Medicare legislation

Measures to change the Medicare program to include a prescription drug benefit were debated for many years. In 2000 and 2002, bills were introduced in the House, but never gained traction. It was not until 2003 that both houses of Congress passed, and President Bush signed, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 into law. The bill significantly changed the Medicare system by introducing a voluntary entitlement program for prescription drugs. Among its many provisions, the bill forbids the federal government from negotiating with manufacturers over drug prices for those enrolled. Arguing that allowing the government to negotiate would lower drug prices, Democratic leaders in Congress promised to change this aspect of the law if voted into the majority in the 110th Congress. In January 2007, after indeed winning a majority, the Democratic-led House passed legislation requiring the Department of Health and Human Services to negotiate drug prices with manufacturers.

Medicare Prescription Drug Price Negotiation Act of 2007
On January 12, 2007, the House passed the Medicare Prescription Drug Price Negotiation Act of 2007 (H.R. 4). The bill requires the federal government (specifically the Department of Health and Human Services) to negotiate with drug companies over the price of drugs for Medicare participants. The legislation strikes a clause in the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 known as the "noninterference provision," which prohibits the secretary of HHS from participating in negotiations between drug manufacturers and insurers that sponsor Medicare plans.



The final vote on the bill was 255-170.



Support and opposition
In support of the bill, sponsor John Dingell (D-Mich.) said, “Forty-three million people can have the purchasing power to perhaps encourage these drug houses to give the government and the American retirees a better price.” House Majority Leader Steny Hoyer (D-Md.) said, "This legislation is a common-sense effort to do right by the 43 million Americans enrolled in Medicare."

All but 24 House Republicans opposed the bill. Many argued that the measure adopted in 2003 worked to promote "healthy competition" between insurers to produce lower drug prices. Rep. Michael Burgess (R-Texas) echoed this sentiment, stating "With all that's right with the program, it seems unwise and unkind to jeopardize its success."  House Minority Leader John Boehner (R-Ohio) stated that, "Many of us believe that competition and using free-market principles in the long run produce better results, lower costs, higher quality and more satisfaction among seniors. And that's exactly what we've seen with this plan."

President Bush threatens veto
Following passage of the bill, White House Press Secretary Tony Snow said that officials at both the budget office and the Department of Health and Human Services believed the bill would have little or no effect on federal spending and provide no substantial savings to the government. He bluntly stated that, “If this bill is presented to the president, he will veto it.”

Senate version introduced
On January 4, 2007, Senate Majority Leader Harry Reid (D-Nev.) introduced a Senate version of the bill (S.3) which would, "amend part D of title XVIII of the Social Security Act to provide for fair prescription drug prices for Medicare beneficiaries."



As of April 18, 2007, it had attracted the following cosponsors:


 * Sen. Max Baucus (D-Mont.) - 1/4/2007
 * Sen. Barbara Boxer (D-Calif.) - 1/4/2007
 * Sen. Sherrod Brown (D-Ohio) - 1/11/2007
 * Sen. Maria Cantwell (D-Wash.) - 1/4/2007
 * Sen. Bob Casey (D-Pa.) - 2/15/2007
 * Sen. Hillary Clinton (D-N.Y.) - 1/4/2007
 * Sen. Russ Feingold (D-Wis.) - 4/18/2007
 * Sen. Amy Klobuchar (D-Minn.) - 1/22/2007
 * Sen. Herb Kohl (D-Wis.) - 1/4/2007
 * Sen. Patrick Leahy (D-Vt.) - 1/4/2007
 * Sen. Carl Levin (D-Mich.) - 2/16/2007
 * Sen. Barbara Mikulski (D-Md.) - 1/4/2007
 * Sen. Bill Nelson (D-Fla.) - 4/17/2007
 * Sen. Chuck Schumer (D-N.Y.) - 1/4/2007
 * Sen. Debbie Stabenow (D-Mich.) - 1/4/2007
 * Sen. Jim Webb (D-Va.) - 1/4/2007

On April 18, 2007, in a vote of 55-42, a motion to invoke cloture and bring the bill to an immediate vote was rejected. Six Republicans, Sens. Norm Coleman (R-Minn.), Susan Collins (R-Maine), Chuck Hagel (R-Neb.), Gordon Smith (R-Ore.), Olympia Snowe (R-Maine) and Arlen Specter R-Pa.), crossed party lines voting in favor of the motion. Senate Majority Leader Harry Reid (D-Nev.) sided with the Republicans for procedural reasons once he realized it would fail regardless.  Senate Minority Leader Mitch McConnell (R-Ky.), who voted against the motion, said that “the Senate protected healthcare access for tens of millions of seniors as well as price negotiations to ensure they pay the least amount of money for the prescription drugs they need" by preventing the bill from passing.



Senate Version
Medicare Improvements for Patients and Providers Act of 2008 (S 3101) amends titles XVIII and XIX of the Social Security Act to extend expiring provisions under the Medicare program, to improve beneficiary access to preventive and mental health services, to enhance low-income benefit programs, and to maintain access to care in rural areas, including pharmacy access, and for other purposes.

The bill, introduced by Sen. Max Baucus (D-Mont.), reverses the 10.6% cut in physician payments that took effect July 1, 2008. It would specifically provide doctors with a 1.1% pay increase that would end up costing $9.9 billion over the course of two years. However, by cutting bonus payments to private Medicare plans known as Medicare Advantage, the total cost of the bill, which would be around $19.8 billion over eight years, would be covered, according to the Congressional Budget Office.





Alternative bills
Chuck Grassley (R-Iowa) has provided an alternative piece of legislation, (S 3118) that would also prevent the doctor's pay cut, but it would avoid the changes to Medicare Advantage private fee-for-service plans that S 3101 would enact.

Initial vote fails
Although Democrats were trying to pass the bill by June 30, 2008, the Republicans successfully blocked the cloture motion to proceed with debate in a 54-39 vote. Every democrat that was present voted for cloture, except for Majority Leader Harry Reid (D-Nev.), who switched his vote so that he could bring forward the motion for cloture again in the future.

Bill cleared in Senate
On July 9, 2008, Sen. Edward Kennedy returned to the Senate to break an impasse on the contentious piece of Medicare legislation. After Democrats won a crucial procedural vote, the Senate cleared the bill, 69-30. It was a wide enough margin to override a threatened veto of the bill, with votes to spare.

Kennedy, 76, is recovering from brain tumor surgery June 2 and had not been to the Capitol for more than six weeks. The veteran lawmaker entered the chamber midway through the roll call vote. As he walked through the door, stunned fellow senators, aides and gallery watchers broke into hearty applause.

House Version
The House version of the Medicare Improvements for Patients and Providers Act of 2008,, H.R. 6331, was introduced on June 20, 2008. The bill was sponsored by Rep. Charles Rangel (D, NY-15) and Rep. John Dingell (D, MI-15).





Presidential Veto
President Bush attempted to block the Medicare legislation by vetoing the bill, however Congress went on to override his veto. There was initial speculation that Bush would succumb to the pressures of Congress and sign the bill into law without a veto but Bush remained firm in his disapproval of the measure.

In his veto message, Bush stated "I support the primary objective of this legislation, to forestall reductions in physician payments, yet taking choices away from seniors to pay physicians is wrong." He called the bill "fiscally irresponsible" and charged that it "would undermine the Medicare prescription drug program."

The House voted 383 to 41 to override the veto, while the Senate voted 70 to 26.

External resources

 * THOMAS page on H.R. 4
 * TheWeekInCongress

External articles

 * "House passes Medicare drug price bill," MSNBC.com, January 12, 2007.
 * Christopher Lee, "House Passes Medicare Drug Bill," Washington Post, January 13, 2007.