[Congressional Record Volume 152, Number 11 (Thursday, February 2, 2006)]
[Senate]
[Pages S512-S513]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      by Mr. LEVIN (for himself and Ms. Stabenow):
  S. 2240. A bill to amend title XVIII to reform the Medicare 
prescription drug program; to the Committee on Finance.
  Mr. LEVIN. Mr. President, today I am introducing ``The Medicare Part 
D Reform Act of 2006.'' This bill is necessary to address some of the 
major problems in the Medicare prescription drug benefit that took 
effect on January 1 of this year. As we all know, the reaction of our 
seniors has been widespread disappointment, mass confusion and 
downright anger.
  Let me describe some of the problems that I am hearing from people in 
Michigan about this new Medicare prescription drug benefit.
  First, many drug companies have previously issued discount cards and 
are currently providing drugs to low-income people and seniors at a 
nominal or no cost. These are individuals usually at 200 percent of the 
Federal poverty level, which is 19,600 for a single person or $26,400 
for a couple, while to qualify for the Medicare low-income subsidy, 
their income must be $14,700 for a single person or $19,800 for a 
couple. Many of these programs are being discontinued, and seniors are 
losing a vital method of obtaining low cost prescription drugs.
  Second, prescription drug plans can drop a drug from its list of 
covered drugs with 60 days notice at any time during the calendar year. 
This is particularly egregious for a senior who relied on a particular 
medication being available and covered when the senior chose that 
particular plan.
  Third, the situation of so-called ``dual eligibles'' is clearly worse 
now than before enactment of the prescription drug benefit. These are 
former Medicaid beneficiaries who are being forced into Medicare 
prescription drug coverage, often putting them in plans with more 
restrictive formularies and higher co-payments, in other words leaving 
them worse off.
  Fourth, many Michigan residents are retirees from good paying jobs 
and currently have a good prescription drug plan. This has changed for 
the worse with the creation of the new Medicare prescription drug 
benefit because many companies have decided to scale back or eliminate 
that retiree coverage. As a result, many of those retirees are worse 
off than they were before the bill became law.
  Fifth, Medicare is specifically barred from negotiating lower drug 
prices for all of its beneficiaries.
  Finally, the coverage gap from $2,250-$3,600 in prescription drug 
expenses per year, commonly referred to as the ``doughnut hole,'' is 
unconscionable. Many seniors do not yet understand that this huge 
coverage gap is looming in their future and that during this gap, they 
are still expected to pay their monthly premiums, although they are 
getting no prescription drug coverage assistance.
  To address many of these concerns I, along with my colleague Senator 
Stabenow, today am introducing the Medicare Part D Reform Act of 2006, 
and I hope the Senate will immediately consider these positive reforms. 
My legislation has four goals and I will briefly outline them.
  First, this legislation would prohibit prescription drug plans from 
removing drugs from the plan's list of covered drugs until January 1 of 
the following year. This will give seniors the opportunity to make an 
informed decision during open enrollment at the end of each year if one 
plan decides to remove a particular drug from the plan.
  Second, my legislation clearly states that the discount cards that 
pharmaceutical companies are providing to our lower income seniors are 
permissible and that seniors should be allowed to participate in these 
programs. There has been some confusion as to whether companies can 
legally continue these programs and, if companies do continue their 
assistance, questions have arisen as to whether that assistance will 
count towards the ``true-out-of-pocket'' costs for that beneficiary, 
which plunges them into the ``doughnut hole'' when they reach $2,250. 
My legislation mandates that there will be no negative consequences for 
pharmaceutical companies continuing to provide discount cards to our 
low-income seniors.
  Third, my legislation would allow former Medicaid beneficiaries now 
receiving their medications under Medicare to continue to receive their 
prescription drugs even if they cannot meet the worsened co-payment 
requirements.
  Lastly, the legislation would specifically give the Federal 
Government the authority to negotiate lower prescription drug prices 
for our seniors. Current Medicare law prohibits the Department of 
Health and Human Services from negotiating lower prices, as we do for 
veterans in our VA health programs. As a result, Medicare beneficiaries 
do not have the benefit of the bargaining power of Medicare.
  All of us are hearing from our constituents that we need to improve 
Medicare Part D. Congress needs to fulfill the promise it made that 
Medicare Part D would lower prescription drug prices, not increase 
them. This bill will help us begin to keep that promise.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                S. 2240

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Medicare Part D Reform Act 
     of 2006''.

     SEC. 2. REMOVAL OF COVERED PART D DRUGS FROM THE PRESCRIPTION 
                   DRUG PLAN FORMULARY.

