WP: New Drug Benefit Questioned
Democrats' Report Cites Lower Prices From VA and in Canada
By Christopher Lee
Washington Post Staff Writer
Wednesday, November 23, 2005; Page A04
The new Medicare drug benefit fails to deliver drug prices as low as those found at the Department of Veterans Affairs, in Canada and at high-volume U.S. pharmacies, a congressional report said yesterday. It was challenged by a Medicare official as flawed and misleading.
The report, released yesterday by the Democratic staff of the House Government Reform Committee, found that the average prices of 10 popular drugs being offered to Medicare recipients through 10 well-known insurance plans were 80 percent higher than prices negotiated for the government by Veterans Affairs. The Medicare prices were 60 percent higher than average prices paid by Canadian consumers, the report found. And they were about 3 percent higher than those paid by consumers who got their drugs at Costco stores or online through Drugstore.com.
"The prices offered by the Medicare drug plans are higher than all four benchmarks, in some cases significantly so," the report concluded. "This increases costs to seniors and federal taxpayers and makes it doubtful that the complicated design of Medicare Part D provides any tangible benefit to anyone but drug manufacturers and insurers."
Gary Karr, a spokesman for the Centers for Medicare and Medicaid Services, said the report was disappointing but not surprising. "It's disappointing because it's selective and misleading, and because of the timing," Karr said....
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During the congressional debate two years ago, many Democrats argued that the way to obtain the lowest prices for seniors would be to allow Medicare to negotiate discounts directly with pharmaceutical companies. Republicans maintained that the lowest drug prices would come through competition as scores of private insurers vied to attract seniors. The law establishing the benefit forbids the government from negotiating drug prices....
http://www.washingtonpost.com/wp-dyn/content/article/2005/11/22/AR2005112201662.html