Under the original Medicare law, the private insurers who offer Medicare Part D coverage negotiated prices with drug companies; the federal government was not allowed to bring its considerable bargaining power to the table in order to push down the cost of prescription drugs. Opponents have strenuously objected to this arrangement, saying that drug companies are reaping billions in profit because the federal government isn't forcing them to lower their prices. Many critics felt that special interest--in the form of drug companies--used their influence to keep drug prices artificially high.
Now, a Democratic Congress is set on revamping Medicare prescription drug coverage to allow negotiations between the Health and Human Services Secretary and drug companies. But at the same time, Democrats also want to prevent the federal government from determining the drug formulary, or list of covered drugs. "Many economists and health policy experts see this as a paradox. The only way to get big savings and discounts, they say, is to steer patients to certain preferred drugs," notes the New York Times. Without the leverage of determining the drug formulary, it will be very difficult for the Secretary to get drug companies to negotiate. Congress is set to debate the issue next week.
For details on the Part D revamp:
- check out this article from The New York Times
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