Medicare “negotiation” proposals threaten Americans’ access to medicines

Gabby Migliara
Gabby Migliara June 30, 2021

Medicare “negotiation” proposals threaten Americans’ access to medicines.

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While nearly 90% of seniors and people with disabilities report that they are very satisfied with their Medicare Part D prescription drug coverage, they also acknowledge concerns with rising out-of-pocket costs. It is no surprise that this has been a recurring discussion on Capitol Hill with many putting forth proposals aimed at lowering the cost of medicines, including principles released by Senator Wyden just last week. Unfortunately, many of these so-called Medicare “negotiation” proposals would create more problems at a time when we can least afford them.

Some in the Senate, for example, are pushing to repeal a patient protection in Medicare Part D so that the government can interfere and set prices for medicines. Others in the House are pushing legislation, known as H.R. 3, which would allow the government to set the price of medicines based on prices set by foreign governments. They are different approaches under the guise of “negotiation,” but several things are true for both:

  1. They are anything but “negotiation.”
  2. They enable the government to dictate prices.
  3. They threaten Americans’ current and future access to medicines.

Repealing a key patient protection in Medicare Part D so the government can “negotiate:”

Under Medicare Part D, seniors and people with disabilities have coverage for prescription medicines they pick up at the pharmacy. There are at least 25 Part D plan options in every geographic region today, and beneficiaries are empowered to choose the plan and coverage that works best for them depending on the medicines they need. This flexibility of plans and robust coverage of medicines is possible, in part, because of a provision in the Medicare statute that prohibits the government from interfering in private negotiations that occur in Part D between manufacturers, PBMs and health plans. That same provision in the statute prevents the government from creating a single formulary for Part D or setting prices.

Now, some want to repeal this part of the Medicare statute, claiming they want the government to be able to “negotiate” lower medicine prices. What they aren’t saying is that they want to repeal the part of Part D that protects robust coverage and choice of plans and access to medicines for seniors and people with disabilities. The Congressional Budget Office has repeatedly said that repealing this part of the law so the government can “negotiate” could only save the government and patients money if access to medicines was sacrificed through the creation of a more restrictive national formulary and/or an expansion of anti-patient policies like fail-first. Why would members of Congress be willing to expand access restrictions to medicines in the Part D program – medicines that seniors and individuals with disabilities rely on each day?

Adopting policies used in Europe that are widely considered flawed so the government can “negotiate:”

Under H.R. 3, the government determines which medicines are worth investing in and which ones are not based on other governments’ decisions – regardless of what patients and their doctors think. Use of this approach in other countries has led to less access to medicines and discrimination against the elderly, the chronically ill and people with disabilities.

It is naïve to think the same couldn’t happen in the United States if we resorted to government “negotiation” schemes like H.R. 3. For example, the first transformative CAR-T cancer therapy was available in the United States seven months before any other country, with patients in countries like Canada and Japan waiting nearly two years for it to be available. Similarly, a groundbreaking treatment for drug-resistant forms of HIV approved in the United States was not available in any of the H.R. 3 countries until 18 months later. Today, that treatment is still not available in Australia, Canada, Japan or the United Kingdom. We cannot accept that patients – who desperately need the latest treatments and cures – simply might not have access to them because our government wanted to “negotiate," and, in doing so, created an environment where American patients are subject to a system where a life-saving cure exists but they might not be able to access it, while people in other countries can.

While there are many ways Medicare works well, there are also ways it could be modernized to make it work even better for seniors and people with disabilities. But sacrificing choice and access to medicines is not the answer.

We have to lower what patients pay for their medicines AND make sure patients are getting the medicines they need. There’s a way to do both, but government “negotiation” isn’t it. Learn more about how at PhRMA.org/BetterWay.

Topics: Part D, Medicare, Proactive Agenda