Do People Realize That Prescription Drug Prices ARE Being Negotiated in the USA?
Last edited Tue Feb 16, 2016, 07:27 PM - Edit history (2)
We hear that the government isn't allowed to negotiate prescription drug prices. Well, that's not entirely true.
Currently, the VHA negotiates drug prices for the 9-million vets it serves. The VHA on average pays 56% of the list price on prescription drugs.
As part of Medicare Part D, the Feds cannot negotiate drug prices. However, private insurance companies can negotiate prescription drug prices. Although they do not supply figures on what they are paying, they have access to what the VHA pays, and the assumption is that they use those numbers to negotiate even lower prices than the VHA as they have more subscribers (note: private insurers cannot negotiate together against the drug companies to bring prices down. Ideally, everybody - private insurers and the government - would be able to negotiate together as one entity to get the absolute lowest price for prescription drugs for all patients, whether they were served by public or private insurance).
That leaves the Federal government which is, in fact, not allowed to negotiate prices for prescription drugs for the programs it runs, Medicare and Medicaid. The Feds pay around 80% of the list price for prescription drugs for the roughly 50-million people those programs serve. Of course, the federal government has never and probably will never be in the business of negotiating drug prices for private insurance companies nor in setting prices for drugs across the board.
Which means that in the grand scheme of things, the Feds are missing out on about a 30% discount that they could be enjoying for their Medicare patients (Medicaid has no co-pays for drugs). That's roughly 16% of the US population that is currently missing out on much lower drug prices.
Seems to me that this reality is an easier lift to sell to people than the idea that everyone in the country is overpaying on drugs because "we can't negotiate." Why not point out that drug prices ARE being negotiated for 5/6ths of people already on non-Medicare plans, that the compromise reached on Obamacare was an OK compromise at the time, but that we are now 6 years down the road and the time has arrived to lift the restriction on the Feds negotiating prices for Medicare/caid?
Makes more sense to me than putting out the illusion that we are at Square One on negotiating prices as "no one gets to negotiate drug prices in this country."
