Strengthen Medicare: End Drug Company Price Setting

It’s no secret that, four years ago, President Obama cut a deal with the pharmaceutical industry. He promised that so long as the drug companies did not block health reform, federal law would continue to prohibit Medicare from negotiating drug prices. Instead, the pharmaceutical industry would get 30 million new customers and remain free to set drug prices for Americans. This single policy will cost Medicare and U.S. tax payers hundreds of billions of dollars over the next ten years. If Congress wants to contain long-term Medicare spending and keep health care affordable in America, lawmakers should start with the low-hanging fruit: the excessive prices Medicare and our citizens pay for drugs. Medicare easily pays between 150 and 300 percent of the average cost of prescription drugs in the other wealthy nations. Recently released data from the International Federation of Health Plans make the point. A monthly supply of Lipitor (a common cholesterol medication) costs about $100 in the U.S.; the same drug costs about $6 in New Zealand and $48 in France. Nasonex (commonly prescribed for nasal infections) costs Medicare about $108 for a monthly supply; the same drug costs France $17 and Canada $29. At best, the United States subsidizes the prescription costs of all other wealthy nations; at worst, we are simply dupes.
Source: Health Affairs Blog - Category: Health Medicine and Bioethics Commentators Authors: Tags: All Categories Health Care Costs Medicaid Medicare Pharma Policy Spending Source Type: blogs