[Senate Hearing 107-146]
[From the U.S. Government Publishing Office]



                                                        S. Hrg. 107-146

                  THE HIGH COST OF PRESCRIPTION DRUGS

=======================================================================

                                HEARING

                               before the

                       SPECIAL COMMITTEE ON AGING
                          UNITED STATES SENATE

                      ONE HUNDRED SEVENTH CONGRESS

                             FIRST SESSION

                               __________

                           JEFFERSON CITY, MO

                               __________

                            AUGUST 27, 2001

                               __________

                           Serial No. 107-13

         Printed for the use of the Special Committee on Aging


                  U.S. GOVERNMENT PRINTING OFFICE
75-461                     WASHINGTON : 2001

____________________________________________________________________________
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                       SPECIAL COMMITTEE ON AGING

                  JOHN B. BREAUX, Louisiana, Chairman
HARRY REID, Nevada                   LARRY CRAIG, Idaho, Ranking Member
HERB KOHL, Wisconsin                 CONRAD BURNS, Montana
JAMES M. JEFFORDS, Vermont           RICHARD SHELBY, Alabama
RUSSELL D. FEINGOLD, Wisconsin       RICK SANTORUM, Pennsylvania
RON WYDEN, Oregon                    SUSAN COLLINS, Maine
BLANCHE L. LINCOLN, Arkansas         MIKE ENZI, Wyoming
EVAN BAYH, Indiana                   TIM HUTCHINSON, Arkansas
THOMAS R. CARPER, Delaware           PETER G. FITZGERALD, Illinois
DEBBIE STABENOW, Michigan            JOHN ENSIGN, Nevada
JEAN CARNAHAN, Missouri              CHUCK HAGEL, Nebraska
                    Michelle Easton, Staff Director
               Lupe Wissel, Ranking Member Staff Director

                                  (ii)

  


                            C O N T E N T S

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                                                                   Page
Opening Statement of Senator Jean Carnahan.......................     1

                                Panel I

Norma Muhleman, Florissant, MO...................................     3
Edna Sowells, Poplar Bluff, MO...................................     7
L.C. Lakes, St. Louis, MO........................................    14

                                Panel II

Robert Schmalfeld, AARP Volunteer Congressional District 
  Coordinator, St. Louis, MO.....................................    28
Ken Bougeno, First Vice President, Missouri Council of Senior 
  Citizens.......................................................    37
Anne Steele, Advocacy Chair, Older Women's League, St. Louis, MO.    40

                               Panel III

Dr. Lanis Hicks, University of Missouri School of Medicine.......    52
Dr. Stephen Zweig, Department of Family and Community Medicine...    64

                                APPENDIX

Written Testimony submitted by Mrs. Ruengert.....................    75

                                 (iii)

  

 
    JEFFERSON CITY FIELD HEARING THE HIGH COST OF PRESCRIPTION DRUGS

                              ----------                              


                        MONDAY, AUGUST 27, 2001

                                       U.S. Senate,
                                Special Committee on Aging,
                                                 Jefferson City, MO
    The committee met, pursuant to notice, at 10 a.m., in the 
Capitol Building, Second floor, House Hearing Room 7, Jefferson 
City, MO, Hon. Jean Carnahan, presiding.
    Present: Senator Carnahan.

           OPENING STATEMENT OF SENATOR JEAN CARNAHAN

    Senator Carnahan. Good morning. I call the hearing to 
order. I want to welcome each of the panelists that is going to 
be here today and thank you for participating on what is a very 
important subject.
    I would also like to thank each member of the audience for 
being here today. As many of you know, I am a member of the 
Special Committee on Aging in the Senate, and our job is to 
help the Federal Government meet the needs of seniors. We 
gather information for the Senate, we highlight important 
issues, and we make recommendations to our colleagues.
    Today we are here in Jefferson City to spotlight the high 
cost of prescription drugs. There has been a lot of discussion 
in Washington on the topic, but I wanted to come here and hear 
from you directly here in Missouri.
    As you know, Jefferson City was my home for nearly 8 years. 
Not only the Missouri capital, it is part of America's 
heartland. So I want to come here to mid-Missouri to hear your 
thoughts on drug prices and how it affects your everyday lives.
    During today's hearing, we will be receiving testimony from 
a variety of people from across the State. I am pleased to 
announce that Senator John Breaux of Louisiana, the Chairman of 
the Special Committee on Aging, and Senator Larry Craig of 
Idaho, the Ranking Member, have sent staff members to be with 
us here today as well, and together we will see that your 
message is taken back to Washington and conveyed to the Senate 
Committee on Aging.
    Your message could actually not be more timely because next 
week, when we go back to Washington, back into session, this 
will be a high-priority item, the cost of prescription drugs.
    Why is this such an important issue? It is important 
because Medicare, the Federal program that provides health 
insurance for some 40 million elderly and disabled Americans, 
does not include a prescription drug benefit. While it may not 
have been a necessary component of Medicare when the program 
was first created back in 1965, it is certainly unacceptable 
not to have it today. [Applause.]
    Prescription drugs save lives, and they improve the quality 
of life for millions of Americans. But when medication is 
unaffordable, we fail our sick and elderly. And when those in 
need have to choose between buying food or paying for a 
prescription drug, we are failing our seniors. And when older 
adults have to rely on family members to pay their drug bills, 
we fail both seniors and their families.
    I hear these concerns everywhere I go, and I receive 
countless letters and e-mails from people all over Missouri on 
this subject. And it troubles me when I think about the tough 
decisions that our seniors, living on fixed incomes, have to 
make every day--choices between medicine and food, between 
medicine and rent, and medicine and heat. Sad and difficult 
decisions are being made every day in homes all across 
Missouri.
    I want to create a prescription drug benefit as part of 
Medicare and have supported setting aside funds in the Federal 
budget for this purpose. We are still working out the difficult 
details, but we have agreed on a number of principles that a 
drug benefit should meet. And I want to share some of those 
with you that I believe in very strongly.
    First, a benefit should be universal. Everyone that is 
enrolled in Medicare should be eligible to receive the benefit. 
[Applause.]
    Second, the benefit should be voluntary. Seniors should 
have a choice as to whether they want to participate or not.
    Third, the benefit should be affordable.
    Fourth, the benefit should be stable. We want to create a 
benefit that provides coverage for a long time, not one that is 
constantly changing.
    Fifth, the benefit should be available. It should not 
matter if you live in an urban or suburban or rural setting. 
You should be able to get prescription drug coverage wherever 
you live.
    Finally, the benefit should be part of Medicare. We don't 
need to create a whole new system. Medicare is a program that 
works, and it is one that our seniors trust. We in the Senate 
need to understand what seniors need, the extent of the 
problem, and what the consequences are if we fail to act.
    We are privileged today to have three panels of speakers 
here to address some of these questions.
    The first panel is made up of Missouri seniors who will be 
speaking about their experiences in struggling to meet the 
increasing cost of drugs.
    The second panel is comprised of representatives of 
organizations that advocate on behalf of Missouri's seniors, 
and they will be sharing with us their recommendations on how 
to craft a Medicare prescription drug benefit.
    The third panel will provide a look at the scope of the 
problem. They will also examine the impact of drug prices on 
the health of seniors and on health care in general.
    I look forward to hearing the testimony and to learning 
from their experiences, and I hope our audience will gain a 
greater understanding of this complex and costly health problem 
as well.
    Now I would like to introduce the first panel of speakers, 
but before I do so, I probably should introduce someone else, 
who is in the audience who will not be participating, and that 
is a woman by the name of Doe Ruengert. She is here from 
Jefferson City, and she has submitted written testimony for the 
record on her care for her 91-year-old aunt, Dorothy Creighton. 
Mrs. Ruengert is a nurse, and she has cared for her aunt for a 
number of years in her home because her aunt was unable to live 
alone because of the cost of her prescription drugs. Mrs. 
Creighton pays upward to $800 a month just for prescription 
drug costs alone. So I appreciate her being here, and I will be 
referring to her testimony again later on.
    Our first witness is Norma Muhleman from Florissant. If the 
three of you, as I call your names, if you would take your 
seats up here? She wrote to me back in March. Nice to have the 
chance to meet you today. You wrote to me about your husband 
and about your costs for your bills. Norma and her husband have 
lived in Florissant for 40 years. They were in business 
together for the past 13 years before he retired. She is the 
mother of a son and daughter and has three grandchildren. So we 
appreciate your being here today.
    The second gentleman is Mr. L.C. Lakes from St. Louis City. 
Mr. Lakes is a retired welder. He is a member of the Friendly 
Temple Baptist Church. He is on the committee there that builds 
housing for senior citizens. And he also volunteers in the 
Caring Communities Program and works in the 22nd Ward to help 
provide a safe neighborhood there. So we welcome you as well.
    Then our final witness on this panel comes from Poplar 
Bluff, Mrs. Edna Sowells. Is she here today? OK. Welcome. She 
is the former head cook at the Lucy Lee Hospital and has been 
very active in her church and community.
    So I will begin by turning our floor over to our first 
witness, Mrs. Muhleman. Welcome.

