Biden Plan Puts Medicare Part D in Peril

With liberal lawmakers coveting an expansion of government control over Americans’ health care, their efforts risk “taking programs that work well and mangling them in the name of ‘reform.’”

In a commentary published by Missouri’s Springfield News-Leader, Project 21 Co-Chairman Stacy Washington – a resident of the St. Louis metro area – writes about how efforts to mess with the free market, contained in Joe Biden’s $ 3.5 trillion spending plan, could compromise seniors’ Medicare Part D prescription drug benefits:

To be sure, they imbue their actions with good intentions. By enabling the government to set drug prices in Medicare, they claim they’ll save seniors money at the pharmacy.

But they’re wrong. Insurers already drive a hard bargain with drug companies. Replacing these negotiations with government-directed price controls will, if anything, pad the Treasury Department’s balance sheet at the expense of limiting seniors’ access to life-saving treatments today and curtailing the development of new medicines tomorrow…

A pillar of this legislation is the “non-interference clause,” which prevents the government from involvement in negotiations between Part D insurers and drug companies. This clause exists so bureaucrats won’t get to decide which drugs Medicare can cover and to ensure that Part D insurers and drug companies will offer as many medication choices as possible.

But this clause – and the benefit – are imperiled by the Biden Administration’s plan to fundamentally transform America:

If they repeal the non-interference clause, the government would be able to set drug prices. This might sound appealing, but in practice, it’d be extremely difficult for Medicare negotiators to get better prices than private Part D plan insurers unless they’re willing to ration access to the most expensive drugs. With less revenue coming in, research companies would have less money to invest in the scientific exploration that brings new medicines to market.

Even worse? The savings the government would yield for itself through price controls wouldn’t even go to patients. Lawmakers plan to take that money and redirect it to a host of new spending programs. In short, the proposed change to Medicare is designed to pay for more wind farms.

As for what the conservative resistance in Congress can do, she advises: “By saving the non-interference clause, they’ll protect a program that helps vulnerable seniors.”

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This article was published on October 27, 2021, and reproduced with permission from The National Center for Public Policy Research.