In his first bill introduction in the new Congress, Rep. Peter Welch (D-VT) today unveiled legislation that would cut the cost of prescription drugs for seniors and save taxpayers billions of dollars.
The Medicare Prescription Drug Price Negotiation Act (H.R. 242) would require the federal government to negotiate the price of Medicare prescription drugs with pharmaceutical companies. When the new Medicare Part D prescription drug benefit was authorized by Congress in 2003, the drug lobby struck a midnight deal with then House Majority Leader Tom Delay that prohibited the Secretary of Health and Human services from using the leverage of the millions of seniors expected to be covered by the new program to negotiate lower drug prices and save taxpayer dollars.
President-elect Donald Trump voiced his support for Medicare prescription drug negotiation throughout the presidential campaign. The legislation is estimated to save taxpayers $156 billion over ten years.
"Putting the federal government's purchasing power to work to save seniors and the taxpayer money is simply common sense. The fact that we continue to pay retail rates for wholesale purchases is a ridiculous," Rep. Welch said. "It's long past time we put an end this sweetheart deal for big Pharma. If President-elect Trump was serious about this campaign promise, I will work with him to make it happen."
Taxpayers fund more than three-quarters of the cost of the Medicare Part D drug benefit, accounting for an estimated $94 billion worth of drugs in 2017 alone. Yet managers of the program, which serves 41 million seniors, have been barred by Congress from negotiating rates with the pharmaceutical industry the program went into effect in 2006.
Negotiating prescription drug prices is producing significant savings in the Department of Veterans Affairs. A Families USA report found that the top five Medicare Part D insurers charged prices 58 percent higher than the Veterans Administration for 20 commonly prescribed drugs.
Welch is the co-chair of the House Democratic Caucus Prescription Drug Task Force and the co-chair and co-founder of the House Affordable Medicine Caucus.