Responding to popular anxiety over prescription drug prices, the Senate Finance Committee last month approved a bill to restructure the Medicare prescription drug benefit.
The Prescription Drug Pricing Reduction Act contains a mix of good and bad ideas for amending the program, which relies on choice and competition to provide prescription drug coverage to 47 million seniors.
Restructuring Medicare Part D. Under Medicare Part D, prices are set through negotiations between private pharmacy benefit managers and drug manufacturers without government involvement.
First, and most obviously, the government pays no subsidies to drug companies under Medicare Part D. It pays premium subsidies to private prescription drug plans, which negotiate rebates and other price concessions from manufacturers and compete to enroll seniors.
There is no rationale for assessing Medicare Part D penalties on manufacturers based on prices that Medicare Part D plans do not pay them.
Drug prices in the Part D program would continue to be set without government interference, even as the secretary of health and human services separately exacts penalties against drug companies that increase their list prices.
Some Senate Democrats are unhappy with the bill because it does not direct the secretary of health and human services to "Negotiate" drug prices with pharmaceutical companies.
https://www.dailysignal.com/2019/08/28/good-and-bad-ideas-in-the-senates-medicare-drug-bill/
The Prescription Drug Pricing Reduction Act contains a mix of good and bad ideas for amending the program, which relies on choice and competition to provide prescription drug coverage to 47 million seniors.
Restructuring Medicare Part D. Under Medicare Part D, prices are set through negotiations between private pharmacy benefit managers and drug manufacturers without government involvement.
First, and most obviously, the government pays no subsidies to drug companies under Medicare Part D. It pays premium subsidies to private prescription drug plans, which negotiate rebates and other price concessions from manufacturers and compete to enroll seniors.
There is no rationale for assessing Medicare Part D penalties on manufacturers based on prices that Medicare Part D plans do not pay them.
Drug prices in the Part D program would continue to be set without government interference, even as the secretary of health and human services separately exacts penalties against drug companies that increase their list prices.
Some Senate Democrats are unhappy with the bill because it does not direct the secretary of health and human services to "Negotiate" drug prices with pharmaceutical companies.
https://www.dailysignal.com/2019/08/28/good-and-bad-ideas-in-the-senates-medicare-drug-bill/
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