A bipartisan group of senators on Tuesday "revived" a proposal from the previous Congress that would authorize the... HHS secretary to negotiate drug prices with pharmaceutical companies for the new Medicare prescription drug benefit, CQ Today reports. Sens. Russell Feingold (D-Wis.), Dianne Feinstein (D-Calif.), John McCain (R-Ariz.), Olympia Snowe (R-Maine) and Ron Wyden (D-Ore.) are sponsors of the bill. As of Jan. 1, 2006, when the Medicare law takes effect, the bill also would require HHS to negotiate drug prices whenever private health plans request assistance in dealing with pharmaceutical companies and that "fallback" plans are created in cases where so few private plans are offered in a region, CQ Today reports (Schuler, CQ Today, 2/1). To further aid consumers, the bill would have the Government Accountability Office review retail drug prices and report them to Congress. This information would then be released to consumers to facilitate price comparisons in their region (Gibson, South Florida Sun-Sentinel, 2/2). The 2003 Medicare law supported by Republican lawmakers and the Bush administration does not give HHS the ability to negotiate over prices, "something some lawmakers have argued would hold down drug prices," CongressDaily reports. Sponsors of the bill on Tuesday said that Medicare, as a major purchaser of drugs, should be allowed to function like a private purchaser (CongressDaily, 2/1). However, GOP leaders have previously stated that allowing HHS to negotiate prices "would be akin to government price fixing," according to CQ Today (CQ Today, 2/1). During his Senate confirmation hearing in January, HHS Secretary Mike Leavitt did not state an opinion on the matter (CQ Today, 2/1).

Comments
Wyden said the current system is "the equivalent of standing in the Price Club and buying toilet paper one roll at a time. No smart shopper would do it that way" (CongressDaily, 2/1). Wyden continued, "This [legislation] is a strategy that is going to empower seniors across the country in the marketplace. We're going to make sure seniors have the same opportunity big private-sector buyers do." Court Rosen, spokesperson for Pharmaceutical Research and Manufacturers of America, said, "We feel very strongly that it is not in the best interests of seniors to have the government interfere with negotiations because private market forces are far more capable of getting good prices for seniors" (South Florida Sun-Sentinel, 2/2).

"Reprinted with permission from kaisernetwork kaisernetwork. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at kaisernetwork/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork, a free service of The Henry J. Kaiser Family Foundation . © 2005 Advisory Board Company and Kaiser Family Foundation. All rights reserved.