          STATEMENT OF NORMA MUHLEMAN, FLORISSANT, MO

    Ms. Muhleman. Thank you. Good morning, Senator Carnahan, 
and everyone else. I appreciate very much the opportunity to 
speak to you about my concerns about a prescription drug plan.
    My husband and I are Medicare enrollees as well as we have 
Medigap plans to supplement Parts A and B of Medicare. But none 
of these plans pay for prescription drugs, dental, nor 
eyeglasses.
    My husband has been on oxygen 24 hours per day for a few 
years because of his emphysema, heart problems, and other 
things that entail his having to use very expensive 
prescriptions. We do not have prescription insurance on any of 
our plans, and in checking the Medigap policies that would 
allow us coverage, if they accepted us with our medical 
problems, they have a cap or a limit on prescriptions that 
would only pay for a proverbial drop in the bucket on our cost 
of prescriptions, especially after paying the higher rate for 
prescription coverage. It would not help us at all.
    We have investigated everything we have ever heard about, 
and there does not seem to be any plan that we could get paying 
for it ourselves that would help.
    Two years ago, our prescriptions and out-of-pocket expenses 
were around $5,500. Last year, it was approximately $8,000 out 
of our own pockets. As you can see, it increases constantly 
with the cost of drugs, et cetera.
    We have thought for a long time that Congress should 
provide something to help people like us, of which there are 
many around us with the same problems, such as insurance where 
we could pay the premiums but enable us to have a copayment, 
like the large companies in the country provide for their 
employees.
    We are very satisfied with Medicare as it is and hope it is 
not changed, other than to add a prescription drug plan that 
will pay for our prescriptions, with us paying a premium and a 
small copayment on our part.
    Medicare has been tested many times with us, as my husband 
has been in the hospital many times, and we are thankful for 
its good coverage, along with our Medigap supplemental plans we 
have, but the drug costs are killing us.
    We have worked hard and live economically. My husband 
worked as long as his health permitted and was 72 years old 
before he had to give up his work. Even then, while he was 
still working, he was on oxygen at night after working hours. 
We are hoping for something that allows us to pay premiums, as 
we do Parts A and B on Medicare, for our prescriptions. We are 
not asking for something free, but feel we older middle-class 
citizens deserve this opportunity.
    Thank you.
    [The prepared statement of Norma Muhleman follows:

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    Senator Carnahan. Thank you, Mrs. Muhleman. I appreciate 
your sharing that story with me. I had the opportunity to care 
for my father for 7\1/2\ years, and he had emphysema and 
diabetes and asthma. And so I can understand some of your 
concerns and some of the things that you have been going 
through.
    Let's see. Mrs. Sowells, if you would?
    Ms. Sowells. Do I push this button here?
    Senator Carnahan. I believe that is correct, yes.

          STATEMENT OF EDNA SOWELLS, POPLAR BLUFF, MO

    Ms. Sowells. Good morning. My name is Edna Sowells. I am 
from Poplar Bluff, MO. Thank you, Senator Carnahan, for giving 
me the opportunity to testify this morning to millions of 
people like me for some sort of prescription drug relief.
    For a number of years, I was a head cook at Lucy Lee 
Hospital in Poplar Bluff, MO. I have also been very active in 
my community, church, and helping neighbors in time of need, 
and babysitting and cooking food. I have been happily married 
for 44 years and have three wonderful, precious children.
    Several years ago, I was diagnosed with diabetes I, I was 
able to control that by taking a pill and monitoring my diet. 
About 14 years ago, I lost a massive amount of blood that led 
to a radical surgery because I had only two pints of blood left 
in me. After this surgery, I tried to go back to work but found 
it impossible; therefore, I went on Social Security disability 
for stiffness on my right torso and my left foot and leg by a 
hysterectomy and surgery to remove a cyst. Since this surgery, 
my diabetes has now progressed and forced me to take two shots 
a day, two pills a day.
    When I became disabled, not only the source of my income, a 
Social Security disability check, I also received medical help 
with my doctors' and hospital bills. However, I have no help to 
pay for my monthly prescription drugs. I pay at least $200 or 
more for my prescription drugs alone. For example, this month 
of August, I paid $206 at just one drugstore for my hives, my 
blood pressure, my diabetes, my nerves, my cholesterol, my acid 
reflux, and this in addition to the payments I have to make for 
my equipment. For example, last month, at a different drugstore 
I spent $120 for test strips, $13 for needles and syringes, 
because I got them on sale. I have to buy new equipment at 
least every other month and a half. However, sometimes money is 
so tight that I re-use the needle and syringes and alcohol 
swabs after thoroughly cleansing and contacting my doctor for 
samples or even resort to cutting pills in half in order to 
save a few dollars a month.
    Because of this high prescription drug cost, I have to 
sacrifice several things that I would love to do, I would love 
to have the opportunity to do. I am unable to go out to dinner 
with my husband to a nice place and can no longer donate any 
money to my church or buy my kids and grandchildren gifts. 
These are all things that I used to do and enjoy before I 
became sick. I never dreamed that this would happen to me or 
that it would be difficult to survive once I stopped working.
    Senator Carnahan, I was an orphan from the age of 10, and I 
learned at a young age how to be thrifty and efficient. I 
taught myself how to cook and sew in order to survive. However, 
things are really tight, and I am unable to make ends meet. I 
would really benefit from some sort of prescription drug 
relief. Please work hard to address my and every other senior's 
needs for the prescription drug benefit.
    Thank you very much for the opportunity to speak today, and 
I appreciate your kindness and concern.
    [The prepared statement of Edna Sowells follows:]

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    Senator Carnahan. Thank you, Mrs. Sowells. I think your 
testimony--sometimes we focus just on seniors, and we don't 
always focus on those who have disabilities as well, because 
that cuts back on the amount they are able to earn, and it also 
increases what they have to have as far as equipment and 
prescription drugs. So I appreciate your telling us about that.
    Mr. Lakes.

             STATEMENT OF L.C. LAKES, ST. LOUIS, MO

    Mr. Lakes. Yes, good morning, Senator Carnahan.
    Senator Carnahan. Could you get closer to the microphone? 
Thank you.
    Mr. Lakes. For the record, my name is L.C. Lakes, a 
resident of the city of St. Louis, MO, in the 22nd Ward. I was 
born on November 20, 1932. I am currently retired. In my life, 
I have worked in several jobs, most notable working as a welder 
for 27 years. I am currently Captain of Block Unit 294, and an 
active member of several neighborhood initiatives aimed at 
improving the quality of life for the residents of our 
community. I am a member of Friendly Temple Baptist Church in 
St. Louis. I work on our church committee to build houses for 
the senior citizens.
    I was also involved in the successful effort to locate a 
police substation in our neighborhood to help us fight the 
problems of drug abuse and crime in the 22nd Ward. I actually 
worked with the police officers, the aldermen, and other public 
officials in the effort to demolish the nuisance properties 
that are used to sell drugs. I have also volunteered with the 
Caring Community Program under the direction of Mr. Khatib 
Waheed in St. Louis to provide fun and safe activities for our 
youth.
    I sincerely thank the committee for the opportunity to 
appear before them to discuss the critical issues of 
prescription drug coverage for senior citizens. It is an issue 
that either affects now or it will affect everyone in our 
Nation. Everyone in the United States is going to get old 
sooner or later. If you have a little luck, you will get to be 
an old man like me. But you are going to have to have a little 
luck.
    My wife and I are now both retired and living on a fixed 
income. My wife receives a pension from St. John's Hospital 
where she worked for 28 years. She received Social Security 
benefits after she retired from St. John's. My wife was part of 
the HMO that the hospital provided for employees. While she was 
covered, she had to pay $200 every month to stay in the HMO. I 
also received coverage on her plan for a monthly fee.
    Since my wife required so many different kinds of medicine, 
she was put out of the HMO. Since then she has been forced to 
seek a private insurance plan due to the high cost of our 
prescription drugs, especially for her heart condition. She 
spends several hundred dollars monthly for this medication. I 
was also put out of the plan because my wife lost her coverage. 
I pay the AARP $110 every month for supplemental hospital 
coverage.
    Since Medicare only pays 80 percent of the cost of any 
hospital stay, the AARP pays the other 20 percent. Again, this 
only covers a hospital stay, not the cost of medicine. If it 
were not for this coverage, my wife and I would have nothing. 
For us in a time of bad health, my wife and I both require 
several prescription drugs each month to maintain our health. I 
am on four prescriptions. My wife has been placed on nine by 
her doctor. I must spend $33 a month for--some of these 
medicines here I am unable to pronounce the name of them, but 
we got some things here--but I will go on to the others. To 
treat my high blood pressure and my borderline diabetes 
requires two medicines, Glucotrol and Glucophage, I think it 
is. They cost $35 for 30 pills. My doctor also prescribes 
Baycol for my high cholesterol, which has since been taken off 
the market. My wife's situation is even more serious. She must 
take nine different kinds of medicine, her gout prescription.
    Senator, here are some more of the medicines here. I am not 
a doctor, so I can't pronounce a lot of these. But, anyway, the 
cost of this medicine is $10 for 20 tablets. The prescription 
for the heart condition costs $100 for 30 tablets. Due to their 
high cost, we can only afford to buy 15 at a time, half those 
what the doctor prescribes. Her high blood pressure medication 
costs $80 for 60 pills. Since she has to take two every day, 
she also needs a second blood pressure medicine which costs $30 
a month. The complications from her blood pressure also forced 
her to take a $30-a-month prescription to remove water and 
fluid from around her heart and a $35 prescription for another 
one of them, Senator.
    Her doctor also prescribes 60 potassium tablets at $49 a 
month. She also needs 120 tablets a month for Cuminid, a blood 
thinner, I believe that is. But she can only afford 30 at a 
time. Her Glucophage prescription for diabetes costs $45 for 60 
tablets and $40 for her prescription of Glyburide, or whatever 
that is.
    We must pay for all of this medicine I just read to you on 
a fixed retirement income of $886 a month for me, $730 a month 
for my wife. After requiring Medicare deduction of $50 each, 
together we have to survive on about $1,600 a month, and for 
that we must pay our electric bill, gas bill, water, sewer, 
food, and other expenses. If it wasn't for my wife's history at 
St. John's and our friendship with the doctors and nurses, we 
wouldn't be able to get the free samples that we need from 
them, which keeps the medicine costs where they are now.
    Even now we have to cut back on the medicine that my wife 
needs because we just don't have the money. I urge you, Senator 
Carnahan, to do what you can to help us older Americans with a 
prescription drug benefit. You can do a great deal to make our 
lives easier. No one should have to choose between the medicine 
they need to live and food to eat, we senior citizens need your 
help.
    Again, thank you for the opportunity to come before you. 
Thank you for hearing my concerns and those of other seniors in 
my community. Thank you.
    [The prepared statement of L.C. Lakes follows:]

