Bill Would Allow Medicare to Negotiate Best Price for Prescription Drugs

Bill Would Allow Medicare to Negotiate Best Price for Prescription Drugs
February 27, 2005

When the Medicare Prescription Drug and Modernization Act was signed into law by the President in 2003, I had serious concerns about the legislation. One of the most serious flaws of the prescription drug benefit portion of the Medicare reform bill is that it prohibits the government from using its market power to negotiate seniors' drug prices with the pharmaceutical companies.

Although other federal agencies, such as the Department of Veterans Affairs, have had great success in controlling prescription costs by negotiating with drug manufacturers, the law was written to prevent Medicare from doing the same thing to protect both seniors and all federal taxpayers from unnecessarily high costs. With recent reports indicating that providing Medicare drug benefits will cost more than $700 billion over ten years, it only makes sense to provide negotiating authority to Medicare.

Both Republicans and Democrats have criticized the law's restriction on Medicare's ability to negotiate drug prices. During the last Congress, I cosponsored bipartisan legislation to eliminate this prohibition and allow Medicare to use its bargaining power to reduce the costs of prescription medicines for seniors. While that legislation did not make it through Congress last year, the legislation has been reintroduced and I am once again a cosponsor.

I also recently joined a bipartisan group of colleagues in sending a letter to the Administrator for the Centers for Medicare and Medicaid Services, Mark McClellan, and to the Secretary of Health and Human Services, Michael Leavitt, to urge them to reconsider the Administration's position and provide negotiating authority to Medicare. I hope that by working with the Administration and by promoting legislation in Congress, we will be able to correct this serious flaw in the program.

Missouri seniors have had many questions about the new Medicare reform bill since it was signed into law by the President. Seniors may contact Medicare directly to ask questions or obtain more information by calling 1-800-MEDICARE (1-800-633-4227) or by visiting the Medicare web site at www.medicare.gov. Telephone assistance for those with hearing impairments is available by calling 1-877-486-2048 (TTY).

http://www.house.gov/skelton/col050227.htm