[Congressional Record Volume 149, Number 90 (Wednesday, June 18, 2003)]
[Senate]
[Pages S8012-S8013]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                       PRESCRIPTION DRUG BENEFITS

  Mr. DURBIN. Mr. President, we are in the midst of debating a historic 
measure on the floor of the Senate; that is, the prescription drug 
bill. This is an issue which Americans understand. Seniors on fixed 
incomes understand how difficult it is to fill those prescription drugs 
to stay healthy.
  For 8 or 10 years, we have been struggling to find some way to give 
them a helping hand to pay for their prescription drugs. There have 
been a lot of different proposals. Some people said the way to do it is 
to eliminate Medicare altogether. Others have said the best thing to do 
is put it, as appropriate, in Medicare.
  What we have coming before us from the Senate Finance Committee by 
Senators Grassley and Baucus is an effort to create a prescription drug 
benefit for seniors. To my mind, it falls short of what we need.
  Isn't it interesting that in the course of this debate about this new 
bill there is one group which we have not heard from? Why is it the 
pharmaceutical companies and drug companies haven't said a word about 
the new prescription drug bill? I think the answer is obvious. Because 
this new prescription drug bill offered by Senators Grassley and Baucus 
has no effort in it--none whatsoever, as far as I am concerned--to keep 
drug prices under control.
  If you ask any family in America, or any senior, they will tell you 
the cost of prescription drugs has increased 10 to 20 percent a year. 
If you are a drug company, and the Federal Government says it is going 
to help your customers pay for the drugs, but they don't have to 
control your prices at all, you don't have to keep them under control, 
then, frankly, that is the best outcome you could hope for. You can 
continue to increase prices and know the Federal Government is going to 
pick up a portion of the tab.
  Of course, if you are a customer buying prescription drugs, it is 
going to be an elusive target. Even though the Federal Government is 
offering you some help in paying for prescription drugs, if you do not 
do anything to contain the cost of prescription drugs, then ultimately 
it is going to go far beyond the family resources.
  I stepped back and asked, Is there a better way to approach this? One 
that achieves the result, which is to help seniors pay for prescription 
drugs, and does it in a sensible way? I sat down and said: Take the 
$400 billion we allocated for this program and put into it some price 
competition. For example, in the Veterans' Administration we have 
established a formulary where they have said for 2,300 drugs, we will 
save 40 percent to 60 percent of the cost. If the drug company wants to 
do business with the Veterans' Administration, they have to bring down 
the prices. Let us apply the same principle to our use of the Medicare 
recipients and their drug prices.
  I brought into question having this kind of formulary to reduce the 
cost. Then I brought in a proposal by Senators Schumer and Gregg that 
says let us encourage more generic drugs which are cheaper and just as 
effective. And then I added an element, which the Senator from 
Michigan, who is on the floor, has been pushing for and will offer as 
an amendment.

  Why wouldn't we let the Medicare Program itself offer a prescription 
drug benefit? We know they have no profit margin. We know their cost of 
administration is lower than any drug company. So put those three 
things together, take the $400 billion, and what can you achieve?
  Let me tell you what you can achieve. You can guarantee--guarantee; 
which this bill does not do--a $35 monthly premium for the seniors who 
volunteer to sign up for the program. You can eliminate the $275 
deductible, which is part of the bill that is on the floor. And instead 
of a 50/50 split on the cost of prescription drugs, you can move to a 
70-percent Government pay, 30 percent being paid by the seniors, and 
you can give full coverage. You do not have the gaps in coverage that 
are part of the existing bill on the floor.
  How do you achieve this? Because, frankly, you keep the costs under 
control. You have generic drugs as part of it. You have Medicare as 
part of the competition. And what period of time would the $400 billion 
cover? We are waiting for an official CBO number, but we believe it 
would be a 5-year period. Then, at the end of 5 years, you can 
reauthorize the program, decide whether it has worked or whether it has 
not worked.
  I think this approach, which we call Medisave, is much more 
preferable to the Grassley-Baucus bill because it does say to seniors: 
We are going to give you a better helping hand, 70 percent being paid 
by the Federal Government, no deductible, and a guaranteed $35 monthly 
premium. And the way we will achieve it is by reducing the cost of the 
drugs, as we do in the Veterans' Administration today. I think that is 
a sensible way to approach it.
  To take the Grassley-Baucus approach is to open up the possibility 
that the drug costs will just continue to skyrocket 10 and 20 percent a 
year. And in that situation, the seniors will not be able to keep up 
with them.
  The Senator from New Hampshire was kind enough to yield to me until 
10:10. I see my friend, the Senator from Michigan, has come to the 
floor. If the Senator from New Hampshire would not mind, I will yield 
the remaining time I have until 10:10 to my colleague from Michigan.
  The PRESIDING OFFICER. The Senator from Michigan.

