[Congressional Record Volume 146, Number 110 (Monday, September 18, 2000)]
[House]
[Pages H7707-H7713]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       PRESCRIPTION DRUGS FOR ALL

  The SPEAKER pro tempore (Mr. Hulshof). Under the Speaker's announced 
policy of January 6, 1999, the gentleman from New Jersey (Mr. Pallone) 
is recognized for 60 minutes as the designee of the minority leader.
  Mr. PALLONE. Mr. Speaker, this evening, as I have so many times, I 
would like to talk about the need for a Medicare prescription drug 
program. I have to say that I will be partisan this evening. I know 
some of my Democratic colleagues will be joining me, because I believe 
very strongly that the only reason that we do not have a Medicare 
prescription drug plan is because of the opposition of the Republican 
leadership.
  I have to say that I have been very disturbed to see that the 
Republican presidential candidate, George W. Bush, Governor Bush, has 
now come up with a proposal to deal with the problem that seniors face 
with prescription drugs, but it is really no different than the same 
plan that we have been hearing over and over again by the Republican 
leadership in this House that does not provide a prescription drug 
benefit under Medicare but rather simply tries to provide some sort of 
government subsidy, primarily for low-income people, that I believe 
will never succeed because essentially it is not practical. It is not 
under the rubric of Medicare because the Republicans traditionally and 
now have opposed Medicare and do not want to see it expanded to include 
a prescription drug benefit.
  Mr. DOGGETT. Mr. Speaker, will the gentleman yield?
  Mr. PALLONE. I yield to the gentleman from Texas.
  Mr. DOGGETT. In short, we have been there and done that in this 
House, have not we? We have already had a vote on that very proposal 
which was really a plan not to help the seniors of this country but to 
help the insurance companies to reach out and touch someone, but in 
this case it was to touch and subsidize insurance companies and assist 
them but to leave out the vast majority of what we might call the 
working-class or middle-class seniors that worked to build this into 
the greatest country in the world, but they just have been left out of 
the Republican plan. Is not that correct?
  Mr. PALLONE. Absolutely. And the thing that disturbs me most about 
it, and I know that the gentleman is very knowledgeable about this, is 
that the fact of the matter is that every time the Republicans have 
come up with a proposal to deal with the prescription drug issue it has 
always been defensive. In the case of the House of Representatives, 
because the Democrats were out there with our proposal to bring 
prescription drugs under the rubric of Medicare and we had a proposal 
out there that was a very good one, and they tried to avoid it by 
coming up with this plan that essentially did not help anybody.
  Mr. DOGGETT. Is not it true, in fact, that what they did was to have 
a focus group or they got some high-powered, expensive political 
consultant to tell them what going by any meeting of the American 
Association of Retired Persons or retired teachers or many of our 
retired veterans could have told them for free, and that is that the 
Republicans are perceived here in the House and around the country as 
having done absolutely nothing to help seniors when it comes to the 
outrageous price of prescription drugs? They have sat on their hands. 
They have been here in charge now for right at 6 years, and they have 
done absolutely nothing. So after they got that input from this high-
powered consultant, it only took a few days and then they were out in 
our Committee on Ways and Means with a proposal to subsidize insurance 
companies and make it appear that they were finally getting around to 
doing something.
  Mr. PALLONE. The irony of it is that the insurance companies 
testified before your Committee on Ways and Means and before my 
Committee on Commerce and said that they would not sell the policies. 
They were not interested in it.
  Mr. DOGGETT. I believe that their famous comment on that of one of 
the insurance folks was that it would be like insurance for haircuts 
being proposed.
  Mr. PALLONE. Exactly.
  Mr. DOGGETT. And even though they were going to get a general 
subsidy, they did not know whether they could ever provide the 
policies.

                              {time}  2030

  I believe though Texas, unfortunately, has been way behind on doing 
anything to assist our seniors, there have been some States that have 
tried this approach that the Republicans have advanced, and what has 
been their experience?
  Mr. PALLONE. Well, Mr. Speaker, we have the perfect example in Nevada 
which, I believe around March or so of this year, passed a plan that is 
almost exactly the same as what the Republicans in the House proposed. 
The insurance industry told the Nevada legislature it was not going to 
work and there was not a single insurance company that wanted to sell a 
policy that would meet the specifications of what the Nevada 
legislature passed. So it has been a total failure in Nevada.

[[Page H7708]]

