• The short-term policy battles in the upcoming Democratic congress will define the parameters of the healthcare debate in the 2008 Presidential elections. The dominant issues that are shaping up to be at the center of the debate include the role of government in setting price and quality standards, transparency and cost. And the budget issues that will confront the 110th Congress parallel the issues faced by individual consumers in paying for the rising costs of drugs and health services.
  • America is going to have to make some critical decisions soon on healthcare, but the day of reckoning may yet be a few years down the road.
  • Congressional staff, Wall Street analysts and political pollsters looked ahead to the upcoming congress to set expectations for a group of about 100 senior healthcare industry executives attending a roundtable discussion sponsored by HealthStrategies360, a partnership between Chandler Chicco Agency and Mehlman Vogel Castagnetti, Inc.
  • The policy and financial experts told the group that changes in the upcoming Congress will be incremental rather than sweeping, that the issue of drug price negotiations will move quickly through both houses toward a possible presidential veto and that increasing demands for transparency will fuel the role of consumers as a force in controlling costs.
  • Budget constraints, relatively slim political margins, and the Administration’s willingness to offer a countervailing force to energized Democrats will ultimately determine what can be accomplished on healthcare in the next congress.
  • Leslie V. Norwalk, Acting Administrator for the Centers for Medicare and Medicaid Services (CMS) made it clear to the group that the Bush Administration would continue to defend the system of private payment for benefits against potential efforts to shift some of the authority to government.
  • Norwalk said the issue of allowing the government to negotiate Medicare drug prices with pharmaceutical companies would likely come up very quickly in the session. “It is safe to say our friends on the Hill campaigned on this, but we don’t necessarily agree that it makes a lot of sense.”
  • Norwalk’s comments launched a series of expert observations from Democratic pollster Anna Greenberg and GOP pollster Bill McInturff, a Wall Street panel comprised of CitiGroup’s Paul Heldman, Rick Weissenstein of the Stanford Washington Research Group and Alex Casdin of Cooper Hill Partners LLC who provided insight into how Congressional actions on healthcare will be viewed by investors.
  • The Congressional perspective on the upcoming session was provided by Debbie Curtis, Chief of Staff for Representative Pete Stark (D-CA); Kate Leone, Senior Health Counsel to Senate Democratic Leader Harry Reid (D-NV); Chuck Clapton, Assistant to Speaker Dennis Hastert (R-IL) for health policy: and, Colette Desmaris, Senior Health Policy Advisory to the Senate Finance Committee and Senator Charles Grassley (R-IA).
  • The Congressional panel indicated that the first days of the new congress will see action of Speaker-elect Nancy Pelosi’s commitment to make healthcare more affordable by negotiating for lower prescription drug prices.
  • Ms. Pelosi and the Democrats have already identified changes to the Medicare drug benefit as a priority for passage during the first 100 hours of Democratic control. Topping their list of changes is giving the Health and Human Services (HHS) Secretary the authority to reduce drug prices by negotiating directly with drug manufacturers on behalf of beneficiaries. A number of other measures addressing drug costs will be considered early on.
  • “There has been a lot of talk about generic biologics being the next great step toward cost savings,” said one high-level congressional staffer.
  • The reauthorization of the State Children’s Health Insurance Program (SCHIP) and the Prescription Drug User Fee Act (PDUFA) will provide legislative vehicles for Congress to enact measures that are of concern to the pharmaceutical industry, such as mandatory clinical trial registry and greater post-marketing surveillance.
  • The Wall Street panel noted that investors take a much longer view than just the upcoming Congress, but will carefully monitor which issues gain traction in 2007 as a precursor to the healthcare debate in 2008.
  • “There is something much larger going on here and that is consumerism,” one Wall Street panelist observed, adding that congressional efforts to significantly increase transparency on drug pricing and clinical trial data will empower consumers to make their own decision balancing quality and price as they do in other purchases.
  • “No industry has benefited more from a lack of transparency than drug manufacturers. As soon as everybody figures out what everyone else is paying, the whole house of cards gets to be pretty shaky,” he said.