Should Medicare negotiate drug prices? Probably not

A popular idea, but not a good one It’s nice that the vast majority of Democrats (93%) and Republicans (74%) have found something to agree upon. Too bad it’s the overrated idea of having Medicare negotiate drug prices. Prescription drug costs are rising again after years of flat or modest growth. New, expensive products are hitting the market while drug makers have also found ways to boost the prices of older products, even generics. There’s been a lot of ink (and electrons) spilled by people complaining about “the $1000 pill” and other outrages, like bad boy drug exec and price gouger Martin Shkreli. On the other hand, many Hepatitis C patients have been cured and the need for liver transplants and cancer treatment averted. That should be worth something. Why do people think Medicare would be such a good negotiator? Private sector Part D drug plans already do a good job of price negotiation. Executives’ bonuses and stock options depend on getting good deals from the drug makers. Meanwhile, if Medicare tried to negotiate it would have to be willing to say “no” to certain drugs and to impose restrictions such as prior authorization and high co-pays. No doubt many in the vast majorities cited above would be quick to complain about those tactics, making it hard for Medicare to be the bad guy. It’s a whole different ballgame if we’re talking about Medicare simply dictating the price it will pay or requiring rebates...
Source: Health Business Blog - Category: Health Management Authors: Tags: Pharma Policy and politics Uncategorized drug prices election medicare Source Type: blogs