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    Senator Carnahan. Thank you, Mr. Lakes. I notice you 
indicated that it takes a little bit of luck to age 
successfully.
    Mr. Lakes. Yes, ma'am.
    Senator Carnahan. But we want to try to eliminate the 
necessity for luck and put a little more certainty into aging, 
and having a prescription drug benefit would certainly help to 
do that.
    Mr. Lakes. Thank you, ma'am.
    Senator Carnahan. I would like to go to the questioning now 
of our panelists here for a minute. I can tell that you are 
making some budget decisions as you look to your costs, and 
that perhaps there are some sacrifices you are having to make. 
I can tell that you are already trying to--I believe, Mr. 
Lakes, you mentioned that you use samples sometimes that your--
--
    Mr. Lakes. The doctors sometimes have. And if I may, 
Senator, sometimes when the medicine gets to selling, they 
don't have samples. They stop giving them out once they get 
going. And then the doctor don't have them. But it is mighty 
nice when the doctor gives them whenever he can.
    Senator Carnahan. Then I believe it was, Mrs. Sowells, you 
indicated that sometimes you also use samples and that you 
halve the pill sometimes in order to make it go farther. But I 
am just wondering. You are making some adjustments in your 
medicines. What adjustments are you making in your budget? What 
is it you are not able to do as a result of this? What kind of 
sacrifices of priorities are you having?
    Ms. Sowells. Well, I can no longer be no help to my family. 
I can't do anything for my church activities. I can't do 
anything for my grandchildren. And when it comes right--I don't 
do very much for my husband, and when it comes right down to 
me, you just might say we do without to stretch and make it. 
And I was telling Jason and Rich that we was with, two very 
nice men--appreciate their help--you have to learn to live 
within your income. If you keep going out of your income, you 
are going to really be in deep trouble. And I know I do a lot 
of things that I shouldn't do that the doctor don't want me to 
do, but you have to do in order to make it. They want you to 
use a needle and syringe one time. I can't do that. I can't 
make it. Most of the time they run $20 a month. And I re-use 
the needle and syringes after I thoroughly clean them. And on 
my medicines, sometimes when it gets so tight, I figure a half 
a dose is better than no dose. So I will put it in half in 
order to stretch it out.
    Senator Carnahan. Would any of the others like to comment? 
Mrs. Muhleman----
    Mr. Lakes. I would like to say that--and me and my wife----
    Senator Carnahan. Could you speak a little closer to the 
microphone?
    Mr. Lakes. Yes. Me and my wife's situation comes that 
sometimes we have to go to some of the city programs like 
energy and things like that to get some of our bills paid, like 
lights and gas. At this time of month we go and try to get help 
from the energy people to help us out there, and sometimes we 
were able to do that. And right now it is kind of hard since we 
got a new President to get that done. You know, they don't have 
no money half the time, they say, and if they ain't got it, 
they can't give it.
    When wintertime come, we go to the gas--go back to the 
problem of gas, and me and my wife have that problem, you know. 
As she said, do the best we can. That is all we can do. But it 
is a long way from where we should be. I worked hard all--it 
ain't like, again, we are asking for something for nothing. I 
worked for some 30 years and just think it is no more than fair 
to try to give us some help.
    Senator Carnahan. Mrs. Muhleman.
    Ms. Muhleman. It takes a lot of ingenuity, as Mr. Lakes 
says, with increasing gas prices, gasoline for the cars and 
also for heating, and for air conditioning. And it really keeps 
you busy, you know, juggling the budget. And sometimes it does 
have to come out of savings whether you really want to or not, 
because my husband's medicines are very expensive. They are, I 
guess, some of the most expensive that a person has to have for 
his condition. And I have health problems, too.
    Senator Carnahan. Have any of you tried to get insurance to 
cover your drug prescriptions? I think you mentioned, Mrs. 
Sowells, that you had attempted to do this.
    Ms. Sowells. I wasn't able to do this until--my husband 
does it for me. I cannot do it. He bought me a supplement 
insurance for the 100 percent deductible and 20 percent 
copayment. But it does nothing for drugs. And that runs him 
over $1,000, $1,200 a year for this insurance, which right at 
this present I am still paying on hospital bills that I had 3 
and 4 years back that I am still paying on monthly besides 
everything else.
    But I was not able to get insurance until then. Everybody 
would turn me down, or it would either be so high, we could not 
afford it. There was no way that we could get it and pay for 
it.
    Ms. Muhleman. Also, they will not take a lot of people that 
have pre-existing conditions.
    Ms. Sowells. That is right. That is right.
    Ms. Muhleman. We have tried many times.
    Senator Carnahan. So you have tried, but you didn't find 
anything that was attractive.
    Ms. Muhleman. Nothing. And the cap is usually $500, and 
that is nothing--for us, at least.
    Senator Carnahan. Mr. Lakes, did you----
    Mr. Lakes. Yes, ma'am. I did want to say just what she just 
made the statement, that my wife, being an HMO, she jumped from 
one to the other on account of $500 is the limit there. And a 
couple of months at the most, she's out of that $500 due to her 
condition and heart trouble. Some of the medicines cost about 
$3 a pill. It is something she got to have, you know, and----
    Senator Carnahan. One of the issues that we are going over 
in Washington is whether or not a prescription drug benefit 
should be a part of Medicare or whether it should be covered by 
private insurers. Do you have any opinions on that? I see you 
shaking your head over here, Ms. Sowells.
    Ms. Sowells. I would rather have Medicare than insurance, 
like I was talking about the insurance that my husband got, it 
was through his cousin that found this company to insure me, or 
I probably wouldn't be insured today. And as I said when we 
first started, it was about $1,000 for a little over a year, 
but now then it has gone up to $1,250 a year to insure me for 
the $100 deductible and the 20 percent copayment. But, at that, 
it still does not cover none of the prescription drugs or 
anything that I have to have, like my expensive machines. And I 
guess Rich got a little--looked at me a little funny, but I 
kept saying, ``Do you lock your van? Do you keep this locked? 
Do you keep that locked?'' Because I have got all my medical 
supplies with me that I had to bring, and like I told him, I 
have things that I cannot replace. They are too expensive. My 
machine monitor and my--well, all my pills. There for a while I 
was carrying them in my purse, and I was tearing up my purse. 
And so I had to buy an extra bag in order to put all my 
medication in that bag, you know, to move it around. And I told 
them it is like going somewhere, it is just like moving, 
picking everything up and going.
    But, no, I would rather to have it on Medicare than any 
insurance company.
    Senator Carnahan. You just feel a little more confident 
being under Medicare.
    Ms. Sowells. Yes, I do, because I feel like they wouldn't 
turn you down as quick as what an insurance company might turn 
you down on something that you would really need that they 
think, well, you really don't need that. Even if the doctor 
says you need it, they might think you don't need it.
    Senator Carnahan. How do you feel?
    Ms. Muhleman. I think it should be with Medicare and us pay 
a premium like we do Parts A and B. I am very much for that.
    Ms. Sowells. Yes.
    Mr. Lakes. So I am. She speaks for me, too.
    Senator Carnahan. OK. Very good. Well, as we mentioned 
earlier, we want to try to make this to be a voluntary benefit. 
But in order for it to work, we are going to have to have some 
features in it that are attractive to people. If we have to 
place limits on what we offer, what would you be willing to 
accept in terms of copay, deductibles, premiums, and so forth? 
What do you feel like you could afford to accept?
    Ms. Sowells. Anything would beat what we are doing right 
now.
    Senator Carnahan. OK. But, I mean, how much do you feel 
would be an acceptable amount that you could afford, say, a 
month?
    Ms. Sowells. Well, if it would cover most of the drugs, 
even if we would have to pay a small amount, if it was 
something like Medicare, if we would have to pay a premium like 
Medicare in order to get the drug prescriptions, it would pay 
us to do that. It would be well worth it of what we are already 
paying. And then if we had to pay a little bit on each 
prescription, that wouldn't be----
    Senator Carnahan. So you don't object to a copay? You would 
be willing for a copay?
    Ms. Sowells. If it is necessary, yes.
    Senator Carnahan. And some sort of deductible feature as 
well?
    Ms. Sowells. Such as?
    Senator Carnahan. Oh, like a $250 deductible before----
    Ms. Sowells. In other words, you would have to be out the 
$250 before it would kick in?
    Senator Carnahan. Right.
    Ms. Sowells. Yes, ma'am. Yes, ma'am.
    Senator Carnahan. Mrs. Muhleman, that is sort of----
    Ms. Muhleman. That would be good.
    Senator Carnahan. You would be willing to pay a deductible?
    Ms. Muhleman. A copayment and a deductible would be OK.
    Mr. Lakes. Well, I don't agree with the $200 deductible. 
You know, I just don't agree.
    Senator Carnahan. You think that is too high?
    Mr. Lakes. Yes, ma'am, I do. I think it is much too high. 
See, if you go with the HMOs, if they would stand still instead 
of the 30 months, they have maybe 5 months and 6 months, take a 
whole year in there, I would have thought it would be good. But 
if you are using a lot of medicine with an HMO, $500 is only a 
little bit, even though you pay $10 for that copayment, it is 
fine, but it don't last. So if you got to pay $200 or $300, or 
whatever, that is too much. I don't agree with that. I don't 
mind paying something, but----
    Senator Carnahan. And this question might cause you to 
range out a little bit and think in terms of some of the 
friends that you know who have similar problems. Do you think 
that what you are going through is typical of the senior 
community?
    Mr. Lakes. Yes.
    Ms. Sowells. Absolutely.
    Senator Carnahan. Mrs. Muhleman.
    Ms. Muhleman. Yes. In the breathing centers and places 
where my doctor has to go, and the hospitals, we find that this 
is very common.
    Senator Carnahan. In what way?
    Ms. Muhleman. Well, the high prescriptions, the expense, 
all the--it is wonderful to have all these medicines, but they 
are very expensive. Just terrible. And they keep going up all 
the time. So it is a very common thing. Everyone talks about 
it.
    Senator Carnahan. Among friends, OK.
    Ms. Sowells. When one drug fluctuates $10 or $15 a month, 
it just nearly chokes you.
    Senator Carnahan. So this happens commonly, that the drug 
would fluctuate and raise that much in a month's time?
    Ms. Sowells. Well, that is what my pharmacists tell me. At 
one time I had one pill that jumped up $12, and I called him, I 
said, Oh, I can't handle this. And he said, ``Well we don't 
want to do it, but,'' he said, ``it's getting to that. So we 
have to do it.'' And I said, ``Well, just don't fill it.'' 
Because it was already 30-some dollars, and then when they add 
$12 more to it, that is 40-something. And when you have got 
four or five that runs you 30 and 40 or close to $50 a month--
and that is not--like I said, that is not all that you get. 
That is just part of what you get. You just can't do it.
    Senator Carnahan. What about your friends? Do you have 
friends who are having similar situations?
    Ms. Sowells. Yes. And another thing that I talked to Jason 
about and Rich about, I talked to my pastor and some of my 
senior citizens at my church about this, and they said, ``Well, 
it sounds like to me that if they would do this, people that 
are not taking medicine or as sick as you are would be paying 
for your drugs.'' And I said, ``No, that is not what they told 
me.'' I said they reassured me that they had money put back for 
this and that it wouldn't be like that, it would be like 
Medicare. You either get Medicare or not have Medicare. And I 
said that is what they told me. And I said I believe that is 
the way it is.
    It would be hard to, like he said, cough up the $200, $250, 
but it wouldn't be anything--it wouldn't be worse than what we 
are doing now. We could more apt to do that than keep doing 
this every month and every month and every month to where you--
the quality of life is not enjoyable. You just dread--every day 
you dread what you have to do to live with your medicine. I 
don't know if anybody takes shots, but it is not enjoyable. And 
it was one of the hardest things I ever had to learn to cope 
with.
    Senator Carnahan. Mr. Lakes.
    Mr. Lakes. Yes, ma'am. Senator, I would like also just to--
sometime your medicine that you may be taking--I will just name 
blood pressure medicine, for instance. It may stop working, and 
then the doctor prescribes another medicine. Sometime there may 
be two. In my case it was two prescriptions instead of that one 
I had before. You know, I was taking--Pezotag was one, and now 
I am taking two more that is supposedly going to do the same 
thing, but I take two medicines, two prescriptions, which costs 
two pieces of money, in the neighborhood of $35 or so for 30 
pills. So that is a concern to me. Medicine doesn't always 
work, and when it stops working, they go to another one.
    Senator Carnahan. I have one final question, and if you 
would each address this question. Did you have any idea that 
your retirement, what we often think of as our golden years, 
would be like this?
    Ms. Sowells. No, not at all. Not at all. I tell my children 
sometimes life is not worth living, and they would say, 
``Mother, don't talk like that. Don't talk like that. We are 
not ready to give you up.'' And I said, ``Well, when you can't 
live a quality of life, you know''--and sometimes it is 
depressing. It is heart-breaking. It is aggravating. It is 
frustrating. And I was talking about this one drug that I told 
the druggist not to refill. I was already paying--it was a 
nerve pill. My nerves was really bad, and the doctor said I was 
right at a nervous breakdown when I quit work. And he had me on 
four Xanax pills a day. And I was paying $60 a month, and it 
got so bad, I went into him, and I said, ``Do not refill that 
prescription anymore.'' And he said, ``Just a minute.'' And he 
went to the phone, and he called the pharmaceutical, that makes 
the medicine, and he was telling them about me, and I know they 
had asked him, ``Well, does she really need it?'' He said, 
``Yes, or I wouldn't be calling.'' Here this medicine was 
already 60-some dollars a month, and they said, ``Let her have 
it at cost.'' They started charging me $20 for the medicine. 
That is what it took them to make my medicine, was $20, which I 
had been paying 60--over 60-some dollars a month for this one 
pill.
    Senator Carnahan. Mr. Lakes.
    Mr. Lakes. Senator, what I didn't anticipate when I was 
younger, that I was going to have these problems when I got 
older, you know, arthritis and all these other things.
    Senator Carnahan. You were going to enjoy your retirement.
    Mr. Lakes. Yes. But, unfortunately, I got old--I am glad I 
am living, though. [Laughter.]
    But it just come up, you know, one thing after another. I 
thank God that I haven't got worse health, but we do need help, 
and we are--I watch you a lot on the radio and what have you--
on the television, I should say, and I will say this: You will 
get my vote all the time. I will be working hard for you. 
[Laughter.]
    Senator Carnahan. Mrs. Muhleman.
    Ms. Muhleman. My husband has a lot of infections that he 
takes a lot of antibiotics constantly, and, of course, they are 
very expensive. And he has one medicine that goes in his 
nebulizer, or breathing machine, that a month's supply costs 
over $200. And that is just for his breathing machine. So these 
medicines are extremely expensive.
    Senator Carnahan [continuing.] told are very heart-rending. 
They make us all the more determined to do something and to 
help, and I appreciate your being here very much.
    We will take a 5-minute break at this time.
    Mr. Lakes. Thank you for having us, Senator.
    Ms. Sowells. Thank you.
    Ms. Muhleman. Thank you. [Recess.]
    Senator Carnahan. Could I have your attention? We will get 
started with our second panel. Our second panel will feature 
advocates for seniors in Missouri who have been working to 
relieve the burden of high prescription drug costs.
    Robert Schmalfeld is an AARP volunteer congressional 
district coordinator from St. Louis. Mr. Schmalfeld is a 
retired lieutenant from the Navy and a former administrator at 
Oklahoma State University and more recently at University of 
Missouri in St. Louis. We welcome you today, Mr. Schmalfeld.
    Mr. Schmalfeld. Thank you.
    Senator Carnahan. Ken Bougeno is the first vice president 
of the Missouri Council of Senior Citizens. Mr. Bougeno is a 
retired Chrysler employee and has been very active in his local 
UAW chapter.
    And, finally, Ann Steele, welcome. She is the advocacy 
chair of the Older Women's League. Mrs. Steele is a retired 
educator. She taught in the Rittenour School District for 28 
years, retiring in 1987, and she has been involved with the 
Older Women's League for over 10 years.
    We are very privileged to have you all here today, and your 
written testimony will be included in the written record in its 
entirety. But if you would please limit your prepared remarks 
to 5 minutes today, that would be very helpful.
    So we will get started with Mr. Schmalfeld.

