House defies Bush, OK's drug plan
The US House of Representatives, in repudiation of President George W. Bush's Medicare prescription drug plan, yesterday passed a bill requiring the government to negotiate drug prices with pharmaceutical companies.
But Bush said he would veto the measure if it passes the Senate, and the 255-to-170 vote in the House could not override a veto. Democrats had promised to make lowering drug prices a priority once they gained a majority in Congress.
Currently, Medicare cannot negotiate drug prices. Individual insurance companies contract with Medicare to provide prescription drug coverage, and only they are allowed to negotiate with manufacturers and wholesalers.
Supporters of the House measure, called the Medicare Prescription Drug Price Negotiation Act, said it would save $96 billion over 10 years.
"This will deliver lower premiums to the seniors, lower prices at the pharmacy, and savings for all taxpayers," said Representative John Dingell , Democrat of Michigan and chairman of the House Energy and Commerce Committee.
When the Medicare drug plan, called Part D, was passed in 2003, critics claimed it would primarily benefit pharmaceutical companies and insurers. But supporters say many seniors have seen significant savings since the plan took effect last year.
Yesterday's vote reignited that debate, with opponents and supporters lining up in predictable fashion. The drug industry said negotiating prices with the government is tantamount to imposing federal price controls.
"Our experience in Europe has been that negotiating with the government ends up with the government dictating prices," said Tim Hunt , a spokesman for Biogen Idec Inc. of Cambridge, one of the state's largest biotechnology firms. "This vote will hurt Massachusetts biotech companies; it's harmful to Massachusetts patients, and in the end it won't save much money."
Several government officials backed up that contention. They said enabling Medicare -- through the secretary of health and human services -- to negotiate with drug companies would not drastically cut drug prices.
The bill "would have a negligible effect on federal spending because we anticipate that the secretary would be unable to negotiate prices across the broad range of covered Part D drugs that are more favorable than those obtained by the prescription drug plans ," wrote the Congressional Budget Office, a nonpartisan research arm of Congress.
Mike Leavitt , secretary of health and human services, said, "There's just no evidence that government makes better choices for consumers on their health than consumers do for themselves."
But the Veterans Administration, which negotiates drug prices for its healthcare system, does pay significantly less for many of the drugs provided by Medicare plans.
AARP, an advocacy group that represents 38 million seniors, called the bill's passage by the House "a significant victory."
"The American public overwhelmingly supports giving Medicare the power to bargain with manufacturers on behalf of beneficiaries for lower drug prices," said William Novelli , the group's chief executive, in a statement.
State Senator Mark C. Montigny , Democrat of New Bedford and former head of a national state legislators healthcare group, said, "The Medicare drug law was the most blatant abuse and corruption of the public policy process I've seen in 14 years. Today's vote is a major step in the right direction."
While independent surveys show the majority of seniors are satisfied with the drug benefit, many were initially confused by the complexity of the plan.
It's unclear whether Democrats will bring a similar bill to a vote in the Senate. Senator Max Baucus , Democrat of Montana who helped negotiate the 2003 law, said he supports giving Medicare the ability to negotiate with drug makers.
"The total prohibition on negotiation should be eliminated," he said.
Material from Globe wire services was used in this report. Jeffrey Krasner can be reached at krasner@globe.com. 
