[Congressional Record Volume 153, Number 62 (Wednesday, April 18, 2007)]
[Senate]
[Pages S4634-S4636]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


[[Page S4634]]
  MEDICARE PRESCRIPTION DRUG PRICE NEGOTIATION ACT OF 2007--MOTION TO 
                                PROCEED

  The ACTING PRESIDENT pro tempore. Under the previous order, the 
Senate will resume consideration of the motion to proceed to S. 3, 
which the clerk will report.
  The bill clerk read as follows:

       Motion to proceed to calendar No. 118, S. 3, a bill to 
     amend part D of title XVIII of the Social Security Act to 
     provide for fair prescription drug prices for Medicare 
     beneficiaries.


                             cloture motion

  The ACTING PRESIDENT pro tempore. Under the previous order and 
pursuant to rule XXII, the clerk will report the motion to invoke 
cloture.
  The bill clerk read as follows:

                             Cloture Motion

       We, the undersigned Senators, in accordance with the 
     provisions of rule XXII of the Standing Rules of the Senate, 
     do hereby move to bring to a close debate on the motion to 
     proceed to Calendar No. 118, S. 3, Prescription Drugs.
         Dick Durbin, Amy Klobuchar, Ken Salazar, Edward Kennedy, 
           Mark Pryor, Blanche L. Lincoln, Daniel K. Inouye, Byron 
           L. Dorgan, Chuck Schumer, Max Baucus, Kent Conrad, Jeff 
           Bingaman, John F. Kerry, Ron Wyden, Debbie Stabenow, 
           Jay Rockefeller, Maria Cantwell, Harry Reid.

  The ACTING PRESIDENT pro tempore. By unanimous consent, the mandatory 
quorum call has been waived.
  The question is, Is it the sense of the Senate that debate on the 
motion to proceed to S. 3, a bill to amend part D of title XVIII of the 
Social Security Act to provide for fair prescription drug prices for 
Medicare beneficiaries, shall be brought to a close?
  The yeas and nays are mandatory under the rule. The clerk will call 
the roll.
  The bill clerk called the roll.
  Mr. DURBIN. I announce that the Senator from South Dakota (Mr. 
Johnson) is necessarily absent
  Mr. LOTT. The following Senators are necessarily absent: the Senator 
from Kansas (Mr. Brownback) and the Senator from Arizona (Mr. McCain).
       The ACTING PRESIDENT pro tempore. Are there any other 
     Senators in the chamber desiring to vote?
  The yeas and nays resulted--yeas 55, nays 42, as follows:

                      [Rollcall Vote No. 132 Leg.]

                                YEAS--55

     Akaka
     Baucus
     Bayh
     Biden
     Bingaman
     Boxer
     Brown
     Byrd
     Cantwell
     Cardin
     Carper
     Casey
     Clinton
     Coleman
     Collins
     Conrad
     Dodd
     Dorgan
     Durbin
     Feingold
     Feinstein
     Hagel
     Harkin
     Inouye
     Kennedy
     Kerry
     Klobuchar
     Kohl
     Landrieu
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lincoln
     McCaskill
     Menendez
     Mikulski
     Murray
     Nelson (FL)
     Nelson (NE)
     Obama
     Pryor
     Reed
     Rockefeller
     Salazar
     Sanders
     Schumer
     Smith
     Snowe
     Specter
     Stabenow
     Tester
     Webb
     Whitehouse
     Wyden

                                NAYS--42

     Alexander
     Allard
     Bennett
     Bond
     Bunning
     Burr
     Chambliss
     Coburn
     Cochran
     Corker
     Cornyn
     Craig
     Crapo
     DeMint
     Dole
     Domenici
     Ensign
     Enzi
     Graham
     Grassley
     Gregg
     Hatch
     Hutchison
     Inhofe
     Isakson
     Kyl
     Lott
     Lugar
     Martinez
     McConnell
     Murkowski
     Reid
     Roberts
     Sessions
     Shelby
     Stevens
     Sununu
     Thomas
     Thune
     Vitter
     Voinovich
     Warner

