In the News

Republican opposition is building to a proposal from President Trump to lower drug prices in Medicare.

The rare break between Trump and Republican allies follows an aggressive step from the president in October that would tie certain Medicare drug prices to lower prices in other countries, a departure from the traditional GOP position. A coalition of conservative groups, including Americans for Tax Reform and FreedomWorks, on Tuesday wrote a letter calling for the proposal to be withdrawn. And on Thursday, House GOP lawmakers questioned Health and Human Services (HHS) Secretary Alex Azar about the move and aired their concerns in a private meeting. Senate Finance Committee Chairman Orrin Hatch (R-Utah) is talking to other GOP senators about writing a letter to the administration sharing their concerns about the proposal. A spokesperson for Sen. Chuck Grassley (R-Iowa), who will take over the committee's gavel from Hatch in January, likewise told The Hill the Iowa senator has concerns Trump’s proposal would impose "price controls.” Trump has long railed against drug companies and called for lowering prices. His controversial proposal on Medicare drug prices is his most sweeping move yet.

Trump administration officials argue the current Medicare payment system for drugs administered in doctors' offices essentially lets drug companies charge whatever they want. They insist that system needs to change. But critics worry the move is essentially importing price controls from other countries, which is anathema to free-market minded Republicans, who are pushing back. “I understand that we do want to get drug prices down but I think that any proposal that would lead to government price-fixing in that space is a pathway we don't want to follow,” Rep. Larry Bucshon (R-Ind.), the first GOP lawmaker to publicly criticize the proposal, told The Hill. Bucshon is a member of the GOP Doctors Caucus, the group of lawmakers who met with Azar on Thursday and questioned him on the proposal. “I would say that the Doc Caucus has concerns but we're happy that they came and explained the program in more detail and what their proposal is,” Bucshon said. For now, the administration is not backing down and insists it is willing to fight back against the powerful pharmaceutical industry, which is working to kill the proposal.

Asked if the administration intends to stand by the proposal, an HHS spokesperson said: “[We] absolutely intend to proceed.” The department said Azar “welcomed” the opportunity to meet with GOP lawmakers on Thursday and “dispel some of the myths about the rule put forward by the industry that wishes to continue charging American patients more for their products.” However, having Grassley, the incoming chairman of the Finance Committee, opposed to the proposal will be a problem for the Trump administration. “Portions of the Administration’s proposal raise concerns about the possibility of importing price controls from other countries,” a Grassley spokesperson said, adding that while other countries are not paying their fair share for drugs, “the creation of price controls is not the solution.” Grassley is often willing to oppose pharmaceutical companies, and supports ideas like importing drugs from Canada. But Trump’s Medicare proposal goes too far for him. Not all congressional Republicans oppose Trump’s move. Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Health Committee, gave the proposal an important boost in October when he said he was “encouraged” by the plan.

Sen. Bill Cassidy (R-La.) proposed a similar idea in May and said last month he was “pleased” with Trump’s move.   It’s also a strange situation for Democrats, who find themselves more aligned with Trump on this proposal than many congressional Republicans are. Some Democrats offered mild praise of the move in October when it was announced, but added that more needs to be done.

Democrats, though, are closely watching to see if the proposal, still in the early stages, gains momentum. The party has seen such efforts falter in the past. A somewhat similar proposal under President Obama in 2016 was ultimately withdrawn in the face of industry and congressional opposition.

Sen. Thom Tillis (R-N.C.), who is up for reelection in 2020, warned on Wednesday at an event hosted by The Hill that Trump’s move could harm innovation by pharmaceutical companies. “The recovery period for all the money you put into a drug to begin with gets stretched out and therefore all these things you'd like to work on and research have to wait," Tillis said. A spokesman for Tillis added that while the senator has “significant reservations” about the proposal, he agrees drug prices need to be lower and encourages stakeholders to comment on the move.   For now the administration is listening to those concerns. Azar has been “meeting and talking with many members of Congress across the aisle to discuss” the proposal, the HHS spokesperson said. But the administration is also digging in.

When he unveiled the proposal in October, Azar tried to show his determination to push it forward even in the face of opposition. “Nobody should question the president's resolve to get drug prices down,” he said.