This Is How President Biden ‘Beat Medicare’

His Inflation Reduction Act leaves patients with less access to medicines and higher premiums

By Tomas J. Philipson. Excerpts:

"This year, the number of stand-alone Part D plans available to seniors dropped by 11%. Medicare Part D is the government-funded insurance program that covers most prescription drugs obtained at pharmacies."

"premiums for Part D plans are up 21%—and 5 million beneficiaries are enrolled in plans that raised their premiums by 50% or more this year."

"The law’s price controls will also deter companies from developing new medicines. A study I co-authored estimated that 135 fewer drugs will come to market through 2039 because of the Inflation Reduction Act. Research firm Vital Transformation’s forecast is even bleaker, predicting that the U.S. could lose 139 drugs within the next decade.

Dozens of life-sciences companies have announced cuts to their research and development pipelines because of the 2022 law. These announcements have come in earnings calls and filings with the Securities and Exchange Commission—where deliberate misstatements would expose executives to civil and criminal penalties—so they can’t be chalked up to political posturing."

"Because of price controls, the clinics that administer intravenous or injectable medicines under Medicare Part B will lose out on crucial reimbursement revenue used to employ doctors, nurses and administrative staff. Clinics can expect a 47% decline in these payments"

"It’s one thing for policymakers to pursue cuts while being honest about the trade-offs—in this case, less access to medicines, fewer plan options, higher premiums and fewer new drugs being developed. Basic economics dictates that slashing a program will lead to a decline in the quality and availability of its goods or services."

"It’s another thing entirely for Mr. Biden to make some of the largest cuts to Medicare in history, to deny his poorly designed law’s negative effects on patients, and then to portray himself as a defender of the program."