans.

The secretary of health and human services should be able to exert his bargaining power with drug companies in those cases in which the private plans have failed to rein in unduly high prices – leaving the rest to the drug plans. The result could be lower costs for consumers and savings for the taxpayers who support Medicare.

Under current law, written to appease the pharmaceutical industry, the government is explicitly forbidden from using its huge purchasing power to negotiate lower drug prices for Medicare beneficiaries. That job is left to the private health plans that provide drug coverage under Medicare and compete for customers in part on the basis of cost.

The Democrats’ bill would end the prohibition and require – not just authorize – the secretary of health and human services to negotiate prices with the manufacturers. That language is important since the current secretary, Michael Leavitt, has said he does not want the power to negotiate…