  Basically, what the House Republicans are saying is that they want to 
adopt a State example that has failed.
  Mr. TURNER. Mr. Speaker, if the gentleman will yield, I think one of 
the central issues that distinguishes the Democratic plan for 
prescription drugs for seniors and the Republican plan is that the 
Republican plan does not tell the senior citizens what they are going 
to get in terms of coverage, it does not tell them how much it is going 
to cost, and it certainly does not tell them how long the coverage is 
going to be there.
  I had the experience in my district just recently going around 
talking about the issue of prescription drug coverage for seniors under 
Medicare, and I was met by seniors who were quite upset. They had 
signed up for this Medicare+Choice plan that is sponsored by the HMOs 
that a lot of my seniors were lured into because the HMO option for 
traditional Medicare said, well, we will offer you a little 
prescription drug coverage.
  So all of my seniors that needed prescription drug coverage were very 
interested in those plans. A whole lot of them signed up. Now, we have 
5,000 seniors in my district alone who have received notices that their 
HMO Medicare+Choice plan is being canceled as of December 31.
  So I think the history of HMO coverage for Medicare is very clear. We 
cannot depend on it. We do not know if it is really going to be there. 
Over 200,000 seniors they tell me across this country have gotten 
similar notices that as of December 31, they will no longer have their 
Medicare+Choice plan in effect, and as I said, most of them signed up 
because it offered them some kind of little prescription drug coverage.
  So what we know about the Republican approach is that the seniors 
today, when they look at that plan, they do not know what they are 
going to get, they do not know how much it is going to cost, and they 
do not know how long it will be there for them.
  The Democratic plan, on the other hand, is a plan that offers seniors 
the drugs they need from the pharmacist that they trust. Our plan 
covers all drugs; our plan tells the seniors exactly what it is going 
to cost. If they want to sign up, keep in mind, the Democratic plan 
under Medicare is optional. If a senior says I do not want this 
coverage, they do not have to sign up. But when they sign up, they know 
that initially it will cost $25 a month; those costs are projected to 
increase as the coverage increases up to about 40 some odd dollars and 
it will cover one-half of the first $5,000 in prescription drug costs. 
Over that, it will cover all of it.
  We know that low-income seniors will be able to have that premium 
paid for by the government. But that plan is a very clear plan that 
gives seniors a defined benefit at a cost that is understandable with 
coverage that they understand.
  So I say the Republican HMO plan simply offers confusion and 
uncertainty to seniors, and that is a big difference. Because one thing 
I have learned the older I get, what we look for is security, and the 
Democratic prescription drug plan offers security for seniors, and the 
Republican plan does not.
  So I think that when it comes right down to looking at the two plans, 
we clearly have the plan that seniors are going to choose. I think if 
we do that, we will be doing the right thing for our seniors. We will 
have a plan that is workable, one that seniors understand, and one they 
can count on. After all, Medicare, since 1965, has been a plan that 
seniors can count on. All of these other private insurance plans like 
our Republican colleagues advocate, they are here today, they are gone 
tomorrow. Only Medicare has been there for seniors since it was first 
put into law in 1965, signed by, I might say to the gentleman from 
Texas (Mr. Doggett), a great President, Lyndon Johnson from Texas.
  So I think we need to stay on that course and make sure that we take 
care of the security that our seniors need.
  Mr. DOGGETT. Mr. Speaker, will the gentleman yield?
  Mr. PALLONE. Certainly.
  Mr. DOGGETT. Since the name of the great Lone Star State has been 
invoked here, I have to tell my colleagues about an experience that I 
had, and my colleague may have made the same kind of inquiry in New 
Jersey, about what was happening to seniors in the capital of the Lone 
Star State of Texas.

  Now, we have pretty high regard, particularly in some parts of the 
State, I know over in East Texas where my colleague is from, for our 
dogs. There some people have dogs that are pet dogs and then there are 
other people that have bird dogs and some have hunting dogs and they 
think pretty highly of them, but it seems to me that we ought not to 
think so highly of them that if the dog got arthritis, the dog could 
get the prescription drugs cheaper than one of our retirees, one of our 
retired teachers or a senior who had a small business in the community 
and had given back to the community through the years.
  Mr. Speaker, I found when I did a study on arthritis medicine, for 
example, there in Austin, Texas, the capital of the Lone Star State, 
that it was going to cost almost, it was 150, almost 200 percent more 
for the very same type of medication that could be given to a dog or 
given to a senior, and there was that kind of price discrimination. If 
all we do is just subsidize insurance companies with all of the 
uncertainty that my colleague from Texas has talked about, there is 
nothing to keep the seniors from getting treated literally worse than 
dogs in Texas and I expect in some other parts of the country. They 
still are going to be gouged; they are still going to have higher and 
higher co-pays, even if some insurance company will write the policy.
  So I am really concerned that this Republican plan will leave our 
seniors around Texas and undoubtedly around the country literally being 
treated worse than dogs when it comes to the price that they have to 
pay for their prescription drugs.
  Mr. TURNER. Mr. Speaker, will the gentleman yield?
  Mr. PALLONE. I certainly will.
  Mr. TURNER. Mr. Speaker, I think the point the gentleman made is one 
that we need to have the people of this country understand, because in 
Texas, if one can go across to Mexico, and a lot of folks do, they buy 
their prescription drugs at about half the price that they pay in 
Texas. As the gentleman pointed out, one can go to the veterinarian to 
take care of their dogs and pay less for their medicine than they can 
get at their local pharmacy.
  The truth of the matter is, the most vulnerable people in our society 
today are paying the highest prices for prescription drugs of anyone, 
and that is just not right.
  I think that is another benefit of our Democratic plan for 
prescription drugs, because we put the power, the buying power of the 
senior citizens of this country together to be able to bargain with the 
big pharmaceutical companies. And when the buying power of all of our 
seniors are united rather than divided as they are today; right now, a 
senior citizen without prescription drug coverage is on their own when 
they walk into the local pharmacist. I have talked to many a one of 
them who tell me they went up there, they turned in their prescription, 
they came back a few hours later to pick it up and they had to say, no, 
I am sorry, I cannot afford that medicine.
  So we are going to put, under the Democratic plan, the buying power 
of all of the seniors in this country together so that they will have 
the necessary clout to be able to bargain with those pharmaceutical 
giants for fairness in prices. If we do that, I suspect we will not 
have to talk about, as we have done for about 2 years here on the floor 
of this House, about the problem of price discrimination between the 
price of drugs in Mexico and Canada and anywhere else in the world, and 
what our seniors in this country are having to pay.
  Mr. PALLONE. Mr. Speaker, reclaiming my time, let me tell my 
colleagues that the gentleman's example with the dog is certainly true 
in New Jersey. I actually have a cat; it is actually my wife's cat that 
I inherited, and she had, I guess it was a thyroid problem, and in New 
Jersey, I guess one can get the prescription drugs at the veterinarian 
or one can get it from the local pharmacy. So I had to refill the 
prescription and I went to the local pharmacy to purchase the medicine 
for our cat. I was told by the pharmacist that the same drug would be 
twice as much if it

