Wednesday, April 23, 2014
Inquirer Daily News

Drugs prices too high or too low?

HHS Secretary Kathleen Sebelius said the administration will keep working to lower drug costs for government programs such as Medicare.

Drugs prices too high or too low?

Health and Human Service Secretary Kathleen Sebelius chaired a panel discussion Thursday afternoon at the African American Museum and the focus was the difficulty some women, especially African American women, have in accessing affordable health insurance.

Several told of the struggle they endured and then Dolores McCabe, the retired pastor at Millcreek Baptist Church, asked Sebelius what she and administration could do about the high price of medicine.

McCabe, who uses an asthma inhaler, noted that she was old enough to remember the price controls imposed by President Nixon.

“There has got to be something we can do above the Affordable Care Act that does something about an industry that is immoral,” she said, drawing applause from the crowd. “It is immoral and unethical to charge people to stay alive.”

As head of HHS, Sebelius oversees the U.S. Food and Drug Administration, Medicare and Medicaid. She urged the women to call their Congressional representatives and demand such action.

Referring to the now nearly two-year-old health-care law, Sebelius said, “We didn’t get as far as you are suggesting in terms of price controls, but we came some of that distance. It is illegal for us who run Medicare to negotiate for prices. As a former governor, I could negotiate for Medicaid prices and Medicaid drug prices are significantly lower than Medicare drug prices. But that is a change that has to be passed by Congress.”

Sebelius noted the donut hole problem in Medicare drug plans and that the administration's plan closed that by 50 percent right away and will change further. The other fiscal problem with the Medicare Part D drug plan is that there was no funding mechanism created when the law was passed during George W. Bush's administration.

"We're going to continue to work on drug prices," Sebelius said. "This is not over."

As you can imagine, the pharmaceutical industry has fought to keep the restrictions on negotiating drug prices for Medicare and doesn't think it gets enough for some drugs.

An industry trade association, the Pharmaceutical Research and Manufacturers of America (PhRMA), was not happy with the proposed budget cuts that reduce what drug companies get in reimbursements from the program.

“Despite President Obama’s many pronouncements to support innovation, advance biomedical research, promote job creation and control health care costs for seniors, his 2013 budget proposal flies in the face of these important goals," PhRMA President and CEO John Castellani said in a statement released Monday after the budget announcement.

“Specifically, proposed mandatory rebates in Medicare Part D are a short-sighted proposition that could destabilize the program and threaten hundreds of thousands of American jobs.

“Recent research from the Battelle Technology Partnership Practice shows that staggering potential job losses would result from undermining the business foundations of biopharmaceutical companies. The report estimates that a $20 billion per year reduction in biopharmaceutical sector revenue would result in 260,000 job losses across the U.S. economy. Government estimates show the Administration’s proposals would have an impact of about this magnitude.

“Medicare Part D is working well for seniors. Due to competition, costs continue to be far below initial projections. We should not disrupt this successful program."

 

David Sell
About this blog
David Sell blogs about the region's pharmaceutical industry. Follow him on Facebook.

For Inquirer.com. Portions of this blog may also be found in the Inquirer's Sunday Health Section.

Reach David at dsell@phillynews.com.

David Sell
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