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March 28, 2005

Why Oh Why Are We Ruled by These Liars? (Tommy Thompson Edition)

Outsourced to the Carpetbagger Report:

Now He Tells Us: There's an annoying tendency of high-ranking Bush administration officials to grow bothered by the politics, road blocks, and ineffectiveness surrounding their work, only to have them talk about after they've left and it's too late. The latest in Tommy Thompson.

Yesterday, during a rambling question-and-answer session at the Kaiser Family Foundation, Thompson complained bitterly and broadly about his frustrations while working in the administration. But there was one complaint in particular that undermines Thompson's already-weak credibility.

Speaking to a luncheon of health policy experts, Thompson said another major frustration was Congress' refusal to let him and future HHS secretaries negotiate drug prices for the new Medicare prescription-drug plan. Critics say using Medicare's 42 million enrollees as bargaining leverage in price negotiations – a tactic that Congress never seriously considered – could save the program billions of dollars.

How wonderfully convenient for Thompson. He wanted to use Medicare's buying power to lower the price of prescription drugs, but those mean Republicans in Congress wouldn't let him. That's a wild distortion of what happened.

Republicans in Congress, to be sure, never even considered using Medicare to negotiate more affordable drugs, but the Bush administration's plan – personally championed by Thompson – designed its Medicare proposal this way.

In his State of the Union address this year, President Bush urged members of Congress to work with him to help control the rising costs of medical care. Just months ago, however, the president worked with Congressional leaders to block attempts to control the fastest growing health care cost: prescription drugs. The Medicare prescription drug benefit that the President signed into law and lauded in his speech omits any effective mechanisms to lower prescription drug prices. Instead, the President and Congressional leaders drafted the law with the intent of emulating the private market practices that have brought us to where we are today – exploding prescription drug costs that are increasingly borne by patients due to health insurers' restructuring of drug benefits. Even if the Medicare program experiences similarly unsustainable costs, the new law expressly forbids the secretary of Health and Human Services from acting to ensure reasonable prices under the drug benefit.

This report, the first in a series on the new Medicare law and its implications for beneficiaries and taxpayers, examines the law's provisions regarding prescription drug prices. After identifying concerns with the legislation as passed, the report offers options for legislative changes that would lower drug costs for Medicare beneficiaries and taxpayers.

The new Medicare law relies on private drug plans (e.g., HMOs and other private health insurers), in conjunction with pharmaceutical manufacturers, to establish the prices beneficiaries and taxpayers will pay for prescription drugs under the Medicare drug benefit. Moreover, it states, "In order to promote competition under this part and in carrying out this part, the Secretary (1) may not interfere with the negotiations between drug manufacturers and pharmacies and [prescription drug plan] sponsors; and (2) may not require a particular formulary or institute a price structure for the reimbursement of covered Part D drugs."

These provisions were as subtle as a sledgehammer. The Bush administration didn't want HHS to be able to lower prices in negotiations with pharmaceutical companies, so the law reflected this, making it literally illegal for Thompson or any HHS secretary to even try.

Not only did Thompson go along with this, he was on the House floor, twisting GOP arms during the vote, making sure this bill became law.

And now he wants us to believe he wanted to help lower prices through Medicare? Please. It's kind of sad Thompson would even try such nonsense; the Medicare vote wasn't that long ago and too many of us remember his role in this fiasco.

Posted by DeLong at March 28, 2005 07:13 PM