[Congressional Record (Bound Edition), Volume 146 (2000), Part 5]
[House]
[Pages 6700-6706]
[From the U.S. Government Publishing Office, www.gpo.gov]


[[Page 6700]]

                       PRESCRIPTION DRUG BENEFIT

  The SPEAKER pro tempore (Mr. Thune). Under the Speaker's announced 
policy of January 6, 1999, the gentleman from New Jersey (Mr. Pallone) 
is recognized for 60 minutes as the designee of the minority leader.
  Mr. PALLONE. Mr. Speaker, I intend tonight with some of my Democratic 
colleagues to also take up the issue of prescription drug benefit under 
Medicare.
  I must say that I was pleased to hear that my Republican colleagues 
on the other side of the aisle were concerned about the issue. I 
certainly do not doubt their sincerity in raising the issue, but I am 
very concerned about the proposal that the Republican leadership has 
put forward and I express that concern because I do not believe that it 
will actually do anything to provide a prescription drug benefit to 
most American seniors.
  I say that with heavy heart because I really believe that this is one 
of the most important issues that we need to address in this Congress, 
and I believe that we will not get a prescription drug benefit unless 
we get it on a bipartisan basis. And so, we do need to have Republicans 
and Democrats work together.
  But it is also important to point out distinctions and to make it 
clear that the Republican leadership proposal that has been set forth 
really does not do anything to help most senior citizens and in fact is 
just, in my opinion, a way to show concern in an election year to give 
the impression that somehow this issue is going to be addressed in an 
effective way when it will not if the Republican plan were to be 
adopted.
  Let me just summarize, if I could before I yield to my colleague, 
some of the problems with the Republican plan.
  First of all, it will leave millions of seniors uncovered. Their 
proposal would do nothing to assist more than half of all Medicare 
beneficiaries who currently lack prescription drug coverage because it 
provides assistance only to beneficiaries with annual incomes of under 
$12,600. Seniors with modest incomes above $12,600 would receive 
absolutely nothing under the Republican plan.
  The benefit will fail to be an affordable option even if it is 
available. And if enacted, the Republican proposal would mark the first 
time in the program's history that Medicare would not provide coverage 
for all American seniors.
  Now, I say that because, basically, what they are proposing is a 
private insurance plan, not a Medicare benefit. Every time that we have 
expanded Medicare to provide more coverage, it has been a benefit that 
has been available to everyone under Medicare either as a guarantee or 
as a voluntary benefit that they can opt into by paying a premium, as 
they do right now under part B for their doctor's care, for example.
  Well, all of a sudden we have a proposal which really is not Medicare 
at all but is, basically, saying that the Federal Government will 
subsidize for low-income people a private drug insurance plan. We do 
not believe that those plans will ever be available.
  So one of my chief criticisms is that this is not really a Medicare 
benefit at all, this is not really Medicare at all, this is simply a 
private insurance plan which even most of the insurance companies say 
will simply not be available for most seniors.
  Also, even for those seniors who would be perhaps able to take 
advantage of what the Republicans are proposing, it does not even 
guarantee, if you will, the coverage for many of those who have an 
absolute need. The Republican plan relies on these private insurers to 
voluntarily offer a drug only benefit.
  In testimony before the Congress, even the insurance industry itself 
had expressed skepticism about the effectiveness of this approach.
  The other thing is, one of the key issues that has come up in the 
context of the prescription drug issue and that the Democrats, 
particularly my colleague the gentleman from Maine (Mr. Allen) has 
pointed out, is the need for access to lower prices.
  Price discrimination is a major issue here. What happens is that the 
seniors that are in an HMO or have access to some larger plan maybe 
through the Government, like the veterans' plan or whatever, they are 
getting lower prices. The senior who goes out and tries to buy the 
prescription drug on their own, they are charged a lot more.
  Well, there is nothing in the Republican proposal that would provide 
access for the average senior citizen to discounts on prescription 
drugs that these larger plans, the people in the HMOs and the people in 
the veterans' plan, obtain.
  I mean, one of the advantages that we have with our Democratic plan 
is that we try to address that issue of price discrimination and make 
it so that everyone who is in the Medicare program would have the 
benefit of those same types of discounts.
  Also, and this is the last thing I want to say on the issue of why 
this Republican plan really is nothing that is going to help the 
average senior, it is not really funded.
  Earlier this year the Republicans promised that they would commit $40 
billion for a prescription drug benefit. Their own budget resolution 
dedicated as little as $20 billion to pay for this weak and limited 
plan that would leave so many seniors without coverage.
  Moreover, the lack of their willingness to release 10-year numbers on 
their prescription drug proposal raises serious concerns that their tax 
policy consumes virtually all revenue necessary to adequately fund a 
drug benefit in the future.
  My point is the Republicans continue to advocate a huge tax cut that 
primarily benefits corporations and wealthy individuals. They do not 
leave any money left for this type of Medicare prescription drug plan 
that would actually help most Americans. They do not have the money to 
accomplish that because of the tax cuts that they have proposed.
  Well, I do not want to just keep harping on what they are doing. I 
would like to talk a little bit about what the Democrats have in mind.
  But before I do that, I would like to yield to the gentlewoman from 
Michigan (Ms. Stabenow) who has been such a leader on this issue.
  Ms. STABENOW. Mr. Speaker, I thank the gentleman from New Jersey (Mr. 
Pallone) very much for all of his efforts. He is tireless in his 
efforts coming to the floor of the House not only on the important 
issue of prescription drug coverage and lowering the cost for seniors 
but the Patients' Bill of Rights and some other important issues for 
health care. So I appreciate his leadership on all of these important 
health care issues.
  As my colleagues know, I have been involved in the great State of 
Michigan in an effort that I have called the prescription drug failure 
fairness campaign, where we have put together a hotline for people to 
call and share their stories.
  I have encouraged people to send me copies of their high prescription 
drug bills so I can bring them to the floor. And I am continually 
coming down and sharing stories. I started on April 12 of this year 
bringing letters down to the floor. I am down again. And I am going to 
continue to share stories of people in Michigan until we can get this 
right and until we can pass a plan that really does the job.
  As my colleague indicates, the plan, unfortunately, that is being 
proposed on the other side of the aisle I believe takes us back to 
where we were before Medicare. Before Medicare, half the seniors in the 
country could not find health care insurance or could not afford it. So 
to say that we are going to rely on that same kind of system for 
prescription drugs just does not make any sense.
  Medicare needs to be modernized. It is simple. Everybody understands 
it. It covers the way health care was provided back in 1965 when it was 
set up in the hospital, operations, prescriptions in the hospital.
  As we know, most care is provided now on an outpatient basis in the 
home and with prescription drugs. And so, it

