Everyone Wants to Reduce Drug Prices. So Why Can’t We Do It?

The pharmaceutical and health products industries spent $145 million on lobbying for the first half of 2017, according to the Center for Responsive Politics.

Drug makers gave $4.5 million to congressional campaigns in that period, including six-figure donations to House Speaker Paul Ryan; Representative Greg Walden, a Republican of Oregon who heads the House Energy and Commerce Committee; and Senator Orrin Hatch, Republican of Utah and chairman of the Senate Finance Committee, a Kaiser Health News analysis found.

The drug lobby has spent $28 million so far this year to air six ads depicting heroic researchers about 4,600 times on national TV, according to iSpot.tv, an ad tracker.

The industry hired the former F.B.I. director Louis Freeh to study the impact of importation. He concluded that it would “leave the safety of the U.S. prescription drug supply vulnerable to criminals seeking to harm patients.” Import proponents argue the Food and Drug Administration could easily ensure safety by licensing and inspecting Canadian suppliers.

.. Mr. Trump’s feud with congressional Republicans, especially the Senate majority leader, Mitch McConnell, means “you’re not going to get any strong direction or leadership out of the White House” on drug prices

GOP Congressman Sees Health-Care Bill on President’s Desk by August

Rep. Greg Walden makes estimate at The Wall Street Journal’s CFO Network meeting

House Energy and Commerce Chairman Greg Walden’s estimate, described at The Wall Street Journal’s CFO Network meeting in Washington, suggests he is optimistic that Senate leaders will be able to meet a self-imposed July 4 deadline for passing their health legislation.

The House and Senate remain far apart on health issues, including rolling back the Medicaid expansion and curtailing protections for people with pre-existing medical conditions. The two chambers may have to agree on a compromise bill for the president to sign.

Explaining the Health Payments That Trump Is Threatening to End

The government provides a subsidy to help buy a policy, but about seven million people also get help with their out-of-pocket costs when they go to the doctor or fill a prescription. The government pays the insurance companies extra — $7 billion last year — to offer plans with discounts on the usual deductibles and co-payments that might make medical care unaffordable for relatively poor consumers.

.. There is no language in the bill explicitly linking the subsidies to a permanent funding source, but the Obama administration argued that Congress intended for the money to be paid alongside other subsidies, and the subsidies have been paid over the last three years.

House Republicans said what the Obama administration was doing was unconstitutional, and they brought a lawsuit to stop the payments.

.. Killing the cost-sharing subsidies would be a huge and immediate hit to insurance companies offering Obamacare plans. The companies are still required by law to offer their customers discounts, but they could lose the money to help fund them. Without the government payment, they would need to find another way to make up the difference.

.. Insurers could raise the price of insurance for everyone

.. estimated premiums for a plan would go up by an average of 19 percent without the funding

.. A decision to do away with the subsidies would also send a key signal to the insurance companies that the Trump administration and Congress have decided not to stabilize the market, which has been particularly shaky in some areas. Without the subsidies, insurance could get very expensive in some places in the country. In other areas, no insurance options might be available.

.. encourage Republicans in Congress to pass an appropriations bill that explicitly funds the subsidies

.. A broad coalition of insurance companies, hospitals, doctors and patient groups want the subsidies to be paid. Democrats in Congress are also strong supporters of the cost-sharing reductions. A letter to the White House this week urging a resolution of the issue was signed by insurers, hospitals, doctors and even the solidly Republican Chamber of Commerce.

.. that does not mean that all Republicans in Congress want to see Obamacare markets in their home state fail. In fact, several key Republicans in Congress, including Greg Walden of Oregon, the chairman of the House Energy and Commerce Committee, have said that they would prefer Congress to pass legislation explicitly funding the subsidies.

.. some people in the Trump White House believe that preserving the risk of market failures could create political pressure for a deal on a larger Obamacare replacement bill.