House Passes Medicare Drug Bill

"It's flat wrong to think the government is going to negotiate a lower price than the competitive marketplace," said Rep. Joe L. Barton (Tex.), ranking Republican on the Energy and Commerce Committee.

W.J. "Billy" Tauzin, president of the Pharmaceutical Research and Manufacturers of America, said the House bill may lead to the government limiting which medicines will be covered. "That should not be acceptable to anyone," the former GOP congressman said.

The White House issued a statement this week saying that Bush would veto the bill if it reached his desk. "Government interference impedes competition, limits access to life-saving drugs, reduces convenience for beneficiaries, and ultimately increases costs to taxpayers, beneficiaries and all American citizens alike," the statement said.

Medicare provides health-care coverage to most elderly Americans, as well as to about 7 million younger people with disabilities.

Although the measure moved quickly through the House, its prospects are murkier in the Senate, where no companion bill has been introduced. Sens. Ron Wyden (D-Ore.) and Olympia J. Snowe (R-Maine) introduced legislation this week that calls for government price negotiations in certain instances, such as for drugs with no competing substitutes or when the research behind a drug was funded mostly by taxpayers.

"We do think that there is an opportunity to get some additional value for seniors and additional value for taxpayers," Wyden said.

There is considerable pressure on lawmakers to do something. A poll last month by Kaiser and the Harvard School of Public Health found that 85 percent of adults surveyed -- including majorities of Republicans, Democrats and independents -- favor allowing the government to negotiate prescription drug prices for the Medicare program.

Senate Finance Committee Chairman Max Baucus (D-Mont.), whose committee would vet any Medicare drug bill, said in a statement this week that he favors eliminating the ban on government price negotiations -- a stance that increases the chances that some kind of legislation will pass.

But he added that he opposes "heavy-handed" intervention such as price controls. He said that wants to explore options such as expanding government studies on drug effectiveness and increasing the scrutiny on whether insurers are passing on the discounts they get from drug companies to consumers.

"The HHS secretary has a gold mine of data, the ability to get more data, dozens of agencies and tens of thousands of public servants at his disposal," he said. "That is quite a tool box with which to seek fair drug prices for seniors. It is time to open that tool box for Medicare."