[[Page 6701]]

is critical. I believe it is the number one quality-of-life issue for 
older Americans today is to address the issue of the high prescription 
drug costs and to modernize Medicare.
  I want to first commend Newsweek this week, who has a feature story 
called ``The Real Drug War.'' They talk about this problem and what is 
happening. I urge my colleagues to have a chance to take a look at this 
article. They do mention what a number of us are doing, the fact that I 
did take a bus trip to Canada with a number of the seniors that are 
from Michigan. We lowered the costs by 53 percent just crossing a 
bridge. Just crossing a bridge from Detroit to Windsor, we lowered the 
cost 53 percent.
  I also want to commend Newsweek, who is doing live talk. They are the 
hosting a live talk on the Internet tomorrow at noon. So for anyone 
listening who would like to participate and share their story at noon 
tomorrow, Eastern Daylight Time, they can log on to Newsweek.com.

                              {time}  1800

  I am anxious to see what people are sharing through that mechanism.
  I think it is important to recognize that in the last 20 years we 
have seen a huge increase in the cost of prescription drugs. The price 
increases from 1981 to 1999 have gone up 306 percent, while at the same 
time the Consumer Price Index has gone up by about 96 percent. So, in 
other words, the costs of medications have tripled, have gone up 3 
times as much as the cost of living for everything else, which is a 
critical issue.
  As the gentleman mentioned also, the second piece is price 
discrimination. If one has insurance, if they are in an HMO, then they 
have somebody fighting for them to go out and negotiate a group 
discount. If they are a senior or if they are a woman who has breast 
cancer, and we have done a study in my district on women with breast 
cancer and the kinds of drugs they need to use and the costs, or if one 
is a child, any family member who walks into the drugstore without 
insurance, they are out of luck. They pay whatever the market will 
bear; and unfortunately, the market today for the uninsured is at least 
twice, if not three or four times, higher than someone with insurance.
  We can start with Medicare. Medicare can fight for the seniors of 
this country if Medicare coverage is put into place so they can 
negotiate a group discount, just like every other insurance carrier.
  I would like this evening to share a letter from Mrs. Johnnie Arnold 
from Decatur, Michigan. I am so grateful for Mrs. Arnold's letter, and 
I wanted to share it. It is like so many letters that we have all 
received. She says, ``Dear Congresswoman Stabenow, I am writing about 
my prescription drugs. I am 76 years old and get $280 a month drawing 
from my husband's Social Security. He is a notch baby,'' which is 
another problem, ``and only gets $661 a month.''
  So that is $941 a month that they receive.
  ``Our supplemental insurance costs us $281.34 a month. We are having 
a struggle for my drugs I need. I have had open heart surgery and 
complete thyroid removal for a cancer. I have high blood pressure and I 
have had aorta aneurysm surgery. I am in a wheelchair part-time and 
have been turned down three times for SSI now. My Vasolin high blood 
pressure medication is $65 for a month's supply. My Claritin is $80 for 
a month's supply. My other medications are an additional $85.26, and I 
have additional medications, not counting the Claritin, that come to 
$150.26. I do not buy the Claritin every month because when you add up 
all of my drugs after my supplemental insurance payment, I cannot 
afford them.
  ``Lasix used to be $6.27. Now it is $18.25. It takes all my husband's 
Social Security to pay utilities, insurance and his supplemental 
insurance.''
  So it takes all of his Social Security to pay utilities, insurance 
and his supplemental insurance. That is two-thirds of their income.
  ``Help us, if you can. Mrs. Johnnie Arnold.''
  We need to pay attention to this. We need to have a sense of urgency. 
