House Ways and Means Committee chair Charles Rangel (D-NY) is looking for ways to fund the Democrats’ ambitious health care package, priced at an estimated $1.6T, and thinks he may have located $37B of it – by eliminating tax deductions for prescription drug advertising.
According to Bloomberg, Rangel admitted it would be messy, saying the move would amount to a brand new tax on pharmaceutical companies, but said it’s on the table as work on the bill moves forward.
The prescription drug ads aimed at consumers are controversial, since the targets of the advertising can’t do anything about responding unless they can coerce their doctor into going along. That makes them a target on Capitol Hill.
Wrangel told Bloomberg, “I do it. I go to the doctor and say, ‘Did you ever think about ordering this for me?’ If he says no, I don’t like him, because they promised me on TV that I have no problems at all.”
RBR/TVBR observation: We don’t know if this plan will make it into the bill, but we do know this: It will not generate $37B in savings for the government – the pharmaceuticals will simply be forced to scale back their advertising, and if they spend less, the government – and broadcasters – will earn less.