[Congressional Record (Bound Edition), Volume 146 (2000), Part 1]
[House]
[Pages 1321-1327]
[From the U.S. Government Publishing Office, www.gpo.gov]



          PRESCRIPTION DRUG BENEFITS AND THE MEDICARE PROGRAM

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 1999, the gentleman from Pennsylvania (Mr. Greenwood) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. GREENWOOD. Mr. Speaker, this evening the gentleman from North 
Carolina (Mr. Burr) and I are going to talk about prescription drug 
benefits and the Medicare program.
  In 1965, when Medicare was created of course it was created without a 
prescription drug benefit. It seems unimaginable now in the year 2000 
that the Congress would create a program to provide for the health care 
of the elderly without providing a prescription drug benefit, but those 
were different times. In 1965, a far smaller percentage of Americans in 
general and American seniors used prescription drug benefits on a 
regular basis, and so Congress did not include prescription drug 
benefits in the creation of Medicare.
  But today, as we stand at the millennium in the year 2000, the world 
is a very different place, and today's seniors, as we all do, benefit 
from health care innovations that were inconceivable just 35 years ago, 
and particularly in the area of pharmaceutical products and biological 
products.
  Today if you do not have access to the latest miracle drugs produced 
by the pharmaceutical industry and you do not have access to the latest 
biological products that are being produced, that are creating cures 
for diseases that could not have been imagined 35 years ago, if you do 
not have access to these products, you really do not have good health 
care in America. Yet 35 percent, over one-third of all of the seniors 
in the United States, as well as the disabled, who also receive their 
health care through the Medicare program, do not have access to these 
products.
  This chart to my left here, the pie chart on the right, describes 
which Americans do and which Americans do not have access to 
prescription drugs through the Medicare program and other similar 
programs.
  About 31 percent of American seniors receive a prescription drug 
benefit from their former employer. They worked long enough to receive 
a lifetime of benefits and their employer was in a position and perhaps 
the union negotiated for a benefit that would be a good prescription 
drug benefit that would last for the rest of the life of the retiree.
  About 11 percent of today's elderly population purchase a 
prescription drug benefit when they purchase a Medigap policy, the 
Medigap policies that cover those costs of health care not covered by 
the regular Medicare program.
  Then there are about 10 percent of America's senior citizens who are 
of such low income that they are eligible for the Medicaid program, 
health care for the poor, and they have through that program a pretty 
good prescription drug benefit.
  Then there are about 8 percent of the elderly who choose to receive 
their Medicare in what is called Medicare Choice Plus plans, and that 
is that they have a managed care package, and that managed care package 
provides them with the benefit.
  But the yellow piece of the pie there, the largest piece of the pie, 
represents the 31 percent, the chart says, and the estimates are 
between there and 35 percent, of America's seniors who do not in fact 
have any Medicare prescription at all.
  Let me change charts for a moment.
  This is a chart that demonstrates of those that do not have, the 35 
percent of Americans's elderly who are without prescription drug 
benefit, who they are in terms of income levels. As this chart readily 
indicates, the likelihood that one is covered with a prescription drug 
benefit is in direct proportion to one's income at retirement. So those 
American retirees who have incomes in excess of $50,000 per year, 95 
percent of them are able to in one way or another meet their 
prescription drug needs.
  That figure climbs for those between $25,000 and $50,000 to 16 
percent. Between $15,000 of income and $25,000 of annual income those 
uncovered by a prescription drug benefit is 22 percent. Between $10,000 
and $15,000 the number is 20 percent. For those Americans below $10,000 
and yet with enough income so they do not qualify for the Medicaid 
program or a State-operated Medical Assistance Program, 37 percent of 
those elderly do not have a prescription drug benefit.
  As this chart indicates, this problem is going to be exacerbated by 
time. In 1999, 13 percent of the American population was older than 65, 
and of those over the age of 65, 33 percent were taking some form of 
medication on a regular basis.
  Thirty years from now, when the baby-boom is fully retired, about 20 
percent of Americans will be of retirement age, over 65 years, and more 
than half, 51 percent of them are expected to require daily 
medications. So clearly this problem will get worse in time unless the 
Congress acts to solve this problem.
  As this chart indicates, the problem is being exacerbated because of 
the increasing costs of prescription drugs, the total prescription drug 
costs for any given elderly person.
  In 1993, this is the price increase per year, these are year-over-
year percentage changes, so in 1993 the price of

[[Page 1322]]

pharmaceuticals increased by 8.2 percent, while the consumer price 
index was only 2.7 percent. As the chart shows, the annual increase in 
the total cost of all pharmaceuticals, this is not the per item cost, 
but the total cost of all pharmaceuticals, has risen to the extent that 
just the one year change between 1998 and 1999 was a whopping 18.5 
percent, while the CPI was still down at 2.7 percent.
  I wanted to bring up one other graph.
  This is a very important graph, because it begins to break down the 
components that cause this dramatic increase in the total cost of all 
pharmaceuticals.

