[Congressional Record (Bound Edition), Volume 145 (1999), Part 2]
[Senate]
[Pages 1675-1676]
[From the U.S. Government Publishing Office, www.gpo.gov]




          THE NEED FOR PRESCRIPTION DRUG COVERAGE IN MEDICARE

  Mr. KENNEDY. Mr. President, senior citizens deserve coverage of 
prescription drugs under Medicare, and it is time for Congress to see 
that they get it.
  Medicare is a compact between workers and their government that says, 
``Work hard, pay into the system when you are young, and we will 
guarantee health security in your retirement.'' But that commitment is 
being broken every day, because Medicare does not cover prescription 
drugs.
  Prescription drug bills eat up a disproportionate share of the income 
of the typical elderly household. Senior citizens spend three times 
more of their income on health care than persons under 65, and they 
account for one-third of all prescription drug expenditures. Yet they 
make-up only 12 percent of the population.
  The greatest gap in Medicare--and the greatest anachronism--is its 
failure to cover prescription drugs.
  Because of this gap and other gaps in Medicare coverage, and the 
growing cost of the Part B premium, Medicare now pays only 50% of the 
out-of-pocket medical costs of the elderly. On average, senior citizens 
now spend almost as much of their income on health care as they did 
before Medicare was enacted.
  Prescription drugs are the single largest out-of-pocket cost to the 
elderly for health services. The average senior citizen fills an 
average of eighteen prescriptions a year, and takes four to six 
prescriptions daily. Many elderly Americans face monthly drug bills of 
$100 or more.
  When Medicare was enacted in 1965, coverage of prescription drugs in 
private insurance policies was rare--and Medicare followed that 
standard practice. Today, 99 percent of employment-based health 
insurance policies provide prescription drug coverage--99 percent. But 
Medicare is caught in a 34-year-old time warp--and senior citizens are 
suffering as a result.
  Too many elderly Americans today face a cruel choice between food on 
the table and the medicine they need to stay healthy or to treat their 
illnesses. Too many senior citizens often take only half the pills 
their doctor prescribes, or don't even fill needed prescriptions--
because they can't afford the high cost of the drugs. Too often, they 
are paying twice as much as they should for their prescription drugs, 
because they are forced to pay full price when those with private 
insurance policies get the advantage of negotiated discounts. As a 
result, many senior citizens end up in the hospital--at excessive cost 
to Medicare--because they aren't obtaining the drugs they need or are 
not taking them correctly. As we enter the new century, pharmaceutical 
products are increasingly the source of miracle cures for many dread 
diseases--and senior citizens will be left even farther behind if we 
fail to act.
  The 21st century may well be the century of life sciences. With the 
support of the American people, Congress is on the way to the goal of 
doubling the budget of the National Institutes of Health over the next 
five years. This

[[Page 1676]]

investment is seed money for the additional basic research that will 
enable scientists to develop new therapies to improve and extend the 
lives of senior citizens and all citizens.
  In 1998 alone, private industry spent more than $21 billion for 
research on new medicines and to bring them to the public. These 
miracle drugs save lives--and they save dollars too, by preventing 
unnecessary hospitalization and expensive surgery. All patients deserve 
affordable access to these medications. Yet, Medicare, which is the 
nation's largest insurer, does not cover outpatient prescription drugs, 
and senior citizens and persons with disabilities pay a heavy daily 
price for this glaring omission.
  America's senior citizens and disabled citizens deserve to benefit 
from new discoveries in the same way that other families do. Yet, 
without negotiating power, they receive the brunt of cost-shifting--
with often devastating results. In the words of a recent report by 
Standard & Poor's, ``Drugmakers have historically raised prices to 
private customers to compensate for the discounts they grant to managed 
care consumers.'' The so-called ``private'' customers referred to in 
this report are largely our nation's mothers, fathers, aunts, uncles, 
grandmothers, and grandfathers.
  Up to 19 million Medicare beneficiaries are forced to fend for 
themselves when it comes to purchasing these life-saving and life-
improving therapies. They have no prescription drug coverage from any 
source. Other Medicare beneficiaries have some coverage, but too often 
it is inadequate, unreliable and unaffordable.
  About 6 percent of senior citizens have limited coverage through a 
Medicare HMO. While the majority of Medicare HMO plans offer 
prescription drug coverage, the benefits vary widely. Some plans cap 
the benefit at just $300 a year or less. Imagine that, $300 a year or 
less. In addition, the current trend is for HMOs to cut back on drug 
coverage or, in extreme cases, leave the Medicare market altogether. We 
have tried to remedy this problem in Massachusetts, but clearly it is a 
national problem, and it requires a national solution.
  An additional 12 percent of Medicare beneficiaries purchase an 
independent medigap policy with prescription drug coverage and coverage 
of other gaps in Medicare. Only three of the ten standard medigap 
benefit packages even include insurance for prescription drugs. These 
plans are difficult to obtain, because even the most generous companies 
refuse to cover all people who walk in the door.
  They fear that only those who urgently need the coverage will sign 
up, so the plans contain escape clauses that exclude applicants with 
pre-existing conditions. Even if they decide to issue a policy, often 
there are no limits on what these private companies can charge. As a 
result, medigap plans with drug coverage are often out of reach for 
senior citizens. For those fortunate enough to obtain the coverage, the 
benefits are limited and the costs are high.
  Another 10 percent are Medicare beneficiaries are eligible for 
coverage under Medicaid. This coverage is an important part of the 
safety net for our poorest elderly and disabled citizens, but it offers 
no help to the vast majority of senior citizens.
  Finally, a third of all Medicare beneficiaries have reasonably 
comprehensive coverage through a retiree health plan. These plans, 
which are offered through their former employers, supplement Medicare, 
and the prescription drug benefits are often generous. But 
increasingly, retiree health benefits are on the chopping block as 
companies cut costs by reducing health spending.
  Despite Medicare's lack of coverage for prescription drugs, their 
misuse results in preventable illnesses that cost Medicare as much as 
$16 billion annually, while imposing vast misery on senior citizens. It 
is in our best interest, and in the best interest of Medicare, to 
reform it in ways that encourage proper use and minimize these abuses.
  Savings can be achieved when physicians and pharmacists are better 
educated on the needs of senior citizens and the potential problems 
they face in obtaining and using their medications.
  Savings can also be achieved when senior citizens are assisted in 
learning how to follow the instructions that are dispensed with their 
medications. Too often, patients shortchange themselves. They take half 
doses or try to stretch out their prescription to make it last longer. 
This is wrong, and it doesn't have to happen. If elderly patients know 
that the drugs they need will be affordable, compliance will improve, 
and so will their quality of life.
  President Clinton has correctly identified prescription drug coverage 
as one of the very highest priorities for Medicare reform. I hope we 
can reach a broad bipartisan consensus in the coming weeks that any 
Medicare reform worth the name will include coverage of prescription 
drugs. The health and financial security of millions of senior citizens 
depend on it, and we owe it to them to act as soon as possible.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. DORGAN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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