Obama on Drugs: 98% Cheney?
Wednesday, August 12, 2009
By Greg Palast
For The Huffington Post
Eighty billion dollars of WHAT?
I searched all over the newspapers and TV transcripts and no one asked the President what is probably the most important question of what passes for debate on the issue of health care reform: $80 billion of WHAT?
On June 22, President Obama said he'd reached agreement with big drug companies to cut the price of medicine by $80 billion. He extended his gratitude to Big Pharma for the deal that would, "reduce the punishing inflation in health care costs."
Hey, in my neighborhood, people think $80 billion is a lot of money. But is it?
I checked out the government's health stats (at HHS.gov), put fresh batteries in my calculator and totted up US spending on prescription drugs projected by the government for the next ten years. It added up to $3.6 trillion.
In other words, Obama's big deal with Big Pharma saves $80 billion out of a total $3.6 trillion. That's 2%.
Hey thanks, Barack! You really stuck it to the big boys. You saved America from these drug lords robbing us blind. Two percent. Cool!
| ALERT
Now it's Let's Make a Deal with hospital lobbyists. First, the President was caught with his principles down, cutting a scuzzy back-room deal with pharmaceutical lobbyist Billy Tauzin to limit drug price savings to just 2% over 10 years (see attached, "Obama on Drugs: 98% Cheney?"), the New York Times today reports that another deal was sealed by lobbyist Chip Kahn of the American Hospital Association. Here are the numbers they don't want you to see: Hospitals will be allowed to hike their prices and revenues by six trillion dollars ($5,853 billion) over the next ten years, only $155 billion less than they had projected before the Obama "reform." In all, the Obama back-room deal will "reduce" our $26 trillion total hospital bill over the next decade by one-half of one percent. Once again, the lobbyists got the gold mine, the public got the shaft. Say it ain't so, Mr. President. |
For perspective: Imagine you are in a Wal-Mart and there's a sign over a flat screen TV, “BIG SAVINGS!” So, you break every promise you made never to buy from that union-busting big box - and snatch up the $500 television. And when you're caught by your spouse, you say, "But, honey, look at the deal I got! It was TWO-PERCENT OFF! I saved us $10!"
But 2% is better than nothing, I suppose. Or is it?
The Big Pharma kingpins did not actually agree to cut their prices. Their promise with Obama is something a little oilier: they apparently promised that, over ten years, they will reduce the amount at which they would otherwise raise drug prices. Got that? In other words, the Obama deal locks in a doubling of drug costs, projected to rise over the period of "savings" from a quarter trillion dollars a year to half a trillion dollars a year. Minus that 2%.
We'll still get the shaft from Big Pharma, but Obama will have circumcised the increase.
And what did Obama give up in return for $80 billion? Chief drug lobbyist Billy Tauzin crowed that Obama agreed to dump his campaign pledge to bargain down prices for Medicare purchases. Furthermore, Obama’s promise that we could buy cheap drugs from Canada simply went pffft!
What did that cost us? The New England Journal of Medicine notes that 13 European nations successfully regulate the price of drugs, reducing the average cost of name-brand prescription medicines by 35% to 55%. Obama gave that up for his 2%.
The Veterans Administration is able to push down the price it pays for patent medicine by 40% through bargaining power. George Bush stopped Medicare from bargaining for similar discounts, an insane ban that Obama said he’d overturn. But, once within Tauzin’s hypnotic gaze, Obama agreed to lock in Bush’s crazy and costly no-bargaining ban for the next decade.
What else went down in Obama's drug deal? To find out, I called C-SPAN to get a copy of the videotape of the meeting with the drug companies. I was surprised to find they didn't have such a tape despite the President's campaign promise, right there on CNN in January 2008, "These negotiations will be on C-SPAN."
This puzzled me. When Dick Cheney was caught having secret meetings with oil companies to discuss Bush's Energy Bill, we denounced the hugger-muggers as a case of foxes in the henhouse.
Cheney's secret meetings with lobbyists and industry bigshots were creepy and nasty and evil.
But the Obama crew's secret meetings with lobbyists and industry bigshots were, the President assures us, in the public interest.
We know Cheney's secret confabs were shady and corrupt because Cheney scowled out the side of his mouth.
Obama grins in your face.
See the difference?
The difference is 2%.
*******
Palast studied healthcare economics at the Center for Hospital Administration Studies at the University of Chicago.
Greg Palast's investigative reports can be seen on BBC Television's Newsnight and, in print, at www.GregPalast.com.
