By Sen. Chuck Grassley
Published July 26, 2019
There has been a lot of talk over the past several months about scrapping America’s current health care system and moving to a government-run health insurance system like the so-called “Medicare-for-all” plan. That would not solve anything. In fact, it would do the exact opposite. By putting health care decisions in the hands of federal bureaucrats in Washington, Americans would lose their ability to choose the health care options best for them. They would also see reduced quality of care and higher costs.
It’s not often reported, but the truth is that the majority of Americans are largely satisfied with their health care plans. There are, however, significant problems that need to be addressed. That includes the cost of prescription drugs. As they continue to rise, health care consumers are often left wondering how they’re going to pay for the medications they need.
Throughout my time in the Senate, I’ve worked to reduce the cost of prescription drugs. Sen. Dick Durbin, D-Ill., and I put forward a legislative solution to require pharmaceutical companies to include the list price of their drugs in television advertisements. We are currently working to pass it into law. Americans don’t buy anything without knowing its cost – medications should be no different.
Sen. Patrick Leahy, D-Vt., and I introduced the Creating and Restoring Equal Access to Equivalent Samples (CREATES) Act, which takes on the abuses and delay tactics that prevent generic drug companies from conducting the necessary testing and distribution required for approval by the U.S. Food and Drug Administration (FDA). The bill was included in legislation passed out of the Senate Health, Education, Labor & Pensions Committee.
Sen. Amy Klobuchar, D-Minn., and I introduced the Stop Significant and Time-Wasting Abuse Limiting Legitimate Innovation of New Generics (STOP STALLING) Act. This bill enhances the FTC’s ability to bring cases against entities that abuse the FDA’s citizen petition process by filing sham petitions to stop or delay the approval of generic competitors. It passed out of the Senate Judiciary Committee without objection. We also introduced the Preserve Access to Affordable Generics and Biosimiliars Act last Congress and reintroduced it in January of this year. This bill brings down the price of prescription drugs by limiting anticompetitive pay-for-delay deals that prevent or delay affordable generic versions of brand-name prescription drugs from coming to the market.
Earlier this year, Congress passed the Right Rebate Act, which Ranking Member Ron Wyden, D-Ore., and I worked on together. The legislation closes a loophole in Medicaid that has allowed pharmaceutical manufacturers to misclassify their drugs. Those misclassifications have enabled them to overcharge taxpayers by billions of dollars. Most recently, my bipartisan Prescription Pricing for the People Act – a bill that directs the Federal Trade Commission to examine the behavior of supply chain intermediaries – passed out of the Senate Judiciary Committee without objection.
These are only a few examples of the solutions I and my colleagues in Congress have proposed to lower prescription drug costs. But we need to build on those efforts. With that in mind, Ranking Member Wyden and I came together at the start of this Congress to find areas of consensus on how to cut the cost of medications. After months of bipartisan negotiations, we’ve introduced a prescription drug reform package that will increase transparency and accountability in America’s health care system and deliver relief to patients and taxpayers who are struggling under the skyrocketing cost of medications.
The Prescription Drug Pricing Reduction Act (PDPRA) of 2019 addresses challenges in Medicare Parts B and D as well as Medicaid. Reforms in Part D include permanently eliminating the gaps in coverage, often referred to as the “donut hole” that currently leads to higher costs and placing a cap on catastrophic out-of-pocket expenses for beneficiaries. The legislation also changes the structure of Part D to make insurance companies and pharmaceutical manufacturers more responsible for a larger share of the cost of prescription drugs.
Reforms to Part B address the method of reimbursement of medications prescribed to patients in the doctor’s office or hospital outpatient department. Incentives for doctors and hospitals to prescribe expensive, brand-name medications can leave patients with higher out-of-pocket expenses. It also puts taxpayers on the hook for increased program costs that can often be prevented. To help solve these problems, this bill requires ending incentives that favor expensive prescription drugs, as well as more complete and accurate reporting within Part B. Better reporting, will lead to improved pricing calculations, which will help lower costs for patients and taxpayers.
Reforms in Medicaid focus on good governance policies, such as increased transparency and enhanced data collection. Additionally, the current Medicaid program is not equipped to handle the rapidly changing health care landscape. New technologies and innovations have put a severe financial strain on the states. This bill modernizes the Medicaid program to allow for greater access to new treatments. It also works to stop gaming within the system so that the taxpayer money funding Medicaid goes to patients, not middlemen who want to increase their own profits.
The Congressional Budget Office (CBO) reviewed the Prescription Drug Pricing Reduction Act and found that it will create significant savings to health care consumers and taxpayers. Over 10 years, the legislation will save taxpayers $85 billion in Medicare and $15 billion in Medicaid. Beneficiaries will save $27 billion in out-of-pocket costs and $5 billion in premiums. Americans in the consumer market will also see savings.
While there is no single piece of legislation that will solve every issue within the health care system, targeted, bipartisan reforms like these are critical in providing relief to health care consumers while increasing transparency and improving the way the system operates.
We can find can find areas of consensus when it comes to health care. This legislation is proof of that. Rather than destroying what we currently have, let’s fix what’s broken and build on what’s working. The Prescription Drug Pricing Reduction Act of 2019 is a good start.