Senate Amendment to Negotiate Medicare Prices Fails By One Vote

March 24, 2005

A proposal to grant the HHS secretary the authority to negotiate Medicare drug prices with manufacturers has been defeated in the Senate by a single vote.

Attached as a last-minute amendment to the Senate's fiscal 2006 budget proposal, the plan called for the HHS secretary to negotiate with manufacturers in at least two instances: (1) for health plans that require single-provider bidding, also known as "fall-back" plans, and (2) if a private drug plan asks HHS for help in price negotiations.

The amendment's sponsors, Sen. Ron Wyden (D-Ore.) and Olympia Snowe (R-Maine), said the proposal would have directly addressed the skyrocketing drug-cost crisis. "Failure to enact sensible cost-containment measures now will put the Medicare prescription drug benefit in jeopardy, as costs spiral for seniors and taxpayers alike," Wyden said.

Although the proposal was defeated in a 50-49 vote, the closeness of the vote indicates the issue is starting to hit home with lawmakers, a Snowe aide said. "The plan only lost by one vote, which, to me, says there is growing concern about drug costs in this country," the aide said. "We're still hoping to make progress on the negotiation issue before the drug benefit takes effect."