Dear Speaker Johnson and Leader McConnell:
President Biden’s Inflation Reduction Act (IRA) has been an across-the-board failure. The law arguably made inflation worse by wasting billions on progressive boondoggles such as “Green New Deal” tax credits that benefit China, electric vehicle giveaways, and bigger handouts to insurance companies and affluent families who enroll in Obamacare. The law imposed costly new taxes on U.S. businesses that employ millions of Americans.
The IRA also raided $300 billion from Medicare to fund President Biden’s progressive wish list. At a time when millions of seniors across the country are struggling, cutting Medicare for current and near-retirees is the last thing we should be doing. Savings in Medicare should be used for Medicare reform, to extend the life of the program and avoid a costly taxpayer bailout. It should not be a slush fund for the Left.
Democrats claimed that their changes to Medicare would give Americans some much-needed relief at the pharmacy counter, but all signs suggest that the law is making it much harder for patients to access life-saving drugs. Two-thirds of Americans say this failed law hasn’t helped them at all, and it’s easy to see why.
The law permits government bureaucrats to impose price controls on certain medicines covered under Medicare. This provision was billed as a gift to America’s seniors, but it is precisely the opposite.
The IRA has done little to deliver the savings seniors were promised; it has actually led to higher costs. Monthly premiums for Medicare Part D prescription drug plans have risen sharply since the IRA became law. According to the Kaiser Family Foundation, premiums for Medicare prescription drug plans spiked 21 percent in the year after passage of the law.
The Council for Affordable Health Coverage estimates that number could skyrocket another 50 percent or more next year. At the same time, the number of Part D plans seniors can choose from has fallen dramatically.
Remember, the stated goal of the IRA was to make prescription medicines cheaper for seniors. Instead, Biden and Democrats in Congress managed to make monthly premiums for prescription drug coverage more expensive.
As if this wasn’t enough, the IRA also created a $3 billion new federal bureaucracy that will allow more government interference in decisions that should be between patients and their doctors.
History shows that price controls never achieve their stated ends and the IRA’s price controls are further evidence. Basic economics dictates that imposing price controls on one class of products will simply force manufacturers to stop producing or investing in those products. This, in turn, leads to scarcity of the price-controlled product.
This isn’t theoretical. Patients in countries that allow drug price controls consistently lack access to novel medicines. More than half of new drugs approved from 2018 to 2022 were launched first in the United States, according to a recent analysis from the RAND Corporation. Patients living in other countries routinely have to wait an additional year to access newly approved medicines.
Another recent study found that patients on public insurance plans in the United States have access to 85% of new drugs approved from 2012 to 2021. In Germany, the United Kingdom, and France, publicly insured patients have access to 61%, 48%, and 43% of new drugs, respectively.
The lack of drug price controls in the United States is a major reason we’ve become the world’s pharmaceutical leader. As many as two-thirds of new medicines originate in the United States.
The drug pricing provisions in the IRA are in no way a “negotiation.” In a true negotiation, both parties have the ability to walk away from the table.
But companies that do not comply with the IRA’s price controls have to pay up to a 95% tax on the gross sales of the medicine in question. The 95% tax creates using a similar mechanism to impose price controls on any consumer product on a whim.
Nationalizing entire industries is what socialist dictatorships do, not America.
Instead of hiring more bureaucrats to set up a new price control board, Congress should work to lower Medicare premiums, increase plan choices, and require insurers and pharmacy benefit managers to share discounts, rebates, and savings with patients.
It’s also time that lawmakers take a hard look at foreign countries who are buying U.S.-developed medicines for pennies on the dollar. American patients shouldn’t be subsiding the rest of the world’s access to medicines.
For all these reasons and more, we welcome the opportunity to work with you to enact meaningful, market-based reforms that work for all Americans.
Sincerely,
Charles Sauer James Edwards Market Institute Conservatives for Property Rights
Ryan Ellis Ashley Baker Center for a Free Economy Committee for Justice
Brent Gardner John Goodman Americans for Prosperity Goodman Institute
Grover Norquist Annettee Meeks Americans for Tax Reform Freedom Foundation of Minnesota
Pete Sepp Seton Motley National Taxpayers Union Limited Government
Saulius “Saul” Anuzis Gerard Scimeca American Association for Senior Citizens CASE
James Martin Tom Hebert 60 Plus Open Competition Center
Grace-Marie Turner Christopher G. Sheeron Galen Institute Action for Health
Karren Kerrigan Small Business and Entrepreneurship Council
David Williams Paul Teller Taxpayers Protection Alliance Advancing American Freedom
Jeffrey Mazzella C. Preston Noell Center for Individual Freedom Tradition, Family, Property
Dick Patten Charles Moran American Defense Business Council Log Cabin Republicans
Kent Kaiser Dee Stewart Trade Alliance to Promote Prosperity Center for Innovation and Free Enterprise
Patrick Brenner Steve Moore Southwest Public Policy Institute Unleash Prosperity Now
Tom Schatz Matt Dean Citizens Against Government Waste Heartland Institute
Bob Carlstrom Ryan Walker AMAC Action Heritage Action
Tony Zagotta Phil Kerpen Center for American Principles American Commitment
Paul Gessing Ed Martin Rio Grande Foundation Phyllis Schlafly Eagles
Casy Given Young Voices
Elizabeth Hicks Consumer Choice Center
Carrie Lukas Independent Women’s Forum
Thomas Bradbury CPAC
Sally Pipes, Wayne Winegarden, P.h.D Pacific Research Institute
Andrew Langer Coalition Against Socialized Medicine
Help support the Tampa Free Press by making any small donation by clicking here.
Android Users, Click To Download The Tampa Free Press App And Never Miss A Story. Follow Us On Facebook and Twitter. Sign up for our free newsletter.