AARP Euthanizing America's Healthcare System

Ladies and gentlemen, this is AARP Euthanizing America's Healthcare System. Please welcome, co-founder of the Committee to Unleash Prosperity, Stephen Moore, President of American Commitment, Phil Carpin, and your moderator, Executive Director of the Coalition Against Socialized Medicine, Jack Calvertinos. Alright, greetings. I'm Jack Calvertinos, really excited about this panel. Excited to have, as you heard, Steve Moore, but what the moderator didn't say, what the President didn't say, was you were President Trump's economic advisor and really the architect of the tax plan. Don't you miss Donald Trump? Come on, let's face it. Was he great or what? And we have Phil Carpin, who is a true warrior on this issue and many others, who is head of American Commitment, and we're gonna get right into it today. So over the last 10 years, you know, what have we been talking about with healthcare? It's been Obamacare. It's about repeal and replace. It's about getting drug prices down and what President Trump tried to do, and I served at HHS and Secretary Azar tried hard to get those drug prices down. Mandates, COVID mandates, we've been through a lot. But what a lot of people haven't really focused on is what happened right before the election, which was this IRA and the drug pricing and healthcare provisions in there, passed by the Democrats and their interest groups. So today, we're gonna talk about one of those interest groups and talk about that IRA, mislabeled the Inflation Reduction Act, with our friends here. So let's start with Phil. Phil, you know, most people see that AARP is the group that has that nice, slick magazine, that has the discounts for seniors. They've sort of transformed themselves, though, into this marketing entity with a advocacy arm, and they make a lot of money from their relationships. Tell us about these royalties they make. I've heard that they've made upward of eight billion dollars since 2007. Yeah, it's pretty incredible. The membership dues that they collect are now a tiny fraction, just a little over 10% of the revenue they have on an annual basis. The principal business that they're in is not representing seniors. It's monetizing seniors. It's selling branded products to seniors, and in particular, their cash cow are the health insurance products, the Medicare Part D plans, the Medicare Advantage plans, but especially the Medigap supplemental insurance plans that they sell exclusively UnitedHealth products. And they've got an exclusive deal with UnitedHealth, the largest for-profit health insurer, which also owns one of the largest pharmacy benefit managers, OptumRx. And they make about a billion dollars a year in corporate royalties. And the way this works is every time someone enrolls in one of these health plans, they pay their monthly premium. AARP skims 4.95% off the top of every one of those premiums and pulls it out. It takes it for their general operating purposes. And I think that's what you call a junk fee. I mean, it seems to be the only junk fee that the Democrats and the president like, though, because so much of that money gets recycled into liberal advocacy and democratic politics. And so what you have is sort of the confluence of a notional nonprofit, but that's running billions of dollars through it, from a corporate partnership, and the advocacy always seems to benefit one political party. Let's, Steve, let's talk about that for a moment, because here you have one of the biggest players in Washington by total number of members and what we've just heard about their budget. How does that come, in your opinion, how does that compromise them as someone who's supposed to be this sort of fair dealer in Washington representing America's seniors? What does that do to them? Well, look, I call AARP American Association of Ripping Off Taxpayers, right? And I hope, one of the reasons I wanted to be here and come to talk to you folks, because we have senior citizens in this room, we have a lot of young people. Can we all make a pact? We're never gonna join the AARP. There's no way are we gonna join the AARP. I just turned 63, so I'm getting all these mailers every month, join up with the AARP. Look, the biggest crisis in America today is our massive government spending debt. You know, we are now up to, it's going up to 50 trillion dollars. Did you know that just since Biden came into office, he's been in office two years, the national debt forecast has gone up by six trillion dollars in two years. This is the most financially reckless president in American history. Now, what does that have to do with the AARP? They're in on it, right? The AARP has never seen a big government social welfare program they have not been in favor of. And by the way, love you, but shame on you for calling this the Inflation Reduction Act. This was not the Inflation Reduction Act. This was the Inflation Acceleration Act. It made inflation work. How many of you think we're reducing inflation? Come on, let's go to the grocery store. All of these problems are out there because we've spent too much money. AARP is right behind the