By NRLC Medical Ethics Department

Government-imposed drug price controls in Medicare would compel rationing and gravely endanger development of lifesaving drugs. Unfortunately, pressure is now building in Congress to add drug price controls in the name of allowing government "negotiation" of drug prices.

The National Right to Life Committee announced May 27 its opposition to bills introduced in Congress to repeal the Medicare provision that prevents the federal government from interfering in drug price negotiations.

See Q &A on page 10-11.

Since its inception, the National Right to Life Committee (NRLC) has been committed to protecting the right to life from conception until natural death, which means the organization has fought just as strongly against infanticide and euthanasia as it has against abortion. In particular, NRLC has strongly opposed involuntary denial of lifesaving medical treatment through rationing.

In 1994 NRLC opposed the Clinton Health Care Plan's proposed insurance premium price controls because they would have forced rationing. In 1995-2003, during the congressional debate over Medicare restructuring, NRLC successfully fought for the ability of older Americans to add their own money, if they choose, to government payments in order to obtain insurance plans that are less likely to ration care. Now, NRLC is opposing legislative changes in Medicare that would effectively impose rationing of lifesaving drugs through drug price controls.

In 1997, at the urging of NRLC and other groups, Congress created an escape valve - - one alternative to Medicare rationing that neither breaks the budget nor requires new taxes.

That alternative permits those eligible for Medicare voluntarily to supplement government payments for health insurance premiums with their own funds, if they wish, in order to obtain unrationed, unmanaged, private fee-for-service insurance. This is comparable to the way in which most retirees supplement government Social Security payments for living expenses with their own funds.

In 2003, Congress applied this alternative to the new prescription drug benefit, allowing older Americans the freedom, if they choose, to spend their own money to save their own lives.

Now, however, there are serious attempts to derail this freedom by amending Medicare to authorize the government, under the guise of "negotiating" drug prices for Medicare recipients, to take away this choice by effectively fixing prices for drugs across Medicare. More efficacious drugs could be barred from a national formulary (a listing of the drugs that may be prescribed for reimbursement) if their manufacturers would not meet the price "offered" by the government, excluding those drugs from purchase even by the plans chosen by those who were willing to add their own funds in order to get unrationed access to drugs.

Drug price controls would have a devastating effect on the development of new lifesaving drugs. Research and development is financed by investors who buy stock or provide venture capital. Investment in pharmaceutical development is risky. Many promising leads fail to work out and never make it to the market.

Investors are willing to take this risk in the hope that a "breakthrough" drug that does succeed will have a high return on investment. If the government imposes price controls on the 40% of the prescription drug market that goes to Medicare beneficiaries, that incentive will be severely diminished.

"Imagine the consequences for desperately needed new drugs to deal with Alzheimer's disease, cancer, and other debilitating and destructive conditions that disproportionately afflict older Americans," said Burke J. Balch, J.D., director of NRLC's Robert Powell Center for Medical Ethics. "Even from a purely economic standpoint, drastically diminishing the development of new drugs for these conditions is counter-productive when one considers the enormous costs of caring for those with these diseases as the 'baby boom' generation retires, unless there are pharmaceutical breakthroughs."

NRLC Executive Director David N. O'Steen, Ph.D., commented, "In order to protect the lives of senior citizens from government-imposed rationing, Congress must not deny older Americans who choose to do so the right to use their own money to get the drugs they need to save their own lives."

Action Item:

Contact U.S. senators and representatives, asking them to oppose S. 1999, S. 2053, H.R. 3672, H.R. 3707, and any other measure that would repeal the "non-interference" provision in Medicare. Tell them this would result in government-imposed drug price controls, forcing rationing and preventing the development of desperately needed new lifesaving drugs. For more information, see out