The budget deal made a change that's good for Medicaid — and bad for Martin Shkreli

By:  Dan Diamond

You may hate Martin Shkreli, the greedy drug company executive who hiked the price of Daraprim more than 5,000 percent last month. But you should love how Shkreli sparked a national debate over price-gouging that's finally led to legislative action.

Under this week's budget deal, which has passed Congress and President Obama is expected to sign Monday, a Medicaid drug rebate requirement would be expanded to generic drugs. What this means: Companies that produce generic drugs must pay back the government if the price of their drugs grows faster than inflation.

It's good for the government — the Congressional Budget Office estimates the change would save Medicaid about $1 billion over ten years. And even if a Medicaid drug rebate doesn't directly benefit most patients, it "could still serve as a valuable tool for state budgets and taxpayers, particularly as Medicaid covers more and more people with the Affordable Care Act's Medicaid expansion and as more states choose to expand Medicaid," the Committee for a Responsible Federal Budget wrote.

Democratic lawmakers had been trying to make this exact change for years, but before Shkreli's antics, they didn't have any momentum to do it. In May, Senator Bernie Sanders and Representative Elijah Cummings re-introduced legislation to expand Medicaid's drug rebate. It went nowhere until now.

Continue reading here.