president and the Democrats. This is not a nonpartisan organization either. They always side with the Democrats and the big spenders. And so please, if you're a member of the AARP, rip up your card and stop sending them your dues. Wow. Well, thank you also for calling me out on calling it the IRA or the Inflation Reduction Act. We should not use their terminology. This was supposed to be like the reconciliation bill they misnamed it. It's like when they called, remember what they called the Obamacare bill? They called that the Affordable Care Act. It's the Unaffordable Care Act. Health prices have gone up ever since we passed that bill. By the way, Jack, the calls from AARP members to AARP during the Obamacare debate were 14 to 1 against it and they endorsed it. Wow. So this is an important point though because, you know, if you're a senior citizen and you're worried, you know, we're all and I'm getting up there and I'm getting a little long in the tooth myself. I mean, what do you worry about? You worry about cancer. You worry about heart disease. You worry about Parkinson's. You worry about obviously Alzheimer's, these things. What that sinister bill did was because of these price controls on the drug companies, the evidence is very clear. It's going to take longer to find the cures for these terrible, crippling diseases. How is that in the interest of senior citizens? I mean, it's craziness. Thomas Philipson, one of the top economists in the country, what did he say, Phil? He said that the IRAs, the reduction in private sector cancer drug research that will be caused by that bill is nine times the amount of Joe Biden's moonshot. Right. So they increased it by the amount of the moonshot. Then they put this bill in to cut it by nine times as much in the private sector. So this is the way to lose the race for the cure for all of these diseases. And of course they don't. And by the way, the other thing is that the seniors, the polls show very clearly, even the AARP's own polls show that the major concern of American seniors is the cost of health insurance. Guess what? This is going to make health insurance for seniors more expensive, not less expensive. Okay, so we have jumped right into this bill that passed really right before the election. People didn't even realize what was in it. It wasn't read. And what our two panelists here are talking about are a level of price controls, which will lead to price, which will lead to drug rationing that they know all about in Canada, know all about in England. And yet here in this country, thankfully, we don't. And we're now on the slippery slope. So Phil, do you want to just very briefly just describe without getting overly wonky, what are these price controls that they slipped into this mega spending bill? Well, they really did. They're three, they're three sort of major buckets of them. One is a cap on the annual increase in the price of a given drug equal to the inflation rate. And that one I think is more likely to increase prices than lower them in the near term, because drug price inflation has been running about two and a half percent. Overall inflation has been running, you know, five, six, seven percent. And when you tell companies, you're going to be limited forever in how much you can increase each year, they're probably all going to go for the maximum. So there's going to be a, there's going to tend to be upward pressure. So I think that's just a really nonsensical provision. They haven't thought through the context that they passed that in. The second is a provision that actually prohibits a rule that the Trump administration put in that would have required all discounts and rebates in Medicare Part D to be passed on to seniors at the point of sale. And somehow AARP was on the wrong side of this. They didn't want rebates passed on to seniors, probably because their corporate partner, UnitedHealth, also owns the largest pharmacy benefit manager that's been pocketing those rebates, OptumRx, which is a division of UnitedHealth. But the one that's the real killer in terms of innovation and, you know, the research money that's going to go into cancer drugs and Alzheimer's drugs and all the things Steve was talking about is this fake negotiation provision. And, you know, they've got all these polls that say negotiation is very popular. So they say, oh, we just want to negotiate. The problem they have is every time CBO has ever looked at negotiation, they say you can't save any money with negotiation because the plans are already extremely aggressive negotiators. So HHS can't do any better job other than the private plans do in Medicare Part D. But if you had a hard price control, if you had a penalty to really whack them if they didn't go along with what the secretary wants, then you could lower prices. So what they did is they said we're going to have a quote-unquote negotiation. Here's how it works. The secretary sits down with the manufacturer. They say what they think the price should be. The manufacturer doesn't have to go along. But if they don't go along, they get taxed 95% of their total sales of that product over the past year. Now, I