Saving money isn’t sexy enough to get attention let alone keep it, which is why we can’t have nice things for very long in this country. Here’s a perfect example. Tuesday morning, the Biden-Harris administration announced the first ten drugs that will be negotiated under Medicare Part D via the Democrats’ Inflation Reduction Act and if you know anyone paying the co-pay for these drugs out of pocket, you know what a big deal this is going to be.
In case it’s not clear though, this is why “Big Pharma” has filed 8 lawsuits against the Biden Administration.
Here are the drugs selected for the first round of negotiation under the Inflation Reduction Act:
Eliquis
Jardiance
Xarelto
Januvia
Farxiga
Entresto
Enbrel
Imbruvica
Stelara
Fiasp; Fiasp FlexTouch; Fiasp PenFill; NovoLog; NovoLog FlexPen; NovoLog PenFill
These drugs treat serious health conditions and were selected by a formula indicated in the Inflation Reduction Act, which was signed into law on August 16, 2022. No Republican voted for it, often citing concerns about higher spending and raising taxes.
However, the drug price negotiation program is expected to save the government tens of billions of dollars in the coming years. Additionally, the Tax Policy Center found the provisions of the IRA to be “highly progressive,” estimating that the top 1% would pay a few thousand more in taxes and the top .1% would pay tens of thousands more to fund necessities like addressing climate change.
“We’ve reached this milestone because of the Inflation Reduction Act– one of the most significant laws ever enacted, and one that passed with the leadership of Democrats in Congress. We took on Big Pharma and special interests, overcoming opposition from every Republican in Congress, and the American people won,” President Biden said in a statement provided to PoliticusUSA. “When implemented, prices on negotiated drugs will decrease for up to 9 million seniors. These seniors currently pay up to $6,497 in out-of-pocket costs per year for these prescriptions. In addition, the nonpartisan Congressional Budget Office reports that this will save taxpayers $160 billion by reducing how much Medicare pays for drugs through negotiation and inflation rebates.”
Medicare enrollees paid a total of $3.4 billion in out-of-pocket costs in 2022 for the drugs that were selected for negotiation.
Senior Administration Officials told us in a call this morning with reporters, “Implementing the criteria set by Congress, CMS started with nearly 7500 drugs covered under Part D and then applied the statutory criteria to determine the final selected drug list. And 10 selected drugs meet the criteria set out in inflation Reduction Act, including the some of the most costly drugs to the Medicare program.”
Now, here’s another place where this kind of actual work for the people gets sticky. You just know if Trump had done something like this (as if), he would have put his name on it and it would start immediately and phase out as soon as he wasn’t in office. Democrats did it the other way around – no name and it will go into effect in 2026, meaning that negotiations with participating drug companies will occur in 2023 and 2024. While this does give Democrats something to campaign on, the majority of people rarely pay attention to policy and certainly don’t seem to vote on it very often, in spite of what they tell themselves.
The downsides of this policy are mostly non-existent as it will save the taxpayers money and save people on Medicare who use these drugs money, but the criticism will be “why not x drug”, which is a valid question to ask but also indicates that this policy is so needed and wanted, people want more drugs on this list, not less.
That’s right. People want to be able to live and take the drugs their doctors prescribe for them without going bankrupt to do it.
Ultimately, “over the next 4 years, they will be able to negotiate up to 60 drugs covered under Medicare Part D and Part B, and up to an additional 20 drugs every year after that.” The only reaction to that is “Why not more.” The answer to that question is in who is passing laws, who is in the White House, what are their policy priorities, who funds them, why, and what do they get for their money.
One thing we know for sure is this is the kind of policy that you did not hear a peep about on the Republican presidential primary debate stage.
These things don’t happen without intention and a lot of push by an administration with an agenda to try to address real problems. The Biden-Harris Administration prioritized lowering prescription drug costs. That’s a fact. Have they done it perfectly and is it a unicorn? No. Of course not. A unicorn would be that no one in this country has to choose between high drug costs and paying the rent. But it is huge progress, in addition to the progress they made in reducing the cost of insulin to $35/month for people with Medicare.
In a fact sheet provided to us, the White House pointed out, “Big Pharma has long fought this progress. Their profits grew as they spent more on stock buybacks and dividends than they spent on research and development, even as nearly three in ten Americans struggle to afford their medications because of cost.”
“For far too long, pharmaceutical companies have made record profits while American families were saddled with record prices and unable to afford life-saving prescription drugs. But thanks to the landmark Inflation Reduction Act, we are closer to reaching President Biden’s goal of increasing availability and lowering prescription drug costs for all Americans,” said HHS Secretary Xavier Becerra.
It’s absolutely true that prescription drug costs in the United States are outrageous due to the greed of the pharmaceutical companies and the politicians they successfully lobby.
President Biden delivered the IRA because of the Democrats in Congress. Had he tried to pass that today, with a Republican majority in the House, it would not have passed. There would be no affordable insulin for those on Medicare.
As Biden said years ago when he was Vice President celebrating the passage of “Obamacare,” this is a “big f—ing deal.” This is your government trying to do something good for the people. It won’t be perfect. But it will save lives, and that matters.
Read the list here.
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