Bill to Let Medicare Negotiate Drug Prices Is Blocked
APRIL 18, 2007
WASHINGTON, April 18 — A pillar of the Democratic political program tumbled today when Republicans in the Senate blocked a proposal to allow Medicare to negotiate lower drug prices for millions of older Americans, a practice now forbidden by law.
Democrats could not muster the 60 votes needed to take up the legislation in the face of staunch opposition from Republicans, who said that private insurers and their agents, known as pharmacy benefit managers, were already negotiating large discounts for Medicare beneficiaries.
Fifty-five senators, including 6 Republicans, supported a Democratic motion to limit debate and proceed to consideration of the bill, while 42 senators voted against it. Such motions require a three-fifths majority under Senate rules. Without a limit on debate, opponents can prevent legislation from ever coming to a vote.
The Senate had only a brief debate on the merits of the legislation, which is a high priority for the new Democratic majority in Congress.
Republicans framed the issue as a choice between government-run health care and a benefit managed by the private sector. The drug benefit is delivered and administered by private insurers, under contract to Medicare.
Senator John Cornyn, Republican of Texas, denounced the bill as “a step down the road to a single-payer, government-run health care system.”
Democrats said they were merely trying to untie the hands of the secretary of health and human services, so he could negotiate on behalf of 43 million Medicare beneficiaries.
“The Department of Veterans Affairs is able to negotiate for lower-priced drugs,” said the Senate majority leader, Harry Reid, Democrat of Nevada. “H.M.O.’s can negotiate. Wal-Mart can negotiate. Why in the world shouldn’t Medicare be able to do that?”
The 2003 Medicare law prohibits Medicare from negotiating drug prices, setting prices or establishing a uniform list of covered drugs, known as a formulary.
Mr. Reid said the Democrats fell short today because of “the power of the insurance industry and the pharmaceutical industry” and their close ties to Republicans in Congress.
But the vote also reflected ineffectual advocacy by Democrats, who were slow in responding to criticism from knowledgeable, well-prepared Republican senators like Charles E. Grassley of Iowa.
“Private competition works,” said Mr. Grassley, a principal author of the 2003 Medicare law. “The government has very little experience and a dismal track record figuring out what to pay for drugs.”
Big companies that offer the Medicare drug benefit, like Caremark and Medco Health Solutions, “have more market power than Medicare” because they negotiate for tens of millions of people in private health plans, as well as for Medicare recipients, Mr. Grassley said.
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