House Republicans want their Democratic counterparts to endorse more bipartisan-friendly reforms to drug pricing as the chances of a bill to give Medicare negotiating power look dim.
Republicans on the House Energy and Commerce Committee endorsed during a hearing on Tuesday legislation that includes a series of reforms including an out-of-pocket cost cap for seniors on Medicare Part D. The comments come as Democrats are pressing for the inclusion of legislation to grant Medicare power to negotiate for lower drug prices in a massive infrastructure package.
Republicans say the legislation will likely pass the Democratic-controlled House but will stall in the Senate as Democrats likely can’t get enough Republicans in the Senate to pass it.
“Why aren’t we working together on something that can be signed into law,” said Rep. David McKinley, D-West Virginia, during the hearing. “Unless we change the course, the projection of this legislation, we know how this story is going to pan out.”
Republicans endorsed the “Lower Costs, More Cures Act” introduced last month that includes several provisions aimed at lowering costs on Medicare and Medicaid.
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The legislation would create a $3,100 out-of-pocket cap on Medicare Part D costs for seniors and give incentives for providing a share of Part D rebates to be delivered at the point of sale.
Another provision would call for increased price transparency by expanding a Medicare online tool to enable “beneficiaries to compare costs across three settings: hospital outpatient department, ambulatory surgical centers, and the outpatient prospective payment system,” according to a fact sheet on the legislation.
It would also demand a site-neutral payment to providers for the administration of drugs reimbursed under Part B, which are drugs such as chemotherapy that are administered in a doctor’s office. It would require a payment at the lower “physician fee schedule rate rather than the rate paid to hospitals, lowering federal spending and beneficiary cost-sharing,” the fact sheet said.
The legislation is far different from the “Elijah E. Cummings Lower Drug Costs Now Act” that gives Medicare the power to negotiate for lower prices and requires commercial plans to adopt the prices that Medicare negotiates.
The bill passed the House in 2019 and languished in the GOP-controlled Senate.
But now Democrats are trying again as they have control of the White House and Senate, albeit by a 50-50 margin in the Senate with Vice President Kamala Harris breaking any ties.
“For too long, Americans have been forced to ration their medications, go without, or exhaust their life savings in order to afford the drugs they need, all while large pharmaceutical companies continue to make record profits,” said Rep. Frank Pallone, D-New Jersey, the chairman of the full committee, during the hearing.
Experts also testified that the provisions in the legislation, including the Part D cap, will not be enough to lower costs.
“Capping out-of-pocket costs doesn’t lower spending,” said Rachel Sachs, an associate law professor at Washington University. “It just moves money around in the system.”
She said the cap could increase Part D premiums overall and increase Medicare spending as a subsidy for those premiums.
“The restructuring of the Part D benefit is critical to help seniors afford the cost of prescription drugs, but because it moves money around the other items are important,” she added.