Will the Inflation Reduction Act help drug prices? This is what people are saying

While the Build Back Better bill is getting life support, some pieces are getting a new lease of life that has been announced recently Inflation Reduction Act of 2022 – including multiple medical treatments.

Senate Majority Leader Chuck Schumer, D-N.Y., is a Democrat with Sen. Joe Manchin, DW.Va., announced this week that he would agree that if approved he would allow Medicare to negotiate drug prices, out-of-pocket costs. Medicare-related costs, extend the sunset date for COVID-19-related coverage for people who buy health insurance in the Affordable Care Act marketplace and address environmental justice issues.

Pharmacist Eric Hasebi certifies the formulation of a drug at Harmons City Creek in Salt Lake City on Wednesday, July 31, 2019.

Kristin Murphy, Deseret News

Schumer said the Senate will vote on the resolution before the August recess. votes to pass, not 60 votes for a filibuster.

President Joe Biden issued a words Wednesday to support the new idea. “This is what the American people have been waiting for. This solves today’s problems – health care costs and inflation – and funds our energy future,” he said.

Medicare grants allow Medicare to negotiate drug prices, something the program is not allowed to do. If the bill passes, starting in 2026 Medicare could negotiate prices for 10 “low-cost” drugs prescribed to Medicare members, most of whom are seniors.

The inflation rate also removes the cost of prescription drugs purchased at the pharmacy at $2,000 for people in Medicare drug plans. Currently, these people can pay thousands if they are prescribed expensive drugs, as the Deseret News recently reported.

“Elderly people are among the people who buy the most prescription drugs. And Medicare has a unique position on drug prices, “said the article. “To get help with the cost of drugs that are provided outside the area, Medicare recipients need Part D Medicare or a Medicare Advantage Plan with a drug. Otherwise, they pay the price themselves. If the drug is on Medicare’s formulary, patients pay up to 25% of the cost. But Medicare, unlike conventional insurance companies, does not negotiate discounts with drug companies.

The inflation-adjusted bill, if passed, would allow Medicare to negotiate discounts. The most important factor for some consumers is the high cost of prescription drugs.

For some people on Medicare, copayments and coinsurance for formulary drugs can be hundreds — even thousands — of dollars.

Several Medicare beneficiaries in February told the Deseret News about the difficulties they faced in purchasing drugs through the program. Moira “Meg” Jackson-Drage, 53, of Magna, Utah, described skipping prescriptions for autoimmune diseases because she couldn’t afford the full cost.

David Mitchell, 71, of Bethesda, Maryland, said the out-of-pocket cost of one of his multiple myeloma drugs is $16,000 a year. He started together Cheap Medicines for Patients.

And another Medicare beneficiary, Therese Humphrey Ball of Ogden Dunes, Indiana, said this year that she is struggling to afford her multiple sclerosis treatment.

“With this agreement, we have the opportunity to make drugs cheaper by allowing Medicare to negotiate lower prices and we can reduce health insurance costs for 13 million Americans, about $800 a year for families under the Affordable Care Act,” Biden said in a statement. a written words about this request.

Price control or negotiation?

Not everyone thinks that the solution to this problem is good.

Dr. Wayne WinegardenSenior partner in business and finance at Pacific Research InstituteHe is not very happy about the prospect of the Medicare program negotiating drug prices, as written in the Build Back Better Act.

In early July, before Manchin and Schumer discussed inflation, Winegarden told the Deseret News that such a discussion would focus on price control.

“They say it’s a Medicare negotiation, but it’s really good that the Godfather is negotiating with you, giving you something you can’t say no to,” said Winegarden, who also directs the Center for Medical Economics and Innovation.

As planned in Build Back Better, those who rejected the negotiated price will face a huge tax on their money, he said. “So it’s not just about negotiating, it’s about price control. … The key is to encourage future innovation and to encourage buying now – and price controls are not going to affect the situation.”

Others, such as Dr. Kenneth E. Thorpe, a professor at Emory University who is the chairman of the advisory board. Partnership Against Infectious Diseaseshe told the Deseret News the list of drug prices is not a problem with drug affordability, which extends beyond Medicare.

“I think the focus on drug prices has been misplaced,” Thorpe said recently. “This is important to Medicare maybe, but to me, the real focus should be on patients and what they pay out of pocket.”