 STATEMENT OF ROBERT SCHMALFELD, AARP VOLUNTEER CONGRESSIONAL 
              DISTRICT COORDINATOR, ST. LOUIS, MO

    Mr. Schmalfeld. Thank you, Senator. I am Robert Schmalfeld, 
an AARP volunteer, currently serving as congressional district 
coordinator from the city of St. Louis. I appreciate the 
opportunity to appear here today to discuss the need for 
Medicare prescription drug coverage.
    In the 36 years since the Medicare program began, 
prescription drugs have become essential to the treatment and 
prevention of disease. The lack of prescription drug coverage 
in Medicare has become one of the programs biggest gaps, 
leading beneficiaries vulnerable to substantial costs. Further 
exacerbating the problem is the fact that other sources of drug 
coverage for older Americans are inadequate and undependable.
    For instance, the number of employers offering retiree 
health coverage has seriously declined. In the 1980's, an 
estimated 60 to 70 percent of large employers offered retiree 
health benefits. By 1993, that had dropped to 40 percent, and 
in 2000, it was only 24 percent for future retirees. Medigap 
plans provide prescription drug coverage in only three of the 
standard ten plans, and these plans are expensive and place 
limits on the benefit.
    Medicare+Choice plans are dropping out of Medicare, 
increasing premiums, or reducing benefits. As a result of 
inadequate and costly coverage, one-third of Medicare 
beneficiaries do not have prescription drug coverage, and this 
figure obscures the fact that only 53 percent of beneficiaries 
have prescription drug coverage for the entire year.
    Prescription drug coverage in Medicare would improve 
quality of care, reduce unnecessary hospitalization, and offer 
the potential to reduce the risk of drug interactions. That is 
why AARP is committed to creating a Medicare prescription drug 
benefit. In particular, AARP believes that Medicare's benefit 
package must be modernized to keep up with advances in 
medicine.
    A Medicare prescription drug benefit must be available to 
all Medicare beneficiaries. The benefit needs to be affordable 
to assure a healthy risk pool. This means that healthy and low-
cost beneficiaries must choose to enroll in the benefit in 
addition to those who already have high drug costs.
    Prescription drugs should be part of Medicare's defined 
benefit package set in law. It is critical that beneficiaries 
understand what is included in their benefit and that they have 
dependable and stable prescription drug coverage. The benefit 
should provide protection against catastrophic expenses. The 
benefit must include additional subsidies for low-income 
beneficiaries to protect them from unaffordable costs and 
assure that they have access to the benefit. The benefit must 
be financed in a fiscally responsible manner that is both 
adequate and stable. The benefit should be voluntary so that 
beneficiaries are able to keep the coverage that they currently 
have, if they choose to do so.
    A new prescription drug benefit should also be part of a 
strong and more effective Medicare program. Senator Carnahan, 
we commend you for holding this hearing today to draw attention 
to the need for Medicare prescription drug coverage. AARP 
stands ready to work with you and your colleagues to enact a 
meaningful benefit.
    Thank you.
    [The prepared statement of Mr. Schmalfeld follows:]

