Democrats Urge Biden to Keep Drug-Pricing Proposal in Antipoverty Plan

Democrats Urge Biden to Keep Drug-Pricing Proposal in Antipoverty Plan

WASHINGTON—House Democratic leaders made a last-minute lobbying push to keep healthcare provisions in President Biden’s planned antipoverty and education proposal due next week, in the face of uncertainty over the White House’s plans.

For months, Democratic leaders have said they expect to lower prescription-drug prices for seniors and shore up the Affordable Care Act as part of Mr. Biden’s early legislative agenda. But disagreements among Democrats over how to use the savings generated by lower Medicare drug prices and the complexity of tackling healthcare led to hesitations at the White House, according to Democratic aides, sparking worries that the provisions would be dropped.

House Speaker

Nancy Pelosi

(D., Calif.) made clear Thursday that she was digging in over including healthcare in the next legislative push.

“Lowering health costs and prescription drug prices will be a top priority for House Democrats to be included in the American Families Plan,” Mrs. Pelosi said in a statement Thursday.

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The White House said Mr. Biden was still thinking through the priorities he wanted to focus on during a joint address to Congress set for next week and declined to specify what might be excluded from the plan. White House press secretary

Jen Psaki

said the speech would focus on the American Families Plan, “as well as a number of other issues.”

Asked about the forthcoming legislative package Thursday, Ms. Psaki didn’t mention healthcare, noting that Mr. Biden was working with his advisers “to finalize the details of the package, including the investments in areas like child care, education and other areas that are big priorities to him,” as well as measures to pay for their cost.

While the details of the second package are still being worked out, people familiar with the measure said it could cost more than $1 trillion, with funding for child care, paid leave, universal prekindergarten education and tuition-free community college. The cost is expected to be offset with tax increases, including an increase in the top income-tax rate and higher taxes on investment gains.

During the campaign, Mr. Biden proposed taxing long-term capital gains at 39.6% for households with income above $1 million, instead of getting a current tax rate of 23.8%. He also proposed changes that would impose capital-gains taxes on appreciated assets at death rather than allowing heirs to reset cost basis. Ms. Psaki declined to offer specifics Thursday on Mr. Biden’s tax proposal.

Empowering the federal government to negotiate over drug prices in Medicare has been a longtime goal of Democrats and is popular across a swath of voters. Former President

Donald Trump,

a Republican, backed the idea as a candidate in 2016, but many Republicans diverge from Democrats over what kind of restraints and penalties to put on pharmaceutical companies.

One complication is that Democrats don’t agree on how to use the roughly $456 billion the Congressional Budget Office has estimated that earlier legislation would generate over 10 years. Democratic leaders have said they want to use the savings to reduce costs for people getting healthcare under the ACA’s exchanges.

The coronavirus-relief package passed earlier this year increased subsidies for two years to people who buy ACA health plans, lowering payments for almost 14 million people now insured on the individual market. Mrs. Pelosi said Thursday she wanted to make those expanded subsidies permanent.

Pramila Jayapal (D., Wash.) is among progressive Democrats pushing to make sure that savings from lower drug prices are plowed back into Medicare.



Photo:

Stefani Reynolds/Bloomberg News

The New Democrats, a bloc of centrist House Democrats, released a letter Thursday calling on Mr. Biden to expand the ACA as part of the coming proposal. At a meeting at the White House on Wednesday, a group of the House Democrats hand-delivered the letter to Mr. Biden’s top advisers, according to a person familiar with the meeting.

But progressive Democrats, including Senate Budget Committee Chairman Bernie Sanders (I., Vt.) and Congressional Progressive Caucus Chairwoman

Pramila Jayapal

(D., Wash.) are pushing to make sure that a big chunk of the savings is plowed back into Medicare. They want to use at least some of the savings to expand Medicare benefits to include vision, dental and hearing costs, and to lower its eligibility age below 65. On the campaign trail, Mr. Biden supported lowering the eligibility age to 60, along with lowering the cost of prescription drugs.

“We think it’s very important that he delivers on this promise,” Ms. Jayapal said. “We did a little bit on healthcare in the first bill, but nothing transformative.”

Republicans said Democrats’ proposal would curtail drug companies’ ability to develop new treatments and make the U.S. more reliant on Chinese medical manufacturing.

‘Folks that are having a big debate over how to spend the savings are making a giant leap of faith that it’s a done deal,’ said Rep. Peter Welch (D., Vt.).



Photo:

Pool/Getty Images

“The pandemic has further proven we can’t let the Speaker’s government price control scheme stop the development of lifesaving cures and treatments,” the top three Republicans of the House Energy and Commerce, Ways and Means and Education committees wrote in a letter to House Republicans Wednesday. The GOP released its own proposal that emphasizes transparency in pricing, capping insulin costs, and revamping Medicare’s prescription-drug benefit with an out-of-pocket cap.

Democrats reintroduced legislation in the House Thursday enabling the federal government to negotiate drug prices in Medicare and make those prices available to commercial healthcare plans.

“Folks that are having a big debate over how to spend the savings are making a giant leap of faith that it’s a done deal,” said Rep. Peter Welch (D., Vt.), who has helped lead the push to lower drug prices in the House. “The most urgent thing is making certain the Biden administration puts the drug-pricing plan in their program.”

Drug companies have opposed price negotiations in Medicare, which they say would eat into their profits and mean less money for the development of new treatments. A full-on push to rein in the cost of prescription drugs could generate an intense political fight on a package full of other Democratic priorities, with little room for defectors.

Even if lawmakers pass a narrower infrastructure package with bipartisan support, the healthcare provisions and other social programs, including an extension of expanded child tax credits, are expected to rely on Democratic votes to pass.

Democrats can use a process tied to the budget known as reconciliation to pass legislation with just a simple majority in the Senate, rather than the 60 votes most bills need. But that would still require the support of every single member of the Democratic caucus in the Senate and almost every Democrat in the House, where they can currently lose no more than two votes.

Write to Andrew Duehren at andrew.duehren@wsj.com

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Source: WSJ – US News

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