# Medicare Drug Price Negotiation Act

This bill would allow the federal government to directly negotiate the prices that Medicare pays for prescription drugs, similar to how the Veterans Administration already negotiates drug prices. Right now, Medicare is legally prohibited from negotiating drug prices—it has to pay whatever price pharmaceutical companies set. This bill changes that by giving Medicare the power to sit down with drug manufacturers and haggle over costs, just like any other large buyer would do.

The practical effect would be lower drug prices for seniors on Medicare. When the government negotiates as a massive buyer representing millions of patients, it has significant leverage to push prices down. For example, if a drug company wants Medicare to cover their medication for 10 million seniors, they're more likely to offer a better price than they would to a single pharmacy or hospital. Seniors would pay less out of pocket for their medications, and the government would spend less taxpayer money on the Medicare program overall. Some estimates suggest this could save hundreds of billions of dollars over the next decade.

However, pharmaceutical companies argue that lower prices could reduce their profits and discourage them from developing new drugs in the future. They worry that if the government can negotiate prices down too far, companies won't have enough money to invest in research for breakthrough treatments. This is the main argument opponents make against the bill—that while it helps current patients, it might harm future patients by slowing down drug innovation.

The bill essentially shifts power in drug pricing from pharmaceutical companies to the government on behalf of Medicare patients. Whether that's good or bad depends largely on whether you prioritize lower prices today or believe that maintaining high drug prices is necessary to fund tomorrow's medical breakthroughs.

Medicare Drug Price Negotiation Act

Sanders, Bernard

Medicare Drug Price Negotiation Act This bill makes a series of changes relating to the prices of prescription drugs under the Medicare prescription drug benefit and Medicare Advantage (MA) prescription drug plans (PDPs). Under current law, the Centers for Medicare &amp; Medicaid Services (CMS) may neither negotiate the prices of covered drugs nor establish a formulary. The bill repeals these restrictions and instead specifically requires the CMS to (1) negotiate the prices of covered drugs; and (2) either establish a formulary for covered drugs, or require changes to PDP formularies that take into account CMS negotiations. If the CMS is unable to negotiate an appropriate price for a drug in accordance with certain criteria, the price must be the lowest of three specified options (e.g., the median price in other countries). The CMS must identify drugs that are subject to negotiation, with priority given to certain categories of drugs based on usage and cost. Additionally, drug manufacturers must issue rebates to the CMS for drugs dispensed to eligible low-income individuals. Subject to civil monetary penalties, a Medicare or MA PDP sponsor must report, both to drug manufacturers and to the CMS, specified information related to the determination and payment of such rebates.