Medicare legislation

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Measures to change the Medicare program to include a prescription drug benefit were debated for many years. In 2000 and 2002, bills were introduced in the House, but never gained traction. It was not until 2003 that both houses of Congress passed, and President Bush signed, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 into law. The bill significantly changed the Medicare system by introducing a voluntary entitlement program for prescription drugs. Among its many provisions, the bill forbids the federal government from negotiating with manufacturers over drug prices for those enrolled. Arguing that allowing the government to negotiate would lower drug prices, Democratic leaders in Congress promised to change this aspect of the law if voted into the majority in the 110th Congress. In January 2007, after indeed winning a majority, the Democratic-led House passed legislation requiring the Department of Health and Human Services to negotiate drug prices with manufacturers.

Contents

110th Congress

Medicare Prescription Drug Price Negotiation Act of 2007

On January 12, 2007, the House passed the Medicare Prescription Drug Price Negotiation Act of 2007 (H.R. 4). The bill requires the federal government (specifically the Department of Health and Human Services) to negotiate with drug companies over the price of drugs for Medicare participants. The legislation strikes a clause in the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 known as the "noninterference provision," which prohibits the secretary of HHS from participating in negotiations between drug manufacturers and insurers that sponsor Medicare plans.


The final vote on the bill was 255-170.


Same for all scorecards:

Scored vote

Scorecard: Americans for Democratic Action 2007 House Scorecard

Org. position: Aye

Description:

"Passage of a bill requiring the Health and Human Services (HHS) Department to negotiate prices with drug companies for drugs covered under Medicare Part D. The bill would not authorize HHS to establish or require a particular formulary."

(Original scorecard available at: http://www.adaction.org/pages/publications/voting-records.php)

Scored vote

Scorecard: Drum Major Institute 2007 House Scorecard

Org. position: Aye

Description:

"Often living on fixed incomes, America’s seniors struggle to cope with prescription drug prices that increase every year. The new Medicare prescription drug plan was ostensibly designed to save these seniors money on needed medications. But the plan provides far less savings than it could—both for the seniors it covers and for the taxpayers who bear the costs of the new plan—because it fails to take advantage of the federal government’s ability to negotiate for better prices by buying drugs in bulk. For example, if the federal government were to buy a million pills of cholesterol-lowering medication, enough for every Medicare recipient in the country who has a prescription, they could receive a very low price because of the huge quantity. Instead of realizing these savings, the program relies on individual insurance plans to make drug purchases. Because none of these individual insurers has the purchasing power of the federal government, the result is a less efficient system with higher prices. Most industrialized countries, including Canada, use the government’s bulk purchasing power to bargain for better drug prices. Domestically, the United States Department of Veterans’ Affairs (VA) also uses this common-sense practice to reduce its costs. Studies suggest that the prices negotiated by the VA for many drugs are substantially lower than those offered under the new Medicare plan. Middle-class Americans, whether they are senior citizens, taxpayers or both, cannot afford to see the federal government squander this opportunity to rein in the ever-escalating costs of prescription drugs."

(Original scorecard available at: http://www.drummajorinstitute.org/library/report.php?ID=63)

Scored vote

Scorecard: U.S. Chamber of Commerce 2007 House Scorecard

Org. position: Nay

Description:

"Despite strong opposition by the Chamber, the House passed H.R. 4, the Medicare Prescription Drug Price Negotiation Act of 2007, by a vote of 255-170. The bill would have not only removed the non-interference provision, a vital component of the Medicare Modernization Act, but would have gone further to require the Secretary of Health and Human Services to negotiate drug prices. Ensuring robust competition in the overwhelmingly popular Medicare Part D program is among the Chamber’s highest priorities for meeting the health care needs of retirees, employees, and businesses across the country. This program allows pharmacy benefit managers, who provide drug coverage for 190 million Americans, to negotiate drug prices while offering competing versions and multiple plan offerings to seniors. This protects Medicare beneficiaries from government-imposed price controls. The Senate considered similar legislation, S. 3, that would have removed, but would not have required, the non-interference provision. Neither were signed into law."