                              {time}  1530

  The purple parts of each bar are the percentage increase in each of 
the years between 1990 and 1998 that were related to the actual 
percentage increase in the cost of the pharmaceutical products on the 
market. So in 1990, products in general went up 8.4 percent. That has 
been on the decline; it is at a slight increase in the last few years. 
But as we can see, the percentage of increase in products on the market 
is a relatively small percentage of the total cost increases.
  The green part of the bar shows the volume from the mix of new 
products. What that means is that this part of the increase was driven 
by the fact that seniors were getting more prescriptions, taking more 
medications, and new products were coming on to the market, adding to 
the costs. So when we look to methodologies to bring down the cost of 
prescription drugs, we need to understand that it is not just a freeze, 
for instance, on all prescription drug prices, which will not solve the 
problem, because as long as new products come on to the market, seniors 
will have access to them, and that will drive up the total cost of 
pharmaceuticals.
  Mr. Speaker, we Republicans are committed to solving this problem. My 
colleagues on the Committee on Commerce have been working hard at this 
for some time, as have our friends on the Committee on Ways and Means; 
and we have been meeting together. We will have a prescription drug 
benefit plan in legislative form probably next month, in March, and we 
will bring that to our committees for consideration, and to the floor.
  I am convinced that the capacity is here in the House for Republicans 
and Democrats to work together for the Congress, and for the House and 
the Senate to work together, and for the Congress, the Republican 
Congress and President Clinton to work together so that by the end of 
this year 2000 we will have been able to provide a legislative solution 
to this that is sound, that is reasonable, that makes sense, and that 
solves the problem of many seniors today where they have to choose 
between whether to buy groceries or whether to buy a prescription drug, 
or whether to take their prescription from their doctor and then never 
have the opportunity to fill it at all.
  At this time, I yield to my colleague from North Carolina (Mr. Burr), 
who knows as much about this issue as any of my colleagues.
  Mr. BURR of North Carolina. Mr. Speaker, I thank the gentleman from 
Pennsylvania for making part of his time available for me to join him 
in this Special Order on the drug benefits that should exist under 
Medicare.
  I sometimes wonder if in 1960 when Medicare was created, whether they 
knew we would be here at some point in the future. The fact was that 
drug benefits were not part of the insurance package for the private 
sector or for any entity, and if they would have been, I am sure that 
those individuals who were in this institution would have included a 
drug package in Medicare as we know it today. But the fact is, they did 
not. In the last 30 to 40 years, we have seen significant change since 
Medicare happened.
  There has not only been change in the delivery system, it has been 
changed in the treatment methods that physicians use; there have been 
changes in the devices that hospitals are able to use for treatment; 
and there has certainly been change in the pharmaceutical world, which 
I call the high-tech end of medicine. As we discover new things that 
treat specific illnesses, that up until yesterday we might have thought 
were uncurable or uncontrollable, that is the era that we are in.
  The debate in Washington is not over whether we extend a drug benefit 
to individuals who make choices between food and drug. It is a 
philosophical debate in Washington over who we are going to offer a 
drug benefit to. The gentleman and I and others believe that it has to 
be universal; that we have to make sure that 10 years from now, people 
in this institution are not here on this House floor fixing something 
that had design flaws, fixing something that was not inclusive of 100 
percent of the population.
  There is a difference between where the subsidy is, the Federal 
Government subsidy, and making available the option for seniors to buy 
in. It could be that our plan, employers might buy their retirees into 
this drug plan. It means that seniors' high income would pay for their 
premiums and those below a certain level of income on an annual basis 
might have that Federal safety net to pay their premium and their 
deductible. But there are certainly plans all around this town, as we 
have seen.
  The gentleman and I both shared an experience which was the 
modernization of the Food and Drug Administration, a 2\1/2\-year 
process that I remember well. When we started, people looked at us and 
said, it can never be done; it is too big. Granted, things happen slow 
in Washington that are big, but 2\1/2\ years later, I think even the 
agency would say that their ability to bring new pharmaceutical 
products, their ability to bring new devices to the marketplace to 
treat real people is better today than it has ever been in the history 
of that agency, while maintaining the gold standard of the FDA, and 
that is the safety and the effectiveness of their treatments.
  I remember through that process that the gentleman and I met hours 
and hours with individuals young and old who came in with chronic and 
terminal illnesses who did not have a tremendous amount of choices. One 
of the results of the Food and Drug Administration modernization was 
that we have had new applications, a greater number for pharmaceuticals 
than we have ever seen, because companies invested millions and 
billions of dollars in research and development. The human genome 
project is beginning to identify disease that exists in our senior 
population, and we are just right around the corner from those same 
pharmaceuticals finding a chemical that can stop that chronic illness 
that they have had for year after year after year.
  We have to make sure that drug benefits are affordable and accessible 
for the entire population, and we can only do that if we accept the 
challenge of presenting a universal plan, not a targeted plan like some 
have suggested. Clearly, it has to be universal and it has to include 
the entire senior population. As a matter of fact, the General 
Accounting Office testified in front of us today, the Senate last week; 
and they said to Congress, do not do anything that does not change 
Medicare in its entirety. Reform the whole process when you do the drug 
benefit. That is probably a goal that we cannot do this year. The 
question is, how long can seniors wait.
  However, we can get that portion of it that deals with drug benefits 
right: universal in scope, affordable in price, and accessible from the 
standpoint of coverage.
  Mr. GREENWOOD. Mr. Speaker, the gentleman made reference to the 
miracles of some of these more modern pharmaceutical products; and he 
also, in his remarks, has been talking about the cost and how do we 
devise a plan that, given the finite resources, will provide this 
wonderful benefit to all of our seniors. We have to remember that it is 
not a zero sum game, that when we add a pharmaceutical benefit, it does 
not simply and only add to the costs of Medicare. Because in many ways, 
using a pharmaceutical product, using a medicine, is the least 
expensive way to treat an illness as compared to surgery.

