By Marc Palazzo
Speaker Pelosi’s drug pricing bill, deceptively crafted to appear as a compromise, in reality amounts to a poison pill for America’s patients, taxpayers, and economy: a down payment on socialized medicine in America. Pelosi’s plan is a far-left San Francisco liberal’s dream – socialist price controls, huge new taxes, and bigger government.
Ever the astute political tactician, Pelosi knows full-well that an immediate, full-scale government takeover of health care and the imposition of socialized medicine through the so-called “Medicare for All” legislation now supported, amazingly, by the majority of House Democrats, stands little chance of becoming law once its true impacts on Americans are known to voters. So, she has chosen a craftier route, opting for socialists’ tools of choice: price controls in the form of inflationary caps and setting prices based on those set by foreign bureaucrats, and crippling new taxes.
To set prices, Pelosi’s radical plan would force a “voluntary negotiation process” between the government and drug manufacturers on what it calls a “maximum fair price” – a price determined by foreign bureaucrats. Pelosi would subject manufacturers that do not participate in the negotiations or do not reach an agreement suitable to the government to a “non-compliance” fee – a tax starting at 65 percent of the sales of drug the previous year and increasing as high as 95 percent. Far from “voluntary,” the Pelosi plan is more akin to government extortion. As former Speaker Newt Gingrich observed, the system she envisions is more akin to negotiating with Don Corleone after he’s made “an offer you can’t refuse.”
These socialist price control schemes, forced arbitration, and crippling taxes would have a smothering effect on medical innovation, ultimately leading to fewer cutting edge treatments and cures for patients. As in any industry, when government sets prices there is little incentive to produce a product – especially those that require significant dedication of time and resources on the front end such as pharmaceuticals.
Further, as has been shown time and again around the world, price controls, when implemented, lead to shortages and rationing – both in healthcare and in other areas. Unfortunately for patients, in health care that translates into access restrictions and government bureaucrats making decisions about care rather than patients and doctors.
While her drug pricing plan may masquerade as a compromise, when given a closer look, the tools Nancy Pelosi wants to use to remake America’s drug pricing system look increasingly like the hammer and sickle.