Tammy Baldwin Releases New TV Ad, “Boy Did He”

MILWAUKEE — Tammy Baldwin’s campaign for U.S. Senate released a new television ad today that focuses on the issue of Medicare. The new ad “Boy Did He” highlights Tommy Thompson’s record as a Cabinet Secretary for President George W. Bush and the fact that he cut a sweetheart deal with drug companies that increased the cost to taxpayers. It also focuses on the fact that after working for Bush, Thompson cashed in on his connections and profited off his work for drug companies.

Thompson left Wisconsin for Washington and went to work for the Bush Administration, where he was the “point man” on a plan to make it illegal for the government to negotiate lower prescription drug prices. [Milwaukee Journal Sentinel 11/21/2003, Milwaukee Journal Sentinel, Sept. 4, 2012]

The Los Angeles Times reported: “U.S. drug manufacturers are reaping a windfall from taxpayers because Medicare’s privately administered prescription drug benefit program pays more than other government programs for the same medicines, a House committee charged in a report Thursday. The House Committee on Oversight and Government Reform found that taxpayers are paying up to 30% more for prescription drugs under Medicare’s privatized Part D program for seniors and the disabled than under the government’s Medicaid program for the poor.” [Los Angeles Times, 7/25/2008]

And the House Committee on Oversight and Government Reform issued a report which said: “If Medicare Part D paid the same price as Medicaid for all drug purchases, the total savings to the taxpayer over the next ten years could be as much as $156 billion. Beneficiaries could also save up to $27 billion.” [House Committee on Oversight and Government Reform, July 2008]

Thompson “lobbied tirelessly” and “played a key role” in pushing through what the former U.S. Comptroller General David Walker called “the most fiscally irresponsible piece of legislation since the 1960s,” adding $242 billion to the federal deficit. [Politico, 10/7/2008; Philadelphia Inquirer, 12/4/04; Forbes, 11/20/2009]

On Thompson’s sweetheart deal with the drug companies, the Milwaukee Journal Sentinel reported, “Republican Sen. John McCain of Arizona, one of the few conservatives to stick to his principles in opposition to the creation of a major new entitlement program, added that the subsidies to “special interests” such as insurance and drug companies stand in stark contrast to the absence of any means of keeping costs from skyrocketing. In particular, he noted (as did many progressives) a truly bizarre section of the legislation that literally prohibits the government from bargaining over price with the drug companies and other suppliers to beneficiaries.”

In 2005, Thompson left the Bush administration to cash in on his Washington D.C. connections. According to public records and his personal financial disclosures, Thompson made a minimum of $724,100 from the pharmaceutical industry since leaving the Bush administration. [Personal Financial Disclosure, filed 8/13/2007; Personal Financial Disclosure, filed 1/27/2012; Curaxis SEC form S-1/A, 12/8/05; United Therapeutics SEC form DEF 14A, 4/30/2012]

Speaking of his time in the Bush administration, Thompson admitted he and his colleagues were changed by Washington. In a Presidential debate, Wolf Blitzer asked: “The question is, what’s President Bush’s biggest mistake over these past several years?” Thompson answered: “Because we went to Washington to change Washington, Washington changed us. We didn’t come up with new ideas.” (CNN Transcript, June 5, 2007)

“Boy Did He” Script: “Tommy Thompson left Wisconsin for Washington.  Boy did he. Working for George Bush, Tommy cut a sweetheart deal with drug companies, making it illegal for Medicare to negotiate lower prescription drug prices. It cost taxpayers $156 billion dollars.Then Tommy made millions working for a lobbying firm that represents drug companies. ‘We went to Washington to change Washington, and Washington changed us.’ Tommy Thompson.  He’s not for you anymore.”

 Background 

Tommy Thompson left Wisconsin for Washington

Capital Times: “Thompson Off To DC.” Under the headline “Thompson Off To D.C.” the Capital Times reported on December 28, 2000, “Tommy Thompson today made it official — he will resign as governor of Wisconsin to head the U.S. Department of Health and Human Services.  President-elect George W. Bush made the announcement at a press conference in Washington, D.C., calling Thompson a ‘creative, compassionate conservative,’ adding that ‘real welfare reform began in Wisconsin.’ Thompson promised he would play an active role in advancing Bush’s social agenda.” [Capital Times, 12/29/2000]

Working for George Bush, Tommy cut a sweetheart deal with drug companies, making it illegal for Medicare to negotiate lower prescription drug prices.It cost taxpayers $156 billion dollars.

