June 2023

June 2023

Congress is not in session this week because of the July 4 holiday. If you had a 4th of July parade in your community, you may have seen your Senators or your Representative in the parade. Riding in parades is something politicians traditionally do, of course. They will be back in Washington next week for the rest of July, and then they will take their annual month of August recess.

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Debt Ceiling Crisis Over – But Will Government Shutdown Be Next?

When Congress returns to work next week, they face another approaching deadline: the end of the fiscal year and the need to keep the federal government operating in fy 2024.

The fiscal year for the federal government begins on October 1 each year, and Congress is supposed to have passed all the twelve appropriations bills needed to fund the government by that date. However, meeting that deadline has not happened for years, and virtually no one thinks it will this year.

That means in a few weeks, Congress either must pass legislation to continue to fund the government temporarily, or there will be a government shutdown.

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Social Security, Medicare Threatened Once Again with Cuts

While spending for Social Security, Medicare, and Medicaid does not need to be appropriated each year because they are “mandatory spending,” what TSCL is watching this year is authorizing legislation that Congress could use to cut spending on those programs.

The bill to raise the debt ceiling supposedly kept Social Security, Medicare, and Medicaid off the list of programs that will see cuts in spending for fy2024. The Senate, which the Democrats control, has said it will abide by the debt ceiling agreement regarding spending.

We thought that would be the same in the House of Representatives, which the Republicans control. However, the largest block of Republicans in the House released a proposed budget plan in the middle of June that contains $16.3 trillion in spending cuts that would result in major cuts and changes in spending for Social Security and Medicare, according to news reports.

The plan offered by the 175-member Republican Study Committee would gradually raise the age at which future retirees can start claiming full Social Security benefits from 67 to 69. In addition, it would subsidize private insurance options that compete with traditional Medicare.

In other words, even though a severe financial shortfall for Medicare is threatening in the near future, this budget would give money to private insurance companies to compete with Medicare.

The plan also promises to shore up the solvency of Social Security and Medicare, though the budget document is light on details.

Senate Finance Committee Chair Ron Wyden (D-Ore.) slammed the plan. According to Wyden, “This plan should inform all Americans where Republicans’ priorities lie: showering riches on mega-corporations and wealthy tax cheats and cutting your earned benefits by raising the retirement age and undermining Medicare’s guarantee of health care benefits. Their plan lets Big Pharma off the hook by repealing Medicare’s authority to negotiate drug prices that Democrats passed last year, and slashes Medicaid to the bone, which will threaten critical care like the program’s nursing home benefit that our parents count on.”

The Democrats have been focusing on reducing those two programs' budget shortfalls by reining in Medicare prescription drug costs and raising Medicare and Social Security payroll taxes on high-income earners.

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Senate Works on Bill to Lower Prescription Drug Costs

The Senate Health, Education, Labor, and Pensions (HELP) Committee has passed bipartisan legislation that improves the transparency of Pharmacy Benefit Managers (PBMs) so patients can know what they’re expected to pay and employers have the ability to shop around for the best deal.

The bills are aimed at speeding generic drug competition and reining in drug middlemen business practices. But they failed to pass an ambitious reform to the pharmacy benefit manager sector, despite strong bipartisan support for it.

Chair Bernie Sanders (I-Vt.) is pursuing the drug pricing reforms at the request of Senate Majority Leader Chuck Schumer (D-N.Y.), who wants to hold a floor vote on an even bigger package of health bills later this year.

It’s not clear when the Senate would take up that package, and while the package is bipartisan, it’s not clear whether it has enough support among House Republicans to pass in that chamber.


In addition, Senator Bob Menendez (D-N.J.), a senior member of the U.S. Senate Finance Committee, and Sen. James Lankford (R-Okla.) have introduced the Ensuring Access to Lower-Cost Medicines for Seniors Act – vitally important bipartisan legislation to tackle one of the biggest drivers of the high cost of prescription drugs, particularly for senior adults on Medicare.

The Ensuring Access to Lower-Cost Medicines for Seniors Act would ensure that patients can finally benefit from lower-cost products instead of being forced to pay for higher-priced drugs solely because of pricing gimmicks used by pharmacy benefit managers (PBMs), the drug pricing middlemen.

This legislation would clearly establish pricing “tiers” to separate lower-cost generic drugs and biosimilar products from name-brand drugs so that patients pay less out of pocket for truly lower-priced drugs, therefore incentivizing prices to drop for patients.

The Ensuring Access to Lower-Cost Medicines for Seniors Act requires:

  • Medicare Part D covers a generic or biosimilar if it costs less than its name-brand counterpart.
  • Generic drugs or biosimilars to be placed on a generic/biosimilar formulary pricing tier, and name-brand drugs to be placed on a brand tier, with the generic tier having a lower insurance cost-sharing requirement for patients than the name-brand tier.
  • A new tier for specialty generics or biosimilars would also have a lower insurance cost-sharing requirement for patients.

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Ongoing Fight Over Efforts to Lower Prescription Drug Prices

After losing the drug pricing fight on Capitol Hill, PhRMA, the lobbying arm of the big drug companies, is taking its battle to the courts.

The pharmaceutical industry’s biggest lobbying group filed a lawsuit challenging Democrats’ drug pricing law that allowed Medicare to start negotiating prices for specific medicines.

PhRMA joins a growing club of companies and trades challenging the law. Merck, Bristol Myers Squibb, and the Chamber of Commerce have already filed similar suits in different courts.

Meanwhile, the Biden Administration is moving ahead with implementing the law allowing Medicare to negotiate lower prices with drug manufacturers, despite the multiple industry lawsuits.

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GOP Senator Wants More Pressure on PBMs

Sen. Chuck Grassley (R-Iowa) wants to see his party’s leadership turn up the pressure on pharmacy benefit managers.

“They talk in such generalities on this subject that it’s difficult for me to tell where they’re coming from,” he said in a recent interview, speaking about top GOP senators’ approach to reforming the drug pricing middlemen who negotiate between pharmaceutical companies and insurers. “We’re hearing… ‘We don’t want to do something splitting the caucus.’ But we’ve got a major problem here with PBMs deciding rebates, deciding the price of drugs, probably being an instrument to drive up the price of drugs, and nobody knows what they’re doing.”

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TSCL is a “Go To” Source by National Media

Once again, TSCL is the source that national reporters go to for information about Social Security and Medicare.

  • In an article titled “Here’s What the Average Social Security Payment Will Be in Summer 2023,” the website com said, “With inflation falling throughout 2023, Social Security recipients should expect that their COLA will be significantly lower than in 2023, and perhaps even lower than what they received in 2022.
  • “While it’s hard to know with certainty what inflation will do in the summer months of 2023, there are already projections of the COLA in 2024. According to Mary Johnson, the Social Security and Medicare policy analyst for the Senior Citizens League, the 2024 COLA should be in the neighborhood of 3.1%. However, the SSA won’t announce the official figure until October 2023.”

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For progress updates or more information about these and other bills that would strengthen Social Security and Medicare programs, visit our website at www.SeniorsLeague.org or follow TSCL on Facebook or Twitter.