President Joe Biden speaks during an event on the National Institutes of Health in Bethesda, Maryland, Dec. 14, 2023.
Chris Kleponis | Bloomberg | Getty Images
President Joe Biden on Wednesday said the federal Medicare program should negotiate prices for at the very least 50 prescription drugs each year, up from the present goal of 20 medicines.
That is certainly one of several recent health-care policy proposals that Biden will outline during his State of the Union address Thursday, in keeping with a fact sheet released by the White House on Wednesday. Lots of those efforts aim to expand parts of the Inflation Reduction Act which might be geared toward making medicines more cost-effective for seniors and will take a bite out of the pharmaceutical industry’s profits.
“Medicare should not be limited to negotiating just 20 drugs per year. As an alternative, the President is proposing that Medicare give you the chance to negotiate prices for the most important drugs that seniors depend on, like those used for treating heart disease, cancer, and diabetes,” the very fact sheet read.
Biden has made lowering U.S. drug prices a key pillar of his health-care agenda and reelection platform for 2024. However the fate of his recent proposals can be within the hands of a divided Congress, making it highly uncertain whether they are going to pass into law.
The president’s call to boost the variety of drugs eligible for negotiations with Medicare will likely face the fiercest blowback from the pharmaceutical industry.
The Biden administration is already in a bitter legal fight with several drugmakers over the talks. The administration clinched early wins in two separate cases over the matter this year, however the industry is aiming to escalate the difficulty to the Supreme Court.
The Centers for Medicare and Medicaid Services kicked off the negotiation process last fall when it unveiled the primary 10 drugs which might be subject to cost talks with Medicare. The negotiations for those medications end this fall, with recent prices going into effect in 2026.
After the initial round of talks, Medicare can negotiate prices for one other 15 drugs that may go into effect in 2027 and a further 15 beyond that to take effect in 2028. Under the present structure, the number rises to twenty negotiated medications a year starting in 2029.
Last year, Biden indicated that he wanted more drugs to be subject to negotiations. Wednesday is the primary time his administration has specified the next goal number.
The change will “not only save taxpayers billions of dollars, but more importantly, it is going to save lives and provides seniors critical respiration room that they need,” said Neera Tanden, who serves because the president’s domestic policy advisor, during a call with reporters Wednesday.
The president’s budget cuts federal spending by $200 billion, the White House fact sheet noted. That would increase the variety of drugs that Medicare could select for negotiation and produce more medicines to the negotiation process sooner.
The White House didn’t disclose whether the variety of drugs would steadily rise to 50 after several years under the proposal, or if that recent number would apply starting in 2029. A senior administration official told reporters Wednesday that the president looks forward to working with Congress on the main points of the proposal.
“We’ve got built a system that we’re confident is working and can deliver lower prices for the American people, and we consider we will scale that up,” the administration official said.
Among the many other policy proposals are measures to cap Medicare copayments at $2 for common generic drugs and to increase the $2,000 cap on out-of-pocket drug costs beyond Medicare to all private plans.
Biden also desires to expand one other provision of the Inflation Reduction Act that requires drugmakers to pay rebates to Medicare when their drug prices rise faster than inflation. The president wants that policy to use to business drugs, not only medicines sold to Medicare.