don't consider that negotiation. And in fact, other than wanting the dishonest political talking point of using the word negotiation, there would have been no reason to even go through this charade. They could have just said the secretary set the price. Some might say it's extortion. Yeah, they could have just said the secretary sets the price, which is essentially what they've done, but they dressed it up so that they can make this argument. Now, the problem with this, I think we all want lower prices, but the problem with just having the government set the price is it really messes up the economics of medical research because there are tons of drugs that don't work out for everyone that does. And so on average, I mean Tufts runs these numbers. I haven't necessarily seen the latest one, but it's something like a billion two or a billion five, somewhere in that range on average to develop a new drug and bring it to market. Because you get a bunch of dry holes for each one that works out. So the way the economic works is you get that patent window and you get to charge a lot to make your money back to have a return on capital for your investors and so forth. And so if you, if the government clips off the top, if they basically say, when you hit a home run, you don't get the benefits of that, that has massive effects. And now the economics don't work for doing a lot of these trials. I mean, this is socialism. And the really interesting thing, Jack, is when they were talking about doing this as a standalone bill, they tried to replace all the private sector research. They were going to, they knew they were going to disincentivize with a big plus up to NIH. This bill didn't even have that. So they just nuked the incentive. And we've already seen four or five major trials canceled because the company said the economics of this aren't going to work. And yeah, I mean, I don't think people really realize that because our wonderful fair press has not mentioned, Steve, that four different clinical trials for brand new drugs have been canceled within the first five months of this atrocity of a bill having passed. I mean, this is something I'm sure you've seen a lot where big time initiatives that the Democrats can't pass in regular order through committees get thrown into these omnibuses and then the wool gets pulled over people's eyes. Well, you were right that nobody ever reads these bills, these thousand or more page bills. So no, you're right. Nobody knew what was in it. What was the old line from, from, you know, Speaker Pelosi that we'll read it after we pass it. Of the 30 major wonder drugs over the last two decades that have been introduced on the market, 27 of them were introduced in the United States. That's where they came from. The rest of the world is basically piggybacking off of the American health care system, which is another, you know, whole can of worms. But it is interesting to me when all the Democrats have been talking about for the last 30 years is how they're going to cut the cost of health care. Well, guess what? If you look over the last three decades, what two industries do you think have had the biggest increase in prices? You know what they are? Health care. Anybody know what the second one is? Education and college tuition, this cost of schooling. Isn't that interesting? The two industries that the government runs are the two industries where price is out of control. The biggest financial scandal in America today is what universities are charging our families, right? It's outrageous. And so why would we think that the government's gonna be able to control these costs? They're not. They can't control the cost because every and by the way, just since you got me going on this, never, never again should we ever allow the government to shut down our businesses and our schools and our churches. This was the most outrageous thing that ever happened in our country. Phil did a lot of research on this. Why would we believe that these people are gonna solve our health problem when they took a covid pandemic and they made it worse and they lied to us about every single thing about covid. Now we're going to trust him again. No, never again. Are we going to give the power to government to do that to our country? Well, Steve, the drug companies of the best lobbyists and the best connections will actually get a higher price out of the government. We'll end up paying even more and you know, other ones that aren't as connected, they'll have the disincentives and they won't develop drugs. I mean, the Pfizer charges 700 bucks for each course of Paxlivid because that's what the Department of Defense agreed with. Maybe it's worth it, maybe it's not. But with no market, how do you know? It's just with some government, it's somewhat what someone came up with. So we're either gonna pay too much or too little, but it's definitely not going to be the right price and it has all these disincentive downstream effects. It really is going to be a disaster. And Jack, the thing that I think was the most offensive about this bill is they took about 300 billion dollars out of Medicare prescription