At The Head Of The Table

Who’s in charge? Here is an article from the New York Times illuminating the real role that al-PhARMA is playing and how the administration is prostituting itself, unnecessarily.

Be prepared to be sickened. Understanding what they are doing and how they are doing it spotlights just who is in control and why the final result of “reform” will end up costing far, far more than needs be.

August 6, 2009
White House Affirms Deal on Drug Cost
By DAVID D. KIRKPATRICK

WASHINGTON — Pressed by industry lobbyists, White House officials on Wednesday assured drug makers that the administration stood by a behind-the-scenes deal (emphasis added) to block any Congressional effort to extract cost savings from them beyond an agreed-upon $80 billion.

They are assuring the drug dealers of their intent to keep their promises. This while caving on their promises to those who elected them. Obama pretends that he is standing back and letting the Congress develop the plans but, as that sentence says, he is prepared to interfere with the Congress by blocking their efforts – not that Congress is doing us many favors.

It is important to understand the $80 billion concession the drug dealers have promised. First, that is over 10 years. The bulk of it is directed at the Medicare Part D donut hole. When seniors reach $2,700 (composed of their premiums, deductibles and co-pays plus what the insurance company has paid) the donut hole appears. The senior pays 100% while in the hole. To get out of the hole $4,350 must be reached. This upper level is composed of only the seniors’ expenditures, so a senior must pay much more than the $1,650 you get by subtracting the first number from the second. The seniors still must pay their premiums while the insurance company is paying nothing. Few get out of the hole.

The drug dealers have agreed to only charge 50% of retail to seniors while they are stuck in the hole. But, this applies only to their brand names. They will continue to make obscene profits at that reduced rate and hope to entice seniors to stay on brand names rather than purchase generics.

Drug industry lobbyists reacted with alarm this week to a House health care overhaul measure that would allow the government to negotiate drug prices and demand additional rebates from drug manufacturers.

This is the key. al-PhARMA wrote the Part D bill. They included the prohibition on Medicare negotiating any pricing. The Veteran Administration has been negotiating all along. They pay about half of what Medicare pays. Since Medicare is by far the largest purchaser of medical goods and services, you might imagine keeping that provision is worth far, far more than $8 billion a year. Individual companies have paid fines in the neighborhood of $1 billion for fraud against the government. While we think that is a lot of money, they consider it the cost of doing business, pocket change.

In response, the industry successfully demanded that the White House explicitly acknowledge for the first time that it had committed to protect drug makers from bearing further costs in the overhaul. The Obama administration had never spelled out the details of the agreement.

Notice that they feel they can demand the administration do their bidding. They are willing to make the “behind-the-scenes deal” public in order to hold Obama’s feet to the fire. Have you ever tried to demand that the president follow your demands?

“We were assured: ‘We need somebody to come in first. If you come in first, you will have a rock-solid deal,’ ” Billy Tauzin, the former Republican House member from Louisiana who now leads the pharmaceutical trade group, said Wednesday. “Who is ever going to go into a deal with the White House again if they don’t keep their word? You are just going to duke it out instead.”

Billy Tausin was the one responsible for shepherding the Part D bill through Congress. He then left Congress to become president of al-PhARMA, at a salary of $2 million per year.

A deputy White House chief of staff, Jim Messina, confirmed Mr. Tauzin’s account of the deal in an e-mail message on Wednesday night.

“The president encouraged this approach,” Mr. Messina wrote. “He wanted to bring all the parties to the table to discuss health insurance reform.”

Why anyone would want to bring the enemy, those who created the mess, to the table for planning the strategy of the battle is beyond comprehension, beyond the realm of sanity.

The new attention to the agreement could prove embarrassing to the White House, which has sought to keep lobbyists at a distance, including by refusing to hire them to work in the administration.

Is there any doubt that they deserve to be embarrassed?

The White House commitment to the deal with the drug industry may also irk some of the administration’s Congressional allies who have an eye on drug companies’ profits as they search for ways to pay for the $1 trillion cost of the health legislation.

But failing to publicly confirm Mr. Tauzin’s descriptions of the deal risked alienating a powerful industry ally currently helping to bankroll millions in television commercials in favor of Mr. Obama’s reforms.

Go ahead. Alienate them. Requiring negotiations and a few more easy changes could pay for at least half of that $1 trillion, a number that is artificially and unnecessarily high anyway. Their power will become more of a nuisance than a threat.

The pressure from Mr. Tauzin to affirm the deal offers a window on the secretive and potentially risky game the Obama administration has played as it tries to line up support from industry groups typically hostile to government health care initiatives, even as their lobbyists pushed to influence the health measure for their benefit.

