[Congressional Record Volume 145, Number 151 (Monday, November 1, 1999)]
[Senate]
[Pages S13605-S13607]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BAUCUS:
  S. 1837. A bill to amend title XIX of the Social Security Act to 
provide low-income Medicare beneficiaries with medical assistance for 
out-of-pocket

[[Page S13606]]

expenditures for outpatient prescription drugs; to the Committee on 
Finance.


                    the healthy seniors act of 1999

  Mr. BAUCUS. Mr. President, I rise today to introduce the Healthy 
Seniors Act of 1999. Prescription drugs are a hot topic these days. 
From the lawn of the White House to the TV screen in your house, 
everyone is talking about prescription drugs, and for good reason. 
Americans have the greatest health care system in the world: The best 
doctors, the best research, and the most effective prescription drugs. 
That doesn't mean anything if thousands of seniors can't afford to use 
them. We are creating a system where the well-off can buy the best 
health care and the poor can afford little more than an aspirin.
  Recently, ``60 Minutes'' did a show on the high cost of prescription 
drugs and the need to provide coverage to low-income beneficiaries. 
National Public Radio has run a series of stories on the rising cost of 
prescription drugs and government plans to make them available to 
Medicare beneficiaries. Full-page advertisements and news stories are 
in our Nation's newspapers, from the Washington Post to the Billings 
Gazette. We have all seen Flo and her bowling ball.
  I have a story from the Montana Standard, Butte's local newspaper. 
The headline reads: ``Montanans Testify for Medicare Drug Coverage.''

       Greg Loushin's heart breaks every time he watches Montana's 
     elderly and uninsured scrounge for change to buy prescription 
     drugs. Oftentimes, the Butte pharmacist pulls money from his 
     own pocket.

  Think of that, the local pharmacist pulls money from his own pocket 
when his own customers do not have adequate funds to pay for their 
drugs.
  From the story:

       Pharmacist helping seniors buy drugs they need from his own 
     money.

  People help one another out in Butte, MT. Greg's customers are lucky 
to have him for a pharmacist. But we know in our increasingly 
interpersonal world, Greg's generosity is a rare exception. It isn't a 
long-term solution to the problem of escalating costs of prescription 
drugs; creating a prescription drug benefit under Medicare is.
  Why is it suddenly so important seniors be given a drug benefit under 
Medicare? Why all the attention? Why the stories? The answer is 
twofold.
  First, prescription drug costs have risen dramatically. Overall 
medical inflation has been slowed in recent years, but the cost of 
prescription drugs has actually skyrocketed, rising much faster than 
the average cost of medical care. In 1980, prescription drugs were only 
4 percent of total health costs. In the year 2000, they will account 
for 16 percent of the total, a fourfold increase in 20 years. The 
increased costs are attributable both to the prices charged for the 
new, sophisticated drugs that are being developed by pharmaceutical 
companies, and to increase use of the drugs by our seniors.
  Today as never before there is increased competition among drug 
companies to put out new drug therapies for the many ailments that face 
Americans, young and old. I, for one, do not want to stunt the 
innovation that has made America the leading architect of medical 
technology.
  The second reason the drug benefit is so important is these research 
efforts are increasingly fruitful. Drugs can now treat illnesses where 
formally surgery was needed. Drug coverage means healthier individuals, 
leading to fewer hospitals and less time in the hospital.

  New York has a plan called EPIC to help low-income seniors with 
medications that saved an estimated $47 million in hospitalization 
costs in the recent year, compared with the $41 million it cost to run 
the program. David Cutler, a Harvard economist, reports elderly 
disability rates have fallen 15 percent in the last decade largely 
because of increased use of prescription drugs.
  Barbara Holter, a Montana Medicare beneficiary, last week wrote me:

       Senator Baucus . . . innovative prescription drugs and 
     biological therapies played an important role in the 
     treatment of arthritis. While not a cure, these new 
     medications can help alleviate the pain, slow the progress of 
     disease, and prevent disability. Unfortunately, 35 percent of 
     Medicare beneficiaries do not have coverage. It is important 
     that Congress take action to expand access to drug coverage.