[[Page 1323]]

  I have a chart here on my left that demonstrates an instance of that. 
This is the cost of treating stroke patients. If we use a treatment 
that consists of a pharmaceutical approach, which uses a clot-busting 
drug, it costs about $1,700 to treat that patient on an annual basis. 
Yet, by doing that, we are keeping that patient from having to go 
through the pain and the expense of rehab and often nursing care.
  So the difference here is that we save $6,100 that otherwise Medicare 
would have been paying for.
  Mr. BURR of North Carolina. Mr. Speaker, another important thing: we 
save money, and there is no figure in there on the quality of life 
improvement that we have made for the individuals. No hospital stay, no 
transportation for relatives, the type of thing that for seniors today 
is a problem; just the dislocation from their home is a problem.
  We have been joined by the gentleman from Michigan (Mr. Upton), who 
also participated in quite a few things with us, and one of them was 
the expansion of Medicare in 1995, if I remember, when we made the sell 
that there were certain things under Medicare that we ought to cover, 
such as the PSA exam for senior males that checked for a certain 
cancer; mammograms for senior females so that we could detect at an 
earlier stage; not too dissimilar to the argument that the gentleman 
just made and that is if we find a way to detect things sooner, the 
faster we do it, the faster we treat, the less hospital stay that we 
have, the less cost that we have, a better quality of life that we 
have. Everything that we would chart as a goal in a health care plan we 
were able to achieve, and it should be incorporated into this drug 
benefit.
  Mr. GREENWOOD. Mr. Speaker, the gentleman from Michigan (Mr. Upton) 
has joined us, and with my colleague Mr. Burr and myself, along with 
the gentleman from Virginia (Mr. Bliley) and the gentleman from Florida 
(Mr. Bilirakis), and others, we have been working for all of this year 
and beyond that, earlier than that, to devise a prescription drug plan 
that makes sense.
  I would like to now yield to the gentleman from Michigan (Mr. Upton).
  Mr. UPTON. Mr. Speaker, I thank the gentleman from Pennsylvania for 
taking this Special Order. I certainly welcome the opportunity to work 
with my colleagues on developing a plan that makes sense.
  As we go back home, particularly this next week and a half with 
Congress out of session, as we look at our mail that comes in virtually 
every day, there is a real human cry for us to do something about 
pharmaceutical drugs and to try and work together to allow this to 
happen for today's seniors.
  I am sorry that I was a little bit late when this Special Order 
started. We all have a number of hearings that have been going on, so I 
missed the beginning. I saw some of the charts just briefly before I 
left my office to come over. But we are part of a group that is working 
on a comprehensive plan that tries to do a number of things. Obviously, 
we have been the leader in terms of the pharmaceutical industry looking 
for drugs that are going to save lives and in effect save big time in 
costs. We heard today, the three of us, in our committee a woman from 
Pennsylvania with osteoporosis, or from Florida, or maybe California. 
Anyway, she was a wonderful lady.
  Mr. BURR of North Carolina. Mr. Speaker, she could have been from 
anywhere.
  Mr. UPTON. Yes, she could have been from anywhere. But these drugs, 
particularly for osteoporosis, have saved her life. We are looking at 
some of these advances that are just around the corner with diseases 
before that have been so crippling, and again, we are almost there in 
lots of cases. That medical research money is so necessary, not only 
that we provide to the National Institutes of Health, but also the 
research and development money that pharmaceutical companies use as 
well, to try and develop drugs in major ways.
  Mr. BURR of North Carolina. Mr. Speaker, in her particular case, it 
was not limited to osteoporosis, which is the case with a lot of 
seniors today who have multiple health problems or multiple health 
conditions. She herself said that she took 11 prescriptions a day.
  Now, one of the reasons that she came to see us is she is one of the 
fortunate seniors that is insured. She has an add-on policy that 
provides some costs for drugs; and she said, whatever you do, let 
everybody else have the opportunity who is a senior to buy, but do not 
limit me; let me stay with the plan I am comfortable with. That is a 
challenge to us, to make sure that whatever we design is equally as 
good, if not better, than what she has.
  Mr. GREENWOOD. Mr. Speaker, clearly what we want to do is we want to 
provide choice. One of the first charts I held up demonstrated that a 
significant portion of America's elderly, two out of three already have 
prescription drug coverage and about half of those, or about a third of 
the senior population, receives those benefits from their employer.
  Now, what we do not want to do is do anything that is going to cause 
either those retirees who have a nice prescription drug benefit to 
suddenly have to pay for something they already have, nor do we want to 
do anything that would create a disincentive for the employers to 
provide that. So we have to be careful that we fix what is broken and 
we do not fix what is not broken in the world of prescription drug 
benefits.
  Mr. BURR of North Carolina. Mr. Speaker, the challenge for us, as 
everybody will agree, is that there are 30-plus million Americans who 
fall under this umbrella of Medicare, and it grows every day. We 
certainly know what the demographic shift is in America. We have heard 
the numbers as they relate to Social Security. We talk about it enough 
related to Medicare, but the fact is the senior that goes on Social 
Security is also the senior that will go on Medicare. The population 
will double in the next 15 to 20 years in America, and I think there is 
a responsibility that we have to make sure that the system is sound 
enough that it will go on.
  Mr. Speaker, I think it is important to talk about some of the 
numbers that we hear on a daily basis as we discuss drugs. Individuals 
might see on the nightly news when they talk about the individual who 
is making a choice between food and drugs or drugs and something else 
in their monthly budget.