Journal Sentinel Called Thompson “The Administration’s Point Man” On Medicare Part D.  In a story on the bill that created the Medicare Part D prescription drug plan, the Milwaukee Journal Sentinel reported: “Health and Human Services Secretary Tommy G. Thompson, the administration’s point man on the issue, said the plan was “very, very good for Wisconsin,” above all because it offers more than $ 25 billion in new payments to rural health care providers nationwide over 10 years.” [Milwaukee Journal Sentinel 11/21/2003]

Thompson “Lobbied Tirelessly” For Passage Of Medicare Part D.  According to the Philadelphia Inquirer, “As a point man for Bush’s ‘compassionate conservatism,’ Thompson backed welfare programs that encouraged marriage. He lobbied tirelessly for Bush’s Medicare overhaul, including the prescription-drug benefit, which begins in 2006. He successfully pushed initiatives to offer more preventive health services under Medicare and to expand the use of electronic medical records.” [Philadelphia Inquirer, 12/4/04]

Thompson Played a “Key Role” In Creating Medicare Part D.  Politico reported: “[Thompson] also oversaw the federal response to the 2001 anthrax threats and played a key role in formulating the Medicare Part D prescription drug plan.” [Politico, 10/7/2008]

Medicare Part D Barred The Government From Negotiating Lower Prices For Drugs.  The New York Times reported: “Drugs tend to be cheaper under the Medicaid programs because the states are the buyers and by law they receive the lowest available prices for drugs. But in creating the federal Part D program, Congress — in what critics saw as a sop to the drug industry — barred the government from having a negotiating role. Instead, prices are worked out between drug makers and the dozens of large and small Part D drug plans run by commercial insurers.” [New York Times, 7/18/2006]

House Oversight Committee: Taxpayers Pay 30% More Under Medicare Part D.  The Los Angeles Times reported: “U.S. drug manufacturers are reaping a windfall from taxpayers because Medicare’s privately administered prescription drug benefit program pays more than other government programs for the same medicines, a House committee charged in a report Thursday. The House Committee on Oversight and Government Reform found that taxpayers are paying up to 30% more for prescription drugs under Medicare’s privatized Part D program for seniors and the disabled than under the government’s Medicaid program for the poor.” [Los Angeles Times, 7/25/2008]

Politifact Rated Baldwin’s Claim That “Federal Law Adopted ‘Under Tommy Thompson’s Watch’ Prohibits The Federal Government From Negotiating For ‘Better Prices’ On Prescription Drugs For Senior Citizens” True.  In a September 2012 Politifact wrote, “Baldwin said federal law adopted ‘under Tommy Thompson’s watch’ prohibits the federal government from negotiating for ‘better prices’ on prescription drugs for senior citizens. Her reference was to the Medicare Part D prescription program, which Thompson lobbied for and which includes the prohibition she stated. We rate Baldwin’s statement True.” [Politifact, 9/4/12]

• Thompson campaign Senior Advisor Brian Nemoir, “Acknowledged That The Federal Government Is Prohibited From Negotiating Drug Prices On Behalf Of Medicare Part D Plans.” “When we checked back with Nemoir, he acknowledged that the federal government is prohibited from negotiating drug prices on behalf of Medicare Part D plans.” [Politifact, 9/4/12]

• Thompson campaign Senior Advisor Brian Nemoir “Acknowledged That The Prohibition On The Federal Government Was Done Under Thompson, “Moreover, Nemoir acknowledged that the prohibition on the federal government was done under Thompson.” [Politifact, 9/4/12]

Former Comptroller General: Part D Is “The Most Fiscally Irresponsible Piece Of Legislation Since The 1960’s.”  In an editorial in November 2009, Bruce Bartlett wrote: “This fact became blindingly obvious to me six years ago this month when a Republican president and a Republican Congress enacted the Medicare drug benefit, which former U.S. Comptroller General David Walker has called ‘the most fiscally irresponsible piece of legislation since the 1960s.’” [Bruce Bartlett, Editorial, Forbes, 11/20/2009]

Republican John McCain Criticized Medicare Part D For Prohibiting Drug Price Negotiation.  During debate over passage of the legislation that created the Medicare Part D benefit, the Milwaukee Journal Sentinel reported: “Republican Sen. John McCain of Arizona, one of the few conservatives to stick to his principles in opposition to the creation of a major new entitlement program, added that the subsidies to “special interests” such as insurance and drug companies stand in stark contrast to the absence of any means of keeping costs from skyrocketing. In particular, he noted (as did many progressives) a truly bizarre section of the legislation that literally prohibits the government from bargaining over price with the drug companies and other suppliers to beneficiaries. He also noted that this is precisely what enables the Veterans Administration and the core of the Medicare bureaucracy that deals with hospitalization to keep drug prices below what they are in pharmacies for veterans and retired people in hospitals.  It is no accident, McCain said, that the profits of drug companies are officially expected to grow by $9 billion as a result of this protection from having to negotiate with the biggest bulk purchaser of them all.” [Milwaukee Journal Sentinel, 11/30/2003]

