Dual-eligible seniors are caught in a Capitol Hill cross fire over a pledge from the pharmaceutical industry to reduce costs by $80 billion, according to reports from Washington.

Under a House Energy and Commerce Committee proposal from Chairman Henry Waxman (D-CA), the pharmaceutical industry would reinstitute a rebate it initially offered Medicaid for dual-eligible beneficiary coverage when the Medicare Part D program took effect. That rebate—34%—is significantly higher than the 14% rebate the industry now offers Medicare Part D for dual eligibles. It could bring up to $86 billion in savings over the next ten years, according to a study put out by Waxman. The industry calls any such rebates a big step backward, Politico.com reported. Dual eligibles, who are eligible for both Medicare and Medicaid, make up a significant portion of the nursing home resident population.

By striking an early deal with Senate Finance Committee Chairman Max Baucus (D-MT) to reduce costs by $80 billion, the Pharmaceutical Research and Manufacturers Association (PhRMA) hopes to convince House lawmakers to kill the Waxman proposal before it even passes the House, according to the Web site. Baucus helped PhRMA shift dual-eligible coverage from Medicaid (at the 34% discount) to Medicare Part D (at the 14% discount) in 2006, Politico.com reported.