This bill caps what Medicare can pay for prescription drugs by tying those prices to what the federal government already pays through other programs. Specifically, Medicare Part B (which covers drugs administered by doctors) and Medicare Part D (which covers prescription drugs people pick up at pharmacies) would pay no more than the lowest price the Veterans Affairs department or the General Services Administration pays for the same drugs. Starting January 1, 2024, drug manufacturers would have to agree to these price caps in order for their medications to be covered by Medicare at all.

The practical effect is that Medicare drug prices would be limited to what the government negotiates for military veterans and federal employees, which are typically much lower than what Medicare currently pays. This could significantly reduce out-of-pocket costs for seniors on Medicare and lower the overall federal drug spending. However, drug manufacturers might respond by raising prices for non-Medicare customers or reducing their investment in developing new medications. The bill requires the Veterans Affairs department and General Services Administration to share their pricing information with the Department of Health and Human Services so Medicare can enforce these caps.

Cutting Medicare Prescription Drug Prices in Half Act

Sanders, Bernard

Cutting Medicare Prescription Drug Prices in Half Act This bill caps the cost of prescription drugs under Medicare at the amount that the Department of Veterans Affairs or the General Services Administration pays for the drug, whichever is lower.