[[Page H7709]]

was for a human. So there is absolutely no question that we have a huge 
discrepancy between a cat and a senior citizen or a dog.
  The other thing that is so interesting and I think so really sad is 
that when Governor Bush proposed his prescription drug plan and was 
asked by one of the reporters on the day when it was proposed, because 
I have the article here, The New York Times that was from September 6 
of this year, he actually was critical of the Democratic plan, because 
of the negotiation power that the gentleman from Texas (Mr. Turner) 
talked about. He said it was like price control. It is just ridiculous. 
That is not what it is.
  The Democrats are not establishing price controls; they are simply 
saying that we want the government, it is not even the government, but 
in different regions of the country that a benefit provider would be 
set up, basically a group that would be able to go out and purchase the 
medication at a cheaper price because they represent so many people and 
they have the buying power to negotiate a better price, just like the 
HMOs do now or some other large employers do now. And Governor Bush, 
when he was asked about that, and I will just give my colleagues the 
quote from the New York Times here. He said that much like the drug 
industry, he criticized Mr. Gore's plan as a step towards price 
control. ``By making government agents the largest purchaser of 
prescription drugs in America,'' he said, ``by making Washington the 
Nation's pharmacist, the Gore plan puts us well on the way to price 
control for drugs.''
  Well, why should not a regional provider be able to go out and 
negotiate a better price for all of these seniors? Why should they have 
to pay twice the price? It does not make any sense.
  I could not believe that he actually had the nerve to criticize the 
very provision in our bill that would reduce the price in a competitive 
way, sort of the American way, competition. You negotiate a better 
price.
  Mr. TURNER. Mr. Speaker, if the gentleman will yield, I think we all 
understand that the free market system is not working today for our 
senior citizens. Every country in the world has some kind of price 
control over prescription drugs, because they understand that the big 
drug manufacturers with their patent protections have a monopoly. So 
they have accepted the fact that we cannot have a free market if those 
who are providing the prescription drugs have a monopoly.
  Now, we have always tried, and I think rightly so, to preserve the 
free market, and all we are doing here is asking to allow our seniors 
to be able to have their position at the bargaining table as a group. 
We already do that for our veterans in this country. They get lower 
prices, those who go and get their prescription medicines through the 
VA, because we have that kind of arrangement for our veterans. All we 
are trying to do is expand it to be sure our senior citizens have the 
same deal.
  As I say, we have to make a choice in this debate. There is no 
question in my mind that there is a fundamental choice here. One either 
has to take on the pharmaceutical industry, or one has to stand to 
protect them, because the only impediment, the only barrier to passing 
a prescription drug benefit under traditional Medicare is the 
opposition of the pharmaceutical industry.
  And if we do not take on the pharmaceutical industry, if we side with 
them, if we try to protect their bottom line, then we are going to have 
a hard time supporting a plan that is going to bring prices down for 
our seniors and make prescription drugs affordable for them. I just 
think in a country where we have granted patent protection to our 
pharmaceutical manufacturers to encourage them to invest in research, 
to come up with a lot of new and wonderful medicines, that the least 
the pharmaceutical industry owes back to the American people is 
fairness in pricing.
  Mr. DOGGETT. Mr. Speaker, will the gentleman yield?
  Mr. PALLONE. Surely.
  Mr. DOGGETT. Mr. Speaker, I think that is just such a critical point. 
The pharmaceutical industry has been masquerading under something 
called Citizens for Better Medicare. It sounded like from the news 
report that the gentleman from New Jersey read that the Republican 
candidate had been watching too many of their ads. Because they put out 
ads under the pretense of being for better Medicare, but the truth is 
that their group is really ``Citizens for Leaving Us Alone to Let Us 
Charge Whatever We Want to Charge.''
  My colleague from Texas referenced the fact that some people along 
the borders of America are going south or they are going north to go 
right across the boundary and get prescription drugs at significantly 
less cost, because they are sold at less cost in Mexico and in Canada. 
Some of those prescription drugs are made right here in the United 
States, and they are made and sold by our manufacturers in the 
pharmaceutical industry for less in Mexico and Canada than they are 
sold to our seniors here. They give them maybe as good a deal in Mexico 
or Canada as they will give a dog here in the United States. And to be 
sure, the prices that our uninsured seniors are having to pay are the 
highest I think in the entire world.
  My colleague referred to the experience of some of the other 
countries around the world, but I do not believe anyone gets gouged as 
much as a senior in Texas or New Jersey or any other part of this 
country, and unless we come to grips with that problem and bring in the 
negotiating power so that it is not one retired police officer, or one 
retired nurse or teacher who is out there trying to take on these 
pharmaceutical giants that can afford to spend hundreds of thousands of 
dollars in campaign contributions, millions of dollars in lobby 
expenses, millions of dollars in these television ads, giving 
misinformation to everyone, we pit one senior against those 
pharmaceutical giants, they do not have a prayer.

