Released to the Press

September 25, 2013

New Report Analyzes Interest Group Influence in Blocking Proposed Cost Saving Measures in Medicare

Report Finds Influence of Pharmaceutical Industry as Major Impasse to Common Sense Budget Fixes

Congress has failed to act on a commonsense, good-government approach to controlling health care costs. The significant resources the pharmaceutical industry has put toward influence and access has rendered Congress unable to act in the public interest.

Bad Medicine: Pharmaceuticals’ Prescription for Profits Over People, released by the Alliance for a Just Society details the overwhelming influence of Big PhRMA on congressional outcomes and finds that the imbalance created by industry spending harms both the interest of the American people and our democratic process.

At issue is a bill Senator Jay Rockefeller introduced in April 2013 with 18 co-sponsoring Senators. The Medicare Drug Savings Act, would eliminates a provision from the Medicare Modernization Act that allowed pharmaceuticals to charge Medicare higher prices for beneficiaries eligible for both Medicare and Medicaid. The bill would require drug companies to offer rebates to these “dual-eligible” beneficiaries — who are generally low-income seniors or individuals with disabilities and nearly 50% of whom are people of color. These rebates were offered prior to the 2006 overhaul of Medicare. This provision would save the American taxpayers $141.2 billion dollars over 10 years.

Despite the emergence of this commonsense solution, progress has proven elusive.

Major Report Findings:

The industry enjoys a dominant stranglehold on Capitol Hill. From 1998 through 2013, the industry spent nearly $2.7 billion on lobbying expenses, more than any other industry, and 42 percent more than the next-biggest spender, insurers.[i]

In 2012, the industry employed a small army of 845 registered lobbyists,[ii] or nearly two lobbyists for every member of Congress.

The Pharmaceutical Research & Manufacturers of America (PhRMA), the powerful industry trade group, has 36 current or former staff members who at one time has worked for a member of Congress, 12 who have Despite the emergence of this commonsense solution, progress has proven elusive.

The full report can be found at http://bit.ly/Pharmareport

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The Alliance for a Just Society is a national coalition of state-based grassroots community organizations that address economic, racial, and social inequities to advance economic justice and generate increased power and sustain social change.