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    Senator Carnahan. Thank you very much.
    I might ask you some questions right now before we move on 
to our other panelists. I certainly appreciate the fact that 
AARP has been such a strong advocate for a prescription drug 
benefit, and we appreciate all that they are doing in that 
area.
    You did mention a trend in your testimony. You said that 
employers and Medicare HMOs and other insurers are cutting 
back. Is this going to put--when they do this, do you think 
this is going to put a greater burden on Medicare 
beneficiaries? And do you think that this trend will continue? 
And as a result, will it cause Congress to have to heighten 
their interest in this topic and their need to do something?
    Mr. Schmalfeld. I believe that the need to have a 
prescription drug coverage in Medicare will increase as the 
number of employers continues to go down in terms of covering 
retiree benefits. There will be more and more people without 
the prescription benefit, and there will be an even greater 
need across the board for Medicare benefit--excuse me, a 
prescription drug benefit in Medicare.
    If you think about it, the last 10 years there has been a 
50-percent decline in the rate of coverage for those persons 
who used to be able to rely on having a prescription benefit in 
retirement.
    I am not sure whether I have completely responded to your 
question. I hope so.
    Senator Carnahan. Thank you.
    Let's go on and hear from Mr. Bougeno, and then we will 
follow up with some questions as well.

   STATEMENT OF KEN BOUGENO, FIRST VICE PRESIDENT, MISSOURI 
                   COUNCIL OF SENIOR CITIZENS

    Mr. Bougeno. Thank you, Senator Carnahan. My name is Ken 
Bougeno. I am the first vice president of the Missouri Council 
of Senior Citizens. I am here on behalf of them today. We also 
are an affiliate of the Alliance of Retired Americans.
    As a retiree of UAW Local 136, I feel very lucky that at 
the present time we have a copay prescription program and I do 
not have to make the choice between getting my expensive 
prescription filled or eating. With each negotiation, we are 
losing a little piece of our benefits, and the day could come 
when the corporation will take away that benefit altogether.
    There are 13 million senior citizens and disabled people 
who do not have prescription drug coverage. Older Americans 
depend on prescription drugs, and for many, drugs represent the 
difference between life and death. Seniors spend 42 cents of 
every dollar that is spent on prescription drugs, and they are 
the ones who can afford it the least.
    As an officer of the Missouri Council of Senior Citizens, I 
can say that we support the commitment of the Alliance for 
Retired Americans in lobbying for Congress to enact a 
universal, comprehensive, and affordable prescription drug 
benefit under Medicare.
    Seniors need an affordable copay prescription program that 
will protect them from increasingly expensive drugs, and 
employers should be provided with incentives to keep the 
prescription copay and even expand on it in their own 
corporations.
    We have got to put some kind of control as well on 
pharmaceutical prices. They have just skyrocketed on us. 
[Applause.]
    Senator, I want to thank you for the opportunity to come 
here today, and on behalf of the Missouri Council of Senior 
Citizens, we will support you in all your efforts, and anything 
we can do to help you, please call.
    [The prepared statement of Mr. Bougeno follows:]

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    Senator Carnahan. Thank you very much.
    Ms. Steele.

STATEMENT OF ANNE STEELE, ADVOCACY CHAIR, OLDER WOMEN'S LEAGUE, 
                         ST. LOUIS, MO

    Ms. Steele. My name is Anne Steele. I am the advocacy 
chairperson for the Older Women's League, the Gateway Chapter, 
which is in St. Louis, and I have entitled my presentation to 
you today ``Prescription for Change.'' I want to begin my 
remarks by telling you about a friend of mine whose name is 
Olivia, and I hope she will be able to join us a little later 
on.
    Olivia has been with us for 21 years and has worked 
ceaselessly to develop a grass-roots organization to focus 
solely on issues unique to women as they age. She strives to 
improve the status and quality of life for midlife and older 
women. But when prospective members ask me how old you have to 
be to get into this organization, I reply, ``39 or over, or 
ever hope to be.'' And we even take men.
    We work together to bring about these following goals, our 
organizational priorities: health care, and we have had a lot 
of explanation of that; economic security; and quality of life. 
Those are the three issues that we support legislation, we work 
on those, so on and so forth.
    Now, I want to talk about why are so many older women poor. 
By far, more retired women are much less able to support 
themselves, to support themselves with any degree of quality of 
life than men. Why is that?
    When I was a kid growing up, there were three professions I 
could go into, and that was a secretary, a nurse, or a teacher. 
And I ended up being the teacher. But women's professions have 
changed a little bit, but since these were women's professions, 
the pay was low.
    Women now are free to become trained in almost any field 
that they have the interest, aptitude, and opportunity. But 
just think, when the former man, Mr. Lakes, he said, ``You have 
to have a little luck.'' And that is what opportunity is, too.
    So I believe that you have to have that combination. It 
just doesn't come out and lay itself at your feet because you 
have aptitude or interest. It is that opportunity that really 
makes a difference in what you and I do with our lives, whether 
you are 80 or whether you are 8.
    In June 1963, the historic Equal Pay Act was signed into 
law after a protracted 18-year battle. Thirty-eight years 
later--that is now--women have gained 13 cents in the pay gap. 
Instead of 59 cents for every dollar earned by men in 1963, we 
now earn 72 cents on the dollar. OWL has long called for the 
full enforcement of wage and age discrimination laws, as well 
as a speedy closure to the widening gap separating men's and 
women's wages.
    Since Social Security monthly benefits are based on a 
worker's wage history, women who earn less become retirees who 
have less to live on. Older women depend most heavily on Social 
Security as a financial foundation. The poverty rate for women 
65 and older is almost twice that of men, 12 percent vs. 7 
percent. The average older women lives on $15,615 a year, vs. 
an average of $29,171 for her male counterparts. And women live 
an average of 6 years longer to stretch this money for some 
quality of life.
    For the women of color, the pay gap is magnified. African 
American women earn 65 cents and Latinas only 52 cents for 
every dollar earned by a white male. This cycle of low wages 
continues into retirement where African American and Hispanic 
older women have almost 3 times the rate of poverty as white 
women.
    Savings are very hard to manage when you don't make enough 
money to keep body and soul together, so the third leg of that 
retirement stool is often denied women because of their lack of 
income all through their lives.
    I want to refer a little bit to the ERA because we are 
trying to get that passed in the State of Missouri, and we are 
not succeeding.
    It started back the days when our Constitution was written, 
this discrimination of women. When Abigail wrote to John and 
said, ``Remember the ladies,'' he wrote back and said, ``Depend 
upon it. We know better than to repeal our masculine system. 
I'd rather give this up. I hope General Washington and all our 
brave heroes will fight against it,'' meaning putting women in 
the Constitution. And so it was.
    [The prepared statement of Ms. Steele follows:]

