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White House Backs Senators On Deal With Drug Makers

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White House Backs Senators On Deal With Drug Makers

White House Backs Senators On Deal With Drug Makers

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Another day, another headache for President Obama on the health care overhaul. As tempers flare in town hall meetings around the country, the White House is taking sides in a fight between lawmakers.

NPR's Julie Rovner reports the White House is siding with Senate Democrats and the drug industry against House Democrats.

JULIE ROVNER: The deal between members of the Senate Finance Committee and the prescription drug trade group known as PhRMA calls for the group to pledge $80 billion over the next 10 years to reduce drug prices for seniors in the Medicare program.

Here's how PhRMA president and CEO Billy Tauzin described it at the time.

Mr. BILLY TAUZIN (President and CEO, PhRMA): It's a big sum of money. That ought to be enough. And it's going to cost us jobs. It's going to cost us research dollars.

ROVNER: At today's White House briefing, press secretary Robert Gibbs defended the agreement between the finance and PhRMA. Under the deal, drug companies will offer discounts to seniors who exhaust their first round of benefits under the Medicare prescription drug program.

Mr. ROBERT GIBBS (White House Press Secretary): This will help fill that doughnut hole for millions of seniors, and some of that money will be used for health care reform. That's the goal of that agreement, and that's the goal of our White House.

ROVNER: But that deal didn't work for House Democrats. Conservative Blue Dogs threatened to vote against the bill unless it costs the government less. Liberals, however, were afraid that consumers would suffer from the cuts the Blue Dogs forced, so they looked for another way to find savings, and they settled on the drug industry.

Florida Democrat Kathy Castor was among those who helped come up with the House compromise.

Representative KATHY CASTOR (Democrat, Florida): The House of Representatives were not party to any deal with the big drug manufacturers, and instead, we believe it's important to save consumers money and to save the government money by lowering the cost of prescription drugs.

ROVNER: So the bill approved by the Energy and Commerce Committee would, for the first time, allow the government to directly negotiate drug prices for seniors on Medicare. It would also allow the government to develop a specific list of approved drugs under a new public plan that would be available to some people under the age of 65. Castor says the drug industry can certainly afford the extra money.

Rep. CASTOR: In 2008, the largest drug companies have banked over $100 billion. So when they offer up a mere $8 billion per year, that's a pittance for them, but it would be very costly to consumers. And the overriding goal of health insurance reform is to save consumers money.

ROVNER: But the changes made by the House infuriated PhRMA, which thought it had a deal that it wouldn't be asked to contribute beyond the $80 billion it already pledged. The White House agreed. Again, Press Secretary Gibbs.

Mr. GIBBS: We feel comfortable with the amount of money that has been talked about at this point.

ROVNER: When asked directly, however, Gibbs stopped short of ruling out the additional savings in the House bill.

Unidentified Man: What measures is the White House willing to take to ensure that this agreement remains in place and that no extra cost-saving measures are put in place by the House? Are you guys going to set a line in the sand? Can you move beyond this agreement?

Mr. GIBBS: Well, no, no. We've not laid down any sand, and I have not drawn in it.

ROVNER: House Energy and Commerce Committee Chairman Henry Waxman says he's not concerned that the White House is defending the deal. He says it will all be argued out when there's a House bill and a Senate bill passed and in conference, which he says hopefully with be sometime later this fall.

Julie Rovner, NPR News, Washington.

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