Weekly Update for Week Ending July 31, 2020

Weekly Update for Week Ending July 31, 2020

Despite the coronavirus emergency, TSCL is continuing its fight for you to protect your Social Security, Medicare, and Medicaid benefits.  We have 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.

We want to begin this week's update by reminding you to seriously consider seeing your health care provider if you have been putting it off because of the pandemic.  That is especially true if you have a serious health condition and you need treatment or close monitoring.

There are concerns that the impact of delayed care might reach a crisis this winter if a renewed crush of COVID-19 cases collides with flu season.  That could overwhelm the system in what CDC Director Robert Redfield has predicted will be “one of the most difficult times that we’ve experienced in American public health.”

 * * * *

Drug Executives Refuse to meet with Trump

Last week we told you that President Trump issued four executive orders concerning prescription drug prices.  We explained that we at TSCL are taking a “wait and see” approach because of concerns about the orders and the limitations that are involved with them.

The orders were issued on a Friday which left little time for analysts to review them and comment prior to the weekend.  However, since then we have learned new information, we want to share with you.

The four orders would:

1 - Allow states, wholesalers, and pharmacies to import FDA-approved drugs from foreign countries and sell them in the U.S. Trump has long complained that countries where the government sets the price of drugs are taking advantage of American consumers. The order includes a special provision to allow wholesalers and pharmacies to re-import insulin and biological drugs.

2 - Direct federally funded community health centers to pass discounts they now get for insulin and EpiPens directly to low-income patients.

3 - Ensure that rebates drug makers now pay to benefit managers and insurers get passed directly to patients when they buy a medication. The White House last year withdrew an earlier version of the proposal, after the Congressional Budget Office estimated it would cost taxpayers $177 billion over 10 years.

4 - Use the lowest price among other economically advanced countries – the so-called “favored nations rule” - to set what Medicare pays for certain drugs administered in a doctor's office, including many cancer medications. This would apply to the most expensive medications covered by Medicare's 'Part B,' which pays for outpatient care.

Drug companies and some patient groups have long criticized proposals like this last rule, saying it would reduce innovation and access to certain medications.  In addition, drug makers are particularly leery of the approach since Democrats want to use it more broadly to allow Medicare to directly negotiate prices.

When he issued the orders President Trump gave the drug industry until Aug. 24 to find a suitable alternative to one of his drug pricing plans.  He also announced that he would be meeting with drug company executives last Tuesday to begin discussions about a different plan.

But last Monday the drug company executives announced they would not be going to the White House meeting.  A spokesman for PhRMA, the giant lobbying group for many of the biggest drug manufacturers, said the White House talks were a distraction.

"The president’s plan to import policies from socialized health care systems abroad is disrupting our work [on Covid-19 therapies] and diverting our focus away from those life-saving efforts," the spokesperson said. "We remain willing to discuss ways to lower costs for patients at the pharmacy counter. However, we remain steadfastly opposed to policies that would allow foreign governments to set prices for medicines in the United States."

The President's favored nations rule has also upset conservative groups along with the industry and patient organizations.  Some of those groups had launched a media campaign against the proposal before Trump actually announced it.

After the drug executives announced they would not meet with the President, he went on Twitter and accused the pharmaceutical industry of running ads that lied about his new executive order.

As far as the other three orders are concerned, it has been reported that consumers may not notice immediate changes since the orders must be carried out by the federal bureaucracy and could face court challenges.

It is believed that Trump issued the executive orders because a drive to enact major legislation this year stalled in Congress. Although Trump has told Republican senators that lowering prescription prices is 'something you have to do,' many remain reluctant to use federal authority to force drug makers to charge less.

Last year the House did pass a Medicare negotiations bill, which would cap out-of-pocket drug costs for older people and expand program benefits as well.  But it has had no Republican support in the House, and it has no path forward in the Republican Senate because Senate Majority Leader Mitch McConnell (R-Ky.) has refused to bring it up for a vote.  In addition, the White House calls it unworkable.

However, there is and has been an alternative. A bipartisan Senate bill backed by Trump stopped short of giving Medicare bargaining power but would have limited annual price increases and capped costs for older people. The bill passed out of a Senate committee but was never brought to the full body, again because Majority Leader McConnell has refused to do so.

'It´s not clear why the administration hasn't made a bigger push to line up votes to get a bill through the Senate and a deal with Congress, given strong public support to lower drug costs,' said Tricia Neuman, a Medicare expert with the nonpartisan Kaiser Family Foundation.

As TSCL supporters know, it is a particularly important issue for older people, who rely on medications to manage the medical problems associated with advancing age.  However, drug makers remain adamantly opposed to government efforts to curb prices.