New: Subscribe to Palast’s podcasts (iTunes required)
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Great info' Greg-- Clearly not surprising. Side stepping for a moment, we have a drugged out nation regarding anti-depressants and psychotropic meds. Two-year-olds are being medicated with killer drugs, read the side effects. Gee, we don't have to read, they tell us on TV we could get cancer, commit suicide or die. Liquor ads, cigarette ads have been banned from TV. But, drug use is promoted, making it ‘OK’.
These chemical lobotomies are Big Pharma Biz as usual. No one pays attention until it happens to their child, loved one, or friend. The psychotropic meds are addictive; just try to get off of Zyprexa, Prozac, or any other drug in these categories. Withdrawal mimics the symptoms that the drugs are supposed to alleviate. The mock Pharma drug
tests,4 to 6 week period, are often marginally better than a placebo. Overtime, meds can have even less efficacy than a placebo.
Dumbed and numbed society - is there 2% left among us that are aware, care, or will stand up? MerrieWay is in for the long haul...come on and join us. Take a stand for our kids!
good take greg,
the government has purchasing power!! for stationary, maintenance vehicles, street signs...why not medicine?
peter
Billy tauzin?
Oh yeah...he was in charge of the Commitee to look into the role of the TV networks in getting Bush declared President in 2000 ; how'd that go?
Deep-sixed it right well, did he not? D'ya think drug cos profit from selling ex-soldiers cures for what ails them?
“It’s here that the American dream decided it liked the taste of the vomit it was chocking on. Just rolled over on its back and screamed for more drugs. it didn't die.“ - Warren Ellis
Greg,
As usual, you put the reality into the b.s. When's the revolution, because too many of us can't hold on much longer.
There are 2-3 ads from the insurance companies every hour to shoot down health care reform. How many millions have been sent to lobby from a scared insurance industry? Can you imagine a bill that is to the detriment of both the insurance and drug companies passing congress? Can you? Really?
I want health care reform. I want a plan so much better than what is being offered. But the reality is that in order to get a plan...any plan...some compromises will have to be made.
This is my single biggest gripe. It is totally unacceptable. AB M.Div. Yale "87 Is there a way to pass this along in email form?
Notice also that the White House-Pharma "deal" is itself proof that the Pharma industry is fully aware that the US government had the power to negotiate lower prices for the drugs it pays for. The industry is implicitly acknowledging that the US government, as a large buyer, would have the upper hand in all such transactions. If only the government would follow in the footsteps of Canada, Europe etc, and use its inherent power to do its part to keep costs down. Why fold if you have the better cards??
Ann, click on the Share This link immediately below the article. There you will find an email link, along with dozens of other ways to share the article.
I appreciate the analysis. It's a welcome relief to see honesty from the left. (and yeah, Bush sucked on this one, too)
One question? What would you do without the drugs that "big pharma" creates? Let the government develop them? Good luck.
Obviously, there is something motivating Obama that hasn't been made public. It's almost as if he has a gun to his head— like somebody will do something terrible to him (or to us) if he does anything Bush wouldn't do.
Great article!
Now comes the big swine flu pandemic! hurry and get your vaccines! Just say NO!
OMB director Peter Orzrag and President Obama have both spoken on why a 2% cut is indeed a drastic cut. So, you're wrong on that count.(i)
Obama has released the list of healthcare executives that have visited the WH. So, you're wrong on that count. (ii)
Obama has been holding the healthcare deliberations on tape. So, you're also wrong on that count. (iii)
Congratulations for writing a completely uninformed article, Greg.
(i)http://www.whitehouse.gov/omb/blog/09/05/29/HealthCareReformandFiscalDiscipline/
(ii)http://www.talkingpointsmemo.com/documents/2009/07/white-house-letter-disclosing-health-industry-executives.php?page=1
(iii)http://www.politico.com/blogs/bensmith/0309/Streaming_live_Healthcare.html
P.S. I'll be sure to return to your website next time I want to read uninformed rabbbling!
the $80 billion you speak of- would you please clarify if this amount is over one year or multiplied by ten?
also, do you know if this agreement is written in stone, or has room for change once it goes into effect?
thanks -
Thanks for the reporting Greg.
If you can just distance oneself from the disappointment, anxiety, and frustration about Obama's increasinly arrogant, aloof, elitist(and downright stupid) neo-con treachery and betrayals, it is almost amusing, watching in clincial fashion the stupid self-destruction of an otherwise smart person. (Biggest problem, of course, he will take down millions of us genuinely "liberals" & Dems with him.)
Does Mr. Obama not know how many MILLIONS of Americans are feeling the pain of FORECLOSURES, job losses,and medical bankruptcies?