drug spending. I don't think you can do that without having a lot fewer cures developed. But even if you thought you could, they don't keep the money in Medicare. They didn't say we're gonna cut drug spending in Medicare by 300 billion and use it to strengthen the trust fund and you know, bulk up Medicare's finances. They used it to do supersized Obamacare subsidies to the insurance companies and to do green energy subsidies and electric cars. I mean, that's what the spending in this bill that they were paying for have absolutely nothing to do with Medicare. This is the crazy thing. Is that right, guys, that here you have President Biden and the state of the union making it seem like he's the great defender of Medicare. But what you just said was their very bill passed before the mid terms weakened it. And yet our wonderful friends in the media continue to make it seem as though it's the Democratic Party that is on the side of people. And when it comes to health care. So let's end on this note. Let's get a little political here with the issue of how conservatives and how the Republican Party can change this narrative that somehow they care less and we care less about health care. You know, here we're right on the heels of these awful historic mandates that have destroyed so many lives. This raid on Medicare and these price controls. What, gentlemen, do you think the GOP in the next year and the next two years can do to begin to shift that narrative that somehow the Democrats care more about health? One of the things that could be done so easily and we're making a lot of strides on this in the state. It's it's something that my buddy Lapper has been talking to with a lot of the governors and talked to Donald Trump about. Trump started to put this into effect. It's just transparency of the price of things. When you go look when you go to the hospital or you go to the doctor, you know, you have no idea what these things cost. You know, you just they don't tell you what they cost. And then you get the bill and you pass it on to the insurance company. So why not have them require these these doctors and hospitals to post the price? So when we know what we're paying for, right? I mean, it's like going into a store and saying, Oh, I love that dress and I'm gonna buy it and you don't know how it costs. And, you know, it's just so infuriating to me the way government screws everything up. I know this is a little bit off topic, but you know, there was a headline today in the newspaper that global CO two emissions greenhouse gas emissions were the highest they've ever been in history. We've spent $100 billion for the last 20 years trying to reduce carbon emissions, and they're higher now than ever before. And why is that? Because, of course, China and so all of these bills that the Democrats spend more and more money on. And now Biden wants another 500 billion for green energy programs. I say, Oh, no, not one more penny for that crap. I think supposedly Milton Friedman once said, If you put the government in charge of the Sahara, you'd have a shortage of sand. No, it's this. You know, Milton Friedman used to say this. So you notice this, folks. Every time we have a government program that's not working, what are the Democrats say? We have to spend more money. Have you noticed that they always shut down half these damn agencies? They are not working and balance the budget and return the money in the taxpayers. Here's my Steve Moore on fire. We see him on Fox. I'm gonna fire today. Let me just use this last minute we have to answer your question. I would urge Republicans to be much bolder than whatever they think. The boldest thing they get on health. Yes, yes, we've got for the last two years. We basically nuked the health care system in this country. We had record low emergency visits. We had record low inpatient utilization. People were scared to go to the hospital. They were scared to go to the doctor's. We have people dying of heart attacks and strokes because of lies from public health officials who made them think there was no room for them. And then we bailed out these hospitals over and over and over again with our health care money. So I think we need to take on the hospitals. We need to take on the insurance companies. We need to take on the government bureaucrats. We need to say we're gonna have a functioning system where you control your own health care dollars. And there's real competition, not one health system that dominates everything in town because we made the bureaucracy so bad that you can't run an independent physician's practice anymore because you can't deal with all of the government. So I think blow up as much of it as you can, put people in charge of their own health care and get physicians back in charge of running their own practice, not just cogs in these huge bureaucracy and put people and put parents in charge of the education system. So the money follows the parents, not the teachers unions. No more money into these intrusions group. It goes to the people, not the institutions. On that note, thanks to both of you. All right, guys. Thank you all. Thank you.