Push to Negotiate Medicare Drug Prices Prompts Look at VA Model

Lawmakers pushing for Medicare to negotiate its own drug prices can draw inspiration from the Veterans Health Administration’s method of extracting deep discounts from pharmaceutical companies.

But applying that model would require systemic changes to how Medicare works, policy analysts say.

The VA’s system—which includes statutory pricing discounts unavailable in Medicare—is frequently cited as a model for expanding federal negotiation of prescription drug prices. A GAO report this year found the Veterans Health Administration, part of the Department of Veterans Affairs, on average paid 54% less than Medicare for 399 brand-name and generic drugs in 2017.

Fundamental differences in ...