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July 21, 2022

Build Back Better is now all about health care

Daily Briefing

    While President Joe Biden's Build Back Better (BBB) Act was once an expansive domestic policy package, waning support for the proposal has left just two remaining provisions, which would lower prescription drug costs for millions of Americans.

    Our take: 10 health policy topics—including drug pricing reform—to watch in 2022

    How the Build Back Better Act became a health care bill

    Initially, BBB was designed to address a wide range of domestic policy issues, with measures that would have bolstered the social safety net, increased taxes on corporations and the wealthy, and strengthened oversight and regulation of pollutants that impact the climate. 

    However, since the bill was announced, many key elements have been eliminated as lawmakers voiced their opposition. Earlier this month, when Sen. Joe Manchin (D-W.Va.) withdrew his support from parts of the bill, only health care provisions remained.

    While some provisions garnered mixed political reactions, the bill's remaining health care proposal has been widely supported by the public—even gaining favor with Republicans, the New York Times reports.

    The health care provisions included in the Build Back Better Act

    The bill's central health care proposal calls for prescription drug price reform. If passed, the bill would regulate prices for expensive medications purchased by Medicare and penalize drug companies that rapidly increase their prices on existing medicines for all Americans, not just Medicare patients.

    In addition, it would grow Medicare's prescription drug benefit. In particular, the legislation would provide improved financial assistance for poor seniors and eliminate the program's current unlimited cost sharing program, which results in annual medication costs in excess of $10,000 for some beneficiaries.

    Under the legislation, individuals on Medicare would not be required to pay more than $2,000 annually for prescription drugs.

    Notably, the legislation's prescription drug provisions are unusual since they provide real-world benefits to Americans, including lower drug prices and increased financial protections, while simultaneously saving the federal government money, the Times reports. To accomplish this, the bill would force the pharmaceutical industry to accept lower prices for certain products.

    According to advocates for the pharmaceutical industry, including drug companies, this change could ultimately hinder innovation and cost jobs. In the past, similar arguments have prevented drug price reform—but previous negotiations signal that this package will likely have enough votes to pass the Senate, the Times reports.

    President Biden on Friday urged the Senate to pass the legislation before its recess in August.

    "This will not only lower the cost of prescription drugs and health care for families," he siad, "it will reduce the deficit and help fight inflation." (Sanger-Katz, "The Upshot," New York Times, 7/15; Zhou, Vox, 7/18)

    Health policy topics to watch in 2022

    The legislative, regulatory, and judicial outlook for health policy in 2022


    The Biden administration's first year in office was unsurprisingly dominated by the Covid-19 pandemic. While Democrats in Congress were able to pass part one of President Biden’s infrastructure package, other health care priorities were largely sidelined. As we look to 2022, there are 10 key health care topics that are ripe for congressional or regulatory action. If and how Congress and the Biden administration move on those actions will have strategic implications for industry executives across the health care ecosystem.

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