Health Care & Prescription Drugs News

WASHINGTON, DC - The U.S. House of Representatives today voted 255 to 170 to allow Medicare to use its bulk purchasing power to negotiate directly with drug manufacturers for prescription drug price discounts.

Congress created the prescription drug program in 2003 with a drug industry-backed bill that explicitly prohibited Medicare from negotiating discounted prices with drug manufacturers.

"H.R. 4 will lower drug prices and prevent millions of seniors from ever hitting the so-called doughnut hole where they lose coverage and have to pay thousands of dollars out-of-pocket," said PIRGIM advocate David Pettit. Taxpayers, who pay for nearly 75 percent of the drug program, will save billions of dollars, he added.

Key elements of H.R. 4, The Medicare Prescription Drug Price Negotiation Act, include deleting the language in the 2003 law that prohibits Medicare from negotiating lower prices with drug companies, giving the Secretary of Health and Human Services the authority to negotiate prices, and keeping the list of drugs covered by Medicare as broad as possible.

"This is a great victory for seniors and taxpayers but we're only half-way there," said Pettit. "The bill still must pass the Senate where we expect fierce resistance from the drug industry." He added that the drug industry spends more than any other industry on federal lobbying, campaign donations and congressional travel, and has launched a $100 million campaign to kill the Medicare drug negotiation bill.

Senator Charles Grassley, the Ranking Member of the Finance Committee, has vowed to filibuster the bill, and President Bush has threatened to veto it. However, an overwhelming majority of Americans (85 percent) want Medicare to negotiate bulk purchase discounts for its drug program.

PIRGIM is a non-profit, non-partisan, statewide, member-based organization dedicated to protecting Michigan consumers since 1972. For more information, please visit www.pirgim.org.