Thursday, August 2, 2012

Obamacare’s Devilish Details


In a March 2009 interview on CNBC, PhRMA president and CEO Billy Tauzin, a former Republican member of Congress, had said that the bill would be good for pharmaceutical companies, because its subsidies for insurance would broaden the industry’s customer base:

Tauzin had quit his congressional seat and the chair of the House Energy and Commerce Committee in 2004 to take his job with PhRMA (the powerful lobby for the Pharmaceutical Industry). And Obama, during his 2008 presidential campaign, referred to Tauzin in a campaign ad, although he did not say his name; Obama said:

“The pharmaceutical industry wrote into the prescription drug plan that Medicare could not negotiate with drug companies. And you know what? The chairman of the committee who pushed the law through, went to work for the pharmaceutical industry making two million dollars a year. That’s an example of the same old game-playing in Washington. Well, I don’t want to learn to play the game better, I want to put an end to the game-playing.”

Once again Obama says one thing and does another. Now that Obama was “learning to play the game better,” Tauzin didn’t let any petty grudges stand in his way. The drug companies he represented were being given a license to print money, because they’d put themselves on the right side of the backroom deals with Obamacare. No price controls, no vilification from the White House, no re-importation of prescription drugs. During his 2008 campaign, Obama had gone so far as to promise, at least eight times, to conduct all of the negotiations on C-SPAN, and not behind closed doors. Perhaps that was a bit too ambitious, but his behavior toward PhRMA put him as far away from that promise as he could have possibly gone. His conduct clearly and unmistakably violated both the letter and the spirit of his promise.

After using the unnamed executive in his speech; Obama went on to work on backroom deals with Tauzin and PhRMA (the powerful national pharmaceutical lobby). That’s right, the very same person he said was a crook – Obama went on to work with behind closed doors; providing him sweetheart deals:

Along the stretch of Pennsylvania Avenue that runs between the White House and the Capitol Building, the top executives of America’s largest drug companies gathered in the historic Willard Hotel on the morning of July 22, 2009. There were no signs in the lobby to indicate that such a meeting was taking place. There had been no public announcements. The concierge dutifully denied the meeting’s existence when asked that morning by telephone. But they were there, all right. The first clue was the number of well-dressed and important-looking people streaming into the lobby and heading for the stairs to the basement. The drug industry’s powerful trade organization, PhRMA, had just negotiated a major deal with the Obama administration. The industry group was going to:

·         Spend $150 million to $200 million on an advertising and grassroots campaign promoting Obamacare
·         Give the government’s medical programs up to $68 billion in savings over the next ten years
·         Pay an excise tax of $2.3 billion per year, with each large drug company paying in proportion to its market share in return for this - PhRMA was going to get the bill they wanted.
·         They would be protected from imported prescription drugs
·         They would be protected from further “cost-savings” efforts beyond the $80 billion they had pledged
·         Government agencies would not be able to negotiate lower prices for their drugs

So much for doing what is best for the American People and Tax Payers!

This meeting was not open to the public— journalists who had discovered its time and location were stopped at the door and asked to leave. But inside, they must have been smiling. The concessions offered by the White House were worth at least as much as the drug-makers had given up. House Democrats had been hoping to extract more than $150 billion in savings on drugs. Over the next few months, President Obama and his spokesman, Robert Gibbs, danced around the deal’s exact terms. He didn’t want to appear to have let big PhRMA off the hook. But he had. The drug-makers released the details of the deal when they thought the White House was reneging on its terms. But in the end, there was honor among thieves.

The drug-makers were smart. They knew that “Hope and Change” had come to Washington, and they understood how to work within corrupt government. They had watched the automotive bailout, and they knew which side of the gun they wanted to be standing on when it went off. PhRMA’s leaders had made a better deal than anyone realized at the time. For one thing, it would cost them even less than it appeared. Two separate analyses—one by Credit Suisse and another by the AARP—found that despite non-existent inflation, the drug industry had raised prices by about 9 percent in 2009. The projected increase in profits from this one-year increase was $100 billion over ten years—more than enough to offset the $80 billion in savings it was giving the federal government in their deal. PhRMA had seen Obamacare as a great opportunity from the beginning, which is why it spent $78 million lobbying before the deal was made.

Once again I contend – as do so many of my Healthcare Industry colleagues – Obamacare will not reduce costs or improve access to care. Now that it is slowly being unfolded into the marketplace; we have found that it is doing just the opposite.

That’s what happens when the Oval Office is occupied by a person with no real-world experience; but hell-bent and enacting his ideology or vision for the country. What is right, what is best, what is legal or of integrity be damned! It’s my way the highway! I occupy the Oval Office – stop me if you can!

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