       Section 1860D-4(b)(3)(E) of the Social Security Act (42 
     U.S.C. 1395w-104(b)(3)(E)) is amended to read as follows:
       ``(E) Removing drug from formulary or changing preferred or 
     tier status of drug.--
       ``(i) Limitation on removal or change.--Beginning with 
     2006, the PDP sponsor of a prescription drug plan may not 
     remove a covered part D drug from the plan formulary or 
     change the preferred or tiered cost-sharing status of such a 
     drug other than during the period beginning on September 1 
     and ending on October 31. Subject to clause (ii), such 
     removal or change shall only be effective beginning on 
     January 1 of the immediately succeeding calendar year.
       ``(ii) Notice.--Any removal or change under this 
     subparagraph shall not take effect unless appropriate notice 
     is made available (such as under subsection (a)(3)) to the 
     Secretary, affected enrollees, physicians, pharmacies, and 
     pharmacists. Such notice shall ensure that such information 
     is made available prior to the annual, coordinated open 
     election period described in section 1851(e)(3)(B)(iii), as 
     applied under section 1860D-1(b)(1)(B)(iii).''.

     SEC. 3. PHARMACEUTICAL PATIENT ASSISTANCE PROGRAMS.

       (a) Providing a Safe Harbor for Pharmaceutical Patient 
     Assistance Programs.--Section 1128B(b)(3) of the Social 
     Security Act (42 U.S.C. 1320a-7b(b)(3)) is amended--
       (1) in subparagraph (G)--
       (A) by inserting ``or under a patient assistance program 
     (including a pharmaceutical

[[Page S513]]

     manufacturer patient assistance program)'' after ``Indian 
     organizations)''; and
       (B) by striking ``and'' at the end;
       (2) in subparagraph (H), as added by section 237(d) of the 
     Medicare Prescription Drug, Improvement, and Modernization 
     Act of 2003 (Public Law 108-173; 117 Stat. 2213)--
       (A) by moving such subparagraph 2 ems to the left; and
       (B) by striking the period at the end and inserting ``; 
     and''; and
       (3) by redesignating subparagraph (H), as added by section 
     431(a) of the Medicare Prescription Drug, Improvement, and 
     Modernization Act of 2003 (Public Law 108-173; 117 Stat. 
     2287), as subparagraph (I) and moving such subparagraph 2 ems 
     to the left.
       (b) Exclusion of Expenditures Under Certain Pharmacy 
     Assistance Programs From TROOP.--Section 1860D-2(b)(4)(C)(ii) 
     of such Act (42 U.S.C. 1395w-102(b)(4)(C)(ii)) is amended by 
     inserting ``under a pharmaceutical manufacturer patient 
     assistance program,'' after ``a group health plan,''.
       (c) Effective Date.--The amendments made by this section 
     shall take effect on the date of enactment of this Act.

     SEC. 4. PROTECTION AGAINST COST-SHARING FOR FULL-BENEFIT DUAL 
                   ELIGIBLE INDIVIDUALS.

       (a) In General.--Section 1860D-14(a)(1)(D)(ii) of the 
     Social Security Act (42 U.S.C. 1395w-114(a)(1)(D)(ii)) is 
     amended--
       (1) in the heading, by striking ``Lowest income'';
       (2) by striking ``and whose income does not exceed 100 
     percent of the poverty line applicable to a family of the 
     size involved''; and
       (3) by adding at the end the following new sentence: ``In 
     the case of an individual who is unable to pay the copayment 
     applicable under the preceding sentence, such copayment shall 
     be waived.''
       (b) Effective Date.--The amendments made by this section 
     shall apply to drugs dispensed on or after the date of 
     enactment of this Act.

     SEC. 5. NEGOTIATING FAIR PRICES FOR MEDICARE PRESCRIPTION 
                   DRUGS.

       (a) In General.--Section 1860D-11 of the Social Security 
     Act (42 U.S.C. 1395w-111) is amended by striking subsection 
     (i) (relating to noninterference) and by inserting the 
     following new subsection:
       ``(i) Authority To Negotiate Prices With Manufacturers.--In 
     order to ensure that beneficiaries enrolled under 
     prescription drug plans and MA-PD plans pay the lowest 
     possible price, the Secretary shall have authority similar to 
     that of other Federal entities that purchase prescription 
     drugs in bulk to negotiate contracts with manufacturers of 
     covered part D drugs, consistent with the requirements and in 
     furtherance of the goals of providing quality care and 
     containing costs under this part.''.
       (b) Effective Date.--The amendment made by this section 
     shall take effect on the date of enactment of this Act.
                                 ______