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    Senator Carnahan. Thank you very much. I am sure there is 
more there that we would all like to hear, but we probably 
should move on back to the topic here of drug coverage.
    There is one part of this that I would like to ask your 
opinion on. We haven't had much discussion about Medigap, but 
do you feel, as some people do, that it is unrealistic to think 
that Medigap is going to provide coverage for our seniors? What 
would a typical Medigap policy cost?
    Mr. Schmalfeld. I am sorry. I can't respond. I don't know. 
Those who are--it would depend upon age and a number of other 
things, and I don't have that information in front of me. Maybe 
others do.
    Senator Carnahan. So you never tried to get Medigap 
coverage or----
    Mr. Schmalfeld. Fortunately, I am with that small group of 
employers that continues to provide insurance, and so I stand 
in a minority here because I worked for a large university 
which continues to make prescription drugs available to me at--
still, I share in the cost, but--so I do not have a Medigap 
program myself.
    Senator Carnahan. I am sorry. Over here?
    Ms. Steele. I can tell you my husband spends $130 a month.
    Senator Carnahan. $130 a month.
    Ms. Steele. [Inaudible comment off microphone.]
    Senator Carnahan. Do you know which plan that is of the ten 
plans, which one----
    Ms. Steele. [Inaudible comment off microphone.]
    Senator Carnahan. Thank you.
    Mr. Bougeno, as a new retiree, I am sure you are planning 
on relying on your employer's drug benefit. Do you have any 
fears that it might be cut or eliminated? Would you talk into 
the microphone, please?
    Mr. Bougeno. I feel it is being cut on a daily basis--not 
quite daily, but monthly basis. We are losing just little bits 
here and there. There used to be gray areas that the insurance 
companies would go ahead and pay. Today they are just moving 
those over to the side. They will not pay them. And those are 
areas that we have been used to all these years paying, and 
they were not actually negotiated items, and they were in what 
they call--they call it ``gray area.'' So now they are not 
paying them. So we are losing just a little bit with each 
passing day.
    Senator Carnahan. I noticed that you advocated a Medicare 
benefit--I am sorry, a prescription drug benefit under Medicare 
as opposed to a private insurer. Would you tell us your 
thinking on that?
    Mr. Schmalfeld. Why it should be in Medicare?
    Senator Carnahan. Yes.
    Mr. Schmalfeld. We believe that presently the Medigap 
programs that there are have basically eliminated prescription 
drug as a covered item, and that practically the only choice 
that remains ahead of us for having any hope of having coverage 
at all is through Medicare.
    Going back historically, I don't think any of us could have 
imagined 36 years ago the degree to which prescription drugs 
would play a part in terms of managing health conditions. That 
has grown considerably. There have been many breakthroughs that 
have made using prescription drugs the treatment of choice that 
one could not have imagined.
    With this has come a great increase in terms of cost. A new 
drug coming on the market, the pharmaceutical company will get 
as much as it can for as long as it can before allowing it to 
become a generic drug. In fact, we have seen some instances 
where the Congress has taken action to extend the patent period 
for certain drugs, which makes it even more difficult for 
people to be covered. I think it is the only choice that 
remains ahead.
    Earlier this month, on the occasion of the 36th 
anniversary, AARP went to all of the offices of Senators and 
representatives, including yours in St. Louis, and presented a 
cake with a piece out of it, which said prescription drugs--and 
that piece out was the prescription drug benefit that is yet to 
be enacted. And we hope that the Congress will move toward 
enacting this, particularly since monies have already been 
identified and are just waiting for a bill to be introduced 
that utilizes those monies appropriately.
    Senator Carnahan. I did hear about the cake that was 
delivered, and I hope that I will be able at some point to 
return you a slice of cake and say this is what we have done, 
we have put it all together. [Laughter.]
    Mr. Schmalfeld. Thank you. We look forward to that.
    Senator Carnahan. Mrs. Steele, I certainly admire what your 
organization is doing on behalf of women and the studies that 
you are making. In drafting a Medicare prescription benefit, 
though, are there certain issues that we need to focus on that 
would be particularly helpful to elderly women?
    Ms. Steele. I believe that it has to be stable and it has 
to be protected so that inflation--so that with inflation the 
amount of coverage for prescription drugs will increase also. I 
think it has to be--in order to pay for this, we are going to 
have to have everybody in the pot, because you simply cannot 
pay for it if only the sickest choose coverage.
    So those are the things that I see, and, of course, that 
everybody gets the kind of care they need; instead of saying we 
are going to cover this, this, and this, you have a menu of 
choices.
    Senator Carnahan. Well, how can we--you say we need the 
low-cost beneficiaries in there as well to expand the pool. How 
can we make this benefit more attractive so that more people 
will want to take part?
    Ms. Steele. Well, I think even those who have--well, let me 
say that I am one of those who no longer is insured by a former 
employer. When my husband retired in 1987, we were told we 
would have lifetime coverage. That ended in 1997, and we knew 
it was going to end in 1993.
    Senator Carnahan. So the stability factor is a very 
important one.
    Ms. Steele. Yes. But it also means that I have to go out 
and find my own. I am not part of a group anymore, which makes 
it much more difficult.
    So I just think we have to be able to count on a community. 
We are a community. We need to work together as a community to 
protect everybody in that community.
    Senator Carnahan. Mr. Schmalfeld, would you like to comment 
on that, how we can make it more attractive?
    Mr. Schmalfeld. Obviously it has to--the Congress needs--it 
is a very daunting job. They have to devise something that will 
be attractive to----
    Senator Carnahan. And affordable.
    Mr. Schmalfeld. And affordable to everyone. And I think 
this is a kitchen-table kind of issue, that when the plan is 
devised, that people will sit around the kitchen table and say 
this is what we are paying now, this is what is proposed under 
this system, does this look like it is moving in the right 
direction? Does this make it interesting and affordable and 
appropriate for us to adapt? Until a program is devised, it is 
really hard to comment and say this is the way, this is the 
deciding factor that I am going to decide to sign up because it 
is a good deal, not because it is something that I am going to 
pay more on. Or you weigh out the difference. You say, well, my 
insurance costs--which I didn't say earlier. You asked about 
the cost and so forth. I failed to mention that over the years 
since I have retired in 1996, my insurance rates have increased 
by more than 45 percent. So while I am still covered, more of 
my resources are being spent to provide that benefit. And I 
heard recently in a newsletter that that cost is going to go up 
even more.
    So I think people are going to be very practical about 
this. It is a money issue, and it is like look at what the 
details are, what it is going to provide, what is the 
deductible, what are we paying now, what has our history been 
with drug costs, is it going up, are we likely to lose our 
insurance benefit, as one of our panelists has talked about, or 
be reduced. Are we on a better path going into this?
    I think the other thing is that as a program is offered, 
those concerns--then companies that offer prescription benefits 
now as part of retirement benefits are going to have decisions 
to make. Hopefully they will continue them. If they don't 
continue them, one of the options is going to be perhaps to pay 
the cost of that, whatever the charge is under Medicare, and 
also to provide wrap-around things.
    Another thing that AARP is concerned about is low-income 
persons, people who need additional help to pay for the cost of 
insurance, which is true now in terms of Medicare Part A. If 
you are in a certain low-income basis, you have that premium 
paid.
    So there are options out there that I think common-sense 
people--it is a money issue. They are going to have to look at 
all the details, and they are going to have to decide whether 
it is worthwhile or not. But if we don't attract the large 
numbers, then it is not going to work.
    Senator Carnahan. Well, thank you so much for sharing these 
experiences with us today. We are going to have to move on to 
the third panel. I notice we are running out of time. But, 
again, thank you very much for being here. [Applause.]
    Our final panel will explore in greater detail the serious 
impact that high prescription drug costs are having on Missouri 
seniors.
    Our first witness today will be Dr. Lanis Hicks, professor 
in health service management at the University of Missouri 
School of Medicine. Dr. Hicks has been involved in several 
projects with rural hospitals, conducting environmental 
assessments and market strategies. She also conducts research 
into the cost-effective delivery of health services in rural 
areas. Welcome, Dr. Hicks.
    Dr. Stephen Zweig is--did I say that, pronounce that--
Zweig, I am sorry. Dr. Stephen Zweig is a professor and 
associate chair and coordinator of geriatric activities at the 
Department of Family and Community Medicine at UMC. He is also 
director of the Care and Aging Program at the UMC Hospital and 
Clinic. Dr. Zweig has received numerous awards and honors and 
has focused much of his career and training around geriatrics, 
and we are very honored to have these distinguished panelists 
with us today.
    Again, your written testimony will be received into the 
record, and I ask you to make your presentations--keep them 
limited to 5 minutes.
    Dr. Hicks.

STATEMENT OF DR. LANIS HICKS, UNIVERSITY OF MISSOURI SCHOOL OF 
                            MEDICINE

    Dr. Hicks. Thank you for the opportunity to be here today 
to discuss the issue of seniors and prescription drugs. My name 
is Lanis Hicks, and I am a professor of health economics in the 
Department of Health Management and Informatics at the School 
of Medicine.
    As this first graph shows, there has been a rapid increase 
in expenditures on health care, and the expenditures on the 
prescription drugs has been increasing even more rapidly. In 
1996, they accounted for 6.5 percent of total expenditures. In 
the year 2000, they were up to 8.9 percent. And by 2010, they 
are expected to account for almost 14 percent of the health 
care expenditures.
    These rising expenditures on prescription drugs are not 
necessarily bad, but the implications of the increases have to 
be examined. Prescription drugs are increasingly used as 
components with our other medical interventions as complements 
to improve patient outcomes. They are used as immuno-
suppressants used with organ transplants. Other prescription 
drugs are used to substitute for more invasive procedures, such 
as lipid-lowering drugs to reduce the need for bypass surgery, 
and to treat medical conditions that previously we weren't able 
to treat, such as Parkinson's disease.
    Furthermore, as our knowledge and understanding of genetics 
grows, pharmaceuticals are expected to grow exponentially. 
These changes in pharmaceutical products are expected to have a 
disproportionate impact upon the seniors since seniors 
represent the cohort relying mostly on prescription drugs to 
manage their multiple health problems. Seniors not only have 
more problems with their health, but their health problems tend 
to be those that respond to drug therapy.
    In 1996, 89 percent of seniors reported having one or more 
chronic health problems, and almost 10 percent reported having 
five or more chronic problems. Chronic health problems have 
major implications for expenditures on prescriptions. 
Currently, seniors account for about 13 percent of our total 
population but incur about 43 percent of our total prescription 
drug expenditures.
    There is discrepancy in the utilization of prescription 
medications and the expenditures on prescriptions between 
Medicare beneficiaries that have insurance coverage and those 
that do not have insurance coverage. As this graph shows, the 
dark line is those that do not have any kind of benefit 
coverage, and the other ones are those that have benefit 
coverage.
    As the data show, individuals with insurance coverage 
filled on average 24.4 prescriptions while those without 
coverage filled 16.7 prescriptions. These same discrepancies 
hold even when the adjustments for health status, economic 
conditions, and chronic conditions are considered.
    Under all circumstances, individuals with insurance 
coverage on average utilized more prescription medications than 
individuals without insurance coverage. As shown, non-covered 
seniors living below the poverty level only utilize about half 
the number of prescriptions as covered seniors below the 
poverty level use. Non-covered seniors indicating poor health 
status use about a third fewer prescriptions than covered 
seniors in poor health.
    These data indicate the critical role that insurance plays 
in the utilization of prescriptions medications by seniors. 
Non-covered individuals with five or more chronic conditions 
average $1,051 on prescriptions while covered individuals with 
five or more chronic conditions average about a little over 
$1,800, about 75 percent more, although covered individuals pay 
only $595, or 56 percent as much out of pocket.
    As with the other end, seniors without a chronic condition 
but with insurance coverage spent almost 70 percent more for 
prescriptions than non-covered beneficiaries, although their 
out-of-pocket expenses are only about half as much.
    From the data available, it is not possible to determine 
the appropriate level whether or not some individuals are 
spending too much and others too little. But what we have been 
able to look at through some of the research is that non-
covered beneficiaries with hypertension were 40 percent less 
likely to purchase anti-hypertension medication, and we have 
also shown that about three-fourths of drug-related 
hospitalization by seniors could have been avoided with the 
proper use of medications.
    Rural populations tend to face exacerbated access and 
financial problems, with other half of senior residents living 
at 200 percent of the poverty level compared to 41 percent.
    All of these are problems that we are encountering within 
the health care industry, and the problem, as we try, you know, 
to work toward solving these problems, is to recognize what is 
going to happen in a very short period of time when the elderly 
increase from about 13 percent of our population to over 20 
percent. And that is going to have increasing medical--you 
know, in terms of trying to make it an affordable plan.
    Thank you.
    [The prepared statement of Dr. Hicks follows:]