                              {time}  1545

  The President's new proposal has a full subsidy at 135 percent of 
poverty. That income level on an annual basis is $11,727 a year; excuse 
me, the 150 percent is $11,727.
  What happens to that person that is at 135 to 150? Clearly they have 
the same choices that they have to make, maybe not as great as the 
person at 100 percent. But I think one of the things we have to do is 
we have to identify where is that safety net needed the most, whether 
there is a transitional safety net for people in the middle, because 
today we can look at 200 percent of poverty for seniors and realize 
that there is no State, Federal, or community safety net that fills 
their need, and how expansive we can be is only limited to how creative 
we can be at producing a new model.
  Mr. UPTON. Mr. Speaker, I would just note, if the gentleman will 
yield, that a number of States, Michigan being one, have just embarked 
on a program that in fact will help how many HMO seniors, those as high 
as 150 percent of poverty. But again, it is not a very high dollar 
figure, as the gentleman suggested.
  But what do we do with those States that already have something in 
place? We have to be very careful not to undo what they have done, and 
yet try to encourage other States to follow the same lead that States 
like Michigan have already taken.
  Mr. BURR of North Carolina. The gentleman is exactly right. The 
challenge for us as well is to make sure that the plan that we produce 
has a value. I think sometimes we leave value out of it because we are 
talking about this captured audience, and I guess that is how people 
can look at the current health care system and say, it is the best in 
the world.

[[Page 1324]]