[[Page S8013]]

  Ms. STABENOW. Mr. President, I thank my friend from Illinois. I 
commend the Senator for his substitute. What the Senator is talking 
about is exactly what the seniors of America are asking us to do to 
make sure they have a comprehensive prescription drug benefit under 
Medicare which they know will be there, which is stable, dependable, 
where you can choose your own doctor no matter where you live in the 
country; that whether you live in the upper peninsula of Michigan or 
Chicago, IL, you will have an opportunity to receive the health care 
you need and deserve under Medicare.
  By simply expanding that to include prescription drugs, and then 
coupling that with the ability to keep prices down, I believe this is 
the best possible approach to come before the Senate--in fact, the U.S. 
Congress. I am hopeful that colleagues, when this comes to the floor, 
will rally around this plan.
  What Senator Durbin has done is put together a plan designed for 
seniors, not designed for pharmaceutical companies or insurance 
companies, which is, unfortunately, why this process has become so 
complicated. For example, people look at me with bewilderment when I am 
explaining that for the private sector plans in their region, if there 
are two or more, they would have to take one. But if there isn't, they 
could have a backup, but then they would have to drop it and go back to 
an insurance plan. When I explain that plan, they scratch their heads 
and say: Why are you doing that?
  Well, unfortunately, we have a plan put forward--and I have to say it 
is a valiant effort by many people to try to come to some consensus, 
and I appreciate that--but the reality is, it is designed much more to 
benefit the pharmaceutical companies in particular than it is our 
seniors.
  Why is our approach not supported by the pharmaceutical industry? For 
one simple reason: If we have all 40 million seniors and people with 
disabilities in one insurance plan, they can negotiate a big group 
discount, which is what they should be able to do. They should be able 
to come together, as one insurance plan, and negotiate a group 
discount. As Senator Durbin indicated, when you do that, you are not 
paying retail. In fact, the Federal Government does that on behalf of 
our veterans through the VA, and we are able to get about a 40-percent 
discount, which is a terrific deal for the veterans of this country. I 
am proud we do that, but why shouldn't that same opportunity be 
available for every senior, for every person with a disability under 
Medicare?
  So I just wanted to rise to congratulate the Senator's vision on 
putting forward the right plan that makes sure that, in fact, our 
seniors know they can count on a $35 premium. They would also not have 
to have a deductible. Seventy percent, as I understand, of their 
prescription drug costs would be paid for. There would be no gap in 
coverage for the last few months of the year. Or if you found yourself 
getting to a point where you reached the end of your coverage, and 
then, unfortunately, your doctor indicates you have an even more 
serious illness to deal with, you would not be left wondering what to 
do to pay for that treatment and medication.
  This plan does what our seniors in this country are asking for. I 
believe it does what we should be doing for them. It is what they need, 
and it is what they deserve. It is what they have been waiting for.
  I commend the Senator from Illinois for putting forward this option 
of which I encourage all of our colleagues to come together to embrace, 
standing together to achieve a bipartisan victory that is in the best 
interest of our American seniors.

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