Making it easier to drug the elderly!

[Guest guest]

By DAVID ESPO, AP Special Correspondent David Espo, Ap Special Correspondent

 

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Sun Jun 21, 12:39 am ET

 

WASHINGTON

– The pharmaceutical industry agreed Saturday to spend $80 billion over

the next decade improving drug benefits for seniors on Medicare and

defraying the cost of President Barack Obama's health care legislation, capping secretive negotiations involving key lawmakers and the White House.

"This new coverage means affordable prices on prescription drugs when Medicare benefits don't cover the cost of prescriptions," Sen. Max Baucus, chairman of the Senate Finance Committee, said in a statement announcing the accord.

The deal marked a major triumph for Baucus as well as the administration. Obama praised the deal.

"The agreement by pharmaceutical companies to contribute to the health reform effort

comes on the heels of the landmark pledge many health industry leaders

made to me last month, when they offered to do their part to reduce

health spending $2 trillion over the next decade," Obama said. "We are

at a turning point in America's journey toward health care reform."

Baucus,

a Montana Democrat, has been negotiating with numerous industry groups

for weeks as he tries to draft legislation that meets Obama's goal of

vastly expanding health coverage, has bipartisan support and does not add to the deficit.

Baucus'

announcement said drug companies would pay half of the cost of

brand-name drugs for seniors in the so-called doughnut hole — a gap in

coverage that is a feature of many of the plans providing prescription

coverage under Medicare. Other officials said wealthier Medicare

beneficiaries would not receive the same break, but there was no

mention of that in the statement.

In addition, the entire cost of the drug would count toward a patient's out-of-pocket costs, meaning their insurance coverage would cover more of their expenses than otherwise.

"The

existence of this gap in coverage has been a continuing injustice that

has placed a great burden on many seniors," Obama said. "This deal will

provide significant relief from that burden for millions of American

seniors.

"Key sectors of the health care industry acknowledge what American families and businesses already know — that the status quo is no longer sustainable," the president said.

Billy Tauzin, president and CEO of the Pharmaceutical Research and Manufacturers of America (PhRMA), said, "Millions of uninsured and financially struggling Americans are depending on us to accomplish comprehensive health care

reform this year. Today, America's pharmaceutical research and

biotechnology companies are signaling their strong support for these

critically important efforts."

While none of the changes in the prescription drug program

would directly lower government costs, several officials also said the

industry agreed to measures that would give the Treasury more money

under federal health programs. In particular, officials said drug

companies would likely wind up paying pay higher rebates for certain

drugs under Medicaid, the program that provides health care for the

poor.

Those funds would be used to help pay for legislation expanding health insurance for millions who now lack it.

One

official said the deal was agreed to late Friday night when Tauzin

called Baucus. The senator's statement said the White House was

involved in the agreement.

It was not clear what leverage the agreement would give Baucus with other health care providers with whom he is in negotiations.

But at a minimum, the agreement served as an effective counter to impression that the drive to enact health care legislation was sputtering.

The disclosure of negotiations came near the end of an up-and-down week for the administration and its allies on health care.

Congressional Budget Office estimates

showed early versions of two major Senate bills were either too costly

or failed to make a large enough dent in the ranks of the uninsured.

Republicans seized on the reports as evidence that Democrats were

losing traction.

They leapt again when it was

disclosed that House Democrats were considering a wide array of tax

increases to finance their legislation, including an income tax

surcharge, a tax on employers based on the size of their payroll and a

value-added tax, a form of a national sales tax.

 

House Democrats on Friday unveiled draft legislation they said would

cover virtually all of the nation's nearly 50 million uninsured but it

came without a price tag or an indication of how it would be paid for.

Major provisions of the 850-page measure would impose new

responsibilities on individuals to obtain coverage and on employers to

provided it. It also would end insurance company practices that deny coverage to the sick and create a new government-sponsored plan to compete with private companies.

 

Speaker Nancy Pelosi has said she hopes the legislation can clear the House before lawmakers leave for their annual August vacation.