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    Senator Carnahan. Thank you.
    Dr. Zweig.

   STATEMENT OF DR. STEPHEN ZWEIG, DEPARTMENT OF FAMILY AND 
                    COMMUNITY MEDICINE, UMC

    Dr. Zweig. Thanks, Senator Carnahan, for this opportunity 
to testify before this Special Committee on Aging. This is an 
important problem, and we hear your genuine concern and 
appreciate that.
    I am privileged on a daily basis to work with older people, 
to help to teach medical students, residents, fellows in 
geriatrics and others about the importance of caring for elders 
and how to do that in a cost-effective way. I don't know how I 
can speak more articulately about this program than those 
patients and family members that have come before me. It is a 
serious problem.
    The Congressional Budget Office estimates that spending on 
prescription drugs by Medicare beneficiaries from all sources 
will equal $1.3 trillion between 2004 and 2011, and that 
includes spending by beneficiaries and insurers on their 
behalf.
    As has been pointed out previously, purchase of Medigap 
policies that cover prescription drugs are expensive. They have 
deductibles, high copays, and benefit caps. And as Ms. Muhleman 
pointed out, these are often out of the reach of many people 
who need them.
    Prescription drugs spending is increasing at a rate 3 times 
that of professional and hospital spending for Medicare. Not 
only are many patients filling prescriptions, but the cost of 
those prescribed drugs is very high. In fact, the 25 most 
heavily advertised and promoted drugs accounted for 40 percent 
of the increase in retail drug spending in 1999.
    As has been pointed out, Medicare beneficiaries fill 
prescriptions, 86 percent did in 1995, and a Family USA study 
found that in the year 2000, the number of prescriptions filled 
by the elderly averaged 28.5 per year, including refills.
    As Ms. Sowells pointed out, it is not surprising that those 
people with many chronic conditions, such as heart disease, 
high cholesterol, and diabetes, spend much more, over $3,000 a 
year out of pocket compared with an average of $1,343.
    While the majority of Medicare recipients have some form of 
insurance, this insurance is not adequate to cover the cost of 
most beneficiaries. Unfortunately, there is little relationship 
between the cost of the drug and the benefit it may afford. But 
the absence of needed drugs may precipitate loss of function in 
the elderly, resulting in increased disability and dependency.
    So, in summary, the number of prescriptions is up. The cost 
of those prescriptions is up. Costs are higher for those 
without insurance coverage. Total expenses, however, are higher 
for those with good insurance coverage, and those with multiple 
chronic diseases have more need.
    Unlike other insurance policies, out-of-pocket expenses for 
prescription drugs are unlimited in most circumstances, and as 
has been pointed out, 65 percent of beneficiaries have some 
form of insurance and 60 percent of them have supplemental 
plans. Most are employer-sponsored, but this is also 
decreasing. The statistic that I had read included only 30 
percent of elderly with employer-sponsored plans in 1998.
    Twenty percent are members of Medicare HMOs, which have 
historically had the most generous prescription drug coverage, 
but more recently they have limited these benefits. And as Mr. 
Lakes' experience testifies, high prescription drug users are 
more likely to disenroll from Medicare HMOs and may not qualify 
now for their former Medigap plans, leaving them without any 
coverage at all.
    As has been also pointed out, those most likely to be 
without coverage have low income, to be of fair or poor health 
status, and to be older than 75. And even though the Medicaid 
program covers 17 percent of elderly living in the community, a 
very, very fine prescription drug program, many poor people 
don't receive Medicaid benefits. In fact, in 1999, an estimated 
45 percent of community living Medicare beneficiaries within 
incomes below the Federal poverty level received no Medicaid 
benefits.
    Dr. Hicks has articulately described the population trends. 
Our population is aging. By 2020, 20 percent of Americans will 
be 65 and older, and the largest growing population in the 
United States is that in the 85-year-and-older group. As our 
population ages, the prevalence of chronic disease will also 
increase, which means more prescription drug use and higher 
costs.
    Valuable pharmacologic research is fueled by a promise of a 
drug that will be preferred by both patients and physicians, 
and it will be expensive. While Medicare has limited payments 
to physicians and hospitals, there has been no such limit on 
the cost of prescription drugs.
    I have a nurse colleague in our practice named Rebecca 
Raskar who coordinates the care for about 230 of the most frail 
and complicated older patients that we care for living in the 
community. And I asked her this morning what I should tell this 
group, and she said, ``Tell them these poor old people can't 
afford those expensive drugs.''
    Indigent drug programs that are sponsored by pharmaceutical 
companies are valuable, but they are full of gaps and delays, 
and they are incomplete. Frequently, our patients and us cobble 
together programs which are associated with discontinuity and 
possible injury, and I will be happy to give examples.
    Drug samples are free at first and costly much later. As 
Mr. Lakes pointed out, they are not available long term. And 
the Medicaid spend-down program has helped many, but is not 
available to all those who need it.
    I will stop there.
    [The prepared statement of Dr. Zweig follows:]