                             NOT VOTING--3

     Brownback
     Johnson
     McCain
  The ACTING PRESIDENT pro tempore. On this vote, the yeas are 55, the 
nays are 42. Three-fifths of the Senators duly chosen and sworn not 
having voted in the affirmative, the motion is rejected.
  The majority leader.
  Mr. REID. Mr. President, I enter a motion to reconsider that vote.
  The ACTING PRESIDENT pro tempore. The motion is entered.
  Mr. OBAMA. Mr. President, I am extremely disappointed by the Senate's 
failure to consider a bill that would have placed the needs of seniors 
ahead of the profits of the health industry. Once again, a minority of 
the Senate has allowed the power and the profits of the pharmaceutical 
industry to trump good policy and the will of the American people.
  We have a major crisis in this Nation, and that is the rising cost of 
health care. Over the last century, the Nation has witnessed tremendous 
advances in medical science and technology, and we now have treatments 
and cures for diseases and conditions that were at one time surely 
fatal.
  Yet we are paying the price for this success. Health care, 
particularly the cost of drugs, is becoming increasingly unaffordable. 
Over the last decade the cost of drugs has quintupled, now totaling 
almost $200 billion. In 2005, the drug companies' profit was 16 percent 
of their revenues, compared to only 6 percent for all Fortune 500 
firms. The total profit of the top 7 U.S. based drug companies was $34 
billion in 2004, and, if you add it up, their CEOs were paid $91 
million that same year. Clearly, the new drug benefit in Medicare has 
been a tremendous boon for the drug companies, adding to these extreme 
profits.
  The growth in the cost of drugs has slowed in recent years, in part 
because of greater use of generic drugs. But given the pricetag, and 
the financial challenges of our health care system, we can--and must--
take additional steps to curb how much we are spending on drugs.
  Allowing the Federal Government to negotiate for lower drug prices in 
the Medicare Program would have been an important step forward in this 
regard. When you look at the prices the Federal Government has 
negotiated for our veterans and military men and women, it is clear 
that the government can--and should--use its leverage to lower prices 
for our seniors as well.
  Drug negotiation is the smart thing to do and the right thing to do, 
and it is unconscionable that we were not able to take up this bill 
today.
  Mr. WHITEHOUSE. Mr. President, I speak today in outrage that my 
colleagues on the other side of the aisle have chosen to block S. 3, 
the Medicare Prescription Drug Price Negotiation Act, from coming to 
the floor.
  You meet a lot of people when you campaign for a seat in this 
esteemed body. You meet people of all ages, from all socioeconomic 
levels, from all ethnic and cultural backgrounds, liberal and 
conservative, rural and urban, healthy and ailing--you meet them all. 
These individuals bring personal voices to national issues. They 
educate us with their stories, and they trust us to be stewards of 
their experiences. I am sure my fellow freshman Senators will agree 
with me when I say that listening to these stories was the best part of 
running for U.S. Senate.
  Sometimes these stories are uplifting tales about the triumphs of 
government: SCHIP providing health insurance to at-risk children, 
AmeriCorps helping young people serve communities throughout the 
Nation, The Family and Medical Leave Act allowing parents, spouses, and 
children the time to care for loved ones. But sometimes these stories 
are just the opposite--depressing, discouraging, disheartening tales of 
how the government has failed in its duty to support and safeguard our 
must vulnerable citizens.
  I have hosted community dinners throughout my State. Some of the very 
saddest stories that Rhode Islanders shared with me were about their 
experiences with the Part D drug benefit. I would like to share with 
you a particularly touching story from Travis, who came to one of my 
community dinners in Woonsocket. Travis told me of his great-
grandmother, a woman over 90 who was living independently, in a second 
or third story walk-up apartment building in Woonsocket. She, like 
other women her age, had signed up for a Part D plan, and was taking a 
number of prescription medications. One day, Travis's great-grandmother 
arrived at the pharmacy, only to be told that she was in the donut 
hole, that she would now be responsible for almost the entirety of her 
drug bill. His great-grandmother called Travis in despair. She would no 
longer be able to afford her apartment, or her independent lifestyle. 
She was forced to choose between her spirit of self-reliance and her 
health.
  This is a tragedy. It is a human tragedy because no human being 
should be forced to choose between her dignity and her life, and it is 
a moral tragedy because this is a totally unnecessary choice. The 
Congressional Budget Office concludes that the privatization of the 
drug benefit--the choice not to simply add the drug program onto the 
established Medicare benefit--costs almost $5 billion a year. The 
Center for

