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Gov. Whitmer endorses Kamala Harris for president, says she's not leaving Michigan; Grilled by lawmakers on the Trump assassination attempt, Secret Service director says, 'We failed;' Teachers rally at national convention in Houston; Opioid settlement fund fuels anti-addiction battle in Indiana; Nonprofit agency says corporate donations keep programs going.

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Kamala Harris rapidly picks up Democratic Support - including vast majority of state party leaders; National rent-cap proposal could benefit NY renters; Carter's adoption support: Empowering families, strengthening workplaces.

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It's grass-cutting season and with it, rural lawn mower races, Montana's drive-thru blood project is easing shortages, rural Americans spend more on food when transportation costs are tallied, and a lack of good childcare is thwarting rural business owners.

Biden’s Medicare Move Projected to Lower Drug Prices, Federal Deficit

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Tuesday, October 18, 2022   

Over the next 10 years, some 64 million people on Medicare, and American taxpayers, will save $100 billion, thanks to provisions in President Joe Biden's Inflation Reduction Act, which once again allows Medicare to negotiate prices with drug companies.

Todd Stubbendieck, state director for AARP Nebraska, said it is something the Department of Veterans Affairs has been doing for years, saving taxpayers billions of dollars.

"For years Big Pharma has had a blank check," Stubbendieck asserted. "Whatever they said the cost was, was what Medicare had to pay. Medicare is a big customer when it comes to buying prescription drugs. This finally allows them to bring down those prices."

Just as Costco or Sam's Club leverages their buying power to lower prices for customers, Stubbendieck explained Medicare will be able to do the same thing. Industry groups have criticized the move, claiming its current pricing structure provides research-and-development funds, which have produced groundbreaking new medicines.

AARP and other groups had been working to reverse a law passed by Congress two decades ago which blocked Medicare from negotiating prices, but were unable to overcome powerful lobbying efforts. Big Pharma spends $233 million a year to get lawmakers to vote their way.

Stubbendieck is not convinced drug-company pricing has been linked to research and development costs.

"I think that argument would hold a lot more water if American consumers were paying the same prices for drugs that folks around the world were paying," Stubbendieck contended. "American seniors are paying two to three times the cost for these drugs as people in other countries."

Medicare provisions in the Inflation Reduction Act are projected to reduce the federal deficit by $237 billion. The cost of insulin will be capped at $35 per month, and drug companies will have to pay rebates if prices rise faster than inflation. Out-of-pocket costs for older Americans will also be capped at $2,000 per year.

Disclosure: AARP Nebraska contributes to our fund for reporting on Budget Policy & Priorities, Consumer Issues, Health Issues, and Senior Issues. If you would like to help support news in the public interest, click here.


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