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Life Health > Health Insurance > Medicare Planning

Biden Stumps for Medicare Drug Price Negotiations

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What You Need to Know

  • Biden already has called for the FDA to help states and tribes import prescription drugs from Canada.
  • He focused in his remarks on letting Medicare negotiate drug prices.
  • The president said savings on drugs could help Medicare expand its benefits menu.

President Joe Biden fought for changes in Medicare drug price rules Thursday, in remarks at the White House.

Biden called for Congress to give Medicare the same ability to negotiate drug prices that the program has to negotiate prices for other products and service.

Biden talked about the effects of the drug price issue on his own family.

“I remember what it was like for my mom as she got older and moved in with us,” he said. “Her prescription drugs were so expensive that it took me, my two brothers and my sister — three siblings — chipping in to cover the thousands of dollars in monthly costs that she did — that she had to exhaust, rather than exhaust the little savings she had, for her prescription drugs.”

The heart of the Biden administration proposal would be a system for setting base prices for drugs. The base prices would reflect research and development costs and the need for the manufacturer to earn a significant profit, Biden said.

“Our plan says that drug companies can only raise prices based on the rate of inflation after it’s determined how much they’ve invested and what a healthy profit constitutes,” Biden said.

Other provisions in the plan would be to cap what Medicare enrollees spend on prescription drugs at $3,000 per year and require drug makers to sell drugs to their distributors for the same prices that Medicare pays or else face a 95% excise tax.

Biden said this proposal would work in conjunction with other moves his administration has made, such as ordering the Food and Drug Administration to help states and tribes import drugs from Canada.

If Medicare can save money on prescription drugs, then it can afford to add dental, vision and hearing benefits, Biden said.

Drug Makers’ Reaction

Stephen Ubl, the president of the Pharmaceutical Research and Manufacturers of America, said in a statement that PhRMA is ready to do its part to help lower costs for patients.

“Unfortunately, the policies the president outlined today would undermine access to life-saving medicines and fail to address an insurance system that shifts the cost of treatments onto vulnerable patients,” Ubl said. “This is a misguided approach.”

U.S President Joe Biden. (Image: lev radin/Shutterstock)


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