                              {time}  2045

  The only hope we have through this Democratic plan is to come in and 
add a little balance in the system so it can be evened out a bit.
  Mr. PALLONE. The reason why the prices are so much more here is 
exactly based on what our colleague from Texas said, and that is that 
since there are price controls and negotiating power for citizens in 
other countries, the only place left on the planet where there are not 
the price controls and the negotiating power is here in the United 
States. So the drug companies make up the difference here. They cannot 
make the money in these other countries, so they jack up their prices 
here to make up for the fact they cannot do it abroad. So that is just 
unfair to the average American.
  Mr. TURNER. It is amazing to me how hard the pharmaceutical industry 
is fighting to preserve the status quo. The gentleman from Texas (Mr. 
Doggett) mentioned Citizens for Better Medicare. The first time I ran 
into that group I thought this must be a group of seniors trying to 
improve Medicare.
  We got to looking into it, and we found out just what the gentleman 
from Texas (Mr. Doggett) said, and that is it is an arm of the 
pharmaceutical industry. In fact, studies showed in the first 6 months 
of this year, the so-called Citizens for Better Medicare spent $65 
million in advertising to try to persuade the Congress and the American 
people to preserve the status quo. They ran TV ads with a character on 
it, a lady named Flo, and she began to talk about how she did not want 
government in her medicine chest.
  Then we had letters mailed out to our seniors. I had a gentleman in 
Wal-Mart, a friend of mine, I have known him for years, John Perkins, 
walked up to me in the parking lot and said, ``Here Jim, I have got a 
letter that said to write you, and now that I have caught you, it will 
save me writing a letter.''
  I said, ``Well, fine, John, what do you have?''
  He said, ``Well, here is this letter.''
  It kind of looked like a telegram. And down at the bottom it said 
Citizens for Better Medicare.
  I read it. I said, ``John, this letter is telling you to write me and 
tell me to vote against the very bill that I am sponsoring, trying to 
help our seniors have some prescription drug coverage.''
  He said, ``Oh, just forget about the letter.''
  Well, all of those direct-mail pieces, all of that television 
advertisement, they even ran ads in our major newspapers, full-page 
adds. I think the one

[[Page H7710]]

they ran in the Washington Post cost something like $80,000 or $85,000 
for one ad for one day. It is just amazing to me how much money the 
pharmaceutical industry is pouring in to try to defeat our efforts to 
provide a meaningful prescription drug benefit under the Medicare 
program.
  They have got a lot to protect, I know that. They are the most 
profitable industry in the country today. I read that they spent $148.5 
million on lobbying expenses in the last Congress. The top drug 
manufacturers, the top 12, paid their executives $545.5 million in 
salaries last year, and $2.1 billion in stock options last year to 
those same executives. They are a very profitable industry.
  As the gentleman well pointed out, the truth is every other country 
in the world provides prescription drugs for their seniors at about 
half, on average, the price that our seniors in this country pay. That 
has just got to stop. I think it is our responsibility. When the free 
market system has broken down, when it is not working, and particularly 
when it is not working for the most vulnerable people in our society, 
this Congress has a responsibility to do something about it. I think 
our plan is the right plan to provide some security for our seniors.
  Mr. PALLONE. Let me just mention another aspect of this that I think 
is important, and that is that what Governor Bush is now saying is, 
well, maybe we cannot cover all the seniors; but, if we cannot, then at 
least let us try to cover the low-income seniors, because the bottom 
line is that he does not have a Medicare plan.
  I mean, what he has proposed and what the Republican leadership 
proposed here is not Medicare. I would argue that it ultimately would 
lead to the destruction and dismantling of Medicare. The reason for 
that, and the issue I want to bring up, is the fact that now the 
Republicans are saying, okay, we will at least try to help the low-
income people and see if we can provide them with a prescription drug 
benefit. Because if you look at the Bush plan, there are about 25 
million seniors under Medicare that would get absolutely no help and 
have no option for prescription drug benefits because two-thirds of 
seniors have income above the 175 percent poverty level. In other 
words, under the Bush plan, as a single individual you would have to be 
making less than $14,600 a year. Otherwise, you would not get any 
subsidy whatsoever.
  The problem that I have with just targeting the low-income seniors is 
that it breaks the whole principle that Lyndon Johnson put forward with 
Medicare. When President Johnson established Medicare, the idea was you 
were going to get Medicare, regardless of income. It was primarily to 
benefit middle-income people, of course. But everyone received the 
Medicare benefit, regardless of income.
  I am very fearful of the fact if you say okay, let us just deal with 
the low-income and let us not deal with the average senior, that you 
set a very bad precedent, because you suggest that somehow Medicare 
perhaps should be almost like welfare, just for low-income people. If 
you start that precedent, you could see that for other aspects of 
Medicare as well.
  I should also hasten to point out that only a fraction of low-income 
seniors would get any coverage either, because basically what Governor 
Bush does is he says this is going to primarily be administered through 
the States. It would be up to the States to establish a prescription 
drug program for low-income seniors.
  We know that the record is very unclear about States. Some States 
have some prescription drug programs. Most do not. Those that do have 
it for low-income people tend to have only coverage for certain 
aspects.
  Mr. DOGGETT. If the gentleman would yield on that, first I think is 
the very, very important point you made about welfare. When President 
Johnson was leading that struggle 30 years ago, these same Republican 
voices were being raised in this room, maybe not the same individuals, 
but the same philosophy; and they said just extend the welfare program 
and take care of those most in need.
  They were opposed to Medicare. In fact, you remember it was only a 
short while ago that Bob Dole was bragging about how he was one of a 
few people to stand up and oppose Medicare and Speaker Newt Gingrich 
was in this very room, and he was boasting of the need to let Medicare 
wither on the vine. They do not really believe in Medicare, and this is 
a way to start the concept that we just need a welfare plan for those 
most in need.
  I think Medicare and Social Security have been two of the best 
programs this Congress has ever devised under Democratic leadership, 
over Republican opposition, and over continued Republican efforts to 
undermine those programs. I believe if we go with a welfare program for 
prescription drugs, that is really what the focus will be.
  The second very important point the gentleman makes is just turning 
this over to the States is not a very good answer. Texas could have 
done this, but Texas has not, unfortunately, met the needs of its 
seniors on prescription drugs. It has not done anything. And when Texas 
had the opportunity after Democratic leadership in promoting the 
children's health insurance program to provide health insurance to meet 
the needs of children in our State, and we have in Texas more uninsured 
children than any State in the country, I think, except possibly one, 
we are right at the top, and we, unfortunately, at the State level, 
there were delays, no effort was made to expedite the program; and 
Texas has foregone hundreds of millions of dollars that could have 
helped get children there with insurance for prescriptions and other 
things.
  With that kind of example, it does not inspire confidence that 
seniors who want help now would be able to get that help, even the few 
poor seniors who would be covered under this Republican scheme, that 
they would get help in a timely manner to meet their needs.
  Mr. PALLONE. If I could use an example on the opposite side of the 
country in my home State of New Jersey, we have a program for certain 
low-income seniors to provide prescription drugs. It is financed 
through our casino revenue fund from Atlantic City casinos. I had 
numerous senior forums throughout the August recess. My district, a lot 
of the towns I represent, I would say they are very middle income, not 
necessarily poor, not necessarily rich; and I remember particularly one 
day being at the Neptune Senior Center, which is a town which is very 
diverse, poor people, wealthy people, and mostly middle-class people. 
There were probably 100 seniors in the room.
  There were maybe five or six that were covered by a prescription drug 
program under Medicaid, and they were complaining about how they could 
not get certain prescription drugs because they were not listed under 
Medicaid; and there were maybe another 10 or 15 out of the 100 covered 
under the State prescription drug program, financed with casino revenue 
funds, and they were fairly happy with their program. But there were 
collectively, between the Medicaid and the state-funded program, out of 
the 100 people, I doubt there were more than 20 that were receiving any 
coverage. The other 80 people in the room had no prescription drug 
coverage.
  This is not a problem that is faced primarily by low-income people. 
This is a problem that everyone faces. It is primarily middle-income 
people that are complaining to me now and saying, look, I cannot afford 
the drugs; I do not have the benefit.
  Mr. TURNER. If the gentleman will yield further, I think the point 
the gentleman made really goes to the heart of it. Whether or not you 
need some help in being able to pay for prescription drugs just does 
not depend upon your income; it depends on how sick you are. That is 
one of the beautiful things about our Medicare program that was 
established in 1965; everybody over 65 is eligible. I think it has been 
a program that has received broad public support because it is 
available to every senior.
  If we go to a system where we try to take care of prescription drugs 
by putting together another welfare program, all we are going to do is 
send money out to the States. They will struggle trying to figure out 
how to put a program together, and I do not think they can do it nearly 
as quickly as we could put a prescription drug benefit under Medicare, 
and it would turn out to be wholly inadequate; and it will turn out to 
be different all across the country.
  One of the other fundamental issues that one has to come to grips 
with in

