Trump: I'd let Medicare negotiate drug prices Clinton, Sanders have also called for the policy change

During a campaign rally in New Hampshire on Monday, Republican presidential candidate Donald Trump called for allowing Medicare to negotiate drug prices directly with pharmaceutical companies—a policy GOP lawmakers have blocked for more than a decade.

Trump told the crowd that the policy change could save Medicare $300 billion annually, but that opposition from drug companies has prevented the policy from becoming law.

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According to Real Clear Politics' polling average, Trump is currently leading the Republican field both nationally and in Iowa and New Hampshire.

Background on the policy

The Medicare prescription drug benefit program, signed into law by President George W. Bush in 2003, offers beneficiaries private drug coverage through Medicare Part D.

The law bars the Medicare program as a whole from directly negotiating drug prices with pharmaceutical companies. Instead, the private insurers that manage Part D engage in their own, separate negotiations.

Many Democrats say this setup is not sufficient to reduce costs and have advocated for lifting the prohibition. However, those efforts have been blocked by Republican lawmakers, who argue that private market forces are better at containing costs than government intervention.

Democratic presidential candidates Hillary Clinton and Bernie Sanders both released plans calling for Medicare's bargaining power to be restored, although they did not spell out how the negotiations would work in practice, David Nather reports for STAT News.

Policy experts tell Nather that it would be impractical for CMS to negotiate the price of every drug.

Clinton's plan indicated that she would likely have Medicare focus negotiations on high-cost medications that have limited competition. That's similar to what President Obama put forward in his fiscal year 2016 budget, which called for allowing Medicare to negotiate only the price of biologics and high-cost drugs.

Meanwhile, a Sanders aide tells STAT that any legislation changing Medicare's negotiating power backed by Sanders would broadly define CMS's authority and leave the details to the agency (Politico Pro, 1/25; AP/Charlotte Observer, 1/25; Sullivan, The Hill, 1/26; Nather, STAT News, 1/6; Real Clear Politics website, accessed 1/26; Morgan, Reuters, 2/2/15; New York Times, 10/21/15).

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