House Democrats on Friday plan to pass legislation requiring the government to negotiate for lower Medicare prescription-drug prices. They see it as one way to reduce the impact of the program's coverage gap, which forces seniors and disabled Americans with high drug costs to pay their full cost for a period of months.

The Medicare prescription-drug law signed by President Bush in 2003 prohibited the government from interfering in negotiations over drug prices. Those negotiations are handled by scores of private insurance plans in each state.

An advertising and lobbying blitz by consumers, insurers and drug manufacturers isn't as extensive as it was in the early 1990s — at least not yet. But the debate over this issue could signify a series of political conflicts over health care policy reminiscent of the Clinton administration's first two years.

"This is about both money and politics," says Tricia Neuman, director of the Medicare Policy Project at the Kaiser Family Foundation, a health care research group. "This is an issue that both seniors and the public feel fairly strongly about."

The debate comes as the Medicare prescription-drug program is rebounding from a troubled start last January, when millions of low-income beneficiaries were mistakenly dropped or overcharged. More than 90% of seniors have some type of drug coverage. Individual premiums and overall taxpayer costs have come in substantially lower than projected. And for the first time in Kaiser's surveys, a majority of seniors approve of the program.

The biggest objection is the coverage gap encountered by seniors whose total drug costs exceed $2,400. Until they have paid $3,850 on their own, they receive no coverage. Proponents of price negotiations by Medicare say that would help narrow the gap.

House Democrats, who have made government price negotiations part of their first "100 hours" agenda, have public anger over drug prices on their side. A Kaiser survey shows that four in five seniors want the government to negotiate for lower prices.

"I think this is one of the reasons the Democrats took the House and the Senate," says Rep. John Dingell, D-Mich., who chairs the Energy and Commerce Committee and is sponsoring the bill. If Bush vetoes it or the administration refuses to negotiate over prices, he says, "then we'll see what the political consequences of it are."

Rep. Henry Waxman, D-Calif., has estimated it could save between $61 billion and $96 billion over 10 years. That's disputed by the Congressional Budget Office, which projects no savings, largely because the government would not be able to restrict which drugs are covered.

Private insurers and the Department of Veterans Affairs drive prices down by negotiating with drugmakers over which medicines will be offered to beneficiaries. Companies that don't cut prices risk having their drugs excluded.

A report released Tuesday by the consumer group Families USA says Medicare's prices for seniors' most frequently used drugs are about 58% higher than those provided by the Department of Veterans Affairs. Under the House bill, Medicare could not decide which drugs insurance plans cover.

"Prescription-drug plans were both envisioned and have turned out to have sufficient incentives, market share and tools to negotiate effectively," says Douglas Holtz-Eakin, former CBO director. "It doesn't look like the (government) would bring much more to the table."

AARP, the nation's largest seniors organization, backed the 2003 law but is running ads that blast Medicare for having 43 million beneficiaries "and zero bargaining power" over drug prices.

On the other side are the White House, Senate Republicans, health insurers and drug manufacturers. Health and Human Services Secretary Michael Leavitt has called the House bill a "surrogate for government-run health care." He met Tuesday with House Republicans to drive home the administration's opposition to the House bill.

Insurers are touting the current program's success in saving seniors an average of $1,200 on their drug bills while preserving their choices in drugs and pharmacies. "We've exceeded expectations," says Karen Ignagni, president of America's Health Insurance Plans.

And drugmakers are running ads against the House bill. "We're trying to remind people that it took nearly 40 years" to get a Medicare prescription-drug benefit, says Ken Johnson of the Pharmaceutical Research and Manufacturers of America. "Do we want to risk blowing it up in 100 hours?" The bill, he says, "could ultimately lead to price controls and restrictions on new medicines."

While Democrats have the votes to pass the bill in the House, it faces a closer battle in the Senate. The Senate Finance Committee opens hearings on the issue Thursday. A weaker version that allowed but did not mandate government negotiations got 54 votes in the Senate last year, six short of the 60 required to overcome Republicans' objections. Sens. Olympia Snowe, R-Maine, and Ron Wyden, D-Ore., its sponsors, count 58 or 59 votes this year — still short of what's needed.

White House spokesman Tony Fratto said Tuesday that Bush's advisers would recommend he veto the House bill. "The so-called reform sounds nice on a bumper sticker, but it's a solution in search of a problem," he said. "It would limit drug choices for seniors and impede competition."