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Peter Pitts: There's a caveat to cheap drugs
Peter Pitts: There's a caveat to cheap drugs
By Peter Pitts
March 25,2007
All right, who's in favor of lower prices for prescription drugs?
It's hard to believe that anyone would say "not me" to the above question. After all, no one wants to pay too much for anything, even the drugs that make healthy lives possible.
But in the case of prescription drugs, lower costs in the near term threaten to cripple our nation's ability to invent new cures in the long term — a possibility that Democratic backers of "cheap drugs" are quietly hoping the public ignores.
In recent weeks, Democrats have cynically used the public's natural preference for lower prices to bolster support for their latest foray into government-run medicine — a proposal that would allow the government to "negotiate" prices under the Medicare drug benefit. A vote on the measure is expected in the Senate soon, hidden in a bill on the federal budget.
A much-touted survey from the Kaiser Family Foundation purports to show that a sizeable majority of seniors support the Democrats' plan. But such surveys don't tell the whole story.
A January poll by Penn, Schoen and Berland Associates, for example, showed that when the risks of so-called negotiations were explained, voters were not so sure that negotiation was the right approach. Voters recognized the deadly trade-off in allowing health care bureaucrats to play negotiator, bringing somewhat lower drug costs in the short term at the expense of drug choice and the future potential of medical innovation.
Under the current Medicare system, prescription drug prices are negotiated by private insurance companies. The plan championed by House Speaker Nancy Pelosi, however, would give government the power to "negotiate" — really, to manhandle drug companies into offering their drugs at lower prices. But such coercion is at odds with the choice seniors now enjoy under Medicare Part D.
Supporters argue that production costs are so low that drug developers can afford to charge less. While basic production costs may be fairly low, drug development is an enormously expensive, time-consuming venture. It's really the first pill that costs close to a billion dollars to make.
Other supporters point to drug programs offered by the Department of Veterans Affairs or European countries as models of how negotiations could work. But these programs can claim success only by placing stringent limits on what drugs are offered.
France's program, for example, has instructed its doctors to prescribe fewer medicines — not for health reasons, but to save money. And the VA program offers a far smaller selection of drugs than is currently available via Medicare Part D.
Proponents of negotiation don't like to inform voters of these inconvenient facts. And that's understandable; when voters are made aware of these downsides, they tend to oppose negotiation overwhelmingly.
In the Penn, Shoe and Berland poll, 76 percent of voters initially supported negotiations while 24 percent opposed it. After the potential risks were made clear, the numbers shifted substantially, as 65 percent of voters from across the political spectrum opposed price negotiation.
When informed of specific risks, those numbers shot even higher. Eighty-nine percent opposed the proposal when they learned it could limit access to new prescription drugs; 86 percent opposed it when they learned that the proposal had restricted drug access in other countries; and 77 percent refused to support the plan upon learning that it gave government the right to create a single, limited list of available drugs.
Voters aren't the only ones concerned about negotiations. Independent experts at both the Department of Health and Human Services and the Congressional Budget Office have said that government involvement in price negotiations will not lead to lower costs for taxpayers. Further, as a spokesperson for HHS recently explained, "the private market place is working for beneficiaries and taxpayers"
Voters seem to agree. According to another recent poll, a 55 percent majority held a favorable opinion of the prescription drug benefit in its current form. Among seniors enrolled in the plan, more than 80 percent were satisfied with it.
None of this is encouraging for those in Congress who wish to foist an anti-innovation, anti-choice program on the American public. Despite the public support claimed by Democrats, when voters recognize that negotiations are potentially catastrophic for both medical progress and drug choice, they turn against it. And it seems more than likely that eventually they'll also turn against those in Congress who pushed the plan in the first place. |
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