Saturday, April 30, 2016

Would You Believe Campaign Cash-- Bribes Basically-- Keeps Up The Price Of Medications?


This afternoon we looked at David Jolly's STOP Act, an attempt to start chipping away at the domination of big money over Congress. Several people told me I should have included some concrete examples of how the money chase influences policy. Of course, that's been one of the major themes of DWT since 2005 but let me offer a specific example I ran across today regarding how Big Pharma bribes Congress to keep drug prices high. Ryan Grim pointed out that pharmaceutical industry lobbyists are desperate to slow down an Obama administration plan to reduce drug prices and that they're getting some help from both sides of the aisle. Before we get into looking at how Huff Po dealt with that yesterday, lets take a quick look at which House members are scooping up the biggest does of cash from Big Pharma so far this cycle. So far in the cycle they've spent $8,982,706 bribing members of the House, of which $5,779,854 went to Republicans and $3,202,852 went to Democrats. This year's dirty dozen:
Kevin McCarthy (R-CA)- $288,050
Paul Ryan (R-WI)- $254,139
Kevin Brady (R-TX)- $198,751
John Shimkus (R-IL)- $188,190
Erik Paulsen (R-MN)- $186,550
Frank Pallone (D-NJ)- $168,113
Fred Upton (R-MI)- $159,350
Renee Ellmers (R-NC)- $155,449
Brett Guthrie (R-KY)- $138,199
Leonard Lance (R-NJ)- $133,100
Anna Eshoo (D-CA)- $126,190
Ron Kind (New Dem-WI)- $123,335
No, none of them have signed on as co-sponsors of Jolly's bill to prevent congressmembers for asking for bribes-- but all of them are integral to pushing Pharma's agenda in Congress. And one thing Pharma wants is to stop the Obama administration plan to promulgate a "new rule that would experiment with ending the financial incentive doctors have for prescribing some extremely expensive medications." When doctors prescribe an expensive drug to a patient they can take a 6% cut off the top-- so a lot of overly expensive drugs get prescribed a lot more frequently than is reasonable.

The Democrats say their protests against the rule aren't as bad as the Republicans' protests
The Democratic letter gives HHS the opportunity to quickly answer the questions and move forward with the rule, while the GOP missive aims to stop it cold. All of the tussling takes place amid the implicit threat to attach a rider to legislation that would block the rule. If Republicans think they can do so without much Democratic opposition, there’s little to stop them. Pelosi’s alternate letter can be seen as an attempt to show there is division between the parties in how frightened they respectively are of the powerful lobbies at work here.

Pelosi encouraged her caucus to get behind the Neal letter to fend off the GOP attack. In fact, Pelosi’s office even helped with the letter: Democrats forgot to scrub their data from the document before circulating it, and an inspection of its properties reveals that it was last handled by a health policy fellow in Pelosi’s office.

The Republican letter simply asks for HHS to withdraw its new rule, citing “deep concerns.”

...The Medicare drugs proposal is part of a larger push by the White House to tackle prescription drug costs, which are rising rapidly even as costs in other parts of the health care system have grown more slowly in recent years. The administration is limited in what it can do to ameliorate drug spending without new legislation, but convened a forum at the White House in November to air the issue and has issued a slate of smaller reforms.

Any effort targeting the pharmaceutical industry and a segment of the medical community’s wallets is bound to attract staunch opposition, as this Medicare plan has. The proposal launched a fierce lobbying battle, with drug makers, cancer doctors and some patient groups charging that the plan to shift the financial incentives to provide more expensive drugs, higher doses of the medicines or both would be harmful to patients and interfere with clinical decisions by health care providers.

Congressional Quarterly recently reported that “the pharmaceutical industry is spending record sums in Washington, amid rising congressional and regulatory interest in high drug prices,” noting that its spending in the first quarter of 2016 outpaced everything since 2010, the height of lobbying over Obamacare.

The pharmaceutical industry also is fighting back against a set of cost-cutting proposals released this month by the Campaign for Sustainable Rx Pricing, a coalition that includes the lobbying arms of the hospital and health insurance industries, physician societies, the seniors’ advocacy group AARP and large companies such as Walmart.

The rationale for the proposed regulation is that the current system not only can overpay for these drugs, but can encourage physicians to use medicines that are the most profitable to their practices instead of most appropriate for patients. The independent Medicare Payment Advisory Commission, which advises Congress on policy, has cautioned about these incentives and urged lawmakers to update the way these drug prices are set.

The change would affect medicines administered by doctors in a medical setting, not drugs purchased at pharmacies and taken by patients, and those costs are covered by Medicare Part B, the portion of the program that pays for doctor visits and similar services. Medicare spends about $20 billion a year on these medications, according to the Centers for Medicare and Medicaid Services.

Under a formula created during the George W. Bush administration, physicians who purchase these medicines for use in their offices are paid the “average sales price” of the drugs plus an additional 6 percent. The Obama administration wants to reduce the markup to 2.5 percent plus a fee of $16.80 per day. The regulation also would call for experiments with other payment methods, including linking the amount doctors get to how well the medicine works to treat patients’ illnesses.

As one senior House Democratic aide put it in an email:
Basically the old system was really good for doctors-- they got paid more if they prescribed really expensive drugs because they got a percentage of the cost of the drug. So guess what they did? It doesn’t take a rocket scientist to figure that out. We’ve been trying to solve this problem for awhile and the spike in drug costs has made it even more urgent. The administration certainly went big and bold with this proposal but many people think it will be dialed back somewhat in the final version. Only a few specialties will really lose out, the others will actually benefit. But those specialists are the ones who have been making tons of $ on a broken system. Is it their fault the system is broken? Of course not. Is it their fault that drug costs have gone up so much? No, but you didn’t see them complaining too much either.
Meanwhile Indiana crook Larry Bucshon (R), says he's introduce legislation to repeal whatever the Obama administration passes along these lines and vows he has Democratic votes lined up-- New Dems and Blue Dogs, primarily, not actual Democrats-- to make it look bipartisan. So how's that for understanding how campaign contributions make your life worse?

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