Democratic lawmakers used their majority status to pass the measure. They said government negotiations in some cases could lower the cost of prescription drugs for Medicare beneficiaries. People in Medicare drug plans now rely on their insurers to conduct those negotiations.

When you’re negotiating on behalf of 43 million people, that’s leverage,” said Sen. Kent Conrad, D-N.D.

The legislation approved Thursday simply strikes a clause that prohibits the secretary of Health and Human Services from interfering in the negotiations between drug makers, insurers and pharmacies. The committee approved the bill 13-8, with two Republicans, Sens. Olympia Snowe of Maine and Gordon Smith of Oregon, voting with the Democrats on the committee.

Sen. Max Baucus, D-Mont., the bill’s author, said the prohibition on government negotiations went too far. “We eliminated the government’s role in getting fair drug prices for seniors,” he said.

Republicans noted that the Congressional Budget Office, in reviewing the measure, found it would have a “negligible effect” on federal spending. Sen. Charles Grassley, R-Iowa, said the bill made for a good sound bite, but not effective policy. He said the program is already costing less than expected and that Medicare beneficiaries say they’re happy with the drug benefit.
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