Trump's administration “has decided to pursue a radical and dangerous policy to set prices based on rates paid in countries that he has labeled as socialist, which will harm patients today and into the future,” Stephen Ubl, the head of PhRMA, said in a statement.

 * * * *

Senate Drug-pricing Bill to get Renewed Push

The main bill in the Senate regarding prescription drug prices is one that is authored by Senators Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.).  After Trump issued his executive orders, Sen. Grassley said he plans to use the time until the executive orders go into effect to build support for his own prescription drug package which, as we said above, has stalled in the Senate.

“For those who don’t like these executive actions, there’s time to get to the table and back a legislative solution,” Grassley said in a statement. “I will continue the fight in Congress until significant prescription drug pricing legislation becomes law. The next coronavirus relief bill presents the perfect opportunity for Congress to meet the moment.”

Grassley’s proposal has long been seen as the most likely major drug pricing legislation to reach Trump’s desk. However, conservative groups dislike the bill’s cap on drug pricing increases and the legislation’s main Democratic sponsor, Sen. Ron Wyden (D-Ore.), recently withdrew from negotiations on the package.

That leaves Grassley with a ticking clock to build enough support for his proposal to get it through the Senate and to convince House leaders to take it up as well.  House leadership has its own signature drug pricing measure that is closer to Trump’s own order than Grassley’s bill.

 * * * *

New Virus Relief Bill Could Affect Social Security and Medicare

We reported last week that President Trump has dropped his demand for a payroll tax cut in any new pandemic-related stimulus bill, which TSCL successfully lobbied against, along with many other groups.  However, other issues have caused great difficulty in negotiations for a new bill, one of which has not received much attention in the main press.

The $1 trillion Senate Republican stimulus proposal comes with a measure that could curb federal spending in the future by reducing costs tied to Social Security, Medicare, and highway trust funds.

Among the bills that make up the GOP plan is one that would establish congressional review boards to examine the long-term solvency of the three trust funds, a topic that long has been politically fraught.

Proponents of the measure, which include some Democrats, say that addressing the projected shortfalls now would prevent draconian cuts or tax hikes later. The legislation would create congressional panels mandated to draft bipartisan legislation that restores solvency of the trust funds, and the bills would receive fast-track consideration in each chamber.

“This is the right time to act. Our trust funds are approaching insolvency even more quickly because of the pandemic,” Senator Mitt Romney (R-Utah), who is leading the effort, said last Monday on the Senate floor. “It is far better to prepare and hopefully prevent a crisis than wait for a crisis to fall upon us.”

The measure has bipartisan backing in the Senate, as well as support from some moderate House Democrats. However, it is facing opposition from House leaders who say the legislation is a roundabout way to cut Social Security benefits.

“The last thing struggling Americans need right now is a secret panel designed to slash their earned benefits and further undermine their economic security,” House Ways and Means Chairman Richard Neal (D-Mass.) said in a statement. “I wholeheartedly object to the TRUST Act and will fight against its nefarious inclusion in any upcoming relief package.”

The measure’s inclusion in the stimulus is likely to be a point of contention between Republicans and Democrats as they work to hash out a compromise this week that will address state and local funding, money for schools and extending expiring unemployment payments.

 * * * *

Alzheimers and some Potentially Good News

We end the update this week with some hopeful news regarding Alzheimer's disease.  According to a report from National Public Radio, there is evidence that vaccines that protect against the flu and pneumonia may actually protect people from Alzheimer's, too.  The evidence comes from two studies presented last Monday at this year's Alzheimer's Association International Conference, which is being held as a virtual event.

"We've always known that vaccines are very important to our overall health," reported Maria Carrillo, chief science officer of the Alzheimer's Association. "And maybe they even contribute to protecting our memory, our cognition, our brain."

But he cautions that the amount of benefit from flu vaccination could be different in a different group of people.  "There is a protective effect," he says. "How much is something that needs to be quantified with a more intensive study."

Scientists do not know why vaccinations might reduce the risk of Alzheimer's. But previous research has hinted at a connection. And there are several potential explanations.

One is that vaccines for the flu and pneumonia may be protective because the two diseases they are designed to prevent are known to affect the brain.  Another possibility involves evidence linking Alzheimer's to a general weakening in the immune system and to changes that allow more bacteria and viruses into the brain.

A number of vaccines, including those for flu and pneumonia, might be capable of improving immunity overall, according to one researcher. Scientists are looking at several other potential candidates, including vaccines against herpes viruses and tuberculosis.

* * * *

For progress updates or for more information about these and other bills that would strengthen Social Security and Medicare programs, visit the Bill Tracking section of our website or follow TSCL on Twitter.