Chuck Grassley of Iowa Ron Wyden of Oregon introduced a long-awaited Senate bill on drug pricing Tuesday that would limit what seniors pay for their medicines and cap how much drug companies are allowed to increase the price of drugs paid for by Medicare.
The legislation would force drug companies to give rebates to Medicare, which covers people 65 and older as well as people with disabilities, if they increase their prices above inflation.
The bill will be marked up Thursday in the Senate Finance Committee, where Grassley is chairman and Wyden is the top Democrat. The senators worked together on the bill for six months, and while they didn’t say whether the bill would be taken up ahead of the August recess, they said they hoped Congress would take action “very soon.”
“The cost of many prescription drugs is too high,” the senators said in a joint statement. “Without action, we’re on an unsustainable path for taxpayers, seniors and all Americans… The time to act on prescription drug prices is now.”
If the bill moves ahead, it may be combined with a measure from the Senate Health, Labor, Education, and Pensions Committee that aims to lower drug prices primarily by speeding the approval of generics. But another approach is also in the works in the House. Wendell Primus, health adviser to House Speaker Nancy Pelosi, said Monday that House Democrats would be introducing a drug pricing measure in September.
From 2019 to 2029, the Finance Committee bill would reduce Medicare spending by $85 billion, reduce out-of-pocket spending for patients by $27 billion, and reduce premiums for patients by $5 billion, according to Congressional Budget Office figures presented by the senators.
Spending on Medicaid, the program that covers low-income people, would fall by $15 billion over the same 10-year period. That decrease would come through a provision in the bill allowing higher rebates under Medicaid.
Senators will be working to build support for the legislation over the coming days. Conservatives may oppose the cap on drug spending as a form of government price control, while liberals may feel the measure doesn’t go far enough in giving the government power to set prices.
