Eyeing 2020, House empowers Medicare to negotiate drug costs

WASHINGTON (AP) — Sharpening their 2020 election message, House Democrats on Thursday pushed through legislation that would empower Medicare to negotiate prescription drug prices and offer new benefits for seniors.

The vote along party lines was 230-192. Speaker Nancy Pelosi’s bill would cap Medicare recipients’ out-of-pocket costs for medicines at USD2,000 a year.

It would use about USD360 billion of its projected 10-year savings from lower drug costs to establish Medicare coverage for dental care, hearing, and vision, filling major gaps for seniors.

But the legislation has no chance of passing the Republican-controlled Senate, and the White House has issued a veto threat. Still, Democrats saw a victory in the message their bill sends to voters.

“I think that it is going to be too hot to handle for the Republicans,” said Pelosi, D-California. She is claiming bragging rights because her bill would deliver on the promise that United States (US) President Donald Trump made as a candidate in 2016, when he said he would “negotiate like crazy” to lower prescription drug prices for Medicare recipients. It’s a pledge that Trump has backed away from as President.

Speaker of the House Nancy Pelosi. PHOTO: AP

For months, Pelosi’s office and the White House had talked privately about Medicare negotiations. But the sides went their own ways partly because administration officials concluded her approach could never win support among congressional Republicans.

Trump now favours a bipartisan compromise in the Senate that would limit drug price increases and cap what seniors pay out-of-pocket, but would not authorise Medicare negotiations.

Negotiations are “the heart of the matter,” Pelosi insisted.

High prescription drug prices consistently register as the public’s top health care concern. But it’s unclear in a capital divided over Trump’s impeachment that any major legislation will pass before next year’s elections.

Pelosi’s bill “is a serious proposal but everyone knows that the Senate isn’t going to go for it,” said CEO of the National Coalition on Health John Rother.

“It is about legislating, but even more it’s about establishing a platform that Democrats can run on going into the next election cycle and lays the groundwork for legislative activity in 2021,” Rother said. His organisation is an umbrella group that represents health care industry groups and consumers. The pharmaceutical industry is strongly opposed to the bill. Among the groups backing it is AARP.

Medicare’s popular prescription drug benefit is delivered through private insurers. Republicans say the government has no business setting prices for medicines. They argue that the hit on the pharmaceutical industry’s bottom line will stifle innovation, discouraging investment in the hunt for cures for Alzheimer’s and other intractable illnesses.

“Drugs that save lives will not be around,” said Representative Greg Walden, R-Oregon. “Innovation goes on the rocks; lives will be lost.”

House Republican leader Kevin McCarthy of California accused Democrats of putting politics over solutions, “catering to their progressive base by opening the door to a government takeover of our prescription drug market”.

Republicans point to a major concern about the legislation: that it would result in fewer drugs coming to market. But there’s debate about the extent of the expected impact. The non-partisan Congressional Budget Office estimates about three per cent to 10 per cent fewer new drugs. The White House Council of Economic Advisers says it could be much higher, up to one-third of new medications.

Representative Bobby Scott, D-Va, who helped write the Pelosi bill, said Republicans predicting the drug pipeline will dry up are using scare tactics. “Any drug that’s out there, we’re going to have access to,” he said. “The United States would still be the biggest market.”