Are the drug dealers really on Obama’s side? Do you think that the largest, most powerful lobbying machine is sitting on its hands. Before this reform issue came to the fore, al-PhARMA had 638 lobbyists on Capitol Hill. They outnumbered the 435 Representatives and 100 Senators. They are angling for more. Universal care gives them more customers. You’ve heard that 47 million have no coverage. That figure is old. The latest number is 52 million and growing daily as more jobs are lost.

In an interview on Wednesday, Representative Raul M. Grijalva, the Arizona Democrat who is co-chairman of the House progressive caucus, called Mr. Tauzin’s comments “disturbing.”

“We have all been focused on the debate in Congress, but perhaps the deal has already been cut,” Mr. Grijalva said. “That would put us in the untenable position of trying to scuttle it.”

He added: “It is a pivotal issue not just about health care. Are industry groups going to be the ones at the table who get the first big piece of the pie and we just fight over the crust?”

Congress needs  to wake up.

The Obama administration has hailed its agreements with health care groups as evidence of broad support for the overhaul among industry “stakeholders,” including doctors, hospitals and insurers as well as drug companies.

Everyone is at the table but the people. They are not working on healthcare reform. They are modifying insurance coverage.

But as the debate has heated up over the last two weeks, Mr. Obama and Congressional Democrats have signaled that they value some of its industry enemies-turned-friends more than others. Drug makers have been elevated to a seat of honor at the negotiating table, while insurers have been pushed away.

“To their credit, the pharmaceutical companies have already agreed to put up $80 billion” in pledged cost reductions, Mr. Obama reminded his listeners at a recent town-hall-style meeting in Bristol, Va. But the health insurance companies “need to be held accountable,” he said.

“We have a system that works well for the insurance industry, but it doesn’t always work for its customers,” he added, repeating a new refrain.

He needs to realize that it works even better for the far more profitable drug industry. Prescription drugs, taken as prescribed, are the 4^th leading cause of death in this country.

Administration officials and Democratic lawmakers say the growing divergence in tone toward the two groups reflects a combination of policy priorities and political calculus.

With polls showing that public doubts about the overhaul are mounting, Democrats are pointedly reminding voters what they may not like about their existing health coverage to help convince skeptics that they have something to gain.

“You don’t need a poll to tell you that people are paying more and more out of pocket and, if they have some serious illness, more than they can afford,” said David Axelrod, Mr. Obama’s senior adviser.

The insurers, however, have also stopped short of the drug makers in their willingness to cut a firm deal. The health insurers shook hands with Mr. Obama at the White House in March over their own package of concessions, including ending the exclusion of coverage for pre-existing ailments.

This is just one of their broken promises to Congress in 1993.

But unlike the drug companies, the insurers have not pledged specific cost cuts. And insurers have also steadfastly vowed to block Mr. Obama’s proposed government-sponsored insurance plan — the biggest sticking point in the Congressional negotiations.

The drug industry trade group, the Pharmaceutical Research and Manufacturers of America, also opposes a public insurance plan. But its lobbyists acknowledge privately that they have no intention of fighting it, in part because their agreement with the White House provides them other safeguards.

Mr. Tauzin said the administration had approached him to negotiate. “They wanted a big player to come in and set the bar for everybody else,” he said. He said the White House had directed him to negotiate with Senator Max Baucus, the business-friendly Montana Democrat who leads the Senate Finance Committee.

Mr. Tauzin said the White House had tracked the negotiations throughout, assenting to decisions to move away from ideas like the government negotiation of prices or the importation of cheaper drugs from Canada. The $80 billion in savings would be over a 10-year period. “80 billion is the max, no more or less,” he said. “Adding other stuff changes the deal.”

They don’t need to be in a position of making demands. They need to be the target of demands.

After reaching an agreement with Mr. Baucus, Mr. Tauzin said, he met twice at the White House with Rahm Emanuel, the White House chief of staff; Mr. Messina, his deputy; and Nancy-Ann DeParle, the aide overseeing the health care overhaul, to confirm the administration’s support for the terms.

How many people mentioned in that paragraph represent your interests? The answer is zero.

“They blessed the deal,” Mr. Tauzin said. Speaker Nancy Pelosi said the House was not bound by any industry deals with the Senate or the White House.

But, Mr. Tauzin said, “as far we are concerned, that is a done deal.” He said, “It’s up to the White House and Senator Baucus to follow through.”

As for the administration’s recent break with the insurance industry, Mr. Tauzin said, “The insurers never made any deal.”

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So, we have deals in the back rooms and under the table. We have a primary culprit in creating our healthcare mess making demands and threats. The President is going to force Congress to its will (ironic when they are showing no backbone) as a part of his bipartisanship, I’m guessing.

I am disheartened. I am sick. We are no longer citizens. We are subjects. Plutocracy rules.

Tagged as: baucus, bibartisan, congress, deal, donut hole, drug, generic, health care, healthcare, insurance, lobby, medicare, part d, pharma, plutocracy, prescription, public plan, reform, single payer, tauzin