June 25, 2024

The Honorable Mike Johnson
568 Cannon House Office Building
Washington, DC 20515

The Honorable Mitch McConnell
317 Russell Senate Office Building
Washington, DC 20510

Dear Speaker Johnson and Leader McConnell:

President Biden’s Inflation Reduction Act has been an across-the-board
failure. The law arguably made inflation worse by wasting billions on
progressive boondoggles such as “Green New Deal” tax credits that benefit
China electric vehicle giveaways, and bigger handouts to insurance companies
and affluent families who enroll in Obamacare. The law imposed costly new
taxes on U.S. businesses that employ millions of Americans.

The IRA also raided $300 billion from Medicare to fund President Biden’s
progressive wish list. At a time when millions of seniors across the country are
struggling, cutting Medicare for current and near retirees is the last thing we
should be doing. Savings in Medicare should be used for Medicare reform, to
extend the life of the program and avoid a costly taxpayer bailout. It should
not be a slush fund for the Left.

Democrats claimed that their changes to Medicare would give Americans
some much-needed relief at the pharmacy counter, but all signs suggest that
the law is making it much harder for patients to access life-saving drugs. Two-thirds of Americans say this failed law hasn’t helped them at all, and it’s easy to see why.

The law permits government bureaucrats to impose price controls on certain
medicines covered under Medicare. This provision was billed as a gift to
America’s seniors, but it is precisely the opposite.

The IRA has done little to deliver the savings seniors were promised; it has
actually led to higher costs. Monthly premiums for Medicare Part D
prescription drug plans have risen sharply since the IRA became law.
According to the Kaiser Family Foundation, premiums for Medicare
prescription drug plans spiked 21 percent in the year after passage of the
law. The Council for Affordable Health Coverage estimates that number
could skyrocket another 50 percent or more next year. At the same time, the
number of Part D plans seniors can choose from has fallen dramatically.

Remember, the stated goal of the IRA was to make prescription medicines
cheaper for seniors. Instead, Biden and Democrats in Congress managed to
make monthly premiums for prescription drug coverage more expensive.
As if this wasn’t enough, the IRA also created a $3 billion new federal
bureaucracy that will allow more government interference in decisions that
should be between patients and their doctors.

History shows that price controls never achieve their stated ends and the IRA’s
price controls are further evidence. Basic economics dictates that imposing
price controls on one class of products will simply force manufacturers to stop
producing or investing in those products. This, in turn, leads to scarcity of the
price-controlled product.

This isn’t theoretical. Patients in countries that allow drug price controls
consistently lack access to novel medicines. More than half of new drugs
approved from 2018 to 2022 were launched first in the United States,
according to a recent analysis from the RAND Corporation. Patients living in
other countries routinely have to wait an additional year to access newly
approved medicines.

Another recent study found that patients on public insurance plans in the
United States have access to 85% of new drugs approved from 2012 to 2021.
In Germany, the United Kingdom, and France, publicly insured patients have
access to 61%, 48%, and 43% of new drugs, respectively.

The lack of drug price controls in the United States is a major reason we’ve
become the world’s pharmaceutical leader. As many as two-thirds of new
medicines originate in the United States.

The drug pricing provisions in the IRA are in no way a “negotiation.” In a true
negotiation, both parties have the ability to walk away from the table. But
companies that do not comply with the IRA’s price controls have to pay up to
a 95% tax on the gross sales of the medicine in question. The 95% tax creates
using a similar mechanism to impose price controls on any consumer product on a whim. Nationalizing entire industries is what socialist dictatorships do, not America.

Instead of hiring more bureaucrats to set up a new price control board,
Congress should work to lower Medicare premiums, increase plan choices,
and require insurers and pharmacy benefit managers to share discounts,
rebates, and savings with patients. It’s also time that lawmakers take a hard
look at foreign countries who are buying U.S.-developed medicines for
pennies on the dollar. American patients shouldn’t be subsiding the rest of the
world’s access to medicines.

For all these reasons and more, we welcome the opportunity to work with you
to enact meaningful, market-based reforms that work for all Americans.


Charles Sauer
Market Institute

Ryan Ellis
Center for a Free Economy

Brent Gardner
Americans for Prosperity

Grover Norquist
Americans for Tax Reform

Pete Sepp
National Taxpayers Union

Saulius “Saul” Anuzis
American Association for Senior Citizens

James Martin
60 Plus Association

Grace-Marie Turner
Galen Institute

Karen Kerrigan
Small Business & Entrepreneurship Council

James Edwards
Conservatives for Property Rights

Ashley Baker
Committee for Justice

John Goodman
Goodman Institute

Annettee Meeks
Freedom Foundation of Minnesota

Seton Motley
Limited Government

Casey Given
Young Voices

Tom Hebert
Open Competition Center

Christopher G. Sheeron
Action for Health

David Williams
Taxpayers Protection Alliance

Jeffrey Mazzella
Center for Individual Freedom

Dick Patten
American Defense Business Council

Kent Kaiser
Trade Alliance to Promote Prosperity

Patrick Brenner
Southwest Public Policy Institute

Tom Schatz
Citizens Against Government Waste

Bob Carlstrom
AMAC Action

Tony Zagotta
Center for American Principles

Paul Gessing
Rio Grande Foundation

Gerrard Scimeca
Consumer Action for a Strong Economy

Elizabeth Hicks
Consumer Choice Center

Carrie Lukas
Independent Women’s Forum

Sally Pipes
Wayne Winegarden, Ph. D.
Pacific Research Institute

Andrew Langer
Coalition Against Socialized Medicine

Paul Teller
Advancing American Freedom

C. Preston Noell
Tradition, Family, Property

Charles Moran
Log Cabin Republicans

Dee Stewart
Center for Innovation and Free Enterprise

Steve Moore
Unleash Prosperity Now

Matt Dean
Heartland Institute

Ryan Walker
Heritage Action

Phil Kerpen
American Commitment

Ed Martin
Eagle Forum Education & Legal Defense Fund

Thomas Bradbury