How one freshman Democrat sees a drug pricing bill fitting into the larger conversation on health care in America.
The House passed a bill that aims to lower the cost of prescription drugs Thursday, making a major change to how the federal government buys billions of dollars of drugs for seniors on Medicare.
For one moderate Democrat, it’s a sign of how health care reform will continue to play out. Rep. Abigail Spanberger (D-Va.), who represents a Republican-leaning district outside of Richmond, says it’s all “about iterative change.”
“Continuing to ensure that we are stabilizing our current healthcare system is vitally important,” Spanberger said in an interview, adding skepticism toward any complete overhaul or “perfect solutions.”
“A plan and idea on paper is very different from a plan that you actually implement,” Spanberger said.
Not that the drug pricing bill, known as H.R. 3, isn’t significant. Giving the federal government the power to negotiate drug prices in Medicare has long been a goal for Democrats. And in Spanberger’s district, there are approximately 97,000 people enrolled in Medicare Part D that will benefit, according to an analysis from the House Ways and Means Committee Democratic staff, which has jurisdiction over federal health policy. The same analysis found that an additional 613,804 people in the district who are enrolled in private health plans will also benefit the legislation.
But after this bill, Spanberger said she expects a slow but pragmatic crawl toward much larger healthcare reforms like Medicare for All or its many cousins espoused on the Democratic presidential debate stage. (Spanberger herself does not support Medicare for All, but she does back a public option that would allow anyone to buy insurance on state and federal exchanges.)
It’s unclear if the drug pricing legislation will get bipartisan support. Some Republicans say the legislation gives the government too much negotiating power, among other concerns, while the White House has gone both ways on it.
But Spanberger said she hopes “everyone is on board with lowering the costs of prescription drugs for our seniors.”
Introduced in September, the bill addresses the skyrocketing prices of hundreds of medications. Many of them, such as insulin, are life-saving. Spanberger called the current swell in prescription drug costs a “crisis.”
The bill gives the government the authority to directly negotiate the price of some brand-name drugs that don’t have generic options; prices would be capped at 120% of what they sell for in other industrialized countries. Big pharma companies that don’t play ball would face an excise tax ranging from 65% to 95%. Private insurers could also use the lower prices, which would primarily benefit Medicare Part D beneficiaries.
The Congressional Budget Office estimates that components of the bill could save the federal government $456 billion over a decade while costing Big Pharma companies $500 billion over the same period.
Overall, Americans pay the highest prescription drug prices in the developed world, according to the Commonwealth Fund, a Washington, D.C.-based research group.
James Dau, the state director of the Virginia AARP, frequently travels around the Commonwealth talking with Virginians. “The single most frequent topic that people talk about is prescription drug costs,” Dau said.
One specific example Spanberger offered is the skyrocketing price of insulin. In 2016, 33 million Americans relied on Medicare Part D—a federal program to help seniors pay for self-administered prescription drugs—to purchase the lifesaving drug used to treat high blood glucose.
The problem, Spanberger said, is that over the last 10 years, Medicare Part D spending has increased over 840 percent. “If we’re thinking about what that means for families that go on Medicare Part D, or for anyone who requires and relies on insulin to live, it is one of the most basic places where we can see how the rising costs of drugs really impact people’s lives.”
In 1996, when insulin first hit the market, a 10-milliliter vial cost $21. The price of the same sized vial is now $275, according to a data analysis from IBM Watson Health. For people who require multiple vials a month, the costs can exceed $1,000.
Costs are so excessive that a bus recently caravanned people from West Virginia into Canada to purchase insulin, where it is about $35 per bottle.
Spanberger said she would rather not force seniors to travel all the way to Canada just to pick up their prescriptions.
Under the Lower Cost Drugs Now Act, Spanberger said, Virginia residents “would spend 3.5 times less money on insulin.”
In November, the congresswoman made nine stops across the state to discuss the implications of rising drug costs. Insulin was the number one subject attendees mentioned, she said. Many shared their fears about not being able to afford it when they need it most.
Spanberger also acknowledged the complexities surrounding rising prescription drug costs. “Everybody points fingers about whether or not it’s the advent of the pharmacy benefit managers and the middle-man organizations, whether it’s the pharmaceutical companies—there is everybody pointing fingers all these different places as to why the prices of prescription drugs continue to rise.”
The problem, she continued, is no one can be really sure who or what to blame because there is not enough data.
To that end, Spanberger introduced the Public Disclosure of Drug Discounts Act earlier this year. The bill would require pharmacy benefit managers, companies that manage prescription drug benefits on behalf of health insurers, to disclose rebates and discounts offered for prescription drugs on a public website. The legislation passed the House unanimously and has support from HHS Secretary Alex Azar.
If the bill becomes law, she said, it would help settle the debate over whether or not PBMs are contributing to increasing drug prices. Regardless of the results, just having more information would be a good first step toward reducing costs for everyone, she said.
As for H.R. 3, Dau of the Virginia AARP said it would be a “very bold first step to bringing some degree of sustainability to the prescription drug industry to help make prescription drugs more affordable.”
Clarification: This story has been updated to clarify Rep. Spanberger’s position on Medicare for All.
Update: This story has been updated to reflect the House voted to pass H.R. 3.