Senate rules arbiter weakens the Dem drug plan in the income statement

WASHINGTON (AP) – Senate lawmaker on Saturday dealt a blow to the Democrats’ plan to cut drug prices, but left the rest of their sprawling economic bill largely intact as party leaders braced for the first votes on a package containing many of President Joe Biden’s top national goals.

Elizabeth MacDonough, the non-partisan arbiter of the house rules, said lawmakers must remove the language by imposing heavy penalties on drug makers who raise their prices beyond inflation in the private insurance market. Those were the bill’s main tariff protections for the roughly 180 million people whose health coverage comes from private insurance, through work, or bought on their own.

Other important provisions remained intact, including granting Medicare the power to negotiate what it pays for pharmaceuticals for its 64 million elderly beneficiaries, a long-standing goal for Democrats. Manufacturers penalties for excess inflation would apply to drugs sold to Medicare, and there’s an annual $ 2,000 cap on drug costs and free vaccines for Medicare beneficiaries.

His rulings came when Democrats planned to start Senate votes on Saturday on their broad package that tackled climate change, energy, health care costs, taxes and even deficit reduction. Party leaders said they believe they have the unity they will need to push legislation through the 50-50 Senate, with Vice President Kamala Harris casting vote and solid Republican opposition.

“This is a big win for the American people,” Senate Majority Leader Chuck Schumer, DNY, said of the bill, which both sides are using in their election campaigns to blame the worst period of inflation in the country. four decades. “And a sad comment on the Republican Party as it actively combats cost-reducing provisions for the American family.”

In response, Senate Minority Leader Mitch McConnell, R-Ky., Said the Democrats “are misinterpreting the outrage of the American people as a mandate for yet another reckless taxation and spending madness.” He said the Democrats “have already robbed American families once because of inflation and now their solution is to rob American families a second time.”

Eliminating penalties for drug manufacturers reduces incentives for drug companies to limit what they charge, increasing costs for patients.

Clearing that language will cut the $ 288 billion over 10-year savings that the Democrats’ overall drug cuts are estimated to generate – a reduction of perhaps tens of billions of dollars, analysts said.

Schumer said MacDonough’s decision on the price limit for private insurance was “an unfortunate ruling.” But she said the surviving language on drug prices was “a great victory for the American people” and that the general bill “remains essentially intact.”

The ruling followed a 10-day period that saw Democrats resurrect key components of Biden’s agenda that appeared to be dead. In quick deals with the Democrats’ two most unpredictable senators: West Virginia’s first Conservative Joe Manchinthen Arizona centrist Kyrsten Sinema – Schumer has put together a broad package that, although it is a fraction of the older and larger versions that Manchin derailed, would have given the party a result against the backdrop of this fall’s Congressional elections.

The lawmaker also signed a tax on excess emissions of methane, a powerful contributor to greenhouse gases, from drilling for oil and gas. He also left open environmental subsidies to minority communities and other initiatives to reduce carbon emissionssaid the chairman of the Senate Environment and Public Works Committee Thomas Carper, D-Del.

It passed a provision requiring union-scale wages to be paid if energy efficiency projects are to qualify for tax credits, and another that would limit electric vehicle tax credits to those cars and trucks assembled in the United States.

The general measure must face unanimous republican opposition. But assuming the Democrats are fighting an uninterrupted “vote-a-rama” of amendments – many designed by Republicans to derail the measure – they should be able to push the measure through the Senate.

The passage of the house may come when that room briefly returns from Friday’s recess.

“What will it be like to vote for a rama. It will be like hell, “Senator Lindsey Graham of South Carolina, the first Republican on the Senate Budget Committee, said Friday of the approaching GOP amendments. He said that in supporting the Democratic bill, Manchin and Sinema “are enforcing legislation that will make the life of the average person more difficult” by raising energy costs with tax increases and making it more difficult for companies to hire workers.

The bill offers tax and spending incentives to move to cleaner fuels and support coal with assistance in reducing carbon emissions. The expiring subsidies that help millions of people afford private insurance premiums would be extended for three years and there is $ 4 billion to help Western states fight drought.

There would be a new 15% minimum tax on some companies that earn over $ 1 billion annually but pay far less than the current 21% corporation tax. There would also be a 1% tax on companies that repurchase their own shares, traded after Sinema refused to incur higher taxes on private equity firm executives and hedge fund managers. The IRS budget would be pumped to bolster its tax collection.

While the final costs of the bill are still being finalized, overall it would spend more than $ 300 billion over 10 years to slow climate change, which analysts say would be the country’s largest investment in that effort and billions more. for health care. It would raise more than $ 700 billion in taxes and government drug cost savings, leaving about $ 300 billion for deficit reduction – a modest bite of the many trillion dollars expected over 10 years.

Democrats are using special procedures that would allow them to pass the measure without having to reach the 60-vote majority that legislation often needs in the Senate.

It is up to the parliamentarian to decide whether parts of the legislation should be abandoned for violating these rules, which include the requirement that the provisions are primarily intended to affect the federal budget, not to impose new policies.


Associated Press writer Matthew Daly contributed to this report.


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