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Medicare Should Negotiate Aggressively Drug Prices The Medicare Should Negotiate Aggressively Drug Prices:

The American Medical Association (AMA), House of Delegates, November 15th, passed a report urging legislation for Medicare to negotiate with drug companies on the cost of drugs.

The report urges the AMA “to support indexing Medicare Part D drug costs to a proportionate portion of the prices paid elsewhere in the large industrialized western countries.”

The testimony of delegates at this month’s AMA Special Meeting demonstrated a consensus and frustration that out-of-control drug prices are obstructing patients’ access to the medicines they need.

Many have noted that the resolution is timely , as drug price negotiations are growing in popularity in Congress. Congressional Democrats are working on a drug-price compromise that will allow Medicare to negotiate certain prices.

A Kaiser Family Foundation issue brief in August looked at one of the proposed bills, House bill H.R.3 and predicted that “Under the drug price negotiation the savings on premiums for Medicare beneficiaries are projected to rise from 9percent of the Part D base beneficiary premium in 2023 to 15% by 2029.”

Additionally, there is momentum in the public’s support for negotiations. A recent Kaiser Family Foundation poll found that 83 percent of voters across all political parties support directing federal government to negotiate drug prices.

An original provision in the report proposed AMA support legislation that allows for the reinvestment of a portion of any savings made from Medicare price negotiations into the Medicare physician fee schedule as well as other Medicare physician value-based payment plans.

That provision was removed after comments in the reference committee that the optics would be poor if Medicare negotiations to lower drug prices was viewed as being in connection with raising physicians’ pay.

Access to Medicines for Patients: Increased Patient Access

Former AMA president Barbara McAneny, MD, an oncologist in Albuquerque, New Mexico who is in a predominantly under-served region, spoke out against using the international pricing index, citing the potential effects on Part B drugs.

McAneny, speaking for herself, said in an advisory committee meeting: “I just worked with a group of patient advocates and other specialty societies to get rid of this law in New Mexico when it was proposed.

Dr Barbara McAneny

“The reason is that the pricing limits are not always clear. And many providers, particularly of part B drugs — expensive infusion therapies -purchase these drugs. If we are reimbursed less than the cost of purchasing that is what happens when cost containment is employed at the end of the supply chain we are within a short period of time not able to deliver the medications to patients who require them.

She stated that using an international pricing index would “tie up the hands of AMA” because it would make it “impossible for individuals to provide these drugs to patients.”

Jay Gregory, MD, an Oklahoma surgeon and delegate, pointed out statistics which show that the US pricing problem starts internationally. “80% of active pharmaceutical ingredients come form China and India; 40% over-the-counter medicine in America originates from India.”

McAneny shared his concerns about oncology drugs and their high cost that burden patients. McAneny also expressed concerns about their future in an international pricing index.

Len Lichtenfeld MD, an Atlanta oncologist, is a delegate from American College of Physicians. However the delegate spoke on his own behalf and stated that doctors who prescribe drugs to their patients under Part B must be protected from any “negative consequences” should they be required to pay a significant amount more than the amount they are reimbursed for the drug.

Barbara Weissman MD, an alternate delegate from California, said she hoped that delegates would take up the resolution “so that AMA can move away from the sidelines and support legislation that’s currently being in Congress.”

To address concerns regarding international pricing index (IPI), the report includes caveats. For example, any IPI model should not include countries with health systems with a single payer or that use price controls. It should not be used alone to determine the price of a medication.

Furthermore, the use of such an index will help preserve patients’ access to essential medication and reduce burdens on doctors according to the report.

Marcia Frellick is a freelance journalist located in Chicago. She was previously a journalist at, Science News, Chicago Tribune, and Chicago Sun-Times. Cloud (Minnesota) Times. Follow her on Twitter at @mfrellick.

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