Opinion: It's time for drug companies follow the law, negotiate prescription prices
As we celebrate 58 years of Medicare, over 65 million seniors and people with disabilities depend on the program for health coverage, including routine preventive care, hospitalization and prescription medicines. As of late 2022, there were 661,560 Iowans with Medicare coverage, including 11% under age 65 who qualify because of a disability.
For decades, many Medicare enrollees have struggled to afford the prescriptions they need because of skewed rules that prohibit negotiating drug prices and protect the drug corporations’ monopoly power to unilaterally set and keep prices high. Leaving drug corporations in charge of prices has led to nearly one quarter of Medicare enrollees rationing medicine, skipping doses, forgoing other basic needs and going without needed medicines because of the price.
At the Iowa Citizen Action Network, we hear stories every day from our members which include many seniors who continue to work well past retirement age, diabetics who have rationed their insulin to make it through until the next Social Security check, and people who have to depend on food bank groceries to make ends meet all because of the cost of their prescriptions. For example, Gayle Warner, a working senior, struggles to afford basic needs after drug corporations raised the price of two prescriptions without warning or reason. Her prescription for Rybelsus, a diabetes medicine, went from $10 a month to between $285 and $350 and prescription eye drops increased from $40 to $425 a month.
She’s one of many Iowans struggling with drug costs who will benefit from the Inflation Reduction Act of 2022, which makes long-overdue improvements to prescription drug benefits in Medicare. Under the new law, seniors, people with disabilities and their families will save on the cost of prescription medicines thanks to common-sense policies that for decades the drug corporations successfully opposed. These reforms include allowing Medicare to negotiate lower prescription drug prices for seniors, capping the cost of insulin at $35, creating the first-ever out-of-pocket cost cap on Part D medicines, making recommended vaccines free for Medicare beneficiaries, and requiring prescription drug companies to pay rebates to Medicare if they raise their prices faster than inflation.
A new report shows that 3.4 million people with Medicare would have saved $234 million in out-of-pocket costs in 2021 on vaccines, or about $70 per person, if this law had been in place in 2021. Diabetics in Medicare who use insulin would have saved about $500 last year if the law had been in place, and in Iowa, 18,834 people would have saved an average of $725. Medicare recipients have these savings and much more to look forward to as the law is implemented between now and 2026. But implementation won’t be easy and drug corporations aren’t going to give up their price-gouging without a fight.
Big drug companies’ power to raise prices faster than inflation has enabled them to inflate profit margins over the years, making the pharmaceutical industry the most profitable sector in the United States. The new law changes this unilateral price setting and requires them to negotiate lower prices on some of the most expensive medicines in Medicare. On Sept. 1, CMS will announce the first 10 drugs for negotiations, and corporations that refuse to negotiate will face a huge fee for refusing to comply.
It’s no wonder that drug corporations Merck, Bristol-Myers Squibb, and now Johnson & Johnson, along with PHRMA (the drug industry lobby group) and the US Chamber of Commerce, have filed lawsuits to stop the law. Republicans in Congress are backing up these corporations by filing bills to repeal the new benefits, despite the popularity of the policies and the benefits to their own constituents. Iowa’s Mariannette Miller-Meeks, Ashley Hinson and Randy Feenstra voted against the new law to lower drug prices in 2022.
But seniors, people with disabilities and their families won’t stand for more delays and rollbacks in long-overdue reforms like Medicare negotiations. The time for waiting is over: pharmaceutical corporations must sit down and negotiate to make medicines affordable.
Sue Dinsdale is the executive director of Iowa Citizen Action Network. She lives in Huxley, Iowa.
This article originally appeared on Des Moines Register: Opinion: It's time for companies to negotiate prescription drug prices
