Report: Maine Could Save Big By Negotiating Prescription Drug Prices

A new report released today by the Maine People's Alliance and the Center for Economic Policy and Research shows that Maine could save over $300 million if the Federal government allowed Medicare to negotiate the price of prescription drugs.

“This report confirms the absolute necessity of allowing Medicaid to negotiate on the cost of prescription drugs,” said Jennie Pirkl, Maine People’s Alliance health care organizer. “This money could be saving lives in Maine and across the country and instead it’s going to pad the profits of pharmaceutical companies.”

According to the report, State governments pay into the Medicare drug program to cover a portion of drug costs for those beneficiaries who are eligible for Medicaid and Medicare. The report estimates that Maine could save between $150 million to $352 million over the next decade if Medicare negotiated prescription drug prices.

For State Representative Peter Stuckey (D-Portland), not being able to negotiate prices is a missed opportunity that places a greater financial burden on Maine. “When the Maine legislature is forced to make tough choices in our budget, we understand the importance of asking everyone to pay their fair share. This protects the most vulnerable Mainers from harmful cuts to core services and programs, and it raises revenue we need for the communities we depend on,” said Stuckey. “We need Congress to do the same thing; we’ve seen the enormous out-of-pocket expense that prescription drugs pose for Mainers on Medicare, and we think Congress should negotiate Medicare drug with pharmaceutical companies to ensure a more fair drug price for seniors.”

Unlike other government programs such as Tricare, Medicare cannot negotiate the price of prescription drugs with pharmaceutical companies. In 2012, it was estimated that the United States spent $883 per person on prescription drugs – nearly twice as high as other wealthy countries. According to the report, the federal government could save up to $500 billion over the next decade if it enabled Medicare to negotiate drug prices. 

Senator Angus King and Representative Chellie Pingree have recently indicated their support for legislation that would allow prescription drug negotiation. Senator King has recently co-sponsored legislation introduced by Senator Jay Rockefeller (D-WV) to reduce drug prices in Medicare Part D. In the past Senator Susan Collins has been a supporter and co-sponsor of other legislation to reduce Medicare costs, including the Preserve Access to Affordable Generics Act, which prevents drug companies from delaying generic drugs from entering the market.

“We’re excited that both Senator Angus King and Rep. Chellie Pingree are committed to allowing Medicare to negotiate prescription drug cost,” said Pirkl. “We hope Senator Susan Collins and Rep. Mike Michaud will join the growing number of Congressional Representatives and Senators standing up for constituents paying exorbitant prices for prescription drugs.”

The full report can be found here.