[[Page H7711]]

this debate is whether or not you believe that as a senior citizen you 
should have the same benefit and the same coverage under Medicare, no 
matter where you live in this country. I can tell you, representing a 
rural district in east Texas where those 5,000 seniors just got notices 
a few weeks ago that their Medicare-plus Choice plans are going to be 
canceled, I can tell you that those seniors are no longer going to have 
any help with prescription drugs, because you could not count on those 
HMOs that came in there and offered those plans and are now turning and 
running away from them; and those seniors I think are all going to 
probably go back into regular Medicare. They have no other choice. But 
at least under regular Medicare we know that we get the same benefit no 
matter where you are in this country.
  I think when we look at the Republican proposal of trying to rely on 
the States to set up welfare programs for low-income seniors, what we 
are going to find is that where you live will depend on what kind of 
benefits are provided for you, and there will be nothing for those 
middle-income seniors that are the ones I am hearing from too in my 
district who are struggling trying to pay those ever-increasing prices 
of prescription drugs.
  So I think that traditional Medicare, if we believe in it, if we 
think it is important for every senior, no matter where they live in 
this country, to have the same coverage and the same protection and the 
same benefits, then I think we need to add a prescription drug benefit 
to traditional Medicare. That is our plan, and I think it is the only 
plan that provides seniors with the security that they need.
  Under our plan, keep in mind, you do not have to go order it by mail. 
You can go to your local pharmacist, and you do not have to determine 
whether your insurance company has it listed on the formula, because 
under our plan you will get the medicine that your doctor prescribes at 
your local pharmacy.
  That is the kind of security that the seniors need. They need to know 
what it is going to cost, they need to know what they are getting, and 
they need to know it is going to be there for them without any 
question. That is the Democratic plan, and I think it is the best plan 
for our seniors.