(Original scorecard available at http://www.uschamber.com/issues/legislators/07htv_house.htm

Support and opposition

In support of the bill, sponsor John Dingell (D-Mich.) said, “Forty-three million people can have the purchasing power to perhaps encourage these drug houses to give the government and the American retirees a better price.” House Majority Leader Steny Hoyer (D-Md.) said, "This legislation is a common-sense effort to do right by the 43 million Americans enrolled in Medicare."

All but 24 House Republicans opposed the bill. Many argued that the measure adopted in 2003 worked to promote "healthy competition" between insurers to produce lower drug prices. Rep. Michael Burgess (R-Texas) echoed this sentiment, stating "With all that's right with the program, it seems unwise and unkind to jeopardize its success." [1] House Minority Leader John Boehner (R-Ohio) stated that, "Many of us believe that competition and using free-market principles in the long run produce better results, lower costs, higher quality and more satisfaction among seniors. And that's exactly what we've seen with this plan."[1]

President Bush threatens veto

Following passage of the bill, White House Press Secretary Tony Snow said that officials at both the budget office and the Department of Health and Human Services believed the bill would have little or no effect on federal spending and provide no substantial savings to the government. He bluntly stated that, “If this bill is presented to the president, he will veto it.”[2]

Senate version introduced

On January 4, 2007, Senate Majority Leader Harry Reid (D-Nev.) introduced a Senate version of the bill (S.3) which would, "amend part D of title XVIII of the Social Security Act to provide for fair prescription drug prices for Medicare beneficiaries."[3]


As of April 18, 2007, it had attracted the following cosponsors:[4]

On April 18, 2007, in a vote of 55-42, a motion to invoke cloture and bring the bill to an immediate vote was rejected. Six Republicans, Sens. Norm Coleman (R-Minn.), Susan Collins (R-Maine), Chuck Hagel (R-Neb.), Gordon Smith (R-Ore.), Olympia Snowe (R-Maine) and Arlen Specter R-Pa.), crossed party lines voting in favor of the motion. Senate Majority Leader Harry Reid (D-Nev.) sided with the Republicans for procedural reasons once he realized it would fail regardless. Senate Minority Leader Mitch McConnell (R-Ky.), who voted against the motion, said that “the Senate protected healthcare access for tens of millions of seniors as well as price negotiations to ensure they pay the least amount of money for the prescription drugs they need" by preventing the bill from passing. [5][6]


Same for all scorecards:

Scored vote

Scorecard: Americans for Democratic Action 2007 Senate Scorecard

Org. position: Aye

Description:

"Motion to invoke cloture and proceed to a bill allowing the Health and Human Services Department to negotiate the prices drug companies charge under the Medicare Part D prescription drug program."

(Original scorecard available at: http://www.adaction.org/pages/publications/voting-records.php)

Scored vote

Scorecard: AFSCME 2007 Senate Scorecard

Org. position: Aye

Description:

"The Senate rejected a motion to cut off debate on the Medicare Prescription Drug Price Negotiation Act of 2007 (S. 3), a bill to allow the federal government to negotiate with pharmaceutical companies to reduce the price of prescription drugs used by seniors and others covered by Medicare."

(Original scorecard available at: http://www.afscme.org/legislation-politics/19812.cfm)

The American Federation of State, County and Municipal Employees (AFSCME) also supported cloture and selected the vote for their 2007 Senate scorecard, where they gave it the following description:

The Senate rejected a motion to cut off debate on the Medicare Prescription Drug Price Negotiation Act of 2007 (S. 3), a bill to allow the federal government to negotiate with pharmaceutical companies to reduce the price of prescription drugs used by seniors and others covered by Medicare.[7]

Medicare Improvements for Patients and Providers Act of 2008

Senate Version

Medicare Improvements for Patients and Providers Act of 2008 (S 3101) amends titles XVIII and XIX of the Social Security Act to extend expiring provisions under the Medicare program, to improve beneficiary access to preventive and mental health services, to enhance low-income benefit programs, and to maintain access to care in rural areas, including pharmacy access, and for other purposes.

