Sen. Al Franken has introduced a bill that would cut prescription drug costs for seniors by giving the federal government the power to negotiate lower prices for Medicare beneficiaries. The Prescription Drug and Health Improvement Act would eliminate the restrictions against such bargaining put in place when the Medicare drug benefit was enacted.
"When I travel around Minnesota, I always hear from seniors that they're still paying far too much for prescription drugs," Franken says. "This bill … is a common sense measure to cut spending without taking away any vital services."
Under current legislation, pharmaceutical companies negotiate drug costs directly with private insurance companies, with taxpayers and seniors, who are ultimately responsible for the expense, out of the loop. Franken's bill would give the Department of Health and Human Services the leveraging power of 50 million Medicare beneficiaries to force Big Pharma into offering the best deal.
In 2010, the Medicare program saw Part D expenses of $68 billion. Franken's bill could save the program as much as $24 billion each year by permitting Medicare to use the same negotiating tactics employed by other federal agencies, such as the Department of Veterans Affairs. The latter agency, according to a recent review, receives 10 of the most common prescription drugs at approximately 50 percent of what Medicare pays.
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