  Gone are the days when surgery and mechanical devices alone work to 
save lives and increase their quality. A heart ailment that may have 
required an extensive bypass a few years ago can now be treated with a 
clot-busting medication or a stent. To paraphrase the renowned 
physician and health care policy expert, Dr. William Schwartz, medicine 
is changing ``from the mechanical to the molecular.''
  Everyone seems to recognize this shift. Everyone, that is except our 
government. We are 60 days from the year 2000, and we are still trying 
to run a health care program rooted in the year 1965.
  Some say we ought to reform Medicare before providing a drug benefit. 
Senator Bill Roth, chairman of the Finance Committee, has indicated his 
interest in working in a bipartisan fashion to strengthen Medicare in 
the coming year. I welcome his willingness to do so. Without action, 
Medicare will go broke in just 15 years, at the very time our social 
insurance system becomes inundated with the baby boom generation, about 
15 years from now.
  We must act to save Medicare. We ought not let perfection be the 
enemy of the good. I accept and agree that Medicare must be changed. It 
is also true the average senior fills 19 prescriptions every year on 
average. Our seniors don't have the luxury of waiting until the 
politics are right to get the drugs they need. This is particularly 
true in rural areas.
  As this chart indicates, one-third of Medicare beneficiaries have no 
prescription drug coverage. One-third of seniors in our country have no 
prescription drug coverage. In rural areas, it is even worse. In rural 
America, the number increases to nearly half. Seniors are being denied 
products that can save their lives because of geography. Half of 
American seniors don't have prescription drug coverage.
  Part of the problem is we don't have a lot of managed care in rural 
areas. In fact, we have very little. Managed care will often provide 
drug coverage to seniors. In many parts of America, particularly rural 
America, there is no managed care, much less prescription drug coverage 
for seniors.
  Recently, my staff spoke to Ardys Olin and her mother Thelma of 
Billings, MT. Both are beneficiaries of Gold Choice, Montana's only 
Medicare managed care plan. Ardys is disabled; Thelma is 87. For the 
time being, they both get prescription drug coverage through Gold 
Choice, the only managed care program for Medicare in Montana. They are 
quite pleased with it.
  Because payment rates are insufficient to sustain managed care in 
rural America, Gold Choice is soon going to leave Montana, leaving its 
2,600 beneficiaries without prescription drug coverage. Where are these 
people going to go? What are they going to do when Gold Choice pulls 
out of Montana?
  Most employers in rural America can't afford to offer prescription 
drug coverage in their retirement plans. The profit margins are so low 
in rural America. Unfortunately, many people in rural areas have little 
or no retirement income beyond their Social Security checks. These 
people are hurting. Many of the 2,600 Montanans losing prescription 
drug coverage with the termination of Gold Choice--the only managed 
Medicare care program in our State--don't have enough money of their 
own to buy Medigap coverage. Medigap is the insurance plan offered by 
many companies to fill the gap between what Medicare doesn't pay and 
what Medicare should pay. Maybe people do not have enough money to buy 
Medigap insurance. That is why many Americans don't have any 
prescription drug coverage at all. They simply have to hope they do not 
become ill and, if they do, that they will be able to afford the cost 
of the drugs their doctors prescribe.

  The legislation I am introducing will begin, not totally--but begin 
to address this problem. We are not creating any new bureaucracies, no 
new large Government programs. We are simply extending the reach of the 
Medicaid program to administer drug coverage to our most needy. That is 
it. This bill provides prescription drug coverage to the elderly whose 
incomes are 175 percent of the Federal poverty limit. In real terms, 
that means seniors making up to about $13,500 a year will be provided 
some prescription drug coverage; $16,800 in the case of couples.
  This bill impacts seniors who are less able to pay for their 
prescription drugs.

[[Page S13607]]

 Consider the following data graciously provided by, and under review 
at, Health Affairs, the Nation's leading health policy journal.
  These numbers are from a study supported by the Commonwealth Fund, a 
national philanthropic organization engaged in independent research on 
health and social policy issues, and is the product of the able 
scholarship of Dr. Jan Blustein, professor at the Wagner School of New 
York University.
  This chart shows the extent to which low-income seniors with 
hypertension have prescription drug coverage. Hypertension--that is, 
high blood pressure--is prevalent among the elderly, occurring in 
better than 50 percent of persons over age 65. As you can see, seniors 
with hypertension, with incomes between 100 and 125 percent of poverty, 
only have prescription drug coverage about 65 percent of the time. 
Again, seniors whose income is between 100 percent and 125 percent of 
poverty have prescription drug coverage only about 65 percent of the 
time. Those between 126 percent and 150 percent of poverty, the next 
line down, fare even worse, receiving drug coverage only about half the 
time, 55 percent of the time.
  Mr. President, 150 percent of poverty is not a lot of money, only 
about $11,500 a year. There is clearly a need to help these people, and 
the bill I am introducing today does just that.
  Let me be clear in stating this legislation is not intended as a 
permanent solution to the prescription drug problem. It does not 
provide stop-loss coverage for beneficiaries whose drug bills measure 
in the thousands of dollars. And because it uses Medicaid, the 
legislation uses a delivery mechanism that can differ from State to 
State in the scope of benefits it provides. But it does provide a 
benefit to those who need it the most. It is not perfect, but it is a 
start. Most important, it is an idea that has broad-based support from 
the public and in the Congress.
  The Medicare Commission, although unable to reach a supermajority on 
its recommendation to fix the program--that is, Medicare--proposed 
covering drugs for low-income seniors through Medicare. In a recent 
poll, 86 percent of Americans favored adding a new Medicare drug 
benefit to cover part of the cost of the prescription drugs.
  During the recent debate over tax cuts and the Federal budget, I, 
with 33 of my colleagues, sent the President a letter urging him to set 
aside one-third of the on-budget surplus for Medicare. I am pleased he 
announced his intentions just last week to do that, to fund a 
prescription drug benefit. Although creating a prescription drug 
benefit will be expensive, I think inaction is even more costly. In the 
words of the former President, Calvin Coolidge, ``We cannot do 
everything at once but we can do something at once.''
  Let's do that something now to help our most vulnerable seniors, help 
them pay for the drugs that can save their lives.
                                 ______