The bill, introduced by Sen. Max Baucus (D-Mont.), reverses the 10.6% cut in physician payments that took effect July 1, 2008. It would specifically provide doctors with a 1.1% pay increase that would end up costing $9.9 billion over the course of two years. However, by cutting bonus payments to private Medicare plans known as Medicare Advantage, the total cost of the bill, which would be around $19.8 billion over eight years, would be covered, according to the Congressional Budget Office.[8][9]



Alternative bills

Chuck Grassley (R-Iowa) has provided an alternative piece of legislation, (S 3118) that would also prevent the doctor's pay cut, but it would avoid the changes to Medicare Advantage private fee-for-service plans that S 3101 would enact. [10]

Initial vote fails

Although Democrats were trying to pass the bill by June 30, 2008, the Republicans successfully blocked the cloture motion to proceed with debate in a 54-39 vote. Every democrat that was present voted for cloture, except for Majority Leader Harry Reid (D-Nev.), who switched his vote so that he could bring forward the motion for cloture again in the future.[11]

Bill cleared in Senate

On July 9, 2008, Sen. Edward Kennedy returned to the Senate to break an impasse on the contentious piece of Medicare legislation. After Democrats won a crucial procedural vote, the Senate cleared the bill, 69-30. It was a wide enough margin to override a threatened veto of the bill, with votes to spare.[12]

Kennedy, 76, is recovering from brain tumor surgery June 2 and had not been to the Capitol for more than six weeks. The veteran lawmaker entered the chamber midway through the roll call vote. As he walked through the door, stunned fellow senators, aides and gallery watchers broke into hearty applause.[12]

House Version

The House version of the Medicare Improvements for Patients and Providers Act of 2008, ([2]), H.R. 6331, was introduced on June 20, 2008. The bill was sponsored by Rep. Charles Rangel (D, NY-15) and Rep. John Dingell (D, MI-15).



Presidential Veto

President Bush attempted to block the Medicare legislation by vetoing the bill, however Congress went on to override his veto. There was initial speculation that Bush would succumb to the pressures of Congress and sign the bill into law without a veto but Bush remained firm in his disapproval of the measure. [13]

In his veto message, Bush stated "I support the primary objective of this legislation, to forestall reductions in physician payments, yet taking choices away from seniors to pay physicians is wrong." He called the bill "fiscally irresponsible" and charged that it "would undermine the Medicare prescription drug program."

The House voted 383 to 41 to override the veto, while the Senate voted 70 to 26. [14]

Articles and Resources

References

  1. Christopher Lee. "House Passes Medicare Drug Bill," Washington Post. January 13, 2007.
  2. "House passes Medicare drug price bill," MSNBC. January 12, 2007.
  3. "THOMAS page on S.3," THOMAS.
  4. "THOMAS page on S.3," THOMAS.
  5. Klaus Marre, "Senate GOP blocks Medicare Part D negotiation bill," The Hill, April 18, 2007.
  6. Robert McElroy, "Managing America: Health," TheWeekInCongress, April 20, 2007.
  7. AFSCME, Full 2007 Senate Congressional Scorecard.
  8. Republicans Block Senate Debate on Medicare Physician Payment Bill"CQ Politics" June 12, 2008.
  9. Drew Armstrong, "Medicare Bill Cleared in Senate," CQPolitics.com, July 9, 2008.
  10. Republicans Block Senate Debate on Medicare Physician Payment Bill"CQ Politics" June 12, 2008.
  11. Senate Democratic Medicare bill stymied "The Hill" June 12,2008.
  12. 12.0 12.1 Drew Armstrong, "Medicare Bill Cleared in Senate," CQPolitics.com, July 9, 2008.
  13. Bush to Veto Medicare Bill Tuesday; Override ExpectedCQ Politics July 14, 2008.
  14. Congress Easily Overrides Medicare Veto The Washington Post July 16, 2008.

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