[Congressional Record Volume 151, Number 18 (Thursday, February 17, 2005)]
[Senate]
[Pages S1597-S1598]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        PRESCRIPTION DRUG PRICES

  Mr. WYDEN. Mr. President, getting a good deal for our senior citizens 
on prescription medicines is too important for word games. In the 
public debate over the prescription drug benefit, it is regrettable, 
because the administration seems to be confusing the matter of 
negotiation to get the seniors a good price with what constitutes price 
controls. This afternoon I would like to set the record straight.
  First, I want to be clear: I am against price controls for this 
program. I am not in favor of mandating prices. I am against the whole 
concept. But what I have been talking about over the past 3 years, 
particularly with the bipartisan legislation I have with Senator Snowe, 
is negotiating, which has Medicare sitting down and negotiating for the 
millions of older people who are going to be relying on this benefit in 
the years ahead.
  If anybody is not sure what negotiating is, if anybody can't tell the 
difference between negotiation and price controls, I want to be 
specific about what constitutes negotiation. First, with negotiation, 
you simply sit down at the table. You say to the people you are 
negotiating with: I am one of your best customers. And third, you say: 
So, buddy, what are you going to do for me. And this, of course, is 
what goes on in the private sector in Minnesota, in Oregon, in Florida, 
every part of the country.
  To tell the truth, I guess I have more faith in the folks over at 
Medicare than they do in themselves, because I noted that the Medicare 
chief actuary said yesterday this kind of negotiating power isn't going 
to do anything, isn't going to produce any savings, and talked about 
how this was going to lead to price controls and that sort of thing.
  I happen to think that Medicare, through their talented folks, does 
have the ability to negotiate better prices, as does the private 
sector. But if they don't think they do, they can bring in some 
negotiators who make sure that the older people do get a good deal.
  The story that has been trotted out in the last 24 hours is about 
previous and fruitless negotiations for other drugs. Cancer drugs have 
been cited, for example. I think that is comparing apples to oranges. 
There wasn't any negotiation in the past. Medicare paid up. Medicare 
paid up, and that was the end of it.
  What I hope the Senate will see is that there is a real distinction 
between the kind of bargaining power Senator Snowe and I want to see 
this program have at a critical juncture and the notion of price 
controls, which we do not support and oppose strongly.
  It comes down to whether the Senate wants Medicare to be a smart 
shopper. I have said that Medicare purchasing of prescription drugs is 
like the fellow in Price Club buying toilet paper one roll at a time. 
Nobody would go out and do their shopping that way. Yet that is 
essentially what the country faces, if there are no changes at all.
  One other point on this issue is also worth noting. Yesterday 
Secretary Leavitt came to the Finance Committee and was asked by me and 
Senator Snowe and others about this question of how to contain costs 
for prescription drugs. The Secretary said he was hopeful that in July 
and August Senators and Members of Congress and others would go home 
and make the case to constituents this was a good program and that 
older people and their families would sign up for the benefit. I said 
to the Secretary during the course of questioning, as somebody who 
voted for the benefit, I hoped that was the case, that folks would sign 
up, but that the big barrier to older people signing up is they were 
skeptical that the costs would be restrained. Older people were 
concerned about the costs of medicine in Georgia and Oregon and 
everywhere else.

  The Secretary's comment was: Well, there are going to be plenty of 
private plans, and the private plans are going to hold the costs down.
  My response was, I certainly hope that is the case. That was one of 
the reasons I felt it was important to get started with the program and 
why I voted for it. But I pointed out to the Secretary that may be the 
ideal, but what would be done in areas where there weren't a number of 
private plans and the opportunity to hold the costs down. That will 
certainly be the case in areas where there are what are called fallback 
plans. My guess is in rural Georgia and rural Oregon, we are going to 
see a number of those fallback plans because those are communities 
where you are not going to see multiple choices for the seniors. You 
will be lucky to have one plan, if there is to be any coverage for the 
older people.
  What Senator Snowe and I have said is that at a minimum, let's make 
sure in those areas where the older people don't have any bargaining 
power, it is possible for the Government to step in and make sure 
seniors and taxpayers can get the best possible deal on medicine.
  In effect, what Senator Snowe and I have been talking about is the 
position of Mr. Leavitt's predecessor, Secretary Thompson. At Secretary 
Thompson's last press conference he said, almost verbatim, that he 
wished the Congress had given him the power Senator Snowe and I believe 
is important for this program.
  In saying so, the Secretary made it clear, also, he was not for price 
controls; he wasn't interested in a one-size-fits-all approach to 
containing costs. He simply made clear that if it is apparent in a 
community that the older people won't have any bargaining power at all 
because choices are limited, the Secretary wanted essentially a kind of 
fallback authority, which would mean the Government at that point could 
make sure the older people and taxpayers were in a position to have 
some leverage in the marketplace.
  I asked the Secretary why he disagreed with his predecessor. I asked 
specifically: Why do you see it differently than Secretary Thompson? 
Essentially, he said he simply believes in the marketplace, and there 
are going to be lots of choices. I hope he is right. I know he is 
certainly sincere in his views.
  What I am concerned about is, I think it is going to be very hard for 
the Senator from Georgia and other colleagues to go home in July and 
August and get the older people to sign up for this program if they 
don't see this body is taking additional bipartisan steps to control 
costs. The older people are reading the newspaper and walking into 
their pharmacies, and they are seeing what is going on.
  Regrettably, the cost of the program has continued to go up. We can 
debate how much it has gone up. I am not interested in some kind of 
partisan wrangle on it. But the cost of the benefit has gone up. And 
the number of seniors who have signed up for the first part of the 
benefit was really very low. So what this has created is a situation 
for

[[Page S1598]]

the prescription drug benefit, where there is a real likelihood that a 
huge amount of Government money will be spent on a very small number of 
people. That is not a prescription for the survival of the program. 
Certainly, as somebody who voted for the program, I want to see it 
survive. So I will keep up my end of the bargain. I will keep working 
on a bipartisan basis.
  I want to express my continued interest in working with the Bush 
administration to save this prescription drug benefit that we worked so 
hard to get off the ground. We need to have an honest conversation 
about how to do it. I don't think that conversation is helped by this 
confusion about what is the difference between negotiating--which I and 
Senator Smith and Senator Snowe have advocated--what goes on in the 
private sector and what constitutes price controls. Senator Snowe and I 
want to be for what goes on in the private sector. We are against price 
controls.
  This will certainly not be the last time this topic is discussed on 
the floor of the Senate. It certainly won't be the last time that I 
discuss it. I am glad to have the chance to take a few minutes to set 
the record straight because I think there was needless confusion on 
this point in the last 24 hours. I think the remarks of the Medicare 
chief actuary were unfortunate. I guess I have more faith in the folks 
at Medicare to be able to negotiate good deals than they apparently do 
in themselves. I simply urge that there be a continued focus on this 
program during this crucial month, where it is going to be important to 
get older people to sign up. The key to getting them to sign up will be 
to hold down the cost.
  I yield the floor and suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. FRIST. I ask unanimous consent that the order for the quorum call 
be rescinded.
  The PRESIDING OFFICER (Mr. Chafee). Without objection, it is so 
ordered.

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