The Lessons of Obama’s Deal

Just finished watching the PBS special Obama’s Deal on demand and I am now enlightened:

Big Pharma Trumps Big Insurance

That’s right people, in case you were curious, its OK to make Big Insurance your enemy but don’t f*ck with Big Pharma.  Just ask the Obama administration.  From an article published on the Fox Business web site published four days after the new health care (cough) reform was passed:

"I was unable to find anything in there that would cause me to have anxiety if I were a shareholder in a pharmaceutical company," said Ira Loss, a senior health-care analyst at the research firm Washington Analysis.

Of course not Mr. Loss!  Early in the health care reform process Obama’s administration made a deal with big pharma including:

1. Americans will be prevented from buying cheaper pharmaceuticals imported from Canada (or any other country).
2. Pharmaceutical Companies have been given 12 years exclusive rights on medications before alternative (a.k.a. generic) drugs can hit the market and bring prices down.
3. The Federal Government will be prevented from using its immense buying power through Medicare and Medicaid from negotiating lower prices on pharmaceuticals.

The last one is the real kicker.  That’s right folks, we gave a no holds barred route to pharmaceutical companies right into the pocket of every single tax paying American.  Consider the following from an article by The Center for Public Integrity:

Securing approval of the Medicare Prescription Drug Improvement and Modernization Act of 2003, legislation termed "historic" and "breakthrough" by PhRMA, is considered to be among the pharmaceutical industry's most substantial victories. The law yielded the first prescription drug coverage under Medicare — a benefit that according for 2006 through 2015 is likely to cost the government more than $1 trillion according to March 2006 Congressional Budget Office estimates. The legislation was passed after a sustained lobbying campaign in the states and in Washington, D.C.

But wait,  the plot sickens…

One of the law's controversial aspects is a provision that bars the federal government from negotiating price discounts with drug companies. An October 2003 study by two Boston University researchers found that 61 percent of Medicare money spent on prescription drugs becomes profit for pharmaceutical companies.

I have a feeling that the pharmaceuticals will be making a crap load more than $1 trillion over 9 years.  Oh – by the way – when the article says “will cost the government $1 trillion” they mis-spoke.  Legislation never costs the government anything – it costs the American tax payer. 

Interesting how legislation aimed at controlling the cost of healthcare aims at slowing the increase in insurance costs but does nothing to containing the much larger cost of prescriptions.  As a matter of fact, between the Bush legislation from 2003 and Obama’s vast expansion of it, everything has been done to ensure we will all be paying much more for prescription medications – even if you don’t take any!

When do we get the change we can believe in?