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Democrats, Republicans Take Aim at Rising Drug Prices

February 5, 2019

Consensus and compromise aren’t common in Washington, D.C., nowadays, but there seems to be at least some hint of both in a few bills aimed at taking a bite out of surging prescription drug prices.

There seems to be a hint of compromise in a few bills in Washington, D.C., aimed at taking a bite out of surging prescription drug prices.
CCIG’s Tyler Perry.

According to Kaiser Health News, here are some of the ideas either introduced in legislation or that lawmakers’ offices confirmed they are considering:

Sen. Elizabeth Warren, D-Mass., and Rep. Jan Schakowsky, D-Ill., want to make a public option available for generic drugs. Under their proposal, the government could manufacture generics (directly or through a private contractor) if there is a shortage or there aren’t enough competitors to keep prices down.

Several lawmakers want to give Medicare the power to negotiate drug prices. Sen. Sherrod Brown, D-Ohio, has suggested that if a drug maker and the government can’t reach an agreement, the government could take away the company’s patent rights.

Related: 9 Ways to Lower Your Prescription Drug Costs

Along those lines, Sen. Bernie Sanders, I-Vt., and Rep. Elijah Cummings, D-Md., have proposed that Medicare should be able to pay the lowest amount among: Medicaid’s best price, the highest price a single federal purchaser pays, or the median price paid for a specific drug in France, the U.K., Germany, Japan and Canada.

Another Sanders-Cummings bill would let patients, wholesalers and pharmacies import drugs from abroad — starting with Canada, and leaving the door open for some other countries.

Legislation from Sanders and Rep. Ro Khanna, D-Calif., would require companies to price their drugs no higher than the median of what’s charged in Germany, Japan, France, the United Kingdom and Canada. If manufacturers fail to comply, other companies could get the rights to make those drugs, too.

Sanctioning Big Pharma

Other lawmakers, meantime, want to sanction manufacturers who raise drug prices more than 30 percent in five years. Punishments could include requiring the company to reimburse those who paid the elevated price, forcing the drug maker to lower its price, or charging a penalty up to three times what a company received from boosting the price.

Sen. Lamar Alexander, R-Tenn. and Chuck Grassley, R-Iowa, also have indicated they’re ready to tackle the issue. Alexander, who chairs the Health, Education, Labor and Pensions Committee, has said cutting health care costs, including drug prices, will be high on his panel’s to-do list this Congress. Grassley runs the Finance Committee, which oversees pricing issues for Medicare and Medicaid.

Grassley and Sen. Ron Wyden, D-Oregon, late last year joined forces to introduce a bill that’s aimed at the methods drug companies use to overcharge taxpayers for Medicaid rebates.

The Trump administration itself has taken steps in this direction, including testing changes to Medicare that might reduce out-of-pocket drug costs.

Most recently, the administration proposed eliminating discounts arranged between drug makers, insurers and go-betweens and instead requiring that the rebates be paid directly to consumers when they buy their medications.

Just which reforms survive is anyone’s guess. But there’s nothing like a looming presidential election – and big losses in the previous election – to motivate folks to move in at least some direction. And that’s regardless of which side of the aisle they’re on.

Tyler Perry is an Insurance Advisor in CCIG’s Employee Benefits division. He can be reached at 720-330-7934 or

CCIG is a Denver-area insurance and employee benefits brokerage with the full-service capabilities of a national brokerage. We do more than make sure you have the right policy. We also help you manage your long-term cost of risk with our risk and claims management expertise and a commitment to service excellence.


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