Mr. and Mrs. Arnold are every month literally trying to decide do we 
buy our food now, do we afford this medication, that medication, do we 
pay the electric bill, how do we survive and remain at home and keep 
our health and benefit from the medications that are currently 
available today?
  I think Newsweek is right. That is the real drug war. This is the 
drug war we are fighting right now, the drug war to lower the prices of 
prescription drugs for everyone; and for seniors who use the majority 
of medications this is life or death for too many people, and it is a 
situation that we can correct. Instead of putting up those kinds of 
programs that just sound good on the surface but do not do anything, to 
do what I know the gentleman from New Jersey (Mr. Pallone) is going to 
talk about tonight, what he is going to talk about in terms of the plan 
that we are supporting that really does something, now is the time to 
do it. We have economic good times. If we do not do it now, when do we 
do it? If we do not get it right now, we never will.
  Mr. Speaker, I thank the gentleman from New Jersey (Mr. Pallone) very 
much for allowing me to participate in this important discussion.
  Mr. PALLONE. Mr. Speaker, I want to thank the gentlewoman from 
Michigan (Ms. Stabenow) for her remarks. I appreciate the comments she 
made, first of all, to give us an actual example of the constituents 
that write to us and the problems that they face because this is a real 
story. This is not abstract. This is a reality that people face every 
day in our district.
  Ms. STABENOW. Right.
  Mr. PALLONE. Also because I know the gentlewoman has always been a 
leader on addressing and having people contact us through the Internet. 
She really, more than anybody else, brought to my attention the value 
of reaching out through that vehicle, and I think it is so important. 
So I thank her again.
  Mr. Speaker, I wanted to follow up on what the gentlewoman from 
Michigan (Ms. Stabenow) said, though, also in terms of a report that 
recently came out. The Democrats, of course, for some time and the 
President ever since his State of the Union address this year, and even 
before that, has kept watch and constantly talked about how we have to 
address this problem because of the costs to seniors, and a new report 
recently came out by Families USA. Families USA has been highlighting 
the problem of price discrimination for some time, but this report just 
came out within the last week or so from Families USA. It is entitled, 
``Still Rising: Drug Price Increases for Seniors 1999 to 2000.'' So 
they are just talking about the last year or so.
  Once again, this report demonstrates that failure to provide a 
voluntary, affordable and accessible Medicare prescription drug 
benefit, which is what the Democrats would like to see, that this 
imposes, this failure imposes a continuing and growing burden on 
middle-class, older Americans and people with disabilities. The 
President released this report just a few days ago, and I just wanted 
to present, if I could, Mr. Speaker, some of the key findings of this 
Families USA report.
  First, it showed that on average the price for the 50 drugs most 
commonly used by seniors increased at nearly twice the rate of 
inflation during 1999, last year. On average, the prices of these drugs 
reportedly increased by 3.9 percent from January 1999 to January 2000 
versus 2.2 percent for general inflation.
  Second item or second major point in this Families USA report is that 
over the past 6 years the prices of the prescription drugs most 
commonly used by seniors also increased by twice the rate of inflation. 
The report finds that the price of the 50 prescription drugs most 
commonly used by older Americans increased by 30.5 percent since 1994, 
again twice the rate of inflation.
  Another point in the report is that more than half of the most 
commonly used drugs that were on the market for the entire 6-year 
period had price increases that were double the rate of inflation.
  In addition, the Families USA report concludes that more than 20 
percent of