Does he REALLY believe that handing Trillions of taxpayer dollars to the big banks will do anything to help those American families victimized by predatory finance...? or does he just not care)
"Drug lords robbing us blind."
WTF?
The "drug lords" spend hundreds of millions of their own dollars researching and testing pharmaceuticals that save or improve the lives of billions of people and they are demonized? Many of the drugs that they develop don't work and they lose money on them... their money, not yours. I'd hope that the risks that these companies take would be rewarded and their contributions to the well-being of humanity appreciated but apparently it's not to be so from you and your ilk.
Oh, Lj, it is beyond "amusing" --- it's outright hilarious watching you Hopium Huffers come down off your duped high and suddenly recognize the "arrogance" of our latest inexperienced, sociopathic corporate puppet in the White House. As if this Trojan Ass somehow "betrayed" you. You are the one who betrayed all of us by refusing to face reality when it could've mattered. How stupid do you have to be? The man's record in Chicago was a disgrace. He started running for President the minute he hit Washington, in direct betrayal of his constituents, to whom he promised to finish his term of office, and after swearing he'd filibuster if necessary in order to hold the telecoms responsible for spying on Americans, he did the opposite, voting to give them immunity! He was mocking your sorry dumb asses before he even got your votes! You're worse than the Bush voters because you pretend to know better!
Meanwhile. Greg, I'm impressed. I was trying to stomach as much coverage of the town halls and articles as I could, looking for anyone bringing up this topic. I call him Barrack OPhRMA these days. Thanks for writing this up. It's rare to see the type of criticism we need on this fraud. Another favorite of mine was when Jon Stewart pointed our Obama was continuing Bush's war on "terra" but Obama "made the kids like it."
In his Alert, Greg Palast writes, "In all, the Obama back-room deal will "reduce" our $26 trillion total hospital bill over the next decade by one-half of one percent."
I'm not following. According to Garson and Engelhard:
>>>In 2007, the [National Health Expenditures] for the United States totaled $2.2 trillion. For each dollar, 31 cents purchased hospital care, 22 cents paid physicians and other health care professionals, 10 cents purchased prescription drugs and 7 cents went toward nursing home care. The remaining 30 cents was spent on other kinds of medical services such as home health care and dental care as well as program administration.<<<
http://www.governing.com/column/you-get-what-you-pay
That would make the 2007 hospital costs $682 billion. How did Greg P. come up with the $26 trillion amount for the coming decade's "hospital bill"?
Bryce,
So the meetings with the drug companies and their representatives, at which the $80 billion deal was worked out, were videotaped and publicly broadcast? I can't find them on the link you so helpfully provided, where are they? It couldn't be that you are full of b.s., could it?
Actually, I think it is UPTO BUT NOT MORE THAN $80 Billion. So you could very possibly be projecting a very rosy picture of actual savings. It could be more like .5% or less. No actual requirements of doing anything, just a promise. And I think that is off of increases, not off of what we are spending now.
mr pallast: when you speak of $80 billion, is that per year? per ten years? or something else? this is not clear in your article, and is important to know.
also, if and when this bill goes into effect, will there still be room for negotiation and changes, or will everything be set in stone?
thank you for clarifying these points.
The only way for this crooked system to ever see any reform is for it to be completely sucked dry by the corporate vampires and collapse from lack of income. As one poster above noted, there are a lot of problems in the economy which directly affect the majority of Americans. Too many seniors are already making choices between health care and frivolous things like food. At the rate the economy continues to collapse on Main Street while Wall Street is placing orders for new yachts, fewer of us will be able to avail what health care we now can. Unless the people are again included in making a decent living, the economy can only continue to spiral downward until we can no longer afford to meet more basic needs than even health care. Health care will collapse at that point.
In the late 90s Eli Lilly developed a me-too drug in the so-called atypical neuroleptic class. These drugs are used as mood stabilizers and anti psychotics. Big Pharm said these drugs were safer than the old class of phenothyazines like Thorazine & Haldol which cause a painful and disfiguring array of movement disorders (called Tardive Dyskinesia). Some of the original trials clearly indicated that these new drugs wreaked havoc with patient's metabolic functions but Lilly suppressed the results and made a cold blooded decision that paying off lawsuits would be an acceptable "cost of doing business". Because they lied I did not know I was at risk until the diabetes induced by Zyprexa had already trashed my peripheral nerve endings and it has left me in permanent excruciating pain. I can only find relief in powerful opiates which become harder and harder to obtain licitly as doctors in this country grow more and more callously indifferent to their patients suffering. Big Pharm has considerably worse ethics than your corner crack dealer. I did receive a settlement. $19K in dribs and drabs over a six month period (My lawyers got $23K for their efforts.); This for being left in unremitting pain for the rest of my life.
