GOP blocks legislation that would allow Federal negotiations of Medicare Prescription Drug Prices

Apr 19, 2007--Senate Democrats on Wednesday failed to obtain the 60 votes needed to begin to debate legislation (S3) legislation (S 3) that would allow the government to negotiate prices with pharmaceutical companies under the Medicare prescription drug benefit, the Washington Post reports (Murray, Washington Post, 4/19).

The 55-42 vote for cloture included the support of all Senate Democrats and Republican Sens. Norm Coleman (Minn.), Susan Collins (Maine), Chuck Hagel (Neb.), Gordon Smith (Ore.), Olympia Snowe (Maine) and Arlen Specter (Pa.) (Johnson, CongressDaily, 4/19). Senate Majority Leader Harry Reid (D-Nev.) changed his vote to "nay" after it became clear that the cloture vote was going to fail.

Voting against cloture and making a floor motion to reconsider allows Reid to bring the bill back for another vote in the future (Young, The Hill, 4/19). Senate Finance Committee Chair Max Baucus (D-Mont.), a co-sponsor of the bill, said, "It's beyond me why the Senate would not choose to stand up for seniors."

Referring to more expansive House-approved legislation (HR 4) that would require the HHS secretary to negotiate Medicare drug prices, Baucus said, "Concerns about a bill from the House should not frighten senators into silence on an issue this important" (Armstrong, CQ Today, 4/18). Reid said, "The Department of Veterans Affairs is able to negotiate for lower-priced drugs. HMOs can negotiate. Wal-Mart can negotiate. Why in the world shouldn't Medicare be able to do that?"

Sen. John Cornyn (R-Texas) criticized the bill, saying it was "a step down the road to a single-payer, government-run health care system." Senate Finance Committee ranking member Chuck Grassley (R-Iowa) said that HHS "has had very little experience and a dismal track record" at determining what to pay for drugs, adding, "Private competition works" (Pear, New York Times, 4/19).

Looking Ahead
"Few experts believe that the Senate vote will quell demands for government intervention to bring down drug prices," even though the Medicare prescription drug benefit "has proved popular, and it is costing less than initially estimated," the Los Angeles Times reports (Alonso-Zaldivar, Los Angeles Times, 4/19). Baucus said that there "will be a time" to revisit the issue (Henderson, Boston Globe, 4/19).

House Speaker Nancy Pelosi (D-Calif.) said, "Democrats will keep fighting until this bill is signed into law and seniors and people with disabilities have access to affordable prescription drugs" (The Hill, 4/19). AARP, which has lobbied in support of the bill, said, "Senators should know this issue is not going away. No amount of campaign money can trump the will of 90% of Americans" (Freking, AP/Detroit Free Press, 4/19).

Ken Johnson, senior vice president of the Pharmaceutical Research and Manufacturers of America -- which opposes the legislation -- said, "This issue is not going away." He added, "Every time it pops up ... it gives us an opportunity to remind Americans, as well as Congress, that the Medicare prescription drug program has been a resounding success so far" (The Hill, 4/19).

The Congressional Budget Office has said that both the Senate and House proposals "would have a negligible effect on federal spending" unless the HHS secretary were allowed to use a formulary or other tools to lower prices. President Bush has said he would veto either piece of legislation (New York Times, 4/19).

Drug Prices Rising, Study Finds
In related news, Families USA on Wednesday released a study finding that prices for the 15 most popular prescription drugs provided by Medicare increased an average of 9.2% during the last year at the nation's five largest Medicare drug providers, CQ HealthBeat reports. For the study, Families USA compared the lowest drug prices charged by United Healthcare, Humana, WellPoint-Unicare, Member Health and WellCare in April 2006 and April 2007. The findings are based on prices that the insurers reported to CMS.

Ron Pollack, executive director of Families USA, in the release said, "Contrary to promises made last year by the administration, Medicare Part D prices skyrocketed last year, ... making drugs increasingly unaffordable for seniors and ... fleecing America's taxpayers." CMS spokesperson Jeff Nelligan in a statement said that the report "neglects the generous cost-sharing assistance provided by the Part D benefit and contradicts other analyses which suggest that Part D has insulated Medicare beneficiaries from real increases in drug prices."

Nelligan added that "90% of beneficiaries are enrolled in Part D plans with flat copays that are locked in for the year" (Carey, CQ HealthBeat, 4/18).

Broadcast Coverage
Three broadcast programs reported on the Senate vote. Summaries appear below.

American Public Media's "Marketplace": The segment includes comments from Bob Laszewski of Health Policy and Strategy Associates, Drew Nannis of AARP and Sen. Ron Wyden (D-Ore.) (Palmer, "Marketplace," American Public Media, 4/18). Audio and a transcript of the segment are available online.

C-SPAN's "Washington Journal": The segment includes a discussion with Sen. Sherrod Brown (D-Ohio) ("Washington Journal," C-SPAN, 4/19). Video of the segment is available online.

NPR's "All Things Considered": The segment includes comments from Baucus, Grassley, Snowe, Sen. Jon Kyl (R-Ariz.) and Wyden (Rovner, "All Things Considered," NPR, 4/18). Audio of the segment is available online.