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    Senator Carnahan. Well, thank you very much, Dr. Zweig.
    Dr. Hicks, in your testimony, you said that those without a 
prescription drug benefit fill fewer prescriptions than those 
who do have those benefits and that this might indicate that 
people are not filling prescriptions, not taking the medicines 
that have been given to them. And we have seen some examples of 
that already today of people having the medicine or only taking 
it every other day.
    What are the possible health implications of this kind of 
behavior?
    Dr. Hicks. Well, I think we have seen--part of it, as you 
look at some of the research, if you cut your medication in 
half, you know, someone said that, well, maybe the--their view 
was that, well, at least it would give them half of the 
benefit. Oftentimes medications if taken in half give no 
benefit because the dosage is given at a point that is needed 
to make the difference, and if you don't take it at that 
dosage, you really don't get any benefit.
    I think we see it where the hypertension that took 40 
percent fewer prescriptions, we then see an increase in 
strokes, heart problems, and very expensive hospitalizations 
because they haven't been able to afford the preventive type of 
care.
    Senator Carnahan. And what would you recommend, then, for 
those people who simply can't afford to have their prescription 
refilled?
    Dr. Hicks. I think it is the same thing we have been 
talking about of trying to get some type of an affordable 
prescription drug benefit so that everyone has the basic 
coverage as an elderly individual as part of a Medicare plan.
    Senator Carnahan. Some are fearing that if the Government 
provides a Medicare drug benefit, private employers will tend 
to scale back and not provide programs. In fact, there are 
already some indicators now that they are beginning to cut back 
on coverage.
    I was wondering if both of you would comment on this trend 
and how you believe the creation of a Medicare drug benefit 
would impact the private sector.
    Dr. Hicks. I think we are already starting to see the 
private sector cut back on the packages that they make 
available for their retirees. You know, there is a lot of data 
already out there that shows this is happening, and it is 
happening without the protection of the Medicare program to 
pick up the difference. It is falling on the individual to make 
up that difference as the private companies cut back.
    Yes, I think the answer is we probably would see private 
insurance companies cut back if Medicare--very similar to what 
we have seen as Medicare has picked up other costs.
    Senator Carnahan. You don't think they would offer a 
supplemental of some kind, they would just let it go?
    Dr. Hicks. There is obviously the potential to offer a 
supplemental like our Medigap programs that will help pay for 
the deductibles and copays. I think on your prescription drugs, 
just because, you know, the large number and the increasing 
expense of those packages that would be--they would be less 
inclined to offer the supplemental.
    Senator Carnahan. I was wondering if you would comment, Dr. 
Zweig, on the advantages and disadvantages you see of a drug 
benefit under Medicare as opposed to private insurance.
    Dr. Zweig. Obviously not everyone has private insurance 
now, so that would be certainly a major difference. I think 
this is an incredibly tough problem, and anything that we do 
will be very expensive.
    As we look at the costs of administering health programs, 
the cost of administering the Medicare program has historically 
been much less than that associated with other private 
insurance programs. I am not a health economist like Dr. Hicks, 
and I can't predict what employers or health insurers will do. 
I support universal health insurance for everyone in this 
country and I believe that---- [Applause.]
    Senator Carnahan. I think you have an audience that agrees 
with you.
    Dr. Zweig. I believe that as we try to take money out of 
different pockets, as we are constantly doing, in trying to 
care for people, and particularly older people, not only with 
regard to drugs but with regard to long-term care and hospital 
care and home care, it becomes very complicated.
    I think that we will need to replace the existing support 
for the two-thirds of the population if we go with a universal 
Medicare plan, and those who are contributing to those existing 
plans will have to contribute in some way.
    I think that we have to do something first for those people 
who have greatest need.
    Senator Carnahan. Let's move on to something that affects 
people who live in rural areas, and I think they have certain 
special problems in many areas, access problems and certainly 
access to prescription drugs is one of those. And one of the 
principles that we laid out early on regarding a benefit was 
that it should be accessible so that all beneficiaries, no 
matter where they live, have access to prescription drugs.
    What do you see as the challenges in providing prescription 
drug benefits in rural areas? Either one of you, or both.
    Dr. Hicks. I think obviously one of the problems we have is 
the same problem we have with all other health care, is just 
availability of the medications. Especially if a rural elderly 
takes a medication that is somewhat unique and different and 
rare, it becomes almost impossible to get that in a local 
pharmacy because of the problems they have of getting it and 
keeping it and the low volume. So I think that is going to be 
an area that we really have to worry about with our rural 
elderly, is the lack of volume in a lot of the different kinds 
of medications and getting that in.
    Dr. Zweig. Just to add to that, rural practitioners tend to 
be the most overwhelmed of all. We have been very fortunate to 
have social workers within our program who help people to sign 
up for indigent drug programs which have afforded them some 
services that they may not have otherwise had.
    The transportation to accessible pharmacies at low cost is 
a challenge. If people like Mr. Lakes need to get their 
prescriptions every 2 weeks because they can't afford it, that 
certainly adds a tremendous challenge to being able to get a 3-
month supply of medications that will both reduce the cost of 
those drugs and also make it more likely that the person won't 
have gaps in their treatment.
    I think people are less likely to take those drugs for 
which they see a direct positive effect, and they may not be 
the ones that are the best ones to choose to not take.
    Senator Carnahan. On the affordability side--again, I have 
asked this of some of the other panels as well--how can we make 
a benefit that is both attractive and affordable? I would like 
to have your opinion on that as well.
    Dr. Hicks. I guess my response is I really don't know. The 
affordable part of it, with all of the new drugs coming on the 
market that are extremely expensive, the growing elderly 
population is going to make it hard to make it affordable.
    I think one of the difficulties we always face with any 
kind of governmental insurance program is that it can become an 
easy target, because suddenly we have the information in front 
of us about what it is actually costing because it is a 
Government program, and we avoid some of that in the private. 
It doesn't make it any less affordable. It just makes it less 
of a target to be able to hit.
    And so I think trying to find an affordable one is doing 
things that you talked about earlier, and that is, I think it 
will be necessary to have some type of copayment and to have 
some type of deductible. I would, however, really not like to 
see any kind of cap put on it, saying a maximum benefit, 
because unfortunately what you do with a maximum benefit is you 
max out the people that need it the most, and those are the 
ones that are spending the most. [Applause.]
    Senator Carnahan. I might move on to another point that we 
mentioned, that is, the point of stability. It seems like the 
seniors get to where they are relying on a program, and it is 
very unsettling to have the coverage change. So I was wondering 
if you might comment on how we can best create a drug benefit 
that is stable and one that is reliable as well.
    Dr. Zweig. Well, that is clearly the advantage of doing it 
through the Medicare program instead of a private insurer in 
terms of that stability. It seems to me any plan is going to 
need to include some combination of deductibles and out-of-
pocket limits and premiums. I think there has to be meaningful 
price reform with regard to expenses and costs for drugs. I 
think---- [Applause.]
    Senator Carnahan. You have got a real following here.
    Dr. Zweig. Yes. I think we have to be careful to not divert 
support to prescription drugs away from other aspects of the 
Medicare program. I think the formulary has to be comprehensive 
but evaluated by health care providers who know most about 
that. And I think that we should support drugs in particular 
that target significant symptoms and prevent disability in 
older people.
    I am concerned that if we only have a program that supports 
the poor that the program will become a target, as the Medicaid 
program has become in political circles. And, honestly, I am 
concerned about the recent economic forecasts as to how much 
money we will have for such a program. And I applaud your 
interest in continuing to try to pursue this very great 
challenge.
    Senator Carnahan. One of the things that you mentioned 
earlier was the use of drug samples. It seems like doctors will 
often, in all good intent, provide these samples for someone 
with a chronic health problem, and they use it for a month or 
so, and they get committed to the drug, and then it is a very 
expensive drug for them to follow up with.
    Are there ways that we can educate our seniors and their 
caregivers to consider these cost issues up front when they are 
setting up a treatment program?
    Dr. Zweig. I think this is an incredibly important problem. 
You know, in general, the samples left in physicians' offices 
are the newest and most expensive ones. Some of those are very 
valuable drugs for which there is no alternative. Many of them 
are not. Advertisements for these drugs help to support medical 
journals and provide a lot of the costs for supporting 
education and continuing education.
    Most recently, as you know, these drugs have been now 
prescribed on television and on radio, so patients come to me 
on a daily basis saying, ``Why aren't I on this one?'' And they 
are always among the most expensive drugs available.
    I do think that patients need to be informed, but the 
effect of the advertising and the unfiltered attention of the 
media to the promises of medical science, the cure of cancer of 
the month, has created incredible expectations that we cannot 
meet at this point.
    I think our job as physicians is important. We have to make 
sure that our patients are taking the drugs that show really 
the most demonstrated benefit and to negotiate with them about 
that. And what we are trying to do in medical school and 
residency training is to help our students evaluate new 
information and practice in an evidence-based way so that they 
can then communicate that effectively with patients. And we 
have to be familiar with costs. I mean, it is inexcusable for 
physicians to say, ``I don't know what that drug is going to 
cost'' and not put that into the context of their prescribing 
plan. [Applause.]
    And in the process, then, engaging patients and making 
those kinds of choices about--and there is a creative program 
that I just learned about in Ohio a couple of days ago using 
some of the same techniques of pharmaceutical sales 
representatives, where it is an organization called Generics 
First. A generic drug company is going around and spending time 
with physicians informing them about cost comparisons of drugs 
and helping them to learn the least expensive alternatives. And 
I think that that is incredibly important. This is a program 
that some researchers at Harvard discovered a few years ago. If 
we help to train physicians about those things, they can help 
their patients as well.
    Senator Carnahan. Well, thank you very much. We are about 
to run out of time, and I was determined that we would be able 
to finish here at noon. But I appreciate your being here very, 
very much, and I want to thank you for sharing this with us. I 
will make a closing statement, and we will adjourn for the day.
    But before we adjourn, I want to thank all the witnesses 
who have been here to share their thoughts and their opinions 
with us on the problems of prescription drug costs.
    For those of you who have other thoughts on the subject and 
would like to share them with me, there is a table out in the 
hall where you can write comments, and I will take those back 
to Washington with me and read those and get back with you.
    I think you have conveyed a very clear and a very forceful 
message today. We need a prescription drug benefit under 
Medicare, and we need it now. [Applause.]
    This benefit should be universal, that is, it should cover 
every Medicare recipient who wants to participate; and it 
should be affordable, and it should be available to all. And it 
should be something we can rely on for many years into the 
future.
    I will be returning to Washington next week following the 
Labor Day break, and we will begin to struggle to craft a 
prescription drug benefit that works. It will be a difficult 
battle because we are in tight budgetary times. But I assure 
you that I will remember what has been said here today, and I 
will see that those in Washington know what you think.
    I want to close by reading a portion of Mrs. Ruengert's 
very fine written testimony that she submitted for the record. 
I mentioned it earlier. She is caring for her 91-year-old aunt 
in her home. Her aunt, Mrs. Dorothy Creighton, lost her husband 
some years ago. Mrs. Creighton was able to live by herself for 
a while before her own health began to fail. And at this point, 
she sold her house and she spent her savings to move into an 
assisted living home, where she stayed for several years until 
her expenses became too burdensome.
    Because of the rising costs at the home and rising cost of 
medical expenses and her reduced savings, she could no longer 
afford the arrangement. At this point, Mrs. Ruengert invited 
her aunt to live with her in Jefferson City, and in testimony 
submitted to this committee, Mrs. Ruengert writes, and I quote, 
``Even with my help, things are financially hard for her. She 
didn't want to tell you that she was overdrawn at the bank 3 
weeks ago when she sent a check to AARP to pay for medicine. 
But I told her this committee needs to hear about all your 
financial problems due to your medical bills. I ask you, What 
do the elderly do when they have no family member who can help 
them?'' Yes, what do the elderly do when they have no family 
member to help them? That is a haunting question, and that is 
the question I am going to take back to Washington with me 
because that is the question we need to find the answer to.
    This hearing stands adjourned. [Applause.]
    [Whereupon, at 11:45 a.m., the committee was adjourned.]


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