[[Page 6702]]

these prescription drugs increased in price by 3 times the rate of 
inflation over that same time period.
  Fourthly, the report shows that seniors with common chronic illnesses 
are often forced to spend well over 10 percent of their income on 
prescription drugs.
  Lastly, in terms of the key findings of this report, it shows that 
the findings are consistent with the conclusions of studies conducted 
by the Department of Health and Human Services showing that the price 
differential for older and disabled Americans with and without coverage 
has nearly doubled.
  So, again, I am giving the statistics; and the gentlewoman from 
Michigan (Ms. Stabenow) gave us an example with her letter of a family 
of seniors that face the rising cost problem and what it means for 
them. What it means essentially is that they go without certain drugs, 
that doctors prescribe certain prescription drugs that they cannot take 
advantage of and they simply go without or in other cases they may 
simply buy the prescription drugs and go without food or have other 
basic necessities that they cut back on. It should not be that way.
  The promise of the Medicare program when it was set forth was that 
seniors at least, as a group of Americans, would not have to worry 
about coverage for health care and that they would be provided with 
coverage.
  Of course, when Medicare was founded back in the 1960s, prescription 
drug needs were not as significant as they are today. They have grown 
significantly in those 30 or 35 years or so that they are now a crucial 
factor in terms of preventive care. Without the preventive care that 
comes from prescription drugs, we have seniors getting sick, having to 
be hospitalized, having to go into a nursing home or ultimately leading 
shorter lives. It is just not right. That is not what we are supposed 
to be about as Americans.
  Because my colleagues on the Republican side did precede us and 
essentially tried to tout what they are doing with regard to 
prescription drugs, I need to, I feel, focus again on the limitations 
of the Republican leadership proposal. Again, I am not saying that all 
Republicans are bad or that they are not well intentioned, but the 
problem is that the leadership proposal really does not help most 
Medicare beneficiaries.
  This leadership proposal, in my opinion, was developed more for those 
who sell drugs than those who need them. The Republican leadership 
essentially provided no details of the premium for the policy, what the 
basic benefit would cover or how much it would cost the Medicare 
program. That is probably because it really is not part of the Medicare 
program, effectively.
  The details that are in the Republican leadership's outline, which is 
consistent with proposals supported by the pharmaceutical industry, 
raise a lot of serious concerns, and I just wanted to mention three.
  First, covering prescription drugs through drug-only private 
insurance plans rather than Medicare, even though insurers have raised 
doubts about their willingness to offer such policies, the Republican 
leadership assumes that these drug-only insurance policies are going to 
be available, and the insurance companies are telling us that they are 
not going to be available.
  Second, limiting premium assistance for basic benefits to 
beneficiaries with income up to 150 percent of poverty, again I 
mentioned before $12,600 for a single individual, $17,000 for a couple. 
Well, this leaves out millions of uninsured and underinsured seniors. 
Medicare was promised on the idea that it would be available to 
everyone. Why are we now talking about a prescription drug plan that is 
only going to cover certain individuals? This should be universal. It 
should be a basic benefit under Medicare that one can voluntarily opt 
into if one wants to.
  Thirdly, again, a major shortcoming of the Republican leadership 
proposal is encouraging private plans to participate by having the 
Government bear most of the risk of covering sick beneficiaries. What 
is really being done is giving the insurance companies a lot of money 
without guaranteeing them that they are actually going to come up with 
coverage.
  There are so many reasons why this essentially reneges on any kind of 
commitment for a meaningful prescription drug benefit. Again, just to 
talk about the funding, before I introduce another one of my 
colleagues, the Republican budget chairmen have acknowledged that their 
budget resolution uses only half, $20 billion, of its Medicare reserve 
for prescription drugs. This is insufficient to finance a meaningful, 
affordable, accessible drug benefit for all beneficiaries.
  Again, they have not explained how they are going to spell out their 
10-year funding commitment for prescription drugs. Again, I think that 
is because essentially most of the money that they are setting aside in 
the budget is for tax cuts, primarily for wealthy individuals. There 
will not be enough money left over for a prescription drug benefit 
program.
  The main thing that I keep stressing, and I will continue to stress, 
is that what the Republican leadership has come up with is not really a 
Medicare benefit. It is simply a way of suggesting that somehow someone 
is going to be able to go out and buy some kind of private insurance 
that will cover prescription drugs, and there is absolutely no reason 
to believe that that is going to work. It really has nothing to do with 
the traditional Medicare program that most seniors are used to seeing 
and used to having as a guaranteed benefit.
  Let me, if I can, now begin by talking about the Democrats and what 
the Democratic proposal is that we have set forth as a party here in 
the House. I would just briefly mention the principles that the 
Democrats have put forward as part of their Medicare prescription drug 
proposal; and then I will yield to my colleague, the gentleman from 
Texas (Mr. Green), who I see is here.