Alabama Boyngboyng
Greg, great post and nice piece of work you did. Thank you. Good to have your reporting on real facts again.
The Real Kicker in this story is that The Federal Employees Health Benefits Program (FEHBP) has negotiated greater cost reductions than what the Administration "negotiated" for the rest of us (Serfs)
Bryce -- Your 3rd link is about the health care kick off, which was on C-Span, streamed, and live blogged. At one of these town hall health care meetings a question from a citizen about single payer was simply ignored--how's that for transparency? OK, if it's transparent you can't see it, so how could it be in the blog...heh.
The meetings with the BHIP (Big Health Industry Players)have been behind the scenes, backroom but in the Oval Office negotiations. Please don't try to flimflam people. But perhaps you misread the Ben Smith paragraph and simply misunderstood. Or is your link going to the wrong place? If you have a good link, please post -- I'd really like to see what you were referring to. Thnx!
I am not proud to proclaim that for the last 2 1/2 years it has been clear to me that Obama is an empty suit snake oil and used car salesman. I am amazed how easily people can be duped.
Where is the outrage from the left?
No surprise, look at who wrote a significant amount of this bill...John Hacker PhD. Never left teaching political science at the ivory towers to work in the "real" world. I don't understand how someone like this guy could steamroll this monster without much scrutiny.
a) The US drug industry should not allow countries other than the US to strong-arm them into paying less than they charge in the US. In other words ... US consumers, insurers, employers and taxpayers (via Medicare and VA) pay for the super-expensive costs of developing new blockbuster drugs, while Canada and Europe get a "free ride" ... This is why Canada and Europe do about 5% of the amount of pharmaceutical research that the US does ... their Government simply has made it unprofitable.
b) Anybody that believed a word Obama said during his campaign needs to have his head examined. There has seldom been any politician who has honored campaign contributions, and it was also palpably obvious that he was saying what people wanted to hear (I am bipartisan, I am centrist, I am not a Socialist, I am competent, I am not a tax-and-spender, I will have an open administation, I will balance the budget) and not the truth.
c) Having said "b" -- Obama continues to be stuck in "campaign" mode. It is the only thing he knows how to do. Guess what, when you are actually in power, you actually need to operate based on facts, not fantasies.
d)The shine has really come off Obama -- of course the Loony Left has their heads in the sand and will support Obama even if someone found a videotape of him in an Al Qaeda camp. But the "independents" -- whom he and Pelosi hoodwinked to get elected have abandoned in droves -- 67% of them disapprove based on the Rasmussen poll.
The emperor has no clothes.
To
The Epicure and Bryce,
I come from the medical device industry. I have more than one device
(pacemaker) with my name in the list of people who developed and manufactured that device.
The world pays less for those devices than we do here. Why?
Because the USA engaged in "payola" for docs to prescribe devices and as punishment they were forced to pay the FDA mandated amount for the device...
Meanwhile other governments get to negotiate.
Sure seems fair to me...
Just like your crits above.
Drugs are the same Obama has been in that pocket for a decade.
BTW up until a little while ago the federal gov. paid for a LOT of the Pharma basic research bill. With this they still are.
Bryce use links that go where you say they do.
Epi,
I am way left of the center right OBAMA. Don't get to silly with your crap.
I come from the medical device industry. I am more than one medical device and not at all an internet tough guy claiming to be something that I am not.
Despite the fact that my skills as a speller (or grammarian) are below what one hopes a three year old could reasonably accomplish, you should accept my pronouncements as law. No evidence will be offered, for why should any doubt me.
To prove my credentials I shall sign off with a smiley-con. Because I'm not thirteen and stupid. At all.
Greg you're my hero!!
I just got off the phone. My congresswoman Debbie Halvorson D-IL-11 held a "Phone-hall meeting"
During the call she mentioned the $80 Billion savings atleast 8 times!
Unfortunately, I didn't get to correct (educate) her during the "phone-hall" ,but I did email your article to her and will give her a copy in person on Saturday when I see her at her signature petition drive.
the only thing Obama knows is pay to play. the media gave the guy a pass last year, but I didn't. I read everything I could get my hands on about the guy, and decided he was all front and nothing else. empty suit. biggest con ever perpeptrated on the people, after weapons of mass destruction, the 2000 election, and watergate that is. or, perhaps it is the biggest. I am certain this guy is a big big big crook and he knows that no one is watching. that is a lot of power to have. the media is not watching because they love him and make too much money on him to lose him. just sayin'
Honey, you missed something: Obama did get his quid pro quo.
