President’s Budget Leaves out Plans for Lowering Drug Prices
Last week we reported that President Biden’s FY 2022 budget proposal was not expected to included specific legislative proposals for lowering drug prices or fixing Social Security and Medicare.
That turned out to be correct when his budget request was released last Friday.
Although he is proposing a large increase in federal spending on various health care programs, the budget proposal only says that the President would like Congress to take action this year on reducing prescription drug prices and fixing Medicare and Medicaid.
The president specifically indicated his support for creating a public option, lowering the minimum eligibility age for Medicare and expanding Medicare to include vision, hearing and dental coverage.
In discussing the budget request a spokesman for the President said, “We know there are proposals on the Hill being introduced, and we believe that it is more productive to work collaboratively with Congress to develop and build consensus around specific policies that achieve his broad goals.”
It is important to remember that the President’s budget is only a request he sends to Congress. It is Congress that decides how much to spend on which programs. No budget sent by a President to Congress ever comes out the way he proposes.
Clearly, some of the biggest items on Biden’s health agenda will require extensive work with Congress.
That’s why TSCL has been, and will continue working with members of Congress on urgent legislation that seniors need.
The help of TSCL supporters is critical this year if we are going to see our legislation passed. We can win this fight for lower drug prices, for fixing Medicare and Medicaid, and for a bigger COLA for Social Security but it will require your continued support.
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Fight for Lower Drug Prices Heats up in Congress
For the last couple of weeks we’ve also reported on a hearing by the House Committee on Oversight and Reform regarding the prices that drug companies are charging for some of their drugs that are critical for the health of many seniors.
The hearing examined in particular the drug company AbbVie, which makes Humira and Imbruvica, two drugs widely used by seniors.
The committee found that AbbVie inflated prices for the drugs while its executives pocketed growing bonuses. The committee's two-year investigation found that AbbVie "pursued a variety of tactics to increase drug sales while raising prices for Americans, including exploiting the patent system to extend its market monopoly, abusing orphan drug protections to further block competition, and engaging in anticompetitive pricing practices."
According to the committee’s report, AbbVie has raked in more than $100 billion in net revenue from those two drugs since 2013, which the committee said was "driven in large part by AbbVie executives' decision to repeatedly raise the prices of Humira and Imbruvica." The company's top executives pocketed $480 million in compensation during that span, "much of which was directly linked to revenue increases," the report said.
Now, it turns out, AbbVie is helping to fund ads attacking legislation that would lower prescription drug costs.
“AbbVie is one of 33 member companies of the industry's top lobbying group, PhRMA, which raised nearly $450 million from membership dues in 2018, the most recent year for which data is available. But AbbVie's political action committee is one of just two pharmaceutical company PACs to donate the maximum $40,000 to PhRMA's federal PAC since 2013, a potential indicator that AbbVie was highly motivated to influence legislation,” according to a report on Salon.com.
It turns out that PhRMA “spreads that money around to political campaigns across the country as well as other trade groups like the American Action Network (AAN), a conservative dark money group that launched a $4 million ad campaign to defeat the Democrats' H.R. 3 proposal, which would allow Medicare to negotiate lower prices for prescription drugs and cap out-of-pocket drug costs at $2,000,” again, according to the Salon.com report.
The report adds that, “The pharmaceutical industry has already shattered records this year, spending an unprecedented $92 million to lobby the federal government in the first three months of this year, according to the CSP, including $8.7 million from PhRMA. Stephen Ubl, the CEO of PhRMA, criticized H.R. 3 last month, claiming it would ‘destroy an estimated one million American jobs.’ The U.S. Chamber of Commerce, the biggest lobbying spender this year, has also come out against the bill, comparing it to ‘government price controls’ and claiming it would cost hundreds of thousands of jobs.
“The Congressional Budget Office said in 2019 that the bill would likely hamper some pharmaceutical development due to lower ‘potential global revenues’ but predicted that ‘the effects of the new drug introductions from increased federal spending under the bill on biomedical research would be modest and would almost all occur more than 20 years in the future.’ On the other hand, it estimated that the bill would save more than $450 billion in drug spending over the next decade.”
Now there are ads in various parts of the country being run by the Democratic Congressional Campaign Committee, accusing House Republicans of doing the bidding of drug industry donors by opposing the bill. Unremarked upon are the House Democrats who've also received money from the industry — and whose opposition is seen as potentially fatal to the legislation.
But it turns out the Democrats are not quite as united as that statement makes it sound. Ten members recently sent a letter to House Speaker Nancy Pelosi (D-Calif.) expressing concerns about the drug pricing legislation as written.
Democrats currently have an eight-seat majority in the House, meaning 10 defections could doom the legislation. Of those 10 members, seven got contributions last cycle from PhRMA, according to Federal Election Commission records. Six received donations from AbbVie's political action committee.
All of that raises questions about whether Democrats have enough votes to advance H.R. 3 out of the House, but in any case, it's highly unlikely that the bill could get the 60 votes necessary to defeat a filibuster in the Senate.
Fortunately, H.R. 3 is not the only legislation in either house of Congress that could lower drug prices and accomplish the other things necessary to fix Medicare and Social Security.
TSCL is continuing to work hard for any and all legislation that would accomplish those goals.
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More Doctors Could be on the way to Underserved Areas of the U.S.
Modern Health Care reports that there is a push by members of Congress to bring more physicians to rural and underserved areas experiencing shortages. Lawmakers have reintroduced a plan to allow more international physician candidates to attend residency in the U.S. and stay in the country after their training if they agree to work in underserved areas.
The legislation was reintroduced Thursday and would increase the number of slots in the program called Conrad 30. Sen. Amy Klobuchar (D-Minn.) first introduced the bill in 2019 with bipartisan support, but it failed to pass the Senate Judiciary Committee.
Minor changes were made to the bill in order to gain a broader coalition of supporters, including reauthorizing the Conrad 30 program for three year following the bills enactment, language clarifying hospital malpractice concerns, and a mandate that directs U.S. Citizenship and Immigration Services and HHS to keep track of how the J-1 visa program is being used by states.
The American Hospital Association and American Medical Association both support the bill, but it is unclear whether the legislation's effort to raise the number of slots for residency graduates to work in the country will effectively address workforce shortages in rural communities.
A report by the Association of American Medical Colleges shows the U.S. will have a shortage of 139,000 physicians by 2033. Rural areas are especially vulnerable. Only 11% of physicians practice in rural facilities, while 20% of the U.S. population live in rural areas. Neither of these statistics take into account the exodus of physicians from the workforce following the COVID-19 pandemic.
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As we continue recovering from the Covid 19 pandemic, TSCL is continuing its fight for you to protect your Social Security, Medicare, and Medicaid benefits. We’ve had to make some adjustments in the way we carry on our work, but we have not, and will not stop our work on your behalf.
For progress updates or for more information about these and other bills that would strengthen Social Security and Medicare programs, visit the our website at www.SeniorsLeague.org, follow TSCL on Twitter or Facebook.