Committee On Oversight And Government Reform Found That Medicare Part D Could Save As Much As $156 Billion Over 10 Years If It Paid The Same Prices As Medicaid.  In 2008, the House Committee on Oversight and Government Reform issued a report which said: “If Medicare Part D paid the same price as Medicaid for all drug purchases, the total savings to the taxpayer over the next ten years could be as much as $156 billion. Beneficiaries could also save up to $27 billion.” [House Committee on Oversight and Government Reform, July 2008]

• Unlike Medicare Part D, Medicaid Uses It’s Market Power To Require Discounts From Drug Companies In Order To Participate In The Program.  In 2008, the House Committee on Oversight and Government Reform issued a report on the differences between prescription drug buying through Medicare Part D and Medicaid. “Under Medicare Part D, drug prices are established through negotiations between the private Part D insurers and the drug manufacturers. By contrast, drug prices in the Medicaid program are regulated by the 1990 Medicaid drug rebate law.” The report explained: “Under the Medicaid law, drug manufacturers are required to provide Medicaid significant price discounts as a condition for their participation in the program.” [House Committee on Oversight and Government Reform, July 2008]

Report Found Huge Price Differences On Specific Drugs Between Medicare Part D and Medicaid.  In 2008, the House Committee on Oversight and Government Reform issued a report on the differences between prescription drug buying through Medicare Part D and Medicaid. “For individual drugs, the differences in the prices under the Medicare Part D program and the Medicaid program can be large. For one common antibiotic, the manufacturer charged Medicare Part D insurers almost $10 more per pill than the manufacturer charged Medicaid. The manufacturer of a frequently used anti-convulsant drug provided the Part D insurers with an average discount of less than 3% compared to a 70% discount for Medicaid. The manufacturer of a popular sleep medication provided the Part D insurers with an average discount of less than 10% compared to a 65% discount for Medicaid.” [House Committee on Oversight and Government Reform, July 2008]

Thompson made millions working for a lobbying firm that represents drug companies and said ‘We went to Washington to change Washington, and Washington changed us.

Thompson Worked As An Akin Gump Partner From March 2005 To January 2012. [Personal Financial Disclosure, filed 1/27/2012]

While Thompson Was There, Akin Lobbied For Multiple Big Pharmaceutical Companies.  While Thompson was there, Akin Gump’s clients in the pharmaceutical industry included Covidien, Cryolife, Johnson & Johnson, Novartis, Novavax, PharmAthene, Pfizer, Abbott Laboratories, and Akorn. [Open Secrets, Akin Gump et al client list, 2011; Open Secrets, Akin Gump et al client list, 2010; Open Secrets, Akin Gump et al client List, 2005]

Thompson Received Over $700,000 From The Pharmaceutical Industry Since Leaving HHS.  According to public records and his personal financial disclosures, Thompson made a minimum of $724,100 from the pharmaceutical industry since leaving the Bush administration. [Personal Financial Disclosure, filed 8/13/2007; Personal Financial Disclosure, filed 1/27/2012; Curaxis SEC form S-1/A, 12/8/05; United Therapeutics SEC form DEF 14A, 4/30/2012]

Thompson Held Between $1.2 Million and $2.9 Million In Stock In The Pharmaceutical Industry.  In January 2012, Thompson reported owning between $1.2 million and $2.9 million in stock in the pharmaceutical industry. [Personal Financial Disclosure, filed 1/27/2012]

Thompson Said His Net Worth Was Approximately $13 Million.  Reported the Milwaukee Journal Sentinel in January 2012, “Thompson’s report shows assets of more than $13.1 million and less than $44 million, and liabilities of more than $3.1 million and less than $9.3 million. In the interview, Thompson said his actual net worth is roughly $13 million.” [Milwaukee Journal Sentinel, 1/26/12]

Cashing In On Connections: Close Friend Says Thompson Took Advantage Of Opportunities From Serving In The Bush Administration.  In 2007, the Milwaukee Journal Sentinel published a profile article examining Tommy Thompson’s transition to the private sector. Under the sub headline “Cashing in on Connections,” the article pointed out: “Observers say there is no doubt that Thompson – like many other politicos – is capitalizing on the connections he built over a career in politics.” “He took a look at the opportunity that serving in the Bush administration gave him to finally go out and make some money,” said William “Butch” Johnson, a close friend and political ally of Thompson’s since the 1970s.” [Milwaukee Journal Sentinel, 6/10/2007]

