Legislation to lower prescription drug prices and save Medicare $345 billion over the next decade is expected to head to the House floor in the coming week.
The bill would change current rules that bar the Department of Health and Human Services (HHS) from negotiating drug prices for Medicare — federal government offered health insurance for people 65 and over.
Under the measure, HHS would be authorized every year to negotiate lower prices on as many as 250 of the most expensive prescription drugs. Those savings would then go to non-government health plans.
Rep. Peter Welch, D-Vt., who has made this a legislative priority for years, said the time was long overdue for Congress to curb the rising price of pharmaceuticals and give the government the ability to negotiate bulk prices with drug manufacturers.
“You are going to get lower premiums as a result of this legislation,” Welch said in an interview Monday. “Benefit will not only go to Medicare and Medicaid, it will go to employer sponsored health care plans as well. This legislation is going to help everybody.”
The bill also levies a penalty — starting at 65% of the gross sales of the drug in question — on companies that fail to come to an agreement or refuse to negotiate with the federal government.
Last Thursday, after 10-hours of debate, the bill moved out of the House Energy and Commerce Committee, of which Welch is a member, on a 30-22 vote. Parts of the legislative package are now in the House tax panel and the committee on education and labor before it heads to the full chamber for a vote.
Much of the debate came from Republicans who argued the bill could potentially quell pharmaceutical innovation in the U.S.
“There’s a lot to be said about the innovation that we see in Pharma,” said Welch in committee. “But if the cost of the drug kills us, people can’t afford it, and access is limited by price, it has an effect on public health.”
The measure moved out of its primary committee a day after Rep. Elijah Cummings, D-Md., the chair of the oversight committee who had made this legislation a priority at the beginning of the congressional session, died of complications from longstanding health issues.
Welch, who had partnered with Cummings on the policy and accompanied him to the White House to discuss the proposal with President Donald Trump in 2017, said the bill would be part of the late congressman’s “legacy.”
The House is also expected to name the proposal in honor of Cummings.
The legislation, which Speaker of the House Nancy Pelosi, D-Calif., has fully endorsed, is expected to pass the lower chamber easily, but if the president does not signal support it may face more opposition in the Republican controlled Senate.
But Welch is optimistic, believing there may be Republican support in the upper chamber.
Senate Finance Committee Chair Chuck Grassley’s, R-Iowa., is pressing ahead with a bill targeting patent abuse in the drug industry, which would also reduce drug prices. Trump has already said he supports that legislation.
“We are way ahead of where we have been in awhile,” said Welch on the prospect of enacting the measure.
In 2018, Trump outlined his own plan to reduce drug prices, called “American Patients First,” and earlier this month he signed an executive order he said would improve private Medicare plans.
In late September, after Pelosi had announced the House would begin a formal impeachment inquiry into the president, she stated she was hopeful Trump would work with her to lower drug prices.
Trump responded by accusing the speaker of the House of not being interested in helping Americans and trying to win the next election by removing him from office.
“You never know with the president. My hope springs eternal that the president will provide some support for this,” Welch said. “If not because it is the right thing to do, but because it is a politically good thing for him to do.”