[[Page S4635]]

Economic and Policy Research reveals that the combined cost of 
privatization and failure to negotiate prices is more than $30 billion 
a year. I do not know about you, Mr. President, but I cannot look 
Travis in the eye and tell him that the reason his great-grandmother 
cannot afford her apartment is that the government needed to give it to 
pharmaceutical manufacturers, an industry that, in 2004, was three 
times more profitable than the median for all Fortune 500 companies--an 
industry that from 1995 to 2002 was the most profitable industry in the 
entire country.
  I was not in the Senate when the drug benefit was created. I was not 
privy to the debates that went on here regarding the complexities and 
particulars of the bill. But I have a very hard time understanding how, 
with a successful Federal drug benefit model in place at the VA, this 
body created a new program that pays, on average, 70 percent more for 
drugs than the existing VA program, according to the Center for 
Economic and Policy Research. I understand that there are fundamental 
differences between the Veterans population and the senior population, 
between the Veterans system and the Medicare system, but 70 percent? 
This seems, to me, like a de-evolution of the policy making process. We 
are creating new programs that function less effectively and less 
efficiently than the ones we already had in place.
  The real question is why. Have we gained something valuable for this 
extra cost? Can we justify the expensive and byzantine architecture of 
this program based on the promotion of other values? Some of my 
colleagues argue that the Part D drug benefit maximizes choice, and 
that choice is of fundamental importance in health insurance markets. 
Indeed, the bill succeeds here. In 2006, there were nearly 1,500 
prescription drug plans offered throughout the Nation. Beneficiaries in 
46 States had over 40 plans to choose from. This year, seniors 
everywhere in the country can choose between at least 45 plans. In my 
small state of Rhode Island alone, there will be 51 plans available.
  But study after study, survey after survey, has shown us that, beyond 
a reasonable point, more plans do not add up to beneficiary or provider 
satisfaction. In fact, 73 percent of seniors think the Medicare 
prescription drug benefit is ``too complicated.'' Sixty percent agree 
with the statement, ``Medicare should select a handful of plans that 
meet certain standards, so seniors have an easier time choosing.'' 
Thirty-three percent think it is ``somewhat difficult'' or ``very 
difficult'' to enroll in a plan. In addition, 91 percent of pharmacists 
and 92 percent of doctors think the benefit is too complicated. It is 
time to admit that a plethora of plans does not add value to the 
program; it adds bewilderment and burden.
  And do we have a system in place to deal with the confusion we have 
caused? No. We have 1-800-Medicare, which is adequate at its best, and 
inaccurate, unreliable, or altogether unreachable at its worst. But we 
need not rely on anecdotal evidence. GAO itself placed 500 calls to the 
Medicare help line in the middle of last year to make its own 
determination about the usefulness of the feature. Eighteen percent of 
calls received inaccurate responses, 8 percent of the responses were 
inappropriate given the question posed, 5 percent of the calls ended in 
disconnection, and 3 percent of responses were incomplete. In total, 
one-third of calls placed by GAO in this study were handled in an 
unacceptable fashion. Our mechanism to demystify the drug benefit for 
the average consumer is furthering the confusion of one-third of 
callers. This is a catastrophe.
  A second value that some of my colleagues argue excuses the 
convoluted and costly nature of the drug benefit, is expanded coverage. 
More seniors have drug coverage now than they did before January 2006. 
No one disputes this. But insurance is not insurance unless it is there 
for you when you really need it. Our sicker seniors are reporting far 
more problems getting their prescription drugs than our healthy seniors 
are. Over 40 percent of seniors who describe themselves as in ``fair'' 
or ``poor'' health report problems filling a prescription under their 
Part D coverage, while only 12 percent of seniors in ``excellent'' or 
``very good'' health report a problem. If Part D is failing to help the 
sick, it is failing to meet the basic definition of insurance.
  Do I mean to say that providing some coverage is worse than being 
uninsured? No. But that was not the option on the table in 2003. We had 
the option to provide everyone with excellent coverage. We had the 
option to care equally and comprehensively for every elderly person in 
this country, healthy, sick, or in between. We did not. Instead, we 
chose to write checks to the pharmaceutical industry, we chose to write 
checks to private insurers, and we left our seniors to write their own.
  What, then, can we do to fix this broken benefit? There is a lot we 