                              {time}  1815

  We have said, first of all, that any Medicare drug benefit has to be 
voluntary. In other words, beneficiaries can elect prescription drug 
coverage under a new Medicare program. However you describe it, it 
would be part of Medicare. You can voluntarily opt into it, for example 
like you do now with Part B for your doctor's care.
  There would be universal coverage accessible to all. It has to be for 
all individuals, all seniors, not just for low-income seniors. The 
benefits should be designed to give all beneficiaries meaningful 
defined coverage. That means that you know beginning at a certain date 
that you are going to have a certain coverage up to a certain dollar 
amount. What percentage you are going to have, what percentage your 
copay is, all this is defined.
  Next, you have to have catastrophic protection. At some point there 
has to be a guarantee that above a certain dollar amount or a certain 
level of out-of-pocket expenditures, that there would be some 
catastrophic protection, and that coverage would be complete, that you 
would not have to pay out any more money above a certain amount.
  Also as a principle, access to medically necessary drugs, it would 
guarantee access to all medically necessary drugs, and the benefit will 
be affordable to all beneficiaries, the taxpayers, with extra help for 
low-income beneficiaries. Obviously, if we are going to provide a 
Medicare prescription drug benefit, it has to be a premium that you opt 
into that is affordable. For those who cannot afford to pay that 
premium, that that premium is provided and paid for by the government, 
very similar to what we have now with Part B coverage.
  Lastly, to address the issue of price discrimination, we have as one 
of our Democratic principles that the program has to be administered 
through purchasing mechanisms that maximize Medicare beneficiaries' 
market power.
  Again, I will go back to what my colleague from Michigan said before, 
and that is that the Medicare beneficiary should be able to access the 
discounts that are now available for the large purchasers, such as the 
HMOs, or some other government plans like the veterans' plan.
  With that, I now yield to my colleague from Texas (Mr. Green), who

[[Page 6703]]