He got Big Pharma to agree to spend $150 million, more than McCain spent on his entire presidential campaign, on favorable ads for his health plan.
Now isn't that special.
Now think: if Obama isn't saving us money, but delivering us like trussed pigs to the slaughterhouse (drug companies, insurance corporations), is he pushing his health plan for US? If not, who benefits? Follow the money, find the motive.
Easily resolved. We the People need to request passage of a bill that makes ALL lobbying illegal. Lobbying has been the downfall of our government, and will be the death. If we remove corporate voice, we will regain our country.
Let us band together, start this bill, and save our nation.
Excellent work, as usual, Greg.
I wonder if anyone else caught the "paid-for-by-big-Pharma" advertisement weaseled into this comment thread, posted by Max Entropy. It bears reprinting:
#############################################
"Drug lords robbing us blind."
WTF?
The "drug lords" spend hundreds of millions of their own dollars researching and testing pharmaceuticals that save or improve the lives of billions of people and they are demonized? Many of the drugs that they develop don't work and they lose money on them... their money, not yours. I'd hope that the risks that these companies take would be rewarded and their contributions to the well-being of humanity appreciated but apparently it's not to be so from you and your ilk.
#############################################
Nice try, Max. Pharmaceutical companies take risks not in the name of "the well-being of humanity," but in the name of profit. If they lose money sometimes, that's the chance ya take in the game of capitalism.
The figure "hundreds of millions" is inflated, as noted in this NTTimes article: http://www.nytimes.com/library/national/science/health/042300hth-drugs.html
Let's also not forget that our tax money funds research for medical cures that are then handed over to the Pharma companies so that we can pay for them again when we buy the drug.
Furthermore, how about those clinical trials paid for by drug companies? http://agonist.org/20060303/drug_industry_human_testing_masks_death_injury_compliant_fda
Finally, it should be pointed out that, despite the industry's claim to the contrary, pharmacy companies spend twice the amount of money on sales & marketing of their product than they do on research and development.
http://www.plosmedicine.org/article/info:doi/10.1371/journal.pmed.0050001#top
With these points in mind, I would be careful not to paint a picture of US drug companies as White Knights on a hilltop.
wow, so obama is a corporate stooge. hey palast, sounds like you owe ralph nader an apology. tell randi rhodes to pass it on...
wow, so obama's a corporate stooge. hey palast, sounds like you owe ralph nader an apology. tell your homegirl randi rhodes to pass it on...
If you do a little investigation you'll find that Tom Daschle's law office is three floors down from the PhRMA offices in Washington. And Sen. Daschle seems to have the President's ear on the healthcare debate. So, if I follow the logic correctly, the Senator eases up the back stairs and has a little pow wow with Billy Tauzin at PhRMA, creeps back down the stairs, walks out the front door and gets into his limo and heads to the White House. You think he took Billy's deal to Obama?
1) Greg, will you be excluded from live interview on Wisconsin Public Radio until you've a new book going to press?
2) Where's the T-shirt / bumper sticker that reads:
"Best Democracy Money Can Buy / The Obama Chapters" ?
What will you not do for your country?
Now that the nation's hospitals have offered to give up $155 billion in future Medicare and Medicaid payments and America’s largest private health care insurers say they'll give back as much as $2 trillion by reducing the growth rate of health care spending by 1.5% per year during the next decade, all to help defray the cost of President Barack Obama's health care plan, I've decided the least I can do as an average citizen is not to opt for expensive elective surgery during the same period.
Between now and 2020, therefore, I pledge not to get hair transplants ($10,000), Invisalign braces ($5,000), a neck and profile lift ($5,300), calf implants ($4,500) or buttock augmentations ($18,000 -- I know that sounds expensive, but I'm giving up a trip to Brazil), rhinoplasty ($5,500), otoplasty (as you age, your ears just get bigger and bigger -- $2,800 each or $5,600), and liposuction (hips -- $2,400; outer thighs -- $3,000; buttocks -- $1,800); plus non-surgical fees (figure $128,000 spread out over all these procedures), for a grand total of $189,100.
Doesn't sound like much compared to the billions and trillions being donated by the hospitals and insurance companies, but if even 1% of 300 million Americans make the same contribution I am, we will save $567,300,000,000, and be happy to do it.
Actually, I'm even willing not to have these procedures every year, increasing the savings ten fold!
So, my fellow Americans, the challenge is this: ask not what your country cannot do for you, ask what you can not do for your country.