Oversight Hearing on Medicare Part D Discounts
July 24, 2008
The Oversight Committee is currently holding a hearing, "The Medicare Drug Benefit: Are Private Insurers Getting Good Discounts for the Taxpayer?" The Medicare Part D program provides prescription drug coverage to almost 30 million enrollees, and will cost federal taxpayers almost $1 trillion in the next decade. The hearing will examine whether the private insurers that receive government subsidies to provide the Part D benefit are able to effectively obtain prescription drug discounts from drug manufacturers. Since the Part D program's inception in January 2006, observers have questioned whether the private insurers who run the program are effectively negotiating with drug manufacturers for low prices.
Chairman Henry Waxman gives opening remarks:
| Chairman Waxman: "What we discovered is that the taxpayers are paying far more for drugs under Medicare Part D than they do under Medicaid. In effect, Medicare Part D has given the major drug companies a taxpayer-funded windfall worth billions of dollars... The circumstances that led to passage of the Medicare Part D law were controversial. The chairman of the House committee that wrote the Part D law now runs PhRMA, the drug manufacturer's trade association. The Administration's top negotiator left the government to lobby for health insurers and drug companies. There were allegations of threats and arm-twisting on the House floor... I will soon be introducing legislation that will protect the taxpayer by bringing down the high drug prices in Medicare Part D." |
Rep. Elijah Cumminds (MD-03) questions the first panel of expert witnesses on potential solutions:
| Rep. Cummings: "I've sat here and I've listened to all of you, and I've got to tell you -- I'm confused. Because the bottom line... as I understand it, is that the government is spending more money now, in moving these folks to Medicare Part D than they were before. Is that the bottom line?" Professor Gerard Anderson: "$2 billion more, per year." |