[Congressional Record (Bound Edition), Volume 145 (1999), Part 15]
[Senate]
[Page 21856]
[From the U.S. Government Publishing Office, www.gpo.gov]





          THE NEED FOR MEDICARE COVERAGE OF PRESCRIPTION DRUGS

  Mr. SARBANES. Mr. President, in the coming weeks, the Finance 
Committee will begin consideration of legislation to reform the 
Medicare program. While I am not a member of that Committee, I would 
like to urge my colleagues to take this opportunity to address one of 
the most widespread problems facing senior citizens today--the lack of 
prescription drug coverage under the Medicare program.
  Providing access to prescription medication is essential to ensuring 
our older Americans receive the health care they need. Today more than 
ever, medical treatment is focused on the use of drug therapies. 
Prescription drugs are an effective substitute for more expensive care 
or surgery, and they are the only method of treatment for many 
diseases.
  Medicare beneficiaries are particularly reliant on prescription 
medication. Nearly 77 percent of seniors take a prescription drug on a 
regular basis. Consequently, although seniors make up only 14 percent 
of the country's population, they consume about 30 percent of the 
prescription drugs sold. However, the Medicare program, the national 
program established to provide seniors with vital health care services, 
generally does not cover prescription drug costs.
  Medicare beneficiaries can obtain some coverage for drugs by joining 
Medicare HMOs. However, these HMOs are not available in many parts of 
the country, particularly in the rural areas. As we have learned in 
Maryland, where 14 of our rural counties will no longer be served by 
any Medicare HMO as of next year, private companies cannot be relied 
upon to provide a benefit as crucial to the health of our older 
Americans as prescription drug coverage. Drug coverage must be added as 
a core element of our basic Medicare benefits package.
  Beneficiaries may also purchase drug coverage through a Medigap 
insurance policy. However, these plans are extremely expensive and 
generally provide inadequate coverage. In addition, for most Medigap 
plans, the premiums substantially increase with age. Thus, just as 
beneficiaries need drug coverage the most and are least able to afford 
it, this drug coverage is priced out of reach. This cost burden 
particularly affects women who make up 73 percent of people over age 
85.
  Those with access to employer-sponsored retiree health plans do 
generally receive adequate drug coverage. However, only about one 
quarter of Medicare beneficiaries have access to such plans. Thus, 
although most beneficiaries have access to some assistance, only a 
lucky few have access to supplemental coverage that offers a 
substantial drug benefit. Moreover, at least 13 million Medicare 
beneficiaries have absolutely no prescription drug coverage.
  To make matters worse, the cost of prescription drugs has been rising 
dramatically over the past few years. Pharmaceutical companies claim 
that today's higher drug prices reflect the growing cost of research 
and development. However, recent increases in drug prices have also 
resulted in large part from the enormous investment the industry has 
made in advertising directly to the public.

  Moreover, recent studies have shown that seniors who buy their own 
medicine, because they do not belong to HMOs or have additional 
insurance coverage, are paying twice as much on average as HMOs, 
insurance companies, Medicaid, Federal health programs, and other bulk 
purchasers. Medicare beneficiaries are paying more as the 
pharmaceutical industry is facing increasing pressures from cost-
conscious health plans to sell them drugs at cheaper prices. In 
addition, the industry offers lower prices to veterans' programs and 
other Federal health programs because the price schedule for these 
programs is fixed in law. Apparently, pharmaceutical companies are 
making up the revenues lost in bulk sales by charging exorbitant prices 
to individual buyers who lack negotiating power.
  Despite these market pressures and increased research and development 
costs, the prices being charged to seniors and other individual 
purchasers are hardly justified when financial reports show drug 
companies reaping enormous profits.
  Many seniors live on fixed incomes, and a substantial number of them 
cannot afford to take the drugs their doctors prescribe. Many try to 
stretch their medicine out by skipping days or breaking pills in half. 
Many must choose between paying for food and paying for medicine.
  In the context of the budget resolution debate, proposals were made 
to provide for the added cost of including prescription drug coverage 
in the Medicare program. I voted for an amendment to create a reserve 
fund of $101 billion over 10 years to cover the cost of Medicare reform 
including the addition of a prescription drug benefit. This provision 
was included in the final version of the Senate budget resolution. 
However, legislation creating the drug benefit still must be enacted 
before coverage could be extended.
  Helping senior citizens get the prescription drugs they need should 
be one of our top priorities this session. Unfortunately, the Majority 
is more interested in enacting deep and unreasonable tax cuts that 
largely benefit the wealthy. Just before the August recess, Congress 
passed the Majority's FY 2000 budget reconciliation bill. I voted 
against this bill because it would spend nearly all of the on-budget 
surplus projected to accrue over the next ten years and would use none 
of this projected surplus to protect the Social Security System, to 
shore up Medicare, or to give senior citizens the prescription drug 
benefit they so desperately need.
  I am pleased that the Finance Committee will be focusing on Medicare 
reform, and I hope that the legislation they develop will establish a 
prescription drug benefit for our older Americans. Providing seniors 
with drug coverage is essential to ensuring they receive quality health 
care. I believe that access to quality health care is a basic human 
need that in my view must be a fundamental right in a democratic 
society.

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