The Democrats' plan to control drug prices for 180 million Americans has suffered another blow.
A core piece of the party's plan can't pass the chamber with less than 60 votes according to the Senate parliamentarian.
Although a blow to the majority party, which had hoped to campaign this fall on lowering drug prices for all Americans, the nonpartisan parliamentarians vetting means the core of the plan is finally cleared for floor debate, more than a year after they began.
The plan won't be affected by a provision that would penalize drugmakers for hiking costs faster than inflation in private insurance plans.
Most Americans who receive health insurance through their private sector employers will not see a reduction in their costs because of the exclusion of private insurance price limits. Democrats are waiting on a ruling from the parliament on their policy to cap the cost of insufficiencies.
The decision means tens of billions less in federal savings in the bill, a potential threat to Democrats' hopes of offsetting the cost for shoring up the subsidies.
The repeal of the longstanding ban on the federal government directly negotiating drug prices with pharmaceutical companies is one of the most important provisions of the bill.
Schumer said the ruling was good news.
He said that seniors will have free vaccines and Medicare will be allowed to negotiate prescription drug prices.
The provision would break the iron curtain Big pharma has maintained against negotiating drug prices. It won't be possible for pharma to stick it to the consumer at will if it passes. Inflation hammering people at the pump and the grocery store is important.
The parliamentarian's ruling is still a big win for the drug industry according to a candidate for the Senate.
In the days leading up to the vote, he said that it would allow pharma companies to raise prices beyond inflation.
Drug companies and Senate Republicans were going to target the inflation caps provision through a process known as a "byrd bath."
The Senate has strict reconciliation rules that limit what kinds of bills can pass with a simple majority. Only proposals that are related to federal spending or revenue can fly, but not those that make major policy changes and only have an effect on the federal budget.
Democrats argued that the bill needs inflation caps for drug prices across the board in order to function, warning that failure to do so will mean that pharmaceutical companies can hike prices even higher for people with private insurance to make up for what they lose from the cost controls the bill still imposes on Medicare
Such points are usually the kind of argument that is persuasive with the parliamentarian, according to Sen. Chris Murphy.
The private sector can't be untangle from the public sector.
The Congressional Budget Office found last year that the inflation caps provision would save the government around $80 billion over the next 10 years.
The provision was sure to be knocked out of the package.
Stephen Northrup is a lobbyist who worked as the health policy director for the Senate Committee on Health. There is a direct relationship between the policy and the score if the inflation cap is limited to Medicare. The relationship gets more tenuous when it's extended to the commercial market. It looks like you are trying to save money, rather than extending a policy that has an impact beyond the federal budget.
Democrats don't currently have a backup plan for the policy, and some advocates want to apply inflation caps to other federal insurance programs.
Progressives are disappointed that their watered-down plan has become even weaker over the past year even if they are able to do so.
Senate Finance Chair Ron Wyden blamed the pharmaceutical industry for the demise of the inflation cap provision.
Ahead of the parliamentarian's ruling, he told POLITICO that the special interests always worked against them. It is surprising that the special interests are trying to protect their profits.
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