                              {time}  2100

  Mr. PALLONE. Mr. Speaker, I would also point out, because I know that 
the Republicans keep talking about choice and sort of give the 
impression that the problem with what the Democrats are proposing is 
that it is one-size-fits all, in other words, it is under the rubric of 
Medicare and, therefore, it is going to be national and somehow it is 
bad because it is national and it is one-size-fits all. Nothing could 
be further from the truth.
  I would argue that the way the Democrats have set up this plan under 
Medicare, they have more choice, real choice than they have under the 
Republican plan. And I will say why. First of all, just like Medicare 
in general, this is voluntary. If they do not want to sign up for what 
would be Part D and pay the premium of so much a month the way my 
colleague described and the way the Democrats have put it forward, they 
do not have to do it.
  But, more importantly, if they could have the Democratic plan in 
effect, those who are in HMOs, those who are in employer retirement 
plans where they are getting a prescription drug benefit can keep those 
plans and the Federal Government would be helping them and helping 
those plans to continue to provide the prescription drug coverage. Let 
me explain why.
  Let us say that I am in an HMO and I would like to keep the HMO. 
Well, the reason why so many of the HMOs are now dropping seniors is 
because they cannot afford to cover the seniors or in many cases 
provide the prescription drug benefit. Well, under the Democratic plan, 
the HMOs will get the money to provide the prescription drug benefit, 
they will actually be paid by the Federal Government to provide the 
benefit because it is a basic benefit that everyone is entitled to 
under Medicare.
  So, if anything, there should be more choices available. I would 
suggest that both in New Jersey and Texas we will see more HMOs willing 
to provide a prescription drug benefit and cover seniors than we have 
now because now they will be getting reimbursed for most of the cost of 
the prescription drug benefit plan. So if they want to keep their HMO 
and they like an HMO, they are probably more likely to keep it under 
the Democratic proposal.
  The same thing with employer-based plans. Some people may not want to 
opt for the traditional Medicare coverage, which would include the 
prescription drug benefit, because maybe they, through their 
retirement, get prescription drugs as part of their employer-based 
health care plan. Well, we would reimburse that, as well, and they 
could keep their employer-based plan.
  So all we are saying is that everyone gets the benefit and the 
Federal Government will provide the money to pay for the benefit 
regardless of what program they are in, whether it is their veterans or 
their employer-based plan or their HMO. But there is always going to be 
the guarantee, the floor, that if any of those fail and they do not 
have the option of any of those things they can get it through their 
traditional Medicare plan.
  Mr. TURNER. Mr. Speaker, that sounds like a good competitive program, 
because they have got traditional Medicare there to keep the private 
HMO industry honest.
  What would happen to us if we did not have traditional Medicare in my 
rural east Texas district today? With all of those HMOs pulling out, 
with 15 of my 19 counties having no Medicare+Choice HMO option, my 
seniors would be left with nothing if they did not have traditional 
Medicare.
  I submit to my colleagues, there are those in this House who do not 
like traditional Medicare for one reason or another. But the truth is, 
if we are going to have a system of health care for seniors, if we are 
going to keep the HMOs honest in terms of what they offer and the 
prices they are demanding to offer it, we need to keep traditional 
Medicare in place.
  I will also submit to my colleagues, if we are unable to provide a 
prescription drug benefit under traditional Medicare, those who 
advocate getting rid of traditional Medicare will carry the day. 
Because when faced with the choice of choosing a private HMO plan with 
prescription drug coverage and a Medicare plan without it, many of our 
seniors will be forced to exercise the choice of choosing the private 
HMO plan.
  So it is essential for those who really believe in privatizing 
Medicare and turning it over to the insurance companies, they had 
better think a little bit. Because if they ever expect it to work, they 
had better keep a viable traditional Medicare program in place as the 
safety net to ensure that every senior will always have the option of 
having coverage for their health care and their prescription drugs.
  Mr. DOGGETT. Mr. Speaker, that is so very vital. We have talked about 
the fact that too many of our seniors are forced to choose between 
groceries and prescriptions and to make very challenging decisions. For 
some it is literally a matter of life and death.

  I had a woman from Austin, Texas, write me recently about an 
experience that is really of great concern to her family. She says that 
her brother recently underwent a kidney transplant and he is about to 
turn 65, at which time he will be forced to go on Medicare and give up 
the insurance that he previously has had. But he is now going to have 
to have these anti-rejection drugs after having had the transplant, and 
she expresses the concern that they just do not know where they will 
find the money because the cost of these anti-rejection drugs is really 
prohibitive, they cannot get any coverage on Medicare and at this 
point, though they are not wealthy people, they do not qualify for any 
kind of welfare program. And these kind of folks I gather would just be 
excluded from the insurance subsidy plan that the Republicans are 
advancing.
  Mr. PALLONE. Mr. Speaker, I think that is what our colleague the 
gentleman from Texas (Mr. Turner) was pointing out, which is that even 
though the Republicans may argue, well, let us just do this for low-
income people, what they are forgetting is that middle-income people, 
depending on their circumstances as such, they could be completely 
wiped out with the cost of these drugs. So the notion that somehow this 
is not something we have

[[Page H7712]]

to do just for the average person is nonsense because they could be 
wiped out in a minute because of the cost of these drugs.
  I also say that what we are finding today is that a lot of the more 
expensive drugs the HMOs or some of the insurance companies 
characterize as not medically necessary, in other words, they will say 
this is experimental or this is something that is not exactly approved 
at this point, and it is those very things that are very expensive that 
end up not being covered.
  When we say in our Medicare prescription drug plan that they are 
going to have access to whatever is medically necessary, we put that 
language in there because we want to make clear that if their physician 
or the pharmacist says that this is medically necessary, it will be 
covered.
  I know that my colleague, the gentleman from Texas (Mr. Turner), has 
made a big point of that that one of the problems with the Republican 
plans is that not only is it primarily for low-income people but they 
never know exactly what they are going to get. And it is very easy to 
exclude things under the rubric of saying they are not medically 
necessary or they are experimental or those kinds of things, which is 
why it is important to establish in the plan what kind of drugs they 
are going to get and to make it clear.
  Mr. TURNER. Mr. Speaker, I had a similar experience to the gentleman 
from Texas (Mr. Doggett). I talked to a lady in August during my tour 
of the district when I was going around to 40 communities talking about 
this very issue, and she came up to me and she said that her HMO had 
just canceled her and she wanted to know from me what I could do to 
help her.
  It would almost bring tears to your eyes. She was a kidney transplant 
patient. From January until August, her prescription bills totaled 
$17,000. That had been covered by her HMO. As of December 31, she has 
no coverage, like 5,000 other seniors in my district.
  Now, most of my seniors I talk to have prescription drug bills of 
$300, $400, $500. Many of them are paying their entire Social Security 
check just to cover their prescription drugs. This lady has $17,000 
just from January through August.
  I could not tell her what she was going to do. I had no answer for 
her. I told her about what we are fighting for in Congress, why we 
believe that we need a prescription drug benefit under traditional 
Medicare.
  I talked to a fellow at a bank down in Liberty County. He told me 
that he and his wife spend $1,400 a month on prescription drugs. Now, I 
did not have the heart to ask him how long could he keep doing that.
  But these stories are real stories from real people who have real 
problems. And I think that the reason we come here week after week 
talking about this problem is because we want to try to provide some 
help for those seniors who need it. And the way to do it is through the 
Democratic plan where we can provide seniors with a clear plan with a 
defined benefit, we can tell them what they are going to get, that is, 
they are going to get the prescription their doctor prescribes from the 
pharmacist they trust. We can tell them what the premium is and if they 
elect to take the coverage, how much it will cost. We can also tell 
them that under traditional Medicare the plan is here and it is going 
to be guaranteed by the United States Government and by the people who 
believe in traditional Medicare, not a plan that relies on the private 
insurance company that, by necessity we all understand, has to make a 
profit and, if they find out they are not making a profit, as 
apparently many of them did in my district, and decide to cancel their 
coverage for 5,000 seniors, then they are gone.

