Here are the facts about the Medicare prescription drug plan:
- Taxpayers “could save as much as $190 billion over the next 10 years” if Medicare negotiated prices with drug makers.
- Medicare pays substantially more for drugs that the Veterans Administration, which negotiates prices with drug makers.
- Since the program does not require any discount over list prices, “drug makers are being paid as much as 20 percent more for the same drugs that they had already been providing to recipients under the Medicaid program [for the indigent].”
The New York Times reports, “For big drug companies, the new Medicare prescription benefit is proving to be a financial windfall larger than even the most optimistic Wall Street analysts had predicted.” If Congress passes a bill allowing Medicare to negotiate lower prices, the drug industry is counting on President Bush to veto it.