has again been one of the people who has contributed the most to this 
debate and to putting together these principles that we as Democrats 
believe have to be basic to any Medicare prescription drug program.
  Mr. GREEN of Texas. Mr. Speaker, I thank my colleague from New Jersey 
for, one, requesting this special order. It seems like we have been 
doing this for a good while on the prescription medication problems 
seniors have, but not only seniors, but everyone in our country, but 
particularly seniors, because of the limited income.
  I know dozens of Democratic Members participated last week on April 
26th all around the country, I forget if it was 60 Members talked to 
seniors, had different events in their district on the problems with 
prescription drugs, and we did one in Houston that we found, in fact 
this was our third time to do a study of prescription drugs in Houston, 
this time compared to what the same prescriptions for their pets would 
be.
  Our three other studies showed that seniors pay almost double, in 
some cases in fact more than double, than what the most preferred 
purchasers of medications would be, like VA or the local HMOs or 
something like that. We found that for seniors walking into their local 
drugstore, whether it is a chain or an individual.
  The next study we did in our district, and I think the numbers around 
the country may vary, but typically you can say seniors pay double the 
cost.
  We are 6\1/2\ hours drive from Mexico, and in Houston people can save 
almost half their prescription costs by going to Mexico. The same thing 
on the Canadian border. In fact, I know there is a candidate running 
for the Senate that has bus loads of seniors he takes to Canada from 
somewhere up in the northern United States. I had a constituent that 
suggested I do that. I said it is a much longer bus ride to Mexico than 
it is to Canada.
  But the one we released last week showed that some of the same 
prescriptions that you and I and seniors may take are also prescribed 
for pets. Again, oftentimes seniors, humans, pay double what the same 
prescription is for the pet for the same disease.
  We met at the Magnolia Multipurpose Center, we have a great senior 
citizen community there, actually it is a multipurpose center paid by 
community block grant money years ago, and we found that seniors might 
want to start taking out prescriptions in their pet's names instead of 
their own. It would save them hundreds, maybe even thousands of dollars 
a year.
  I want to thank the Committee on Government Reform Democratic staff 
who conducted this study, not only in my district, but all over the 
country, and all three of the studies, and particularly this last one, 
the price differences between humans and animals. That third study the 
committee conducted on prescription drugs, it found that pharmaceutical 
companies were taking advantage of older Americans through price 
discrimination.
  What we found out was that the third study showed if you are furry 
and have four paws, you get a better deal. If you are a grandpa or 
grandma, you have to pay top dollar for these same drugs. The committee 
staff found, and again these were five pharmacies in our district that 
they checked the costs with, that in some cases the average cost was 
106 to 151 percent higher than what humans pay. It shows that our 
Nation's seniors are paying not only more than the preferred providers, 
that we do, and I see our colleague here from Maine, we are cosponsors 
of his bill that would allow for seniors to take advantage of that 
group purchasing like anyone else, that is free enterprise. We get 
millions of seniors together and we can get better deals for them on 
the most commonly used drugs.
  We found that not only that, but you can go to Mexico or Canada and 
get cheaper drugs. In fact, you can almost go anywhere in the world and 
get cheaper pharmaceuticals than in the United States. Now we found 
that even in the United States, our pets for the same prescriptions, 
can get it cheaper.
  Let me pick out two particular drugs. If you need Lodine, it is a 
popular arthritis drug, it will cost you $38 if you are a pet for a 
month's supply, but if you are a human it costs you $109 in Houston, 
the average price in our pharmacies.
  If you need Vasotec, the 14th most prescribed human drug in 1998, you 
can get a 1 month's supply for $78, but your pet can receive it for 
$52.
  What we had, and we had really a fine looking animal at our 
prescription drug event, he was a dog that the owner got out of the 
pound, but he looked like he was part German shepherd and was very 
good. Lucky was the dog's name. Lucky had asthma, and, as we stand here 
on the floor tonight, it is tragic that Lucky, even though Lucky is a 
fine animal and a great pet and was very docile during our press 
conference, that Lucky gets asthma medicine cheaper than my seniors who 
were there watching. It is a tragedy. It should not happen in these 
United States.
  That is what is so frustrating. I know that is what is frustrating 
about what we have been trying to do. We have been talking about this 
for 2 years now. What we need is some broad coverage. Whether it is a 
supplement to Medicare, we need current coverage.
  But we have made the case that in 1965 and 1966 and 1967 there are 
certain illnesses today that you can have prescriptions for that back 
then required to you go to your doctor, and Medicare would have paid 
that doctor, and will still pay that doctor. But now you can keep from 
going to that doctor by taking that pill, whether it is blood pressure 
pill, whether it is heart medication, whether it is cholesterol 
control, whether it is depression medication, and we have checked all 
these prescriptions in our district, whether it be going to Mexico, 
whether it be going to preferred provider, and our seniors pay so much 
more than any of those cases.
  In Houston, when the Houston Chronicle covered it and talked about 
it, in fact the gentleman from Texas (Mr. Bentsen) did an event that 
afternoon in his district, the response to that by the pharmaceutical 
companies was, well, those drugs are first developed for humans, and 
that is why they were developed, and then it is maybe a different 
company we license to sell to pets.
  That does not make sense. You are making humans pay for the research 
cost, and I understand these drugs are not developed for free, they are 
developed with NIH funding, and hopefully we will continue the increase 
as we have done for the last few years, but they are developed with 
private sector dollars. But why should pets not have to pay the same, 
if they are being benefited, why should not the rest of the people in 
the world, if these pharmaceuticals are developed with tax dollars from 
our country, along with private sector dollars, why should the rest of 
the world not have to pay some of the costs for the development, 
particularly our neighbors in Canada and Mexico.
  I have to admit, I have bought prescriptions in Latin America. I used 
this at our press conference, I have allergies. I have had allergies 
for 25 years, and whether I am in Houston or Austin, Texas, where I 
served in the legislature, or Washington, I have allergies. I know what 
will solve my problem. If it is a small infection, I can take 
amoxicillin. Amoxicillin, by the way, was one of the few drugs we found 
that the cost for the pet and the human were close. But if I really 
have a bad allergy infection, I have to take Augmentin, which is a 
better antibiotic, much more broad coverage, and with Augmentin, the 
price discrimination was the same.
  I have to admit, I have bought Augmentin and amoxicillin in Mexico, 
Costa Rica and a number of Latin America countries, where you do not 
have to have a prescription. My daughter, who is in medical school, 
tells me I should not self-diagnose, but I say no, I have been 
diagnosed that way for 25 years by doctors, so I know what will cure 
it. I realize how cheaper the pharmaceuticals are in other countries 
than in our own country.
  Again, that is a tragedy, because as we stand here tonight we know we 
have seniors who say I cannot take that blood pressure medication as 
the doctor prescribed because I cannot afford

