House Speaker Nancy Pelosi just introduced a plan to lower prescription drug prices.
The plan would empower Medicare to negotiate prices on up to 250 of the most expensive drugs on the market, including insulin. Any company choosing not to negotiate could be hit with penalties if they won’t negotiate those prices. The plan would also limit copays for seniors covered under Plan D of Medicare’s drug program to $2,000.
However, according to the Associated Press, “The sweeping legislation leans left politically and appears to be tailor-made for Pelosi’s Democratic majority in the House. But in a signal that Pelosi wants a deal, it also incorporates ideas from the Trump administration and from Republican and Democratic senators.”
It’s also been referred to as “a socialist proposal to appease her most extreme members.”
The Pelosi Plan to Combat High Drug Costs
While these developments will be strenuously debated, it’s also clear both sides of the aisle already agree that lowering drug costs should be a top priority. In addition, President Trump wants to lower drug costs, a well, as he’s noted in prior election cycles.
Until there’s further clarity on the issue, Pelosi is proposing to penalize pharmaceutical companies that raise the price of their drugs faster than inflation, create an out-of-pocket maximum of $2,000 for Medicare beneficiaries, and reinvest savings from negotiated prices on finding new treatments, as highlighted by CNBC.
“The status quo on prescription drug prices is broken,” House leaders noted. “Prescription drug companies are charging Americans prices that are three, four, or even ten times higher than what they charge for the same drugs in other countries.”
Another plan, presented by the Senate Finance Committee – and has been backed by the President – would also make changes to Medicare and include penalties for companies raising prices faster than the rate of inflation. However, this one also saw pushback from those arguing that penalties are a form of government intervention.
From here, it’ll be interesting to see what the two sides can agree on.
If they fail to compromise, it’ll quickly take the spotlight in the 2020 run for the White House.
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