  That is not the kind of security seniors in this country deserve.
  Mr. PALLONE. Mr. Speaker, one of the reasons and I think both 
examples highlight it in my mind, one of the reasons why the Republican 
proposals just do not work is because they are too selective. In other 
words, originally when we started this evening we talked about how the 
Republican leadership proposes a bill that basically says we will give 
them some money and they go out and buy private insurance company and 
the insurance company says, we are not going to sell it. The reason 
they are not going to sell it is because they cannot make any money.
  In other words, for most people, particularly seniors, probably 80 or 
90 percent of them are using prescription drugs. It is a benefit. It is 
not a risk. It is not sold. In other words, if they are an insurance 
salesman or insurance company, they are not going to cover all these 
people that use the benefit because they cannot make any money.
  I think we are also seeing the other phenomena, which is that the 
people that will go and try to sign up for the HMO are the people that 
really need the prescription drug coverage and they will tend to be the 
people that have the higher prescription drug bills and so the HMOs 
cannot even afford to provide it.
  So what we are saying as Democrats is let us create this huge pool 
with all the people, everyone, every senior under Medicare. That create 
a huge pool. Some people use some drugs. Others use a lot. And by 
having this huge pool, the cost for everyone on the average becomes a 
lot less, they do not have the selective situation where people are 
trying to buy insurance or go into an HMO because they have high 
business. That is why it does not work.
  I do not know if I am making it totally clear, but the beauty part of 
the Democratic proposal is that, by putting everybody in this big 
essential insurance pool, it is not as expensive and it is more 
realistic to cover them as opposed to what we are getting now with this 
selective insurance.
  Mr. DOGGETT. Mr. Speaker, when we hear the story like the one that 
was just recounted, a person who is going to be facing $17,000 in bills 
with no remedy, we have to ask, well, why is this Congress not out here 
working on it tonight.
  It was a little over a year ago that I offered in the House Committee 
on Ways and Means with our colleague the gentlewoman from Florida (Mrs. 
Thurman) a proposal to deal with this price discrimination problem that 
would not have set up any government bureaucracy. In fact, that aspect 
of it would not have entailed any substantial cost.
  Every Republican member of our committee voted against that proposal. 
And we have advanced it again this year. Every one of them voted 
against it again. Only after their public relations firm told them they 
had a problem did they come up with the plan the Republican 
presidential candidate is advancing.
  The presidential elections I know are capturing most of the 
attention, but there is no good reason why the Congress should not be 
acting now. The gentleman from Illinois (Mr. Hastert) could put this 
back on the agenda. It could be put on the agenda in the Senate and 
present the next President of the United States with a plan that was 
already in place that could be implemented. This Democratic plan that 
we have been talking about tonight, it could go into effect now.
  I just mention to my colleagues the reaction that I think probably a 
lot of people have across this country that was embodied in another 
communication that I got from a constituent that lives out on Oakwood 
Drive in Austin. It begins: ``Shame on you pharmaceutical companies. 
Where is the compassion for human life? Have you just gotten so 
absorbed into making big profits that you can just say, we don't care 
if you don't have the money, roll over and die, see if we care?''
  And this person does not face the $17,000 problem. She says, ``When 
you have a heart problem and you need three kinds of medication every 
day and just one prescription costs $120 each month, something is 
wrong. When these pharmaceutical companies have luxurious jets that 
transport candidates to the convention as shown on the news, then 
something is very wrong, especially when needed medications have these 
kind of exorbitant prices.''
  Well, I think we are here again tonight because something is very 
wrong and that wrong is the failure of this Congress to respond to 
these needs, a failure that is extended over a number of years and was 
just papered over with this insurance subsidy plan that does not meet 
the need of these kind of folks that are out there tonight facing these 
tough decisions.

