By the design of the program, the federal government is not permitted to negotiate prices of drugs with the drug companies
Yes, but Medicare Part D is not run by the federal gov't, it's run by private insurers (the gov't just pays them). Private Part D plans negotiate down the cost of drugs all the time. In fact, the actual costs of Part D have consistently come in lower than projected since the start of the program.
Private Part D plans get lump sum payments from the gov't to pay for patients. Each Part D plan bids on being a provider. So, when the Part D plan negotiates a lower price on a drug, they can bid lower for their overall plan and the savings get passed onto the gov't.
And it's not fair to compare Medicare Part D prices to what the VA pays. The VA is a pretty small slice of the market and there is statutory language about the discounts they must receive. A lot of it isn't even negotiated.
And finally, Medicare couldn't negotiate lower prices if it wanted to. Right now, Medicare Part D has a hell of a time excluding a drug from their formulary. They basically can't say "no, patients can't use this drug". If they can't say no, then what leverage do they have over drug companies? The rules on how Medicare can manage their formulary would have to change before they could start negotiating.
And don't forget that us Medicare Part D "customers" or whatever you want to call us have more than a little skin in the game, especially the ones who'll enter the "donut hole".
I'd add that the government "choosing a plan" web site is rather good, give it a list of drugs and it'll tell you what you'll pay next year, modulo changes. It's also not difficult to manipulate it to play what if games, e.g. every once in a while I get a sinus infection, and it takes 30 days of a not so cheap generic antibiotic to be sure to cure it. So I put that drug on and off my list, to make sure it'll be acceptably priced if I have bad luck next year. Displays quality survey data that seems to have some relation to reality, makes enrolling in a new plan a snap, etc. etc.
Yes, but Medicare Part D is not run by the federal gov't, it's run by private insurers (the gov't just pays them). Private Part D plans negotiate down the cost of drugs all the time. In fact, the actual costs of Part D have consistently come in lower than projected since the start of the program.
Private Part D plans get lump sum payments from the gov't to pay for patients. Each Part D plan bids on being a provider. So, when the Part D plan negotiates a lower price on a drug, they can bid lower for their overall plan and the savings get passed onto the gov't.
And it's not fair to compare Medicare Part D prices to what the VA pays. The VA is a pretty small slice of the market and there is statutory language about the discounts they must receive. A lot of it isn't even negotiated.
And finally, Medicare couldn't negotiate lower prices if it wanted to. Right now, Medicare Part D has a hell of a time excluding a drug from their formulary. They basically can't say "no, patients can't use this drug". If they can't say no, then what leverage do they have over drug companies? The rules on how Medicare can manage their formulary would have to change before they could start negotiating.