President Biden urged the passage of drug pricing legislation, during his first joint address to Congress on Wednesday. He noted that negotiating drug prices could save Medicare billions of dollars. While he encouraged Congress to pass the legislation, it was notable that it was not included in the American Families Plan whose details were released earlier in the day.
Last week dueling drug pricing packages were introduced in the House. Democratic leaders of the House Energy and Commerce, Ways and Means, and Education and Labor committees reintroduced the Elijah E. Cummings Lower Drug Costs Now Act, which closely mirrors the version of the bill that passed the House in 2019. The bill would authorize Medicare to negotiate prices for certain drugs, cap out-of-pocket costs for Part D beneficiaries and require manufacturer rebates for certain drugs whose prices increase faster than inflation. The prescription drug reforms included in the Democrats’ bill generate significant savings that could be used to offset other spending priorities.
The Lower Costs, More Cures Act, reintroduced this week by Republican leaders of the same committees, also closely resembles the version from the 116th Congress and includes some bipartisan proposals, such as capping seniors’ out-of-pocket drug costs and Part D benefit redesign.
Under the current political environment, a standalone bill on drug pricing would likely not pass in the Senate. Drug pricing will only be truly politically viable if Democrats put it in a reconciliation bill.
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