[[Page 6704]]

it, so I am only going to take half the prescription now. Or they go 
in, and I heard it earlier, someone will go in and say, a senior will 
go in and get the bill for the pharmaceutical and say I cannot afford 
it, and they will walk out of that drugstore without getting that 
pharmaceutical filled. That happens to people in our own districts that 
are not seniors, but it is tragic that it happens to seniors who have 
paid their dues, who have built this country, who are the greatest 
generation, as we know, and yet they do not have the access to some of 
the greatest generation's accomplishments in the last 30 years in 
pharmaceuticals.
  I want to thank the gentleman as the Chair of our Democratic Health 
Care Task Force and the effort he is doing. I enjoy serving on the task 
force, but also our Subcommittee on Health and the Committee on 
Commerce. I would like to have some hearings in our Committee on 
Commerce on this. That is what we are here for. We can have hearings on 
prescription drug benefits.
  Now I know my Republican colleagues have a plan, and my concern about 
that plan is that they want us to provide where we could go down and 
buy health care coverage only for prescriptions. Well, it is kind of 
like what I heard the example was, it is kind of like health care for 
seniors, that is why we had to have Medicare. Every senior is going to 
have to have prescriptions. If you have insurance it works where you 
spread the risk. But if you do not have people to spread it to with 
seniors, the pharmaceutical costs, the insurance costs will be so high 
nobody can afford it.
  So that solution is not a solution. It may get them through November, 
they hope, but it is not a solution. We need to address this issue this 
year. We need to provide pharmaceuticals at a reasonable cost for 
seniors. We can use the Tom Allen bill that the gentleman from Maine 
(Mr. Allen) has worked on, and a bill from the gentleman from Texas 
(Mr. Turner). I think it was one of the first ones we cosponsored.
  We have a plan that the gentleman and I are cosponsoring that is a 
Medicare addition that would be allowed. I have some questions about 
how that will be done still, and the broad coverage for it, but we need 
to address it and we need to address it by having hearings in the 
Committee on Commerce, having hearings in the Committee on Ways and 
Means, and saying okay, what can we do to solve this problem, instead 
of continuing to bury our head in the sand and hopefully the November 
elections will get here and get past.
  I do not think the American people are going to allow that. I hope 
the seniors will not allow us to do that. We need to address it now and 
we need to have a bill here on the floor within the next 30 days. We 
have been signing a discharge petition, and we are still working on 
getting our magic number of 218. So I do not know how many are on there 
that are our Republican colleagues, but I can tell you it is probably 
10 to 1, maybe 20 to 1, Democratic signatures. We need to have that 
bill on the floor.
  I would like it to go through the process. We have a legislative 
hearing process. Let us have the hearings and put all the bills there 
and have testimony on them, and let us have the give and take, so that 
we have at the end of the day, at the end of this Congressional 
session, we need to have a prescription drug benefit for senior 
citizens that is fair, that is cost effective, and it will keep them 
from having to make those tough decisions on whether they are going to 
have heating in the winter or air conditioning in the summer in 
Houston, or whether they are going to take their prescription 
medication. That is wrong, and we need to address it.
  Again, I thank the gentleman for his leadership on this.
  Mr. PALLONE. Mr. Speaker, I thank the gentleman. I appreciate the 
fact that the gentleman and, of course, our other colleague, the 
gentleman from Maine (Mr. Allen), who I will yield to next, because you 
are from States that border in your case on Mexico and his case on 
Canada, that you have tonight made your constituents and really the 
Nation aware of this price discrimination that exists, in this case 
across the border, and, of course, the gentleman from Maine has been 
talking about it here in terms of most seniors not having access to 
these discounts that the larger groups provide.

