Capping prescription drug costs is not a substitute for lowering prices | Opinion
Drug corporations have been raising prices faster than inflation for years, while people of all ages struggle to keep up or are forced to choose between medicine and other basic necessities (Getty Images).
Lawmakers in Congress have been promising to tackle rising drug prices for years, but so far there’s been little action. Now, Congress may be running out of time as bigger issues like the war in Ukraine and inflation crowd out long-standing issues with more immediate concerns.
The outrageous price of medicines has made prescription drug reform a top issue for years now as well as one that attracts bipartisan support. A recent poll showed that 91% of voters considered lowering drug prices a very important issue in the upcoming election, ranking it above COVID worries.
Of course, for millions, worry about affording prescriptions long preceded the pandemic crisis or the latest concerns about inflation. Drug corporations have been raising prices faster than inflation for years, while people of all ages struggle to keep up or are forced to choose between medicine and other basic necessities.
Americans are desperate for a solution to prescription drug price-gouging but Congress doesn’t have multiple chances to get it right and patients have already waited too long. The time is now, while there is majority support in the Senate for tackling prices through negotiations in Medicare, to pass a bill that would finally put in place common sense reform that would address rising prices.
Proposals like creating a national insulin cap are getting a lot more attention than negotiations these days, but any proposal that caps the cost of one or more drugs will not fundamentally address the root of the problem, which is rising prices. Our government can take action to help seniors and others afford their medicine, but without negotiations that actually stop the drug corporations from charging whatever they want and raising prices at will, cost containment can only have limited impact for a limited number of patients while burdens continue to rise for taxpayers, businesses and those paying premiums.
Capping the cost of insulin is a worthy idea, but it won’t, for instance, stop drug corporations from setting the price of cancer drugs outrageously high and forcing up to half of cancer patients into debt to get life-saving treatments. Nor will it stop drug corporations from raising prices on common drugs that seniors and the rest of us use every day. Caps may mean individuals pay less at the pharmacy, but they will pay more in premiums and more in taxes for programs like Medicare thanks to cost-shifting.
The price of half the drugs in Medicare, the health care program for seniors, increased faster than inflation in 2020. Those premium increases were not tied to one specific drug, but rather to thousands of commonly used medications. Currently, there is no limit on what seniors pay out of pocket for drugs in Part D, forcing many to skip doses, not fill prescriptions or go forgo other critical needs to get their medicines.
Congress should fix that and act to limit out of pocket costs, but they should also negotiate prices for medicines in Medicare the way other government agencies already do. Negotiated prices in the Department of Veterans Affairs and in Medicaid saves those programs and taxpayers that fund them substantially. Veterans Affairs and Medicaid pay half of what Medicare pays for prescription medicines thanks to negotiated prices.
We already know that negotiating prices will get consumers a better deal than continuing to give drug corporations monopoly power to set and keep their prices high. It’s that monopoly power that enables the corporations to raise prices twice a year. In 2022 alone, drug corporations have already raised the price of over 800 medicines by more than 5%. Capping costs-on insulin or any other drug–is an important step toward affordability but it doesn’t curtail drug corporations’ price-gouging.
Fortunately, Congress has a solution: Combine cost-containment measures like an insulin cap and out-of-pocket cap for seniors in Medicare with policies that actually rein in rising costs like Medicare negotiations and inflation caps so we can stop drug corporations from raising prices faster than inflation.
These are all proposals on the table right now as part of a package that lawmakers broadly support. It’s time to pass them into law and make medicines affordable for everyone.
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