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AMA Urges Government to Bargain on Drug Prices
New York Times Service, Miami Herald
October 18, 2004
The American Medical Association says the government should negotiate directly with drug manufacturers to secure lower prices on prescription medicines for the nation's elderly.
Under the new Medicare law, signed by President Bush last December, 41 million elderly and disabled people will have access to drug benefits in 2006.
Medicare will rely on private health plans to deliver the benefits. The law says the government ''may not interfere'' in negotiations with drug companies.
Authors of the law included that provision out of fear that government involvement could overwhelm the free market, leading to federal regulation of drug prices -- ''price-fixing'' by federal bureaucrats, in the words of Sen.
Charles Grassley, R-Iowa.
The American Medical Association lobbied for the law, which makes hundreds of changes in Medicare.
The association now says Congress should pass legislation allowing the secretary of health and human services to negotiate contracts with manufacturers of drugs that will be covered by Medicare. The association, often seen as a conservative voice for organized medicine, is influential on Capitol Hill. It strongly supports Republican efforts to limit damages that can be awarded in medical malpractice lawsuits.
But it is Democrats who have taken the lead in trying to repeal the ban on federal negotiations with drug manufacturers under Medicare.
Within hours after Bush signed the Medicare law last year, the Democratic leaders of the House and the Senate, Rep. Nancy Pelosi of California and Sen.
Tom Daschle of South Dakota, introduced bills to give federal officials the ''authority to negotiate prices with manufacturers'' of drugs covered by Medicare.
Dr. Andrew Calman of San Francisco, an ophthalmologist who pushed for the new policy adopted by the medical association, said: 'We have the support of doctors from different points on the political spectrum. We're very concerned about patients' access to affordable drugs. I have some glaucoma patients who need to take three or four different types of eye drops to avoid going blind, and each medication may cost $50 to $100 a month.''
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