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Prescription drug costs pose a stumbling block for Democrats on spending bill

The House is struggling to find a balance that will make moderates and progressives happy.

WASHINGTON — Democrats in Congress face difficult decisions about how to tackle prescription drug costs for seniors after it emerged as a sticking point between lawmakers trying to push a sweeping spending and tax bill across the finish line.

The package is full of contentious issues, but President Joe Biden's proposal to allow Medicare to negotiate drug prices has already hit opposition among some Democrats, and is the target of extensive lobbying efforts by pharmaceutical companies.

Another continuing problem facing Democrats is the so-called "SALT cap," the limit placed on how much a taxpayer can deduct from federal taxes for payments to their local and state government. Democrats in high-cost areas want the cap raised but lawmakers haven't decided how to go about it.

House committees spent the past two weeks going over the details of the multi-trillion-dollar bill, a process that laid bare divisions between Democrats that will have to be resolved if they have any hope of turning their lengthy wish-list into law.

But the committee versions of the bills will likely have to be revised. And the traditional process in which the House and Senate pass their own versions, and then negotiate the differences, is unlikely to work. Instead, Democratic leaders are now under pressure to negotiate the entire package ahead of time to try to find the delicate balance that will make both centrists and progressives happy.

"It's a little bit like a Rubik's cube on steroids," Sen. Mark Warner, D-Va., said Thursday. "Above my pay grade to figure out how this all fits together."

As the negotiations enter a new phase, President Joe Biden will speak with House Speaker Nancy Pelosi and Senate Majority Leader Chuck Schumer later on Thursday about "moving the Build Back Better agenda forward," White House press secretary Jen Psaki said.

The planned call comes one day after three centrists voted in the Energy and Commerce Committee to block a policy to let Medicare negotiate prices: Rep. Kathleen Rice, D-N.Y., Rep. Kurt Schrader, D-Ore., and Rep. Scott Peters, D-Calif. The provision deadlocked in committee.

Party leaders aren't giving up on addressing drug costs.

Pelosi's office said lowering drug costs remains a "cornerstone" of the package. White House spokesman Andrew Bates said Biden believes that "in order to build an economy that delivers for the middle class and working families — not just those at the top — it is critical for us to empower Medicare to directly negotiate for lower drug prices."

A Rice spokesman said she supports the idea of allowing Medicare to negotiate drug but is concerned that the proposed policy would "jeopardize" the bill's "final passage in the Senate."

PhRMA, the drug industry lobby, is waging a campaign to kill the provision, launching TV ads aimed at scaring seniors about its implications, and arguing that allowing Medicare to negotiate prices would threaten older voters' access to medicine they want.

The SALT cap and procedural demands

The party avoided the "SALT" issue entirely in the Ways and Means Committee, but a group of lawmakers from high-tax states, led by Rep. Tom Suozzi, D-N.Y., have insisted that lifting the cap is essential to winning their vote for the final bill.

Chairman Richard Neal, D-Mass., released a separate statement with Suozzi and Rep. Bill Pascrell, D-N.J., promising "meaningful SALT relief" in the final bill. Pelosi's office said reversing the cap imposed by Republicans in 2017 is a priority for Democrats.

Doing so would be costly and inflate the final price tag. Progressives are less enthused about the idea because most of the benefits would go to wealthier people. They'd rather put the money elsewhere.

There are also procedural tensions to navigate.

The House faces a Sept. 27 self-imposed deadline to vote on the Senate-passed infrastructure bill, and progressives have threatened to vote it down unless the safety net package is ready by then.

Separately, centrists have urged Pelosi not to make them vote on a version of the tax and spending bill that has no chance of passing the Senate. They argue that a bill that's too liberal to become law could be used to hurt them politically come election time.

Rep. Stephanie Murphy, D-Fla., who voted against every provision of the bill in the Ways and Means Committee, said she wants more time to read and evaluate the final text.

Murphy, a co-chair of the Blue Dog Coalition that calls for fiscal responsibility, said in a statement Wednesday that while she supports much of the bill, "there are also spending and tax provisions that give me pause, and so I cannot vote for the bill at this early stage."

Senate Democrats, who have zero margin for error, are working separately through a host of issues to get their 50 members on board, from the price tag to policy differences on climate change.

So far, Warner said, they haven't focused much on the House.

"One of the most interesting things I found my time here — and I say this regardless of who's in charge is in the House — how disconnected this side of the building is from that side of the building," Warner said, adding that understands "the concern of some in the House voting on some of the items" when there's uncertainty about the Senate.