Senate may Vote this Week to Lower Prescription Drug Prices
The drama over reducing prescription drug prices grabbed the headlines last week when Sen. Joe Manchin (D-W.Va.) and Senate Majority Leader Chuck Schumer (D-N.Y.) announced they had reached agreement on legislation that Manchin can support, perhaps giving the Democrats enough votes to pass the bill. However, it is still no sure thing it will pass.
We’ll explain more below but first, here’s what the bill would do.
The deal allows Medicare to negotiate drug prices for the first time and would prevent future administrations from refusing to do so. The government would start by negotiating the price of 10 drugs and gradually scale up to 20 by 2029.
But it is not clear how many Americans with Medicare coverage would see lower out-of-pocket costs — or how much money they could save. That depends on which drugs wind up being negotiated and how much prices drop, according to an analysis by the Kaiser Family Foundation.
The bill also includes other policies aimed at curbing the sky-high cost of drugs. For instance, it caps seniors’ drug costs under Medicare to $2,000 per year, forces drug companies to pay a rebate if they increase prices faster than the rate of inflation and provides free vaccines for seniors. Because it would lower drug prices congressional scorekeepers estimate it would reduce the federal deficit by nearly $288 billion over a decade.
However, here are the hurdles it still faces in the Senate if it is to pass by the end of this week, which is the goal of the Democrats.
Because all Republicans are opposed to the bill Democrats will likely need all 50 of their Senate members to be present on the Senate floor, and Vice President Kamala Harris available to break ties, not only on final passage but during voting on a series of amendments.
Covid has been striking Senators from both parties but unless there are new exposures this week among the Democrats, they will apparently have everyone present for a vote.
Then, because of the complicated rules in the Senate, the Senate parliamentarian must complete her review of the legislative text to ensure it meets statutory limits on what can be included in the special procedure the Democrats want to use to pass the bill.
Sixty senators would likely be needed to overturn any determinations altering the contents of the legislation, likely killing it.
While most Senate Democrats support the agreement, it could still be changed.
Majority Leader Schumer already promised to add provisions addressing insulin costs, without specifying which version. Sen. Raphael Warnock (D-Ga.) is pushing to return a cap on monthly out-of-pocket insulin costs at $35, but the provision costs billions of dollars and could face a challenge by Republicans on whether it meets the rules of the procedures the Democrats want to use.
In addition, Sen. Kyrsten Sinema (D-Ariz.) previously opposed some provisions that don’t pertain to prescription drugs but are nonetheless in the larger bill. She has yet to say if she will support the bill.
Also, in previous negotiations some Democrats from high-tax states New York, New Jersey, and California insisted that any bill include lifting the limit on deductions for state and local taxes that are currently in the tax law.
Finally, Sen. Bernie Sanders (I-Vt.), who caucuses with Democrats, said the bill’s provision granting Medicare the ability to negotiate drug prices with pharmaceutical companies doesn’t go far enough because it limits drug negotiations to only a set number of medicines already on the market for years.
The House of Representatives is already in its August recess this week and the Senate is schedule to begin its recess next week. However, it is possible Majority Leader Schumer will keep the Senate in session longer it he thinks it is necessary to pass the legislation.
If the Senate can manage to pass the bill it will then go to the House of Representatives for a vote, where the slim Democratic majority is expected to pass it. However, there are Democrats from some districts that have concerns about the bill.
And all of that is just on the Democratic side.
In addition to total Republican opposition to the bill, Politico, a Washington, D.C., political newspaper, reports that “Drugmakers are waking up to the reality that Democrats’ revived budget reconciliation bill has a shot at enactment and are waging an intense lobbying campaign on Capitol Hill and over the airwaves in a last-minute attempt to bring it down.”
It then adds, “Despite the industry’s legendary clout, momentum appears to be building for a deal, punctuated Wednesday evening with the announcement of an agreement between Senate Majority Leader Chuck Schumer and the Senate Democrat most skeptical of the reconciliation bill, Joe Manchin of West Virginia, which includes once-scrapped tax and climate measures.”
The article reports that, “The drug industry spent millions of dollars over the last two years to oppose iterations of the drug pricing plan and now will use ‘every tool [it] has to push back’ on the reconciliation bill, Brian Newell, a spokesperson for PhRMA [the big drug companies’ lobbying arm], said in an emailed statement.
And then adds this: “PhRMA and the National Association of Manufacturers, which counts drug companies among its members, are rolling out television and digital ads that amplify a longstanding argument: the measure would slow innovation and the development of new cures.”
TSCL will review the bill if the Senate can pass it and then determine if we will support it. At this point, we do not expect it to contain everything TSCL’s supporters would like but part of a loaf would be better than nothing at all.
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Bill Introduced to Give Better Social Security COLA
A bill has been introduced in the Senate by Senator Mazie Hirono (D-Hawaii) that would, among other things, change the formula that Social Security would use to determine the annual COLA. The formula would use a formula that more accurately reflects the costs that seniors experience during a given year.
To determine consumers’ day-to-day living expenses and thus measure the rate of inflation consumers face in the marketplace, the government collects data on a “market basket” of goods and services. This includes food and beverage, housing, apparel, recreation, education, transportation, and medical care.
Research has shown that spending patterns differ between the elderly and the general population, especially in the health care category. Seniors 65 and older spend more than twice as much on health care, and those 75 and older spend nearly three times more on health care than younger consumers.
Not only do health care expenditures steadily increase with age but health care costs have also consistently risen much faster than other market basket categories. The current price index (CPI-W) does not take these critical differences in the elderly population into consideration.
The new bill, called the Protecting and Preserving Social Security Act, would have to be passed by the full Congress before the end of this year to become law so, in our analysis, it is unlikely to do so.
However, we are pleased that the bill has been introduced and if it does not pass this year, we hope it will be introduced again early next year in the new Congress.
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WEP/GPO Repeal Update
On Friday, July 29, 2022 The Senior Citizens League participated in a Press Conference with Representatives Abigail Spanberger and Rodney Davis to show support for H.R. 82 The Social Security Fairness Act.
This bipartisan legislation would eliminate two provisions of the Social Security Act — the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) — that unfairly reduce or eliminate Social Security benefits for millions of Americans who have devoted much of their careers to public service. Under House rules, the bill must be brought forward for consideration now that it has surpassed 290 cosponsors. We are pushing for a vote on the floor of the U.S. House.
You can watch the Press conference here.
Good News: Part D Premiums Projected Slightly Lower Next Year
Last Friday the Centers for Medicare & Medicaid Services (CMS) announced that the average basic monthly premium for standard Medicare Part D coverage is projected to be approximately $31.50 in 2023. This expected amount is a decrease of 1.8% from $32.08 in 2022.
Open enrollment for 2023 coverage runs from Oct. 15 to Dec. 7, 2022.
The CMS will likely release the final 2023 premiums for private Medicare Advantage and Part D plans in September 2022.
More than 49 million Medicare beneficiaries are enrolled in prescription drug coverage, which helps pay for brand-name and generic prescription drugs.
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As we continue moving toward a new normal in dealing with the Covid 19 pandemic, TSCL remains constant in our fight for you to protect your Social Security, Medicare, and Medicaid benefits.
For progress updates or for 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 Facebook or on Twitter.