Sometimes a bad idea is a bad idea, no matter how you package it. New York Governor Andrew Cuomo is trying again, after his $600 million opioid tax was slapped down in December by an Obama appointed federal judge.
Proponents of the earlier tax scheme pointed to a key provision which forbade manufacturers from passing along the cost to patients. This was an essential element of the plan — who in their right mind would want to punish patients whose doctors legitimately prescribe opioids for acute pain?
Even supporters of sin-taxes recognize the folly of squeezing vulnerable patients to pay for an opioid crisis now fueled by the illegal fentanyl trade.
In December, U.S. District Court Judge Katherine Polk Failla ruled against “the method by which the act extracts payments from opioid manufacturers and distributors.” Because the law prevented manufacturers from passing costs on to patients, even in other states, the court found that the punitive tax was unconstitutional.
As a result of the ruling, Governor Cuomo was in a bind. He could have simply abandoned the cash grab, or he could have tweaked the law to make it constitutional by permitting the tax to be passed along to pain patients. Unfortunately, he went with the latter. Like an addict, he went for the fix, regardless of the harmful consequences.
It begs the question, why did the governor propose, and the legislature pass, an illegal funding mechanism in the first place, especially since treatment and prevention are urgently needed and politically popular?
There’s an obvious reason: Albany lacks fiscal discipline. Despite very high tax rates, there’s no money left to fund legitimate programs.
But the real reason Governor Cuomo first relied on an unconstitutional tax was that it was less bizarre than the alternative he’s now chosen.
Taxing legal opioid prescriptions isn’t just bad politics, it’s bad policy. “Taxing patients in pain” wouldn’t make a popular campaign slogan. And because legitimate opioid prescriptions are no longer driving opioid abuse, taxing pain sufferers to pay for treatment and prevention of a black-market fentanyl fueled problem has no rational justification.
It’s not a tax on the bad actors, its a tax on the most sympathetic ones: pain patients. It’s also a tax on the government because for over a decade Medicare has been the single largest payer for prescription opioids.
The tax was constitutionally flawed in 2018, but the legal “fix” exposes the broader gambit as the cash grab it was from day one. Funding a slush fund on the backs of today’s pain patients is foolish. Patients didn’t cause the epidemic and taxing them won’t fix it or prevent addiction.
Instead, states should address the epidemic by tackling the issues in a constructive, and when possible, bipartisan manner. Despite the political rancor, Congress came together last year to pass The SUPPORT act, signed by President Trump in October. The law, which garnered nearly unanimous bipartisan support, was lauded by the American Medical Association for touching “on almost every aspect of the epidemic,” including stemming the flow of fentanyl through the mail, supporting research for new non-addictive painkillers, and targeted funding for prevention and treatment programs.
Critics of the plan aren’t opioid crisis deniers. We believe that there are more sensible, compassionate — and effective — tools to address the problem than simply taxing pain patients to conjure up money for a so-called “opioid stewardship fund.” If there’s one thing Albany has taught us, it’s that the state isn’t a good steward of slush funds, regardless of the severity of the problem at hand.
Jeff Stier is a Senior Fellow at the Consumer Choice Center.