  When we talk to seniors, they will point out every problem that 
exists in Medicare today from the standpoint of the limited scope of 
coverage to the cost and the out-of-pocket cost, $760 when one really 
gets sick and has to go in the hospital.
  That is an area we should look at, but we are doing drugs now. We 
have to make sure that it fits in that modernized Medicare system of 
the future. If not, our work would only be changed by somebody else's 
mistake later on.
  Mr. GREENWOOD. Mr. Speaker, I yield to the gentlewoman from New 
Mexico (Mrs. Wilson). She is a member of the Committee on Commerce, as 
we all are here doing this special order, and she will be playing a 
critical role in determining what kind of prescription drug benefit we 
can provide to our elderly and to our disabled.
  Mrs. WILSON. Mr. Speaker, I thank the gentleman for yielding to me.
  I appreciate the gentleman from Pennsylvania (Mr. Greenwood) having 
this discussion today, Mr. Speaker, because I think Congress is just 
really beginning the hard work of developing the legislation to address 
this problem.
  All of us agree that we have a problem that we have to deal with. It 
is a problem brought about by marvelous advances in medical care that 
did not exist at the time that Medicare was established. We look at 
what the pharmaceutical industry has brought to the quality of life in 
America. We have a much longer lifespan and a much higher quality of 
life because there are miracle drugs that are available today that were 
not available 10 or 15 years ago, but the cost is often very high.
  I heard about this a lot when I was at home over our recent break. 
There was a little lady who came in to see me at one of our town hall 
meetings. Her name is Jean Welch. She did not say anything during the 
meeting itself, but she came up to me afterward. She has trouble 
walking now.
  She gave me a little envelope, and just whispered into my ear, don't 
look at this now, but when you go home, I want you to know that this is 
half of what I spend on prescription drugs every month. I just want to 
you to know.
  So I went home and I pulled out of this little envelope a receipt 
from Wal-Mart for over $360. If someone is on social security and they 
have that high a price for paying for their prescription drugs, it is a 
real burden, and it is something that we have to address.
  I think maybe I would like to just take a minute here, if I might, to 
talk about how we are grappling with this issue and what the choices 
are that face us as a Nation and as a Congress, and how we are 
beginning to sort through those choices.
  There are issues really in three areas. One is the scope of coverage. 
We know that about half of American seniors now have some kind of 
prescription drug coverage. They have some kind of insurance, but we 
also know that about one-third of our seniors have no coverage at all. 
The rest have had some kind of coverage, but it is very, very limited.
  So how do we craft a program that allows continuing choice for those 
who have insurance that they want now, and does not overly burden the 
Federal government and take away choices from seniors who have 
exercised their right to choose? So the scope of coverage is one of the 
issues that we have to deal with.
  How do we administer this program? There are a number of options that 
have been proposed in a lot of different pieces of legislation here, 
but I think they kind of fall into three groups.
  We could have a government-managed benefit, as we do with a lot of 
other Federal Government programs, with regional entities to purchase 
and administer our drug program.
  We could have private insurers that take care of this, and we would 
give seniors some kind of a voucher or a credit in order to buy 
prescription drug insurance. That would not have some of the burdens 
that go along with being a government-run program.
  Or, a third proposal that has been floated is to allow the States to 
manage this and administer the program. So there is not one 
prescription drug proposal, there are a lot of different ways that we 
could do this, and those are ways that we are grappling with here in 
the Congress starting this week.
  There is also the problem of who we cover. All of us know that we 
need to cover low-income Americans and low-income seniors. But there is 
also the problem of those that may not be low-income, but they have 
huge, high drug costs.
  That was one of my concerns with the initial proposal that came out 
that said, yes, we are going to give everyone coverage, it is going to 
cost us somewhere between $300 and $600 a year to buy it, and by the 
way, there is no coverage beyond the first $2,500 worth of costs.
  Well, my husband handles the insurance in my house, but even I can 
figure out that I do not need the insurance for the things I can 
afford, I need it for the things I cannot afford. So if we have caps at 
$2,500, that does not help Jean Welch after May or June. We need to 
think about those who have high costs, as well as those who have low 
income.
  There are a lot of models for reform that the Congress is beginning 
to grapple with and grapple with seriously. I am very pleased that the 
Speaker has asked the chairman of the Committee on Ways and Means and 
the chairman of the Committee on Commerce, who have all of the 
expertise on these programs, to get together, to have the public 
hearings, to begin to craft a proposal that solves a very real problem 
that real Americans face every day.
  Mr. GREENWOOD. Mr. Speaker, the gentlewoman from New Mexico has well 
illustrated that there are a variety of plans that are on the table 
taking different approaches. This is a hard job. This will not be 
easily done. We are talking about being able to find billions of 
dollars, many billions of dollars, scores of billions of dollars on an 
annual basis for the foreseeable future to be able to do this.
  We have finite resources. We have many, many competing demands on our 
budget. We have to do it in a way that makes sense to all of the 
stakeholders.
  There is an old saying, which is that it is amazing how much you can 
accomplish if you do not care who gets the credit. A lot of the 
political observers who watch what happens here in the Nation's Capitol 
will say, do not bet on there being a prescription drug benefit. It is 
an important election year, it is a presidential election year. The 
Democrats want to take the Congress back and the Republicans want to 
keep the Congress, and both parties are vying for the presidency, and 
it will be too easy for the Republicans and Democrats to get into a 
fight over who gets credit and who gets blame for getting something 
done or not getting it done.
  Republicans can fight Democrats, Congress can fight the President, 
but this is too important for that. As the gentlewoman from New Mexico 
said, her constituent has a real life problem. This is about, 
literally, life and death. Our ability to solve this problem in a 
timely fashion really has everything to do with whether some of our 
elderly loved ones live or die, whether they live in pain and 
suffering, or whether they can enjoy their golden years and their 
grandchildren because they have access to the miracles of these 
industries.
  There are also temptations that are nonpartisan. There is a 
temptation to pick on the various industries that are involved. There 
is a temptation to say, let us all pound on the pharmaceutical 
industry. They are a good target. We can beat them up.
  The fact of the matter is we do not want the pharmaceutical industry 
to be price-gouging or making excessive profits, but we do want them to 
be able to continue to provide these miracles, and there is no country 
that compares with the United States when it comes to our ability with 
our pharmaceutical industry to make these products.
  They do not do this in Canada, they do not do this in Mexico, or in 
many countries in Asia, or more than a handful in Europe. These 
products are for the most part innovated in the United States of 
America. We have to make sure that we do not kill the goose that is 
laying these golden eggs.