Thompson: “Washington Changed Us.”  Speaking of his time in the Bush administration, Thompson admitted he and his colleagues were changed by Washington. In a Presidential debate, Wolf Blitzer asked: “The question is, what’s President Bush’s biggest mistake over these past several years?” Thompson answered: “Because we went to Washington to change Washington, Washington changed us. We didn’t come up with new ideas.” (CNN Transcript, June 5, 2007)

Baldwin Opposed the Bill that Gave a Handout to Drug Companies

Baldwin Op-Ed Criticized Medicare Legislation For Prohibiting Price Negotiation. During consideration of the bill that created Medicare Part D, Tammy Baldwin wrote an Op-Ed to the Capital Times. Baldwin said: “This bill does nothing to address the ever-rising cost of prescription drugs. Instead of including measures to ensure that drugs are affordable, this bill actually would prohibit the federal government from negotiating lower drug prices for Medicare beneficiaries. Also, the bill does not allow seniors to obtain affordable drugs from Canada.” [Capital Times, 11/22/2003]

Baldwin Spoke On The House Floor Criticizing Medicare Legislation For Prohibiting Price Negotiation. During consideration of the bill that created Medicare Part D, Tammy Baldwin  spoke on the House floor in opposition to the bill. Baldwin said: “Aside from the meager benefit, there is nothing in this bill that addresses the ever-rising cost of prescription drugs. Instead of including measures to ensure that prescription drugs are affordable, this bill actually prohibits the federal government from negotiating lower drug prices for Medicare beneficiaries. Instead of helping seniors obtain affordable prescription drugs, this bill provides partial coverage of drug spending until total costs reach $2,250 and then leaves seniors high and dry.” [Congressional Record Page H12234, 11/21/2003]

Baldwin Voted Against Drug Plan That Gave $2 Billion Windfall to Drug Companies.  In 2003, Baldwin voted against the Republican Medicare prescription drug plan (for more info on bill, see below). Medicare Part D also gave an estimated $2 billion or more windfall in 2006 alone to drug makers. The windfall was a result of the transfer of millions of low-income people into the new Medicare Part D drug program. [Vote #669, 11/22/2003; New York Times, 7/18/06]

Baldwin continued to push for negotiation of prescription drug prices

Baldwin Voted To Allow Medicare Prescription Drug Negotiation.  In 2007, Baldwin voted for a bill requiring the Health and Human Services (HHS) Department to negotiate with drug companies for lower prices. The bill included discounts, rebates, and other price concessions that may be charged for drugs covered under the Medicare Part D prescription drug program. The bill passed 255-170. [Vote #23, 1/12/2007; Chicago Tribune, 1/13/07; CQ Weekly, 1/08/07] 

Tammy Baldwin Signed A Letter To Pelosi And Reid Calling For Prescription Drug Negotiation In Health Care Reform.  On December 22, 2009 Tammy Baldwin, signed a letter to Speaker Nancy Pelosi and Majority Leader Harry Reid encouraging them to include within pending health care reform legislation, a provision allowing Medicare to negotiate with drug companies over prescription drug prices under Medicare Part D. [Welch letter to Speaker Pelosi and Majority Leader Reid, 12/22/2009]

Tammy Baldwin Signed a Letter to Speaker Boehner Encouraging him to Allow Medicare to Negotiate for Lower Prescription Drug Costs.  On June 16, 2011 Tammy Baldwin signed a letter to speaker Boehner encouraging him to include a provision allowing Medicare to negotiate with drug companies to buy drugs in bulk at discounted prices in his plan to reduce the deficit. The letter said, “We have the opportunity to dramatically curb the costs, and at a time of tough budgets, for both families and the government, we simply cannot afford to leave these real savings on the table. We strongly encourage you to include this reform in any proposal to reduce the national debt.”[Hinchey letter to Speaker Boehner, 6/16/11 (via Votesmart)]

Tammy Baldwin Signed a Letter Pushing for Bulk-Rate Negotiation of Prescription Drugs.  On October 5, 2011 Tammy Baldwin signed a letter to the members of the Joint Select Committee on Deficit Reduction, urging them to require Bulk-Rate Negotiation of Prescription Drugs under Medicare Part D, as Medicaid already does. The letter said, “While the administration of Medicare Part D has been a lost opportunity for cost savings thus far, allowing the Secretary of Health and Human Services to negotiate prescription drug prices as she does for Medicaid beneficiaries would lead to significant deficit reduction in the future without sacrificing seniors’ benefits. We have the opportunity to dramatically curb the costs, and at a time of tough budgets for both families and the government, we simply cannot afford to leave these real savings on the table. We strongly encourage you to include this reform in the Committee’s legislation to reduce the national debt.” [Hinchey letter to members of the Joint Select Committee on Deficit Reduction, 10/5/11 (via Votesmart)]

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• Tammy Baldwin Releases New TV Ad, “Boy Did He”