can do, and today is the first step. Today, we can allow the Secretary 
of Health and Human Services to negotiate directly with drug companies 
to lower prices for consumers. We can require the collection of data 
from prescription drug plans, so that our experts at CRS, at CBO, at 
GAO, or at MedPAC can better understand the operations of this program. 
We can require CBO to study whether or not market competition is truly 
reducing prices, as was the intent of privatization. We can increase 
transparency for our seniors, by making the prices of covered drugs 
available to the public on the CMS website. We can pass S. 3--the only 
thing standing in our way is Republican obstructionism.
  I thank the majority leader and Senator Baucus for their commitment 
to our Nation's seniors, and I hope that my colleagues on the other 
side of the aisle will drop their obstructionist tactics and let us get 
to work on this bill. As important as it is, it is only a first step to 
fixing our Medicare Part D program. I hope we can soon take that step 
and then move on to the broader issues, for I believe there is much, 
much more to be done.
  Mr. SPECTER. Mr. President, I voted for cloture to cut off debate on 
the motion to proceed because I think that the Senate should proceed to 
give full consideration to the proposed legislation which would 
authorize the Secretary of Health and Human Services to negotiate with 
the pharmaceutical companies under Medicare Part D coverage. In the 
past, I have favored such proposals because of the argument that the 
Secretary's bargaining power would result in lower negotiated prices.
  In light of the conclusion by the Congressional Budget Office in a 
letter dated April 10, 2007 from Director Peter R. Orszag to Chairman 
Max Baucus that the new authority to the Secretary ``would have a 
negligible effect on federal spending because we anticipate that under 
the bill the Secretary would lack the leverage to negotiate prices 
across the broad range of covered Part D drugs that are more favorable 
than those obtained by PDPs [prescription drug plans] under current 
law,'' I have reviewed the negotiation process under existing laws.
  The underlying facts are that the pharmacy benefit managers who 
negotiate prices for the prescription drug plans represent 
substantially more people than the Secretary would under Part D. For 
example, Medco represents 62 million people, Caremark represents 80 
million and Wellpoint represents 30 million, contrasted to the 29 
million people covered under Medicare Part D. Accordingly, it may be 
that the pharmacy benefit managers have even greater leverage than the 
Secretary would if the Secretary were authorized to negotiate prices. 
That is not certain because the negotiations between the pharmacy 
benefit managers and the pharmaceutical companies are conducted on a 
confidential basis, so that it is not known with certainty that the 
lowest prices are obtained or that the cost savings are all passed on 
to the prescription drug plans.
  The latest Congressional Budget Office estimate for Part D costs is 
$388 billion below the original estimates, for the 10-year period from 
fiscal year 2007 to fiscal year 2016. That suggests the current system 
is working well.
  Extended Senate floor deliberation would provide an opportunity to 
debate these issues and obtain greater detail on the facts.
  One of the additional arguments favoring giving the Secretary power 
to negotiate was the analogy to the savings achieved through the 
negotiating power of the Department of Veterans Affairs. In analyzing 
the VA's bargaining power, it must be noted that the Veterans 
Department represents 4.4

[[Page S4636]]

million veterans, a much smaller number than represented by the 
pharmacy benefit managers. It is also important to note that among 
brand-name drugs listed on the 300 most popular drugs for seniors, only 
42 percent are available to the VA plan because the pharmaceutical 
companies declined to provide some of the drugs because of their 
unwillingness to meet the price determined unilaterally by the VA. On 
the other hand, it is estimated that PDPs under Medicare Part D have 
access to 97 percent of the brandname drugs among the most favored 300 
drugs. The Medicare Part D beneficiaries have an opportunity to select 
the prescription drug plans that best meet their prescription drug 
needs, with the opportunity to select a new plan on an annual basis.
  Notwithstanding these factors, there may be answers and compelling 
arguments in support of the proposed legislation to give the Secretary 
negotiating authorities. A full debate by the Senate on these important 
issues would pose the opportunity to resolve these complicated 
questions and come to a reasoned judgment. The Senate will doubtless 
revisit this issue in the future. In the interim, I intend to inquire 
further and consider these issues in greater depth to determine what 
policies would best serve the interests of the beneficiaries of 
Medicare Part D.

                          ____________________