[[Page 1325]]

  We think we can bring the price of prescription drugs down 
dramatically because when we get all of these elderly people and 
disabled people who do not have the benefit now, get them into the 
marketplace, subsidized by the Federal government, we will get the 
price of those prescription drugs down.
  Mr. BURR of North Carolina. If the gentleman will continue to yield, 
the gentleman raises a great question. That is, a movement of 30-plus 
million people into a plan of coverage has a devastating effect on the 
cost of the items that are purchased under that plan.
  Mr. GREENWOOD. Supply and demand.
  Mr. LATHAM. This is a supply and demand situation, where if they buy 
them individually, the cost is so much higher. I think that is one of 
the reasons we have to look at some of the plans that are out there, 
and look at the hard and real facts of what does it cover.
  In 1995, the average cost for a senior in America for drug coverage 
was about $500. That was the extent of all the drugs that they 
purchased. But more importantly, we are faced with a situation of 
trying to integrate what we are here trying to put together in with 
every State who takes care of the poorest seniors.
  Somewhere between 58 and 100 percent of those in poverty are 
currently under Medicaid plans. Those Medicaid plans will be affected 
by what we do. We have to make sure this is integrated into it.
  The President made a proposal earlier this year. In the President's 
proposal, the same 135 percent of poverty are covered, just like we 
talked about the need to cover them. After that, individuals are asked 
to pay 50 percent of every dollar that they spend after they buy a 
premium, an insurance policy. The co-pay is 50 percent. There is no 
insurance product in the marketplace today like that, nor is there one 
that anybody would buy.
  Let me give one figure. On $1,100 worth of drugs under the 
President's plan, in the year 2002 the benefit, the benefit for the 
senior would be $197.60. Eight hundred and two dollars of the $1,100 
worth of drugs would be out-of-pocket costs by that senior. What an 
incredible challenge for anybody to buy into.
  Mr. GREENWOOD. Mr. Speaker, I yield to the gentlewoman from New 
Mexico (Mrs. Wilson).
  Mrs. WILSON. If I could follow onto something the gentleman mentioned 
about how easy it is to attack the pharmaceutical industry, these big 
companies, and why are the prices so high, but these are the companies 
that brought us the miracles in the first place.
  I just want to reinforce something the gentleman said about the worst 
thing we could do here is to salt the earth or poison the well that 
will bring us the next generation of miracles, the medicine that will 
cure Alzheimer's or Parkinson's or diabetes. We want this great medical 
miracle that we have seen in the 20th century to continue in the 21st 
century, and the worst thing we can do is to pass legislation which 
would cause the pharmaceutical industry to shrivel in America and stop 
creating the next generation of miracle drugs, because I want them to 
be there for my kids and when I am old and gray.
  Mr. GREENWOOD. It takes about something on the order of 9 years and 
half a billion dollars to bring a product to market, to bring a new 
pharmaceutical product to market. That is a very expensive proposition. 
We need to make sure that there are industries in America, companies in 
America that want to continue to make that kind of investment and take 
that kind of risk.
  At the end of the day, an elderly woman who goes to her doctor 
because she has some kind of ailment and gets a prescription and takes 
that prescription to her corner drugstore, all she cares about is, can 
I afford to get this medicine that is going to make me better? She is 
not out to kill the pharmaceutical industry. She is not out to kill the 
biological industry or her corner pharmacist, for that matter, or the 
insurance industry. What she wants to know is, can I afford at a 
reasonable cost to get this drug so that I can take it home and get 
better and feel better and enjoy the rest of my days?
  What we have to figure out here as policymakers is how to bring all 
of these stakeholders, the medical community, the doctors, nurses, 
hospitals, the insurance industry, the pharmaceutical industry, 
Republicans, Democrats, Congress and the President, and above all, 
listen to the seniors, listen to the seniors and to the disabled who 
are in need of this benefit so that we can share their wisdom, and get 
beyond the political credit-taking and partisanship and solve this 
problem.
  I would certainly say that any Member of Congress or any president, 
for that matter, who serves in the year 2000 who can end this year at a 
bill-signing ceremony seeing that this gets done, and knowing that from 
that day forward no little old lady, no little old man, walks into any 
drugstore in America, hands trembling because he or she is not sure 
they can afford this drug, that will be enough for this Member to 
retire on, feeling that the time we spent here was worthwhile.
  I yield to the gentleman from North Carolina (Mr. Burr).

