Democrats Spar Among Themselves Over PhRMA Deal - Prescriptions Blog

The first big fight over the Senate Finance Committee’s health care legislation erupted Tuesday night: a rollicking brawl over a deal that the Obama administration cut with the pharmaceutical industry to achieve $80 billion in savings on drug costs over 10 years, money that would help pay for the legislation.

Top House Democrats have hated the deal from the get-go. Senate Democrats are now bitterly divided. And Senate Republicans are eagerly jumping into the fray to needle the Democrats over their divisions.

The fight over the deal with PhRMA actually stems from the legislative battle over the Medicare prescription drug legislation that Republicans successfully pushed through Congress in 2003. As a result of that legislation, about 6 million elderly Americans who had been receiving drug benefits under Medicaid, the government insurance program for the poor, were instead shifted into the new Medicare drug program, resulting in the government paying far high prices for drugs.

Representative Henry Waxman, Democrat of California, and now the powerful chairman of the House Energy and Commerce Committee, has long complained about that switch. And the House health care legislation, of which Mr. Waxman is a main author, seeks to reverse the arrangement and to recoup the extra money that the government has been spending by restoring the old Medicaid drug discounts or “rebates” as they are known.

That would save the government at least $86 billion over 10 years, but would potentially cost the drug industry far more.

The White House has said that its deal with PhRMA would help narrow a gap in Medicare coverage of prescription drugs that is know as the doughnut hole, which forces people to pay some of their drug costs after a certain level. But there are also questions about the extent to which the drug industry also benefits, because the increased drug coverage for seniors means that the government will pay for more medication on their behalf, particularly brand-name drugs. In some cases, seniors now stop taking medication or switch to generics when they reach the doughnut hole.

Since the White House reached its deal with PhRMA in June there has been some disagreement between the industry and the administration over the precise terms of the arrangement. PhRMA has insisted that the White House agreed not to seek any additional concessions from drug manufacturers and to block Mr. Waxman’s plan in the House legislation. And the industry said that its support of the health overhaul was specifically aimed at Mr. Baucus’s proposal.

Mr. Baucus had previously announced that the first votes on amendments would not take place until Wednesday, so a final outcome of the fight was postponed.

Read it all at NYTimes.com

Health Bill Clears Hurdle and Hints at Consensus

As a final act before recessing until September, one crucial panel, the House Committee on Energy and Commerce, approved landmark health legislation that could ultimately lead to coverage for about 95 percent of Americans and create a new government-run insurance program.

The 31-to-28 vote occurred at 9:05 p.m. Friday, at the end of a session that began at 10 a.m. Five Democrats joined all 23 Republicans on the panel in voting no.

Congress still has plenty of work to do in September to blend competing, sometimes contradictory health measures, but lawmakers have found a good deal of common ground on proposals that would profoundly change the health system.

Read it all at NYTimes.com

Weiner Pushes for Single-Payer Plan

Rep. Anthony Weiner introduces his Single Payer Amendment during the Health Care Markup Session of the House Energy and Commerce Committee today.

Rate it up at YouTube

Henry Waxman wins breakthrough on health bill - Patrick O'Connor and Carrie Budoff Brown

A quartet of moderate Blue Dog Democrats on the Energy and Commerce Committee agreed to support the Democrats' sweeping health care bill as long as party leaders postpone a House vote until the fall and Chairman Henry Waxman (D-Calif.) cut its costs by $100 billion, exempt more small businesses from a requirement to provide health care to their employees and allow doctors, hospitals and other providers to negotiate their payments directly with the government under any public coverage plan.

News of this breakthrough follows some rare positive news for Senate Democrats from the nonpartisan Congressional Budget Office; legislation being cobbled together by a bipartisan group of six senators on the Finance Committee would cost less than $900 billion and cover 95 percent of Americans.

The new version of the bill would allow for states to set up health care co-ops, which the Senate Finance Committee has advanced as an alternative to the government-run insurance plan advanced in the House. The House bill still includes the public insurance option, but liberals are concerned that the co-ops create a backdoor for states and insurers to avoid using these public plans.

In the deal, Waxman would have to cut somewhere in the neighborhood of $50 to $65 billion in subsidies to help lower-income people purchase insurance through the newly-established exchanges and another $30 to $35 billion from Medicaid.

But allowing doctors and other health care providers to negotiate rates with the government under a public option would cost the government about $60 billion, according to a preliminary CBO estimate. And exempting small businesses with a combined salary of $250,000-a-year to $500,000-a-year would cost the government $30 billion, according to the same estimates.

Read it all at POLITICO.com