                              {time}  2115

  Mr. PALLONE. It is such a cruel hoax, too, because as both of you 
have

[[Page H7713]]

pointed out, this is a real problem. We are getting real people coming 
up to us on a regular basis saying that they are suffering. How cruel 
it is really for the Republican leadership in this House to say, well, 
we are going to solve their problem by throwing a few bucks at the 
insurance industry when the insurance industry is telling us that they 
are not going to provide the benefits, anyway.
  I just wondered if I could for a minute go back to this article in 
the New York Times that talked about what had happened in Nevada. 
Nevada as I said in March of this year passed a piece of legislation 
that was very similar to what the House Republicans had proposed in 
terms of providing subsidies to seniors if they could go out and buy an 
insurance policy that covered prescription drugs. It has been a total 
failure. This is a reference here in the article. This is from July 8, 
New York Times, of this year. It quotes Barbara Buckley, a State 
assemblywoman who is cochair of a task force that monitors this 
potential program. She says that the task force refused to authorize 
the release of any money until it could see the details of a drug 
program that met the eligibility criteria in terms of premiums, 
deductibles, copayment, and benefit limits. Most of those details would 
be decided by the successful bidder.
  The problem was that no insurance company wanted to offer a program 
that met the standards that the legislature set in terms of specifying 
what the premium would be, what the copayment would be, what drugs 
would be proposed. It says in the article, asked why insurers did not 
show any interest, a retired Navy captain, a Mr. Fend, who serves on 
this task force, said, probably because they did not think they could 
make any money. If they thought they could make a reasonable amount of 
money, they would probably buy into the program and bid on it.
  The bottom line is, it is just a hoax. The Republicans here have 
talked about a prescription drug program that will not work. It is 
really awful to think that they know it will not work, it has not 
worked in a State where it was proposed, yet they keep bringing it 
forth as if somehow they are trying to address the problem when they 
are not.
  Mr. TURNER. The Medicare program probably never would have been 
passed in 1965 if the private insurance industry could have taken care 
of the health care needs of our seniors. That is why we passed 
Medicare, is because private insurance would not work. I had a letter 
from a lady who had been in an insurance business 19 years. In fact, I 
have it here with me. It was a letter that was actually handed to me at 
a town meeting I had in Shelby County in my district. The lady asked me 
if I would read this letter on the way to my next stop.
  This lady writes very eloquently to say she had been in the insurance 
business 19 years and her letter calls for us to provide a prescription 
drug benefit under Medicare for our seniors. She tells the story about 
her mother who died last November at the age of 87. As she was going 
through her mother's papers, she knew, of course, her mother had been 
on prescription medicines, I think, for about 20 years, the last 20 
years of her life. She was going through all her bills, seeing what she 
had spent on medicine. She came across a credit card bill that had a 
balance owed of $6,000, and she was just shocked. She could not believe 
her mother, as frugal as she was, would have run up a $6,000 credit 
card bill and not taken care of it.
  So she wrote letters to Visa. She found out what were all these 
charges. It turned out all of them were for prescription medicines. Her 
mother had been spending about $300 a month on prescription medicines, 
and her Social Security check just was not enough for her to get by and 
take care of those medicines. The lady wrote me, she says, I think my 
mother understood that when she died, her home could be sold and I 
could pay off that $6,000 Visa bill for her. But she said my mother was 
a very proud woman.
  No senior in this country should have to struggle like that to pay 
for their prescription medicines. We have seniors who are breaking 
their pills in half trying to take their medicine and being able to 
afford it. I have seniors that told me at a meeting that they routinely 
just take one every other day. A pharmacist was standing there. He 
said, ``For some medicines, that can be extremely dangerous for you to 
do that.''
  I had seniors come up to me and tell me that they actually have to 
make a choice every month of whether to buy groceries or to go fill 
those prescriptions. In a country as prosperous as we are today and as 
compassionate as we like to say we are, I believe we can do something 
about the problem of a prescription drug crisis for our senior 
citizens.
  We talk about this big surplus that is going to arrive here over the 
next 10 years. I hope it does. I am not sure it will, but I hope it 
does. Some as we know on the other side of the aisle have proposed that 
we cut taxes to the tune, I believe Governor Bush says, of $1.6 
trillion when we only have an estimated, hoped-for $2 trillion budget 
surplus. But I think if we are as compassionate as we like to say we 
are that surely we could set aside 10 percent over the next 10 years of 
that $2 trillion surplus and provide our senior citizens with a 
meaningful prescription drug benefit.

  I know everybody wants tax cuts. I know everybody enjoys getting 
their taxes lower. But the truth is there is a basic need here that 
should not be ignored. And I think the vast majority of the American 
people agree with that. That is why I think on close examination of the 
Democratic prescription drug plan as compared to the Republican 
proposal that the overwhelming majority of our seniors and of all 
Americans would be in favor of a prescription drug benefit under 
traditional Medicare as the Democrats propose in this country.
  Mr. PALLONE. I want to thank the gentleman. I think we are running 
out of time. The last point the gentleman made is so important. I 
really believe that one of the reasons why Governor Bush has proposed 
this scaled-down prescription drug plan that really only addresses some 
of the problems for low-income people is because he has proposed using 
so much of the surplus for this grandiose tax cut plan, which primarily 
benefits the wealthy and corporate interests, and so he does not have 
enough money left to pay for a Medicare prescription drug program the 
way the Democrats have proposed. And so that has actually forced him in 
some ways to propose this more scaled-down version that will only help 
some low-income people. That is unfortunate, because if we have a 
surplus, and you and I both I know are worried about these estimates 
and whether the level of surplus that is being talked about will ever 
materialize, but there is certainly enough that we could provide the 
prescription drug program along the lines of what the Democrats have 
proposed. I would hate to see that not happen just because of Governor 
Bush's tax proposals and the tax proposals that the Republicans have 
put forward, which I think really do not help in any significant way 
the average American.
  I just want to say we were here again tonight as Democrats because we 
believe strongly that this is a major issue that should be addressed in 
this Congress, that is, providing a prescription drug program under 
Medicare. We are going to continue to be here every week until this 
Congress adjourns demanding that this issue be addressed.

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