President Joe Biden’s call to authorize Medicare to negotiate lower prices for prescription drugs has energized Democrats with a politically popular idea that they have been pressing for nearly 20 years just to find frustration
President Joe Biden’s call to authorize Medicare to negotiate lower prices for prescription drugs has energized Democrats with a politically popular idea that they have been pressing for nearly 20 years just to find frustration.
But they still don’t have a clear way to enact the legislation. That’s because a small number of Democrats remain uncomfortable with government price restrictions for pharmaceutical companies.
House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer will need all the Democratic votes in a narrowly divided Congress. Otherwise, Democrats may have to settle for an agreement that falls short of their goal. Or they can take the issue to the 2022 mid-term elections.
“There is a way,” said Rep. Peter Welch, D-Vt., One of Pelosi’s lieutenants. “But there is also a challenge, and the challenge is that we have very small margins.”
“This is not a closed deal,” continued Welch. “We have a president and a speaker, but‘ pharmaceutical ’is very powerful.” Pharma is a nickname for the industry and its main lobbying group, Pharmaceutical Research and Manufacturers of America, or PhRMA.
The industry thwarted President Donald Trump’s multifaceted efforts to restrict his pricing power. Even though Trump took office by accusing drug makers of “getting away with murder” and swearing that he would end it, the companies stepped out of office with just a few cuts and cuts.
The PhRMA industry lobby group is considered to be one of the most qualified operators in Washington. Its mission: to preserve a clause in the 2003 law that created Medicare’s pharmaceutical benefit, preventing the government from interfering in price negotiations between drug manufacturers and insurers. This was enacted before the $ 1,000 pills became obsolete.
PhRMA CEO Stephen Ubl notified after Biden’s speech to Congress last week that the industry is ready to defend its prerogative. “Giving the government the power to arbitrarily determine the price of drugs is not the right approach,” he said in a statement, arguing that it would stifle innovation. This measured language belies the influence of the group. It is usually among the top five spenders in lobbying in Washington and in networks with allied groups in the states.
“I don’t think anyone is fully prepared for the attack we expect from PhRMA,” said Margarida Jorge, campaign director for Lower Drug Price Now, a coalition that supports the Medicare negotiations. “We will see a much more accelerated game.”
Pelosi put Medicare’s negotiations back into play with the reintroduction of an ambitious bill she proposed in the House in 2019. Medicare would use a lower average price in other economically advanced countries to negotiate major drugs. Companies that refused to negotiate would be hit by a high tax. Pharmaceuticals that raise prices above the inflation rate owe Medicare rebates. Hundreds of billions of dollars potentially saved through legislation would be reinvested in other health programs. Private insurers that cover people of working age could guarantee the lowest Medicare prices.
In his speech at a joint session of Congress, Biden invited lawmakers to imagine the possibilities. “The money we saved, which is billions of dollars, can be used to strengthen the Affordable Care Act and expand Medicare benefits without costing taxpayers an additional penny,” said the president. “It is within our power to do so. Let’s do it now. We’ve talked about this long enough. “
But Republican Senator Chuck Grassley of Iowa is asking Biden to lower his vision a little. Grassley opposes the Medicare trading authority, but supports the requirement that pharmacists pay discounts for price increases above the rate of inflation – a potential compromise. “I hope the president will reconsider the liberal chimera in favor of the great bipartisan victory,” said Grassley.
Research has consistently shown strong public support for authorizing Medicare to trade. “This is very big among voters’ concerns and is also highly promised by Biden in the campaign,” said policy expert John Rother, a longtime advocate of restrictions on drug prices. The Chamber’s Energy and Commerce Committee will hold a hearing on Tuesday on the matter.
One option for Pelosi and Schumer would be to merge Medicare legislation into one gigantic bill delivering on the promises of Biden’s “American Employment Plan” on social programs and infrastructure. This vehicle appears to offer the greatest chance of overcoming restrictions on the price of medicines. But the political dynamics are different in each chamber. What can work in the House may not get anywhere in the Senate.
With its 50-50 split, the Senate appears to be the bottleneck. The overwhelming majority of Democrats are in favor of Medicare negotiations, but some are not declared.
Among them is Sen. Bob Menendez of New Jersey, whose office says he believes that “any drug pricing bill should generate real savings for consumers at the pharmacy counter, not just get savings for the government or the system in general. “.
“It will be hard work,” said policy expert Rother. “But I don’t think you know for sure until you try.”