Obama: Drug Deal A "Major Step Forward"

(CBS)
President Obama on Monday lauded an agreement from the pharmaceutical industry to cut the cost of prescription drugs for seniors through Medicare, calling it a "major step forward" toward comprehensive health care reform.

Comprehensive reform will require, he said, "these kinds of commitments throughout the system."

"Everyone in the health care community is going to have to come together and do their part," Mr. Obama said, standing in the White House Diplomatic Reception Room.

In the deal, the Pharmaceutical Research and Manufacturers of America (PhRMA) has agreed to reduce its draw of revenues by $80 billion over 10 years by discounting the cost of medicines in Medicare's Part D prescription drug program for some seniors by as much as 50 percent. The discount would go to seniors who fall into the "doughnut hole" -- a gap in Medicare Part D coverage. Currently, once seniors have received $2,700 worth of drugs, they are left to pay the full cost of their medication until that cost reaches $6,100.

"This gap in coverage has been placing a crushing burden on many older Americans," Mr. Obama said. The agreement, he said, will make health care "more affordable for millions of seniors and restore a measure of fairness to Medicare Part D."

The agreement with PhRMA was negotiated with the White House and Sen. Max Baucus (D-Mont.), who is leading health care reform as chair of the Senate Finance Committee. Baucus stood by the president on Monday as he praised the agreement, as did Sen. Chris Dodd, who is leading health care deliberations in the Senate Health, Education, Labor and Pensions Committee and Barry Rand, head of the senior citizens' advocacy group, AARP.

The president pointed out that the pharmaceutical industry stands to benefit from the millions of more customers it could receive as a result of reform. Therefore, he said, "it's only fair" that pharmaceutical companies do their part to reduce costs.

The goal of comprehensive reform, Mr. Obama reiterated, is to reduce costs while improving care. The agreement with PhRMA would only account for a fraction of the costs facing reform, but the president on Monday emphasized his resolve to complete health care reform.

To skeptics with "sky is falling progneses" for reform, the president said, he would respond with his campaign mantra: "Yes we can," Mr. Obama said. "We are going to get this done."

Comments

CBSN Live

pop-out
Live Video

Watch CBSN Live

Watch CBS News anytime, anywhere with the new 24/7 digital news network. Stream CBSN live or on demand for FREE on your TV, computer, tablet, or smartphone.