A landmark in corporate welfare

Medicare Part D is a fiscal debacle – and a lobbyist's dream.

from the July 18, 2007 edition

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When the bill was being debated, taxpayers were told the program would cost $400 billion. Today, realistic estimates put the figure at more than $1 trillion. The big drug companies, of course, love this. All those multiyear investments in lobbying have paid off – allowing them to use your tax dollars to boost their earnings.

In January, under public pressure, the House voted to "require the Secretary of Health and Human Services to negotiate lower covered part D drug prices." The press called that progress. But in the lobbyist-legislated fine print, HHS was still barred from establishing a formulary list. So the bipartisan Congressional Budget Office and Medicare's own actuaries concluded the House bill would have no effect on federal spending. And the version now ostensibly pending in the Senate is an even more dazzling example of the lobbyist's art. It merely authorizes – rather than requires – the secretary of HHS to negotiate for lower drug prices.

If you pay taxes, have an older relative, or have any plans to be one, check out the top 20 list of congressional recipients of pharmaceutical lobbying largess in the last election, compiled by the Center for Responsive Politics (www.opensecrets.org). You'll see some familiar names: Sens. Orrin Hatch, Edward Kennedy, Joseph Lieberman, and Hillary Clinton.

During your next lunch break, call their offices. Ask their staffers why a failure to create real price competition in Medicare Part D should cost taxpayers and coddle drug companies. Or ask them how long the program can survive centrally planned profiteering. And you should suggest to them the following reforms:

First, sell medicines used by Medicaid "dual-eligible" patients to Part D plans at the lower Medicaid rates. Second, let congressional watchdogs monitor prices paid by Part D plans versus Medicaid's best prices (today both price lists are confidential). Third, let Medicare leverage global efficiencies by buying FDA-approved drugs made at FDA-inspected facilities overseas (they're the same pills, made by the same companies, at a fraction of the cost). And finally, fund staffing for the Food and Drug Administration to close its record backlog of more than 850 applications for generics, which typically cost 20 to 70 percent less.

While the lobbyists are paid to make reforms to Part D the legislative equivalent of a child-proof cap, nothing suggested here is really that difficult. Unless you're ready to swallow the idea that everything's negotiable but death, taxes, and drug prices.

• Mark Lange is a former presidential speechwriter.

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