Problems on Lowering Drug Prices

Problems on Lowering Drug Prices

As we’ve said, lowering drug prices is a top goal of Democrats, including President Biden.  Republicans have indicated they will not support that effort so the Democrats have to pass it with just their own members.  With only the slimmest of majorities in both the House and Senate, the Democratic leadership has to try and keep all of their members on board.

However, a rift has developed among Democrats in the House of Representatives.  Those who want to empower the government to demand lower prices from drug makers are concerned that moderates in their party are now emboldened to blunt their ambitious drug-pricing agenda.

Last week a group of 10 moderate Democrats delayed a procedural vote for their party’s reconciliation bill, which is the expensive bill containing the President’s program to rebuild the U.S. infrastructure.  The fear is that some of those same moderates may again band together to blunt the drug-pricing provisions going into the reconciliation package.

That fear comes from the fact that some of those same lawmakers who are demanding action on the bipartisan infrastructure bill ahead of the reconciliation package have also expressed misgivings with taking on drug-pricing changes without Republican support.

But that’s not all.  Congressional Democrats also want to add dental, vision and hearing coverage to Medicare but that goal is running into resistance from powerful health industry lobbies.

Progressives see expanding the popular entitlement as essential to fulfilling their campaign pledges and keeping Democratic control of the House and Senate. But the reforms threaten the bottom line of insurers who administer private Medicare plans and sell supplemental coverage for dental, vision and hearing services. Groups like the American Dental Association, worried their members will be paid less in traditional Medicare than in private Medicare plans, are also pushing to limit the new benefits to the poorest Americans.

Health insurers are pushing back, and are warning that the cost of new coverage could limit other benefits they offer in private Medicare Advantage plans — such as free transportation to medical appointments or free over-the-counter drugs.

An insurance industry source said Congress' deliberations are “freaking out” companies who worry that seniors will drop their private plans en masse and migrate to traditional Medicare once the new benefits are in place. But the source said the industry is mindful of the optics of publicly opposing coverage of eyeglasses, dental care and hearing aids, and is largely lobbying behind the scenes.

TSCL continues to support efforts to lower prescription drug prices and we will be watching this very carefully as things develop in the next few weeks.