How Should Medicare Negotiate Drug Costs? Here’s What You Told Us:

How Should Medicare Negotiate Drug Costs? Here’s What You Told Us:

The United States pays the highest drug prices of any developed nation in the world.  We asked participants in our 2019 Senior Survey to evaluate three leading proposals that would allow Medicare to negotiate drug prices.  Here’s how each proposal fared:


  • Base Medicare Part D drug prices on the prices paid in other industrialized countries such as Canada, Great Britain, Belgium and Japan. To do this Medicare would tie what beneficiaries pay at the pharmacy to an “international drug pricing index” that surveys the cost of that drug in other nations where drug prices are negotiated by the government.

Support                                               72%

Oppose                                                5%

Not sure                                               23%


  • Use a similar system to Medicaid to negotiate prescription drug prices. Under the Medicaid “best price” policy, a drug manufacturer must offer state Medicaid programs the same price given to any other purchasers (with a few exceptions), along with a mandatory rebate of 23.1% off the list price.  Medicaid programs must in turn cover all manufacturers’ prescription drugs with few exceptions.

Support                                               70%

Oppose                                                6%

Not sure                                               24%


  • Use a similar system to that used by the Veterans Administration (VA) and Department of Defense (DOD) to negotiate drug prices. The VA and the DOD require drug manufacturers to offer them a discounted price equal to 24% off a drug’s average price, or the lowest price paid by other (nonfederal) buyers—as well as further discounts if a drug’s price rises faster than inflation.  Both programs use formularies, or a list of covered drugs, to strengthen their negotiating and get steeper discounts, which means some drugs may only have limited coverage or may be left off the formulary altogether.

Support                                               61%

Oppose                                                12%

Not sure                                               27%