Weekly Update for Week Ending October 3, 2020

Weekly Update for Week Ending October 3, 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.

Our nation is in a hyper-partisan period as the November elections approach.  In this environment it becomes tricky when reporting about issues that affect you and other TSCL supporters because the issues are so often intertwined with politics.

We want to assure you that we will try to report the facts as we understand them and keep elective politics out of it.


Government Will Not Shut Down – for now

Last week the Senate, following the lead of the House, passed the legislation needed to keep the government open through December 11.  President Trump then signed it into law.

It keeps the government functioning at FY 2020 spending levels and provides aid to farmers and more food assistance for low-income families.

When Congress returns after the elections, lawmakers will try to complete work on the twelve annual appropriations bills for FY 2021 in a lame-duck session in November and December.  If they fail to reach agreement by Dec. 12, there could be a government shutdown once again.

While the House has passed ten of the twelve needed spending bills, the Senate has not drafted any of them so far.  In trying to pass those bills there is likely to be a battle about paying for the President’s wall on the U.S.-Mexico border and replacing military funds he redirected to pay for border security last year.

Although the House passed new coronavirus aid legislation last week it is considered dead- on-arrival in the Senate. That’s because no agreement on another coronavirus bill was reached in continuing negotiations between House Speaker Nancy Pelosi (D-Calif.) and Treasury Secretary Mnuchin, who appears to be negotiating on behalf of both the President and the Senate.

However, time is running out for passing any new legislation before the elections.  The House recessed as of the end of Friday although it could be called back into session if agreement on a new coronavirus bill is reached soon.

The House Speaker said she will continue talks with the Treasury Secretary this week to try and reach a last-minute deal.  Just how President Trump’s coronavirus sickness and the just-announced coronavirus infections of three Republican Senators will affect this is not certain.

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House Committee Says Drug Companies make “Astronomical Profits”

Last week the House Oversight and Reform Committee held two days of hearings on the high drug prices in the U.S. as compared to the rest of the world.  The CEOs of six major drug manufacturers testified before the committee regarding the prices of drugs.

The day after the first hearing committee chairperson Carolyn Maloney (D-N.Y.) issued the following statement:

“Internal documents obtained during our sweeping investigation show that drug companies are taking full advantage of the federal law that currently prohibits Medicare from negotiating directly with drug companies to lower prices.  Drug companies are targeting the United States for their biggest price increases in the entire world, bringing in tens of billions of dollars in revenues, making astronomical profits, and rewarding their executives with lavish compensation packages—all without any apparent limit on what they can charge.”

In addition, committee member Peter Welch (D-Vt.) said: “It’s true, many of these pharmaceutical industries have come up with lifesaving and pain-relieving medications, but they’re killing us with the prices they charge.”

However, the top Republican on the committee, Rep. James Comer (R-Ky.), called the investigation a partisan attack. “These hearings seem designed simply to vilify and publicly shame pharmaceutical company executives,” Comer said.

The late Rep. Elijah E. Cummings launched the Committee’s investigation soon after becoming chairperson in January 2019.  In December, the House of Representatives passed H.R. 3, the Elijah E. Cummings Lower Drug Costs Now Act, to give Medicare the authority to negotiate directly with drug companies.

The bill has stalled in the Senate, however, because Majority Leader Mitch McConnell (R-Ky) has refused to take up the bill for consideration.

Democrats have long pushed for Medicare to directly negotiate prices with drug makers, a stance that President Donald Trump also took on the 2016 campaign trail. The committee argues that companies are “taking full advantage” of Medicare’s inability under federal law to negotiate.

While Trump abandoned the negotiation plan in office, he has tried, albeit mostly unsuccessfully, to advance other measures to cut drug costs. The president this summer announced an ambitious plan to link Medicare payments to lower costs paid abroad — an approach the industry vehemently opposes and that we have written about in recent weeks.

The irony is that the President’s recent actions to attempt to lower drug costs by executive order are more in line with Democratic positions than with lawmakers in his own party.  That is one reason he has been unsuccessful in convincing the Senate to pass drug legislation.

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House Committee asks for more Information about Drug Discount Cards

Last week the leadership of the House Ways and Means Oversight and Health subcommittees sent a letter to Health and Human Services (HHS) Secretary Alex Azar requesting more information about President Trump’s recently announced drug discount card for certain seniors.

The discount card program, which we reported in last week’s update, has left many questions unanswered, chief among them is what legal authority is being used to justify the program and how it will be paid for.

We have reproduced the portions of the letter below that are most pertinent regarding those questions and others that we believe are important.

We write urgently to request information regarding the recent announcement by Mr. Trump that his administration plans to send prescription drug discount cards to certain Medicare beneficiaries over the coming weeks.

It appears that the Trump Administration may seek to rely on existing waiver authority and claim imaginary “savings” from a separate plan that has not even gone into effect yet.

As you know, the Constitution provides Congress with the power of the purse, not the Executive Branch. The administration has no authority to spend billions of taxpayer dollars as it sees fit, no matter the political benefit it may seek.

  • Please describe the specific legal analysis and justification for the use of such funding from the U.S. Treasury for this purpose. What source of revenue from the Treasury will be tapped to pay for the money loaded onto the cards? If funds will be spent from either the Medicare Hospital Insurance or Supplemental Medical Insurance Trust Fund, please describe the specific legal authority for expropriating funding from the Medicare trust funds for this purpose.
  •  At what point in time did HHS become aware of this proposal to send cards to Medicare beneficiaries for the purchase of prescription drugs? Did HHS receive any actuarial estimates regarding how this action would affect the Medicare trust funds or consider whether this would negatively impact their solvency or beneficiary premiums?
  •  What company will be responsible for printing and mailing the cards? Was this contract competitively awarded? If not, why were usual procurement rules not followed? What is the expectation in the contract for the date at which mailing will begin and conclude?
  •  Does the Trump Administration intend to prioritize certain states above others in sending out these cards?
  •  Please list the products and criteria for what may be purchased with these cards. Where will beneficiaries be able to use them? Will the funding on the cards expire? Are there limitations on what the cards can be spent on and how or where they can be used (i.e. generics, brand, biologics)? How do these cards interact with co-pays or co-insurance? Are there any fees associated with the cards? Will any amounts need to be repaid by recipients? Please provide any documentation related to how Medicare beneficiaries can utilize these cards.

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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.