July 25,2019

Grassley On The Prescription Drug Pricing Reduction Act of 2019

Prepared Opening Remarks by U.S. Senator Chuck Grassley of Iowa
Chairman, Senate Finance Committee
Markup for The Prescription Drug Pricing Reduction Act of 2019
Thursday, July 25, 2019
In 2003, when we first passed the Medicare Modernization Act that I authored in the Senate, our goal was to make the first improvements to the Medicare program in nearly 40 years.
We wanted to give seniors an affordable option that worked like the health insurance they had in the places from which they retired.
We wanted to make sure that the legislation benefited all seniors and we put into place a mechanism to keep the price of drugs down.
In Part D, private insurers negotiate with drug manufacturers to get the best price on drugs so that premiums stay affordable.
That has worked very well.
Premiums in the Part D program have been remarkably stable since the program’s inception, despite claims from naysayers at the time that premiums would skyrocket.
So we should keep what’s working and fix what can be improved.
In the fifteen years since the last major reform to Medicare, we’ve seen the development of innovative medicines to treat arthritis, cancer and countless other disorders.
These treatments have been lifesaving or life changing for millions of Americans.
But, they have come with increased costs.
This includes increased out-of-pocket costs for beneficiaries and increased taxpayer spending.
All of us on this committee have heard from our constituents about the high cost of prescription drugs.
I’ve heard from Iowans who have left prescriptions at the pharmacy counter or who skipped doses of their medicine to save money.
In the first hearing we held this year, we heard from a mother whose son reduced his insulin use because he was concerned about the financial burden placed on his family by the cost.
When I became chairman of this committee again this year, I said that addressing high drug prices was one of my top priorities. 
I also said that any effort to tackle such a problem needed to be bipartisan, go through regular order and be marked up before the August work period.
I want to thank the senators on this committee who I’ve worked with to craft this bipartisan bill.
We have a bill before us that addresses high and rising prescription drug prices in a bipartisan manner.
At last count, there are over two dozen proposals in the legislation that are supported by at least one Republican and one Democrat on the committee.
We’ve included many of our member priorities in the bill.
Today, we will consider legislation that will improve Medicare Part D by bringing the payment system up to date with the therapies that are now available.
We do this by capping out-of-pocket expenses for seniors and people with disabilities, permanently closing the donut hole, keeping premiums from increasing and using taxpayer dollars more efficiently.
In Part B, we are shifting incentives toward use of less expensive, but equally effective medications.
We also want to manage the costs to taxpayers.
We want more transparency about what goes into a drug price, including information from manufacturers and middlemen such as pharmacy benefit managers.
According to the CBO, this bill will save taxpayers more than $100 billion, lower premiums, lower out-of-pocket expenses for Medicare beneficiaries and provide peace of mind to millions of seniors who will never have to worry about going bankrupt to pay for medication.
It will even help lower costs in the commercial market.
That’s a win for all Americans.
To the naysayers who claim our bill contains price controls, I want to submit for the record an analysis by the conservative economist, Avik Roy, who does a good job rebutting that argument. 
My second comment is about proposals to tie U.S. drug prices to international prices.
I have a couple of serious concerns about those proposals.
First of all, we don’t know much about what they are or how they would work.
Secondly, I worry that one unintended consequence could be a loss of innovation.
This is the moment for the Senate Finance Committee to act.
We have jurisdiction over all of Medicare and Medicaid, so what we do here today matters.
Before we move on, I want to make a special point of thanking the Ranking Member, Senator Wyden. You have been a good partner in this bipartisan effort.
That said, the administration threw us a curve ball a couple of weeks ago when they did not finalize a proposed rule.
That rule would have ensured that the savings from rebates in the Part D program would be passed through to benefit seniors at the pharmacy counter.
I believe that is a good idea.
Senator Wyden, I would like to continue to work with you to get a similar policy into our legislation before it becomes law.
I would also like to address the unfair clawback practices that affect pharmacists who are trying to take care of their patients.
I hope you will agree to work with me on that one too.
The only option is to act, now.
The American people are counting on us.
This is the time to decide if we actually want to reduce drug prices for people, or just give the problem lip service.