Congress Rushes to Do Something on Drug Prices

Congress Rushes to Do Something on Drug Prices

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Plus, Space Force is happening!
Tuesday, December 10, 2019

$738 Billion Defense Bill Authorizes Space Force and New Benefits for Federal Workers

It looks like Space Force has earned its wings.

The leaders of the House and Senate Armed Services Committees announced late Monday an agreement on the 2020 National Defense Authorization Act, which includes a provision that would establish a new, independent Space Force within the Air Force. The conference report also sets a topline spending level of $738 billion for defense spending in 2020, and includes a provision providing 12 weeks of paid parental leave to federal employees.

Negotiations on the NDAA were particularly difficult this year, in part because the two chambers of Congress are controlled by different parties. “This conference report is the product of months of hard-fought, but always civil and ultimately productive, negotiations,” the House Armed Services Committee said in a statement. “We look forward to ushering the conference report through the House and Senate as soon as possible and on to the President’s desk for his signature.”

The House is expected to vote on the bill as soon as Wednesday, and the Senate soon thereafter.

Here are some of the key features in the agreement:

  • The bill would create a new Space Force under Title 10 of the federal code. The Secretary of the Air Force would be empowered to transfer Air Force personnel to the new service — a move seen as limiting its potential size and expense. A new chief of space operations would be a member of the Joint Chiefs of Staff and report to the Secretary of the Air Force.
     
  • A 3.1% pay raise for troops.
     
  • A base budget of $635 billion for the Pentagon.
     
  • $71.5 billion for Overseas Contingency Operations funding, used to fight the post-9/11 wars.
     
  • $23.1 billion for defense-related activities at the Department of Energy.
     
  • $5.3 billion in emergency disaster funds for military installations.
     
  • All federal employees would be eligible for 12 weeks of paid parental leave — one of the most significant increases in benefits for government workers in decades.
     
  • The bill would impose sanctions on companies building the Nord Stream 2 natural gas pipeline from Russia to Germany.

The bill is notable for what it leaves out, as well. Democrats wanted to include limits on President Trump’s ability to transfer funds to build the border wall with Mexico and protections for transgender troops, but those provisions are not in the final agreement.

Congress Really Wants to Get Something Done on Drug Prices. It May Fail Anyway.

Lawmakers are eager to show they can deliver on the issues the American public cares most about, so even as House Democrats unveiled two articles of impeachment against President Trump on Tuesday, they also announced their support for a revised trade deal with Canada and Mexico and are preparing to vote on a bill to lower prescription drug prices.

"With pending deals on budget measures, a North American trade agreement and a new paid family leave initiative, Congress faced the prospect of ending 2019 with a rush of bipartisan legislation to go along with a party-line impeachment vote in the House that would be followed by a Senate trial early next year," The Washington Post reported late Monday.

That rush of action includes both new and updated legislation on drug prices, an issue that both Congress and the White House insist is a top priority. Here’s where things stand:

The House is set to vote on Pelosi plan to lower prescription drug prices: The bill, H.R. 3, would allow Medicare to negotiate prices of between 35 and 250 high-cost drugs directly with manufacturers, among other provisions. It is likely to pass the Democratic-controlled House on Thursday, despite some concerns from progressives who say it doesn’t go far enough. Pelosi on Monday reportedly warned progressives against any attempt to organize opposition to the legislation. But the bill probably isn’t going anywhere in the Republican-led Senate, and The Washington Post’s Paige Winfield Cunningham suggests that Thursday’s House vote “ensures lawmakers will spend the week criticizing each other’s ideas about lowering drug prices instead of working on the issue together.”

House Republicans unveiled their own drug pricing bill: The Lower Costs, More Cures Act pulls together what its Republican backers say are more than 40 provisions with support across party lines, including many that mirror bipartisan legislation languishing in the Senate, such as a $3,100 cap on out-of-pocket drug expenditures for Medicare beneficiaries. But it leaves out the more aggressive and controversial elements of Pelosi’s bill, including her plan to allow the government to negotiate prices with drugmakers and her use of international prices to cap U.S. payments.

“Speaker Pelosi’s partisan drug pricing scheme is not only bad policy, it’s never going to become law,” GOP lawmakers said in a statement announcing their bill. “We’re all here to get things done for the American people — so let’s get this done, and let’s do it now.” That call will likely go unheeded. “Republicans’ competing bill is unlikely to gain much, if any, Democratic support,” writes STAT’s Nicholas Florko, “but the bill is good messaging from a party that has been criticized in the past for being too cozy with drug makers.”

The bipartisan Senate bill looks unlikely to pass: Senate Finance Committee leaders on Friday released a slightly revised version of their drug pricing legislation, which the White House supports. But Senate Majority Leader Mitch McConnell has reportedly criticized the legislation in private and other Republican senators have objected to it as well. “The committee is hoping that coupling the package with funding for a slew of health programs will convince McConnell to take it up, but there’s still no word on whether that’s wishful thinking,” STAT’s Florko reports. And lobbyists say the bill has little chance of getting passed, the Post’s Winfield Cunningham adds.

The bottom line: There’s lots of activity around drug prices, but little sign right now that any of it will result in legislation that becomes law rather than just fodder for political messaging fights.

Tweet of the Day

From Bloomberg News political reporter Sahil Kapur:

Disturbing Survey of the Day

From Gallup: “A record 25% of Americans say they or a family member put off treatment for a serious medical condition in the past year because of the cost, up from 19% a year ago and the highest in Gallup's trend. Another 8% said they or a family member put off treatment for a less serious condition, bringing the total percentage of households delaying care due to costs to 33%, tying the high from 2014.”

U.S. Deficit Up 12% to $342 Billion for First Two Months of Fiscal 2020: CBO

The federal budget deficit for October and November was $342 billion, up $36 billion or 12% from the same period last year, the Congressional Budget Office estimated on Monday. Revenues were up 3% while outlays rose by 6%, CBO said.

Number of the Day: $213 Million

That’s how much the private debt collection program at the IRS collected in the 2019 fiscal year. In the black for the second year in a row, the program cleared nearly $148 million after commissions and administrative costs.

The controversial program, which empowers private firms to go after delinquent taxpayers, began in 2004 and ran for five years before the IRS ended it following a review. It was restarted in 2015 and ran at a loss for the next two years.

Senate Finance Chairman Chuck Grassley (R-IA), who played a central role in establishing the program, said Monday that the net proceeds are currently being used to hire 200 special compliance personnel at the IRS.

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