Manchin has already supported cost negotiations and Medicare support in Build Back Better, so its inclusion in the inflation bill is not surprising. For drugs that are prescribed in doctors’ offices or purchased at pharmacies, the Secretary of Health and Human Services may negotiate drug prices, starting with the 10 most commonly prescribed, high-cost drugs that have the largest impact on prescription costs, beginning in 2026. results. , the number that can be discussed will increase.

The inflation bill would also require drug companies that raise their Medicare drug prices at rates faster than inflation to recoup more money.

“In total, the cost of the drug reduces the deficit by $288 billion over ten years, according to the Congressional Budget Office,” CNN reported.

Other health benefits

The bill would extend Affordable Care Act subsidies for another three years. The aid was part of the American Rescue Plan package to provide financial aid during the pandemic, lowering insurance costs for those who buy their insurance in the public market under the Affordable Care Act. Payments are due at the end of the year. Under this bill, they will pass by 2025, at a cost of $64 billion.

Subsidy for insurance assistance is up to 8.5% of the income; it was close to 10% before the pandemic. For low-income earners, the subsidy eliminated premiums. And for the first time, those earning more than 400% of the poverty level became eligible for cost assistance.

The bill would also provide for vaccinations for adults. Some have paid for their own vaccines or skipped them.

Finally, although environmental regulations are written according to the climate, they are also considered to be good for public health, to deal with some of the problems that may occur due to human traffic and other activities for the people living nearby.

Manchin in a written statement said the bill “will end inflation by paying down our national debt, lowering energy costs and reducing health care costs.”

Payment

Before the talks, Manchin only agreed to lower the cost of prescription drugs and increase subsidies for the Affordable Care Act, according to Vox. “They said that doing anything else would increase inflation and destroy the economy. Now, Manchin says, he’s found a way to slow inflation…

Collecting unpaid taxes is important for paying bills. And the bill imposes a stiff tax rate of 15% on corporations with annual revenues of $1 billion or more. The nominal tax is only 21%, but many organizations find ways to buy and pay less.

The bill also goes to people who avoid taxes by investing in taxable income.

A issue on the Inflation Reduction Act it says the bill will raise $739 billion, and invest $433 billion in programs, including $369 billion in “energy security and climate change” and $64 billion in additional ACA subsidies.

The official website says “$300+ billion” in deficit reduction will fight inflation.

And he says no new taxes on families making $400,000 or less and no new taxes on small businesses. Instead, the tax loopholes are being closed and people are encouraged to follow “so that the big and richest corporations pay their fair share.”

CNN reported that “Schumer and Manchin have been in talks since July 18 and closed the deal on Wednesday, according to a source familiar with the matter. Manchin threw cold water on offering taxes and energy as part of the deal, but eventually agreed to it.”

A difficult road ahead?

The Washington Post reported to be helped by Manchin,” some Democratic senators in recent days also asked Larry Summers, a former Treasury secretary who has been critical of Biden’s stimulus legislation, according to two people familiar with the matter, who spoke on condition of anonymity to describe private discussions. Summers was among the economists who first warned that inflation would rise.”

According to the article, “The two men spoke this week, and Manchin listened as Summers explained in detail why the economic plan that the Democrats want — including its power — will not lead to higher rates, the people said. Manchin spoke with Summers at times throughout the last year, and Senate aides have insisted his views have been consistent throughout the negotiations. A spokesman for Summers declined to comment.”

That it’s a plan with so much to be done could delay or kill the deal, as Howard Gleckman, director of the nonpartisan Tax Policy Center, told CNN.

Vox says it could still be difficult, as Sen. Kyrsten Sinema, D-Arizona, did not say whether she would support the bill. He previously voiced his displeasure with the corporate tax hike in the Build Back Better Bill. “Similarly, it’s unclear what support in the House will look like, especially from Democrats who wanted the bill to restore the state and local tax deduction, also known as SALT,” Vox said.

CNN reported the law must pass through the House of Representatives and then through the walls of Congress, “where any Democrat can stop or delay it.”

Some of the activities in the partnership on Twitter:

From former President Barack Obama:

Noah Rothman, author of “The Rise of the New Puritans”:

Ben Shapiro:

Benjy Sarlin, news editor at NBC News: