What’s Happening with Budget Reconciliation Legislation Affecting Seniors?
As Democrats attempt to unite around a final budget reconciliation package – otherwise known as President Biden’s Build Back Better Plan – seniors advocates are keeping a close eye on key provisions affecting older Americans. The Democrats’ plan included adding dental, vision, and hearing coverage to Medicare — and allowing the Medicare program to negotiate prescription drug prices with Big Pharma. We spoke to Dan Adcock, director of government relations and policy here at the National Committee, about what is likely to happen to those key provisions for American seniors.
Q: Is it still realistic that the Democrats’ final reconciliation bill will include dental, vision, and hearing coverage for Medicare beneficiaries?
A: It’s hard to know at this point. Benefits improvements may be scaled back, especially if prescription drug reforms are weakened. Democrats had planned to use savings from prescription drug reform to pay for some of these expansions, but now those reforms may not be as robust and produce fewer savings. There are other ways to pay for Medicare expansion, such as higher taxes on the wealthy and big corporations included in the budget reconciliation bill approved by the House Ways and Means Committee. But how this revenue will be used in the final spending bill is still uncertain.
Q: If Medicare expansion is pared back, which of the new coverages would likely survive?
A: For months, the odds-on favorite was dental benefits. But the problem is that a dental benefit will take longer to implement. It could take anywhere from 3-5 years to design and put into effect. From a policy standpoint, that’s a laudable objective, but from a political standpoint, it creates a problem. Vision and hearing coverage would be easier to assemble and get off the ground – maybe just a year or two.
Q: Are there any workarounds for getting a dental benefit up and running sooner?
A: Some centrist Democrats have proposed giving beneficiaries dental vouchers in lieu of a formal benefit. The problem with that is that dentists could raise prices for their services so that the net out-of-pocket expense for seniors would still be high, even with the vouchers. The voucher plan might also deprive CMS of money and administrative bandwidth to develop a fuller dental benefit in the future. For these reasons, we don’t support vouchers. However, in the meantime, Medicare could expand existing coverage for dental care considered “medically necessary,” so that more dental procedures would be covered moving forward.
Q: Seniors’ advocates have pressed very hard for Medicare to be allowed to negotiate prescription drug prices, but the fate of that provision in the reconciliation bill is unclear?
A: I would say that Medicare price negotiation is not dead, but is on ‘life support.’ The final reconciliation package is unlikely to have full-on negotiation. But we and other seniors’ advocates are still pushing for it. And we are encouraging our members and supporters to contact their members of Congress to demand Medicare price negotiation. Unfortunately, Big Pharma has been pulling out all the stops to stop Medicare negotiation, and the industry wields outsized power on Capitol Hill. Centrist Democrats, especially in the Senate, may not vote for a final package if it contains price negotiation.
Q: Without Medicare price negotiation, what kind of drug cost reform can we still expect?
A: We expect to at least see something resembling the Grassley-Widen bill (first introduced in the previous Congress), which would cap drug price increases at the rate of inflation and peg some prices to what other countries pay for drugs. These reforms would not be as effective as Medicare negotiation, but they would definitely lower what seniors pay for prescription drugs. Given that many seniors can’t currently afford their medications, these other reforms would be a step in the right direction and provide some much-needed relief.
Q: When do you think the reconciliation package will actually be finalized and brought to the floor for a vote?
A: I think it’s unlikely to be this week. The hold-up is that Democrats need a bill that can pass both the House and Senate. Leadership is trying to ascertain what centrists will support in the end. The problem is that some centrists have said what they’re against in the reconciliation package, but not what they’re for. Until that is made apparent, it will be hard to bring a final bill to the floor.
NCPSSM President to Manchin & Sinema: Protect Seniors’ Voting Rights!
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The National Committee to Preserve Social Security and Medicare is appealing to Senators Joe Manchin and Krysten Sinema to support changes to the filibuster in order to protect older Americans’ voting rights. In letters to each senator co-signed by some 40 advocates and political influencers, NCPSSM President and CEO Max Richtman writes that adjusting the Senate filibuster is the only way to safeguard ballot access for seniors if enough Republican Senators won’t support new federal voting rights legislation. Such legislation is necessary, says Richtman, because of restrictive, new state laws that infringe on seniors’ right to vote by mail.
The National Committee, with millions of members and supporters nationwide (including some 38,000 in Arizona and 12,000 in West Virginia), supported both senators’ campaigns in 2018.
“We urge you to support a narrow change to the filibuster rule to allow the Senate to approve new voting rights legislation by a simple majority vote. This crucial legislation will help to protect our democracy and the right to vote for all Americans, including older Arizonans and West Virginians who cast ballots by mail.” – Max Richtman, President and CEO, National Committee to Preserve Social Security and Medicare.
At least 14 states have passed new laws that restrict access to the vote. The West Virginia State Senate has approved a bill which would move up the deadline for requesting an absentee ballot from six days before Election Day to 11 days. Meanwhile, Arizona lawmakers enacted legislation to prohibit sending absentee ballots or ballot applications to voters unless requested.
“The sole purpose of restrictive, new state laws is to suppress votes that the majority party in these legislatures don’t like. We urge Senator Sinema and Senator Manchin to protect American voters from being disenfranchised — including millions of seniors who otherwise can’t safely make it to the polls. If it becomes clear that adjusting the filibuster is the only option to guarantee voting rights, we hope the Senator will reconsider her position.” – Max Richtman, 9/21/21
Currently, seniors who are immobile, sick, or don’t want to risk being infected by the delta COVID variant can request mail ballots — along with those who cannot drive or lack access to mass transit. Voting by mail allows these older citizens to exercise their constitutional rights in a safe, convenient way. In 2020, the majority of voters over age 65 cast their ballots by mail.
Those who want to restrict that right falsely claim that voting by mail is rife with fraud. Nothing could be farther from the truth. Studies have shown mail-in voting to be consistently free of fraud. An M.I.T. study found that only 0.00006% of 250 million mail-in votes nationwide were fraudulent. Additionally, scholars at Stanford University analyzing more than twenty years’ worth of data in California, Utah and Washington found vote-by-mail did not advantage one political party over another.
Nevertheless, Republicans in the Arizona legislature and West Virginia state senate bought into the “Big Lie” that the 2020 presidential election results were illegitimate. Arizona’s law is a solution in search of a problem since county election officials recently reported fewer than 200 cases of potential voter fraud out of more than 3 million ballots cast statewide in the 2020 election.
The National Committee implores both senators to stand up for seniors by supporting a narrow change to the filibuster rule to allow the Senate to approve the For the People Act on a simple majority vote. That is the only truly democratic choice.
Read our letters to Senator Sinema and Senator Manchin.
Holdout House Dems Should Side with the People, Not Big Pharma
Nearly 90% of the American public wants Medicare to be able to negotiate drug prices with Big Pharma – including a majority of Republicans. Unfortunately, the will of the people is being thwarted not only by Republicans on Capitol Hill — who refuse to support Medicare price negotiation — but holdout ‘moderate’ Democrats.
This week three Blue Dog Democrats, Reps. Kurt Schrader (D-OR), Kathleen Rice (D-NY), and Scott Peters (D-CA), voted against Medicare drug price negotiation in the House Energy & Commerce Committee, preventing the measure from being sent to the House floor. Over at the House Ways and Means Committee, Rep. Stephanie Murphy (D-FL) was the sole Democrat casting her vote against Medicare negotiation, though there were enough other votes to pass it out of that committee. (Rep. Murphy voted against every provision in the Democrats’ $3.5 trillion plan, saying she needed more time to study it.)
These ‘No’ votes have not yet doomed Medicare drug cost negotiation – which we have long argued is the best way to reduce prescription prices for seniors – but they do signal that there may not be enough Democratic support for the measure to pass in the full U.S. House, where the party has only the slimmest of majorities.
Even if Medicare price negotiation survives a House vote (as part of President Biden’s $3.5 trillion Build Back Better plan), it is unlikely to garner sufficient support in the Senate. Republicans, of course, will not vote for it, and Senate Democrats are already working on a more modest drug price reform package that does not allow Medicare to negotiate prices.
“The purpose of the drug pricing policy is to pay for a host of new health care policies. The way it works is that it allows the government to restrict the maximum price that drug companies can charge for insulin and a set of expensive drugs that don’t face competition, and generate savings by forcing pharmaceutical companies to take the hit — the measure could save the government $500 billion over a decade.” – MSNBC, 9/16/21
This is another one of those moments in history when reformers put forward commonsense proposals (with the support of the majority of the American people) — and wealthy, powerful interests block their efforts. Big Pharma has intensified its lobbying efforts to defeat drug pricing reform – and especially the ability of Medicare to negotiate prices. In fact, Big Pharma successfully lobbied to exclude Medicare price negotiation when the Medicare Modernization Act was written and enacted in 2003.
Seniors and their advocates felt that this year – with a Democratic President and both houses of Congress in the party’s control – was a golden opportunity to realize the long-held goal of Medicare drug price negotiation. But Big Pharma’s choke hold on federal policy decisions is formidable.
Some question the role that campaign contributions could be playing in this scenario. Of the three House Energy & Commerce committee Democrats who voted to nix Medicare price negotiation, two receive significant contributions from Big Pharma. Reps. Schrader and Peters have collected nearly $1.5 million over the course of their careers. In fact, Congressman Peters is the House’s “top recipient of pharmaceutical industry donations in the 2022 election cycle,” according to MSNBC. (Rep. Rice has received a relatively modest $8,500 from the industry since 2020, says MSNBC.)
“Leaders of nearly two dozen drug manufacturers said that though they share Americans’ concerns over healthcare costs, ‘these dangerous policy experiments are not the answer.’ Dangerous policy experiments? Nearly every other developed country worldwide allows its government insurance system to negotiate drug prices. And guess what? This reasonable use of market power allows people in other countries to pay roughly half what Americans pay for prescription meds.” – Los Angeles Times, 9/16/21
Of course, everyday Americans living paycheck to paycheck deserve to be heard, too. And while seniors’ advocates like us continue to fight for meaningful reform, it can be an uphill battle against Big Pharma’s billions. Not for lack of trying by the President. Earlier this week, President Biden reiterated his support for Medicare price negotiation, which is part of his Build Back Better plan.
We and our members and supporters still will embrace other meaningful reforms to emerge from the 117th Congress. Linking drug price increases to inflation and capping Medicare beneficiaries’ out of pocket drug costs are solid steps toward taming prescription prices. They would help seniors on fixed incomes — and likely lower drug costs for the public at large. But the American people want the full package, including Medicare price negotiation. They know that out of control drug prices are hurting Americans of all ages. When people ration medications or don’t fill prescriptions because of cost, it can literally kill them. Members of Congress should not turn their backs on the people they are supposed to represent. They should muster the courage to stand with the public — and not Big Pharma.
Big Pharma Dreads Medicare Price Negotiation
Big Pharma is none too happy with legislation to allow Medicare to negotiate drug prices, according to published accounts and members of the advocacy community. Such opposition is nothing new, of course, but it has intensified as the Democrats’ (and the President’s) drug reform plans work their way through Congress as part of the budget reconciliation process.
Of course, the drug industry fears that allowing Medicare to negotiate drug prices would cut into its sizeable profits.
“Big Pharma — one of the most profitable industries in America — is absolutely horrified at the idea that its ability to extract all those trillions of dollars might be limited.” – Washington Post, 8/27/21
Currently, Big Pharma can set prices at will – no matter how outrageous or unaffordable. (Simply look at the skyrocketing price of insulin, for example.) Medicare negotiation would force the industry to the bargaining table with the federal government – saving some $456 billion in drug costs over ten years. But price negotiation was specifically excluded from legislation creating the Medicare Part D Prescription drug benefit in 2003, at the industry’s behest.
Meanwhile, overwhelming majorities of Americans from both parties support this commonsense proposal in poll after poll. But Big Pharma is running an expensive ad campaign to scare the public. One television ad warns about “Pelosi’s socialist drug plan.” Another features a senior with diabetes named “Sue” who claims that price negotiation “would make it harder for people on Medicare to get the medicines we need.” No, actually, it’s the high cost of insulin and other essential drugs that make it harder for people on Medicare to get the medicines they need. Too many beneficiaries simply can’t afford their medications — and cut pills in half or skip filling prescriptions altogether.
The pharmaceutical lobby warns that “Washington (would) control the prescription drug market” through price negotiation. If that were true, then the Veterans Administration would already be controlling the market, because it has been negotiating drug prices with Big Pharma for years. The federal government constantly negotiates prices for private sector services and products. It’s part of the free-market system that conservatives tout. Does that mean Washington ‘controls’ the market for everything from concrete to aircraft? Obviously not. In fact, we are the only Western industrialized democracy that does not negotiate prescription drug prices with manufacturers – or have an agreed upon pricing structure.
“American drug purchasers pay substantially higher prices for drugs than their counterparts in other developed countries. A recent paper from the RAND Corporation cited in the government proposal estimates that prescription drugs in the United States cost more than 250 percent of the prices paid by other countries.” – New York Times, 9/9/21
Big Pharma insists that price negotiation would stifle innovation in the pharmaceutical market, even though the federal government puts significant resources into research on new drugs. (In fact, the federal government was instrumental in developing the mRNA technology used in the Moderna and Pfizer vaccines.)
“A study underwritten by the National Biomedical Research Foundation, mapped the relationship between NIH-funded research and every new drug approved by the FDA between 2010 and 2016. The authors found that each of the 210 medicines approved for market came out of research supported by the NIH. Of the $100 billion it spent nationally during this period, more than half of it — $64 billion — ended up helping the development of 84 first-in-class drugs.” – Other98.com
Medicare price negotiation is one facet of the Democrats’ proposed drug reforms, along with lower out-of-pocket caps for beneficiaries and tying the increase of prices to inflation. Advocates consider negotiation the most potent tool for bringing down seniors’ drug costs. But the measure must survive the reconciliation process in the Senate, where the Democrats need fifty votes to enact reform. Seventy-two U.S. Senators received contributions from Big Pharma in the last election cycle. That is not to say that some Senators won’t do the right thing, but the sway of drug industry dollars can be powerful.
In the end, lawmakers’ priority should be the people on fixed incomes who can’t afford their medications, the Americans who have died from rationing medicines, the retirees forced to choose between groceries and prescription drugs because of cost. They are the ones who badly need relief. Drug manufacturers will be perfectly fine — even if the price negotiation they dread is finally enacted.
Social Security Trustees Report Signals Now is the Time to Strengthen & Expand the Program
Americans who rely on Social Security can exhale for a moment now that the program’s Trustees have reported that the trust fund will remain solvent until 2034. That’s only one year earlier than projected in last year’s report.
“There is no need to sound the alarm, but now is the time to address Social Security’s long-term solvency – and provide an overdue boost in benefits. Phone calls and emails to Congress are definitely warranted at this critical juncture.” – Max Richtman, President and CEO of the National Committee to Preserve Social Security and Medicare.
The program, which has never missed a benefit payment in its 86-year history, remains strong. If Congress does not take curative action and the trust fund becomes depleted, Social Security still could pay 78% of benefits because of the steady inflow of revenue from workers’ payroll contributions. But that poses a huge financial risk for the millions of retirees who depend on Social Security for most if not all of their income. It also raises a serious political risk for members of Congress who fail to boost the program’s finances so that the trust fund remains solvent beyond 2034.
At the same time, benefit adequacy needs to be addressed. Living on an average monthly benefit of $1,540 is tough. Retirement savings are dwindling, pensions are disappearing, and the cost of senior housing and medical care are soaring. For over six years, Congressman John Larson has been driving efforts to strengthen Social Security by adjusting the payroll wage cap so that high income earners begin paying their fair share.
Rep. Larson has also proposed an across-the-board boost for all retirees, enhanced benefits for the most vulnerable seniors, and a more accurate formula for calculating annual cost-of-living adjustments (COLAs) so that benefits truly keep pace with inflation. Rep. Larson’s proposals align with President Biden’s own prescriptions for improving Social Security. These proposals win approval from a majority of Americans in poll after poll.
“Of course, the default response from conservatives will be to suggest, indirectly or otherwise, that Social Security benefits must be cut to address the program’s funding shortfall. Some will insist that Social Security be privatized, which would gamble workers’ hard-earned retirement benefits on Wall Street. Meanwhile, conservatives likely will oppose common sense revenue-side measures that would actually boost benefits, including Rep. Larson’s proposed adjustment of the payroll wage cap.” – Max Richtman
The depletion of the trust fund in 2034 is not a foregone conclusion. With Democrats in control of the House and Senate — and an advocate for Social Security in the White House — advancing legislation to strengthen and expand the program is finally within reach. But the public must demand that Congress muster the political will to get it done. The Trustees Report is a firm reminder that time is running short.