                              {time}  1600

  Mr. BURR of North Carolina. I know the gentleman remembers well the 
visits that we had from young and old when we were in the hopes that we 
could modernize the Food and Drug Administration. I think to many 
Americans they might have looked at it and said, all that is being 
accomplished is to have a new version of an old drug on the marketplace 
and this is a process that will allow that to happen. In fact, it was 
not.
  In many cases, the drugs that come through that pipeline today, as we 
refer to it, are drugs that we have not had anything available to treat 
that chronic or that terminal illness.
  Today, as the gentleman and I know, we have a rampant increase in 
infection, in seniors predominately, but in all Americans; and it does 
not have anything to do with sterilization. It just has to do with the 
change in bacteria that goes on as we have treated one strain so long. 
The need exists in this country for new antibiotics but, more 
importantly, the need for patients to take all of the drugs that are 
prescribed for them so that the illness is eliminated totally.
  We know what happens to a senior when they get halfway through the 
prescription. They have another month to go. That means going to the 
drugstore. It means the out-of-pocket cost of another $50 or $60 or 
$70, and they have had a cold month and the heating oil is higher than 
they thought, they may say I feel great now, the signs that I went in 
with are gone, and they do not get that second month of prescription. 
Pretty soon, that problem is back; it is worse. It means 
hospitalizations. It means doctors' bills. We pay for that side of it, 
under Medicare, and it is time that we lift the shells that we have got 
the pea under and make sure that everybody sees them and realizes that 
regardless of where it happens in the system, somebody has to be 
responsible and somebody is paying.
  We have to make sure that we can say to the taxpayers in this country 
that they are getting the best value that they could purchase. We have 
to say to the patients, the recipients, the beneficiaries, they have 
the most quality delivery system with the greatest scope of coverage 
out there that we could possibly design. We are not there yet, and 
clearly we have seen a tremendous amount of options; but too many times 
we want to focus on the most at-risk and stop before we realize that an 
important part of this process is to make sure that we design a product 
that is as attractive to people in the upper income scale of seniors as 
it is needed in the lower income scale. Because by their participation, 
that pool of seniors grows and the purchasing power of that group, 
regardless of whose plan they are under, is that much better for their 
pharmaceutical coverage.
  We have seen it happen in the private sector in health care. We can 
see it in what is the public sector today, which is Medicare.

[[Page 1326]]


