No Care for Medicare

Last week, Republicans’ blind faith in the free market once again trumped a valuable measure to save elderly Americans money on medicine. Despite a similar bill having passed in the House of Representatives, 42 Republican senators blocked by filibuster a proposal to modify a provision of the Medicare Modernization Act of 2003. That provision forbade the Secretary of Health and Human Services to negotiate with drug companies and healthcare providers on behalf of the 43 million Americans who rely on Medicare.

The current system splinters the bargaining power of America’s elderly, creating private middlemen in the form of a slew of private insurance plan providers who in turn bargain with drug companies. With less purchasing power than the whole, drug companies sell their drugs at higher prices than they would in bulk, driving up costs for the government. It is simply nonsensical that Medicare has far less ability to negotiate drug prices than the Veterans Health Administration or Medicaid.

We are also disappointed by the amount of power the pharmaceutical industry, which vehemently opposed the repeal and spent thousands on the effort to shoot it down, still wields on Capitol Hill. To some legislators, special interest groups are apparently more important than the good of elderly Americans.

Since Medicare recipients are such an enormous group of customers, we understand that the repeal might impact the pharmaceutical market in unforeseen ways, especially with respect to incentives for developing new or unique drugs. Nevertheless, pharmaceutical monopolies that are not counterbalanced by bargaining on the part of large purchasers cost consumers dearly. By allotting Medicare the right to negotiate drug prices on behalf of consumers, the federal government can reduce the power of drug manufactures to dictate inflated prices and provide the most comprehensive aid—at the best prices—to the people who need it most.