Another ‘100-Hours’ Promise Kept:House Votes to Require Medicare to Bargain for Rx Drugs

Washington, DC – Friday afternoon, the House of Representatives voted 255 - 170 to approve H.R. 4, the Medicare Prescription Drug Price Negotiation Act, which requires Medicare to negotiate lower prescription drug prices on behalf of millions of American seniors.  Congresswoman Carolyn B. Maloney (D-Manhattan, Queens), a longtime proponent of allowing Medicare to use its purchasing power to reduce drug costs, hailed the vote as a victory not only for seniors, but for the American taxpayer, as well.

“Right now, pretty much everyone can negotiate prescription drug discounts –except Medicare, the biggest prescription drug buyer of all,” said Rep. Maloney.  “H.R. 4 will repeal this special-interest bonanza and help put money back in seniors’ pockets.  I urge the Senate to pass this legislation quickly and for President to sign it.  H.R. 4 is common sense, good business sense, and it makes sense for our seniors.”

Specifically, H.R. 4 will:

• Repeal the provision in current law that prohibits the Secretary of Health and Human Services (HHS) from negotiating with drug companies for lower prices for Medicare beneficiaries; instead, the bill would require the HHS Secretary to conduct such negotiations for plan years beginning January 2008;
• Provide the HHS Secretary broad discretion on how to best implement the negotiating authority and achieve the greatest price discounts for Medicare beneficiaries;
• Continue to prohibit the HHS Secretary from requiring Medicare prescription drug plans to use a particular formulary (i.e., a list of covered drugs) or limit access to any prescription medication;
• Clarify that Medicare Part D drug plans are permitted to obtain discounts or lower prices for covered prescription drugs below the price negotiated by the HHS Secretary;
• Require the HHS Secretary to submit to Congress a bi-annual report on the negotiations conducted by the Secretary, on the negotiated prices and on any price discounts achieved by the Secretary as a result of such negotiations.

Earlier on Friday, Rep. Maloney spoke on the House Floor in support of H.R. 4.  The full text of Maloney’s remarks follows:

Mr. Speaker,

I rise in strong support of HR 4, the Prescription Drug Price Negotiation Act of 2007.  This is the perfect capstone to an extremely productive week.  I came to Congress to help our seniors gain access to benefits they need and deserve, so I thank Chairman Dingell and the new Democratic leadership of the House for bringing this vitally important bill to a vote during the first 100 hours.

In 2003, I voted against the Prescription Drug bill because, among other things, it did not provide adequate benefits to our seniors and did nothing to contain the rising costs of drug prices.

Current law states that the Secretary of Health and Human Services, unlike the Veterans Administration, is expressly prohibited from negotiating the best drug prices on behalf of the 43 million seniors and others in Medicare who desperately need the lowest price available.   

Price data show that Part D plans are not delivering on the promise that competition would bring prices down and that the use of market power has not resulted in drug prices that are comparable to the low prices negotiated by the VA.

HR 4 cuts the cost of healthcare and improves access to medicines by requiring HHS to negotiate with drug companies for lower drug prices for Medicare beneficiaries and greater savings for our taxpayers.

It’s common sense, it’s good business sense, and it makes sense for our seniors.

Negotiations that lower prescription drug prices will help many consumers avoid the doughnut hole by preventing them from ever hitting the coverage gap where they have to pay thousands of dollars of out-of-pocket expenses for medications while still paying their monthly insurance premiums. 

HR 4 does not dictate to the HHS Secretary how to negotiate but instead provides the Secretary with broad discretion on how to best implement the negotiating authority and achieve the greatest price discounts for Medicare beneficiaries.   The bill also ensures that Congress is able to closely monitor the Administration’s progress by requiring HHS to report to Congress every 6 months on drug price negotiation. 

Under the current system, the pharmaceutical companies are the ones who benefit at the expense of our seniors, many of whom are forced to choose between paying for their prescription drugs and putting food on the table.  HR 4 seeks to help those who need it most. 

Older Americans are watching us today, waiting to see if we will act to make their prescription drugs more affordable and more accessible.  I am proud to cast a vote in support of America’s seniors and urge my colleagues to do the same.  Vote “YES” on HR 4.

Thank you.

Background:

10/17/06 - Rep. Maloney: Democratic Fixes to Medicare Rx Program Will Save Seniors Big $$$

07/29/05 - Marking the 40th Anniversary of Medicare and Medicaid, Rep. Carolyn Maloney Vows to Defend Both Programs for Quality Health Care for Seniors and the Disabled

05/20/05 - Rep. Maloney Fights to Give Medicare the Power to Negotiate Lower Drug Prices

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