  Mr. GREENWOOD. Mr. Speaker, when I began my remarks, I mentioned that 
1965 is when Medicare was begun, and as we look back 35 years, it is 
hard to imagine now a time when seniors did not have Medicare, when 
they did not have a guarantee of health care, just as it was impossible 
for them to imagine looking forward into time what health care could 
provide now.
  We are at a particularly wonderful moment in our history. Over just 
the past 5 years or so, we took a Nation that was plunging into debt, 
$250 billion a year adding to the Nation's debt, and by 1997 making a 
lot of difficult decisions, including many that affected the Medicare 
program and trying to squeeze out some of the waste and fraud in 
Medicare, and we balanced the budget.
  Last year, in fact just late last year, we made another huge decision 
here in Washington. We said we are not going to spend any more of the 
Social Security trust fund on anything else but Social Security, and 
that is another milestone that was brought about because of the fiscal 
discipline that we have demonstrated over the last several years.
  Now we are taking down debt. We are to the point where by the end of 
this fiscal year, by next October, we will have paid down over a 
quarter trillion dollars in debt.
  So this is a golden moment in American history. The economy is 
strong. Revenues are coming in. The budget is balanced, and we have an 
opportunity now to take another leap forward; and that leap forward, I 
think, involves creating this prescription drug benefit. It is a 
quality of life item. We have the opportunity to do it, and again there 
is not any question in my mind that there is enough talent in this 
town, some of it actually in the Congress, certainly in this staff and 
elsewhere, enough talent in this administration, talent in both the 
Republican and Democratic parties and a willingness across this Nation 
to do this, that we can do this.
  This is a solvable problem, and if we decide not to care who gets 
credit for it and work together across party lines, it can and it will 
be done. I just hope that all of the Members of the House and Senate 
who can hear the sound of my voice take that to heart and decide that 
this will be the year that we will do this in a bipartisan fashion, get 
the job done.
  Mr. BURR of North Carolina. Mr. Speaker, the gentleman raises an 
important point that we need to remind everybody of. The House of 
Representatives does not have the ability to do it on their own. The 
United States Senate does not have the ability to do it on its own. Our 
Founding Fathers designed a very difficult system, but a system that 
works. It has its checks and balances, but it requires the legislative 
branch and the executive branch to agree.
  It means that we not only have to pass the test of our 434 colleagues 
and our 100 colleagues in the Senate, and the executive branch's power 
over whether something moves, but we have the American people to deal 
with, too. We have to pass the test of: Is this a good product to them? 
That is not just limited to the 30-plus million seniors, because 
certainly the payment in the subsidy, the safety net is created by the 
American taxpayer.
  We have not done a good job of explaining in the past what Congress 
did and why they did it. I think the reason that they did not was that 
we are finding they did not do some things just exactly right.
  We have an opportunity, as the gentleman said, as we head to a period 
where as we pay down debt, we could alleviate off of our annual 
expenditures $260 billion worth of interest payments every year, 
interest payments that we get zero for. We do not educate children. We 
do not provide health care for seniors. We get zero in services. That 
is the one area that infuriates me as a taxpayer, that we cannot get 
that interest off and we cannot do it until we pay the debt.
  As the gentleman knows, in North Carolina I have a mix of every type 
of health care in this country. I have some of the finest medical 
universities at Wake Forest and Chapel Hill and Duke and East Carolina. 
I also have some secondary hospitals that I think are models in the 
county, in Alamance County and Surry County, North Carolina.
  I also have rural health clinics and community health centers. They 
treat this population as well, and their livelihood has been Medicare.
  It was so important that we went back the end of last year and we 
beefed up some of the reimbursement changes we made in the Balanced 
Budget Act of 1997, because we saw that we were falling short of 
supplying the best health care to the seniors in the community health 
centers and rural health clinics. We went back and in a bipartisan way, 
very quickly, without a lot of public debate, we found those areas and 
we strengthened them. Today, those seniors in North Carolina that go to 
the rural health clinic and in every State now have quality delivery, a 
delivery system that they are not going to worry whether it is going to 
be there next year.
  That is the opportunity we have with drugs. We can put aside the 
partisanship of it. We can commit with the President to do a plan, let 
it pass the test of seniors, let it pass the test of the American 
people, the American taxpayer. Those are the two most important. The 
least important is the personal agendas of individuals up here, whether 
it be at this end of Pennsylvania Avenue or the other.
  I am willing to work with the gentleman from Pennsylvania (Mr. 
Greenwood) and with our other colleagues on both sides of the aisle and 
let seniors, the associations that represent them, the American 
taxpayer, judge our product at the end on the value of it to them and 
of the scope of coverage and of the quality of life that it provides 
for all of them.
  Mr. GREENWOOD. Mr. Speaker, the whole concept of aging is changing 
dramatically in this country. It was not very long ago that people in 
their sixties and their seventies, because of the state of the health 
care, they became feeble a lot faster and were not as vital as seniors 
are today. That trend can only continue.
  My mother and father are 78 years of age, and I admit this with a 
certain amount of hesitancy, but it was just about a year and a half 
ago that my mother and father and I, on a dare from my father, jumped 
out of an airplane at 13,000 feet and went skydiving together. That is 
pretty good for a couple of septuagenarians. I think the baby boom 
generation expects to extend its years of vitality even farther, and we 
expect to be still physically able and fit and enjoying life well into 
our seventies and our eighties and our nineties, and of course the 
fastest growing segment of the population is those above 100 years of 
age.
  Nothing more than the advancement of these miracle medicines, these 
miracle pharmaceutical products, these coming biological products that 
will result from the human genome study will continue to enhance the 
vitality of our elderly.
  That is why, again, we have this golden opportunity here to make the 
golden ages more golden for generations yet to come, and I look forward 
to working with my colleague and, hopefully, we will get it done this 
year.
  Mr. BURR of North Carolina. Mr. Speaker, I look forward to working 
with the gentleman from Pennsylvania as well.
  We are at a time where this week alone we saw the President for the 
first time say to Congress, I will sign a bill that eliminates the 
earning limits that we created on seniors, an opportunity for those 
that want to continue to work, that choose to work voluntarily, 
possibly stay in a private sector health plan; but the key thing is 
that they realize that the longer they work, the healthier they are. 
Those that make that choice will not be penalized now under the Tax 
Code.
  If there is an area that we penalize them, it is suggesting that when 
they get to a certain age the only thing we provide is a limited health 
coverage for them, and I think we have a responsibility and an 
obligation to make sure that we do develop a model that is universal, 
that it is accessible and it is affordable for everybody, regardless of

[[Page 1327]]

who is paying the bill, a subsidy or an individual. I think that is a 
test that we will ultimately be under, and I look forward to working 
with the gentleman on it.
  Mr. GREENWOOD. Mr. Speaker, I thank the gentleman from North Carolina 
(Mr. Burr) for joining me on this Special Order this evening, as well 
as our colleague from Michigan (Mr. Upton) and our colleague from New 
Mexico (Mrs. Wilson).

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