Reichert's Plan D

Postman has a post up today noting that the AP is reporting that Dave Reichert's TV ads were paid in part by the pharmaceutical industry:

The pharmaceutical industry quietly footed the bill for at least part of a recent multimillion-dollar ad campaign praising lawmakers who support the new Medicare prescription drug benefit, according to political officials.

The U.S. Chamber of Commerce claims credit for the ads, although a spokesman refused repeatedly to say whether it had received any funds from the Pharmaceutical Research and Manufacturers of America.

Several campaign strategists not involved in the ad campaign said no legal issues were raised by the pharmaceutical industry's involvement. In political terms, though, the disclosure is likely to embolden Democratic critics of the Medicare drug program, who charge it amounts to a Republican-engineered windfall for drug companies.

Reichert did not vote for the bill (the commercial originally claimed he did before he was even in congress), but his ad still touts him as a supporter:

A new version, now airing, was edited to eliminate the suggestion that Reichert voted for the law. The editing changed the phrase "Reichert supported Medicare Part D" to "Reichert supports Medicare Part D."

This is a curious position to take considering that:

Jaime Smith, a spokeswoman for Reichert's opponent, Darcy Burner, did not see the ads as doing much harm to the Democrat's campaign.

"Every senior we've talked to is completely frustrated with that program," she said. "The chamber can tout that all they like."

How bad is Part D? This bad:

Of all the cries of pain from deep in the Part D coverage gap, better known as the doughnut hole, the e-mail from Jerry Goldbaum of East Northport, a well-informed consumer, came closest to defining the problem: There is no way for beneficiaries, their druggists or even their insurers to know in advance what drugs will really cost and when someone will fall into the hole.

...

Queens pharmacist Peter Kassel suggests the average wholesale price is fiction. Wholesalers, drug chains, and other big buyers get the drugs for less, then add in their profit, before selling the drugs to the pharmacist. With each step, the middlemen take a cut; the beneficiary gets no cut. And Medicare, which is forbidden from negotiating prices, spends unnecessary millions that could eliminate the need for the doughnut hole if the money instead were spent on consumers.

Medicare advocates, including congressional Democrats, have suggested that if CMS were permitted to use its buying power to bargain for lower prices from the drug companies, the savings could cover the hole. They insist, too, that placing administration of the drug benefit under Medicare rather than 1,400 different plans could also eliminate the coverage gap.

The wholesale market, however, is dominated by a few Pharmacy Benefit Managers (PBMs) - Medco, Caremark and Express Scripts - which have contracts with insurance plans and drug and grocery chains. The PBMs bargain with the drug companies for low prices.

But pharmacist Jeff Ellis of Somonauk, Ill., wrote that independent druggists cannot negotiate contracts with the PBMs, or know in advance the cost of the drugs they buy or what the PBMs are paying. The PBMs "refuse to answer, based on privacy of financials. And don't get me started on rebates," Ellis said. The PBMs get rebates from the drug companies for pushing certain brands, especially those that are heavily advertised. That may account for complaints from patients and physicians when insurance plans insist on substituting drugs in what they call "step therapy." Step therapy requires people, in certain cases, to start out using a generic drug, even though they've previously used a brand name - making that the first "step" in the process.

Perhaps all the complications are why the Government Accountability Office (GAO) found that the insurance plans as well as Medicare have been wrong much of the time when beneficiaries call for help. Prices change so often that a beneficiary can't know when he or she will fall into the hole.

Nor can beneficiaries find out what their drugs will cost this month or compare what they pay with the prices of drugs in other plans. Pharmacist Mike James, of Raleigh, N.C., a leader in a network of community drug stores, provides an example of costs to the patient. If a drug costs $88, including a $25 co-pay, and a $1.50 dispensing fee to the pharmacist, the remainder is $61.50. At the register, the patient will pay the $25 co-pay, while the PBM will be responsible for paying the $61.50 plus dispensing fee to the pharmacy at some point. The total cost - $88 - is counted against the patient's initial benefit of $2,250. But many drugs cost much more. And what the PBMs charge the health plan is not known.

Retired pharmacist Charles D. Gerstein of Pocasset, Mass., wrote, "Medicare Part D has been endangered by allowing the pharmaceutical industry and the insurance companies to set their own prices and agenda without oversight by the administration and its supporters in Congress."

Members of Congress have been unable to penetrate the mysteries of drug pricing, which the manufacturers consider proprietary information.

Keep the commercials coming Dave. The people in the 8th Congressional District, especially those who rely on prescription medicines, deserve to know which side you're really on when it comes to their health care.