CAGW’s Cancerous Pharma Whitewash

Mytheos Holt | Policy Analyst

Normally, conservatives don’t give cover to the very people who have gone out of their way to rig the U.S. healthcare system in their favor at the expense of consumers, taxpayers, and everyone in-between. Especially when that same industry makes up Hillary Clinton’s most enthusiastic donors. And especially when they are trying to kill a program supported by a Republican President.

Unfortunately, in the case of the usually sound Citizens Against Government Waste (CAGW), it appears there is a first time for everything. CAGW has, for questionable reasons known only to itself, been trying to offer cover even to the pharmaceutical industry’s most egregious actions for a while. But it was only late last month when they took one of pharma’s dearest causes and tried to package it with the most hilariously backward argument yet offered. That is to say, CAGW joined the industry in trying to put limits on the 340B drug discount program by claiming it makes cancer care more expensive.

For anyone who knows anything about 340B, and the grounds for the industry’s opposition to it, this is an argument worthy of the Onion, not a serious conservative organization. To quickly bring readers up to speed, 340B is a program signed into law by President George H.W. Bush, which mandates that any pharmaceutical company doing business with Medicaid and Medicare Part B also sell drugs at a discount to hospitals that help mostly poorer or vulnerable populations. It has the advantage of being an entirely voluntary regulation, which companies need only obey if they want access to one of the largest stores of taxpayer dollars in the U.S., and costs taxpayers nothing.

You see, instead of an actual example of government waste – like a subsidy – 340B, as one of the program’s creators notes, is designed to be self-funding. Specifically, the program was designed to give financial support to hospitals that otherwise are constantly teetering on the brink of bankruptcy. In other words, it’s a model of conservative legislation that still helps the disadvantaged without wasting taxpayer money or offering across-the-board mandates. It’s simply a condition for doing business with the federal government.

So naturally, the corporate welfare-guzzling pharmaceutical industry hates it, mostly because  it prevents them from gouging poor patients for otherwise profitable treatments. And just coincidentally, the treatments whose prices Big Pharma has been hiking most consistently are – ding ding ding – cancer treatments.

CAGW conveniently regurgitates several industry-funded studies to show that cancer care costs more in the hospital setting than in private oncologist offices. Well, duh. Hospitals offer far more services and face much higher regulation. And let’s remember what else hospitals do: They treat the poor patients dumped on them by private oncologists who don’t want to deal with them. The group also somehow ignores the most powerful driver of rising costs in cancer care: drug prices.

Never mind that if 340B were repealed, such high prices would be absolutely inescapable, because nothing would stand in the way of the pharmaceutical industry imposing them on literally every treatment center in the country. Ignore the fact that multiple hospitals would go out of business. Forget the fact that Medicaid would end up spending more money for the same treatments for poor patients – in other words, that taxpayers would be on the hook for more money, which you’d think an organization that’s “against government waste” would be concerned about.

No, ignore all of this, even though it trashes CAGW’s entire case, and consider this: Even if their argument were true, many more treatments than just cancer have their prices held in check by 340B. Destroying the program’s funding mechanism would almost certainly lead to hospital closures, resulting in either the aforementioned increased Medicaid costs (or, God forbid, an expansion of Obamacare), or simply in people dying in the streets. I know CAGW isn’t fond of taxpayer money being wasted, and I’m certain they don’t want people to die, even if they do sometimes seem to think dead people make great letter writers for Microsoft astroturf.

So why is CAGW siding with an industry that is indifferent to all of this? Perhaps a misguided belief that the free market is being harmed? Frankly, if CAGW wants to protect the free market, perhaps it should start with actual government waste that is squandered on Big Pharma, including the massive amounts of corporate welfare the industry receives, or the prohibitive regulations they use to keep out competition.

Those certainly seem far more pressing concerns to this citizen against government waste than a minor Republican reform with no price tag.

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