                              {time}  1830

  But I think in particular, if I could say to my colleague from Texas, 
this contrast between price, between animals, dogs and cats versus 
people, is really dramatic. It really brings home, I think, what this 
is all about and how we have seniors suffering when, at the same time, 
we have to try to buy the drug for one's pet, the cost is less. I have 
a cat and she is older and I have had to go to the drugstore and buy a 
prescription for her, and I have to say, I have never really looked to 
see what the differential was for the same kind of drug. I am going to 
make it my business to check on it the next time. I am sure I am going 
to find the same thing would be the case.
  So I thank the gentleman again.
  Let me yield to the gentleman from Maine, but before doing so, I just 
have to say that he has really brought the whole issue of price 
discrimination to our attention. One of the things that I said earlier 
which I think is so crucial is that we do not see any evidence that the 
Republican leadership bill will address this issue of price 
discrimination, and it has to be a part of what we do in the House, and 
obviously it is part of the democratic principles that we put together 
as a party on the Democratic side. So I yield to the gentleman.
  Mr. ALLEN. Mr. Speaker, I thank the gentleman for yielding. I 
appreciate the gentleman's leadership in pursuing this issue as long 
and as hard as he has. One of the things I am reflecting on today is I 
can no longer count the number of times that the gentleman from Texas, 
the gentlewoman from Michigan, the gentleman from New Jersey and I, and 
others on the Democratic side, have been down here pounding away on 
this issue trying to build enough support around the country and in 
this House to get some action.
  I think back to the first study that was done in my district in Maine 
in July of 1998, which showed that seniors, on average, pay twice as 
much for their medication as the drug companies' best customers, the 
big hospitals, the HMOs and the Federal Government itself, through 
Medicaid or through the VA. We have been back over and over again. Most 
recently, on April 26, a number of us did another study, held events 
around the country, because we know that the only way we can break 
through the clutter of all the other news and all of the things that 
Americans have going on in their lives to get this message home is to 
do coordinated events and try to get the message home.
  What I did in Maine was take another look at this problem of price 
discrimination. What I did was to do a breast cancer study, to look at 
the 5 drugs that are most commonly prescribed in Maine to deal with 
women, to help women who have breast cancer. We have done the study 
that shows seniors pay twice as much as the drug companies' best 
customers; we have done the study that shows that Mainers pay 72 
percent more than Canadians and 102 percent more than Mexicans for the 
same drug in the same quantity from the same manufacturer, and we did 
the animal study that the gentleman from Texas (Mr. Green) was 
referring to which shows that when drugs are sold to pharmacies for 
human use, the charge is 151 percent more than when the same drug is 
sold to veterinarians for animal use.
  Why is this? Well, basically, it is simple. The pharmaceutical 
industry charges what the market will bear. They squeeze as much as 
they can out of the people that they are selling prescription drugs to, 
and the people in the largest health care plan in the country, which is 
called Medicare, those people, 37 percent of whom have no coverage for 
their prescription drugs, they pay the highest prices in the world.
  So in short, basically, it is very simple: the most profitable 
industry in the country charges the highest prices in

[[Page 6705]]

the world to Americans who can least afford to pay those prices, 
including many of our seniors; also, as the breast cancer study showed, 
including women who have breast cancer. What we found is that those 
women who do not have health insurance for their medication pay 102 
percent to 106 percent more than the drug companies' best customers for 
those breast cancer medications.
  For example, Tamoxifen, the most frequently prescribed breast cancer 
medication, costs uninsured Maine women 53 to 72 percent more than the 
drug companies' best customers. That comes to between $1,800 and $2,500 
more each year. Bristol-Myers Squibb charges its favored customers 
$39.60 for a 1-month supply of its hormone therapy medication, Megase. 
The same 1-month supply costs an uninsured Maine woman $174.28. That is 
a 340 percent markup. It is also an additional $1,600 each year that 
she will have to pay out of her own pocket.
  In 1960, 1 in 14 American women were at risk of developing breast 
cancer. Today, that same number is 1 in 8 American women. Breast cancer 
is the most common form of cancer for American women. In 1997, the 
National Breast Cancer Coalition estimated that 2.6 million American 
women were living with breast cancer: 1.6 million who had been 
diagnosed and 1 million who did not know they have the disease.
  Now, what we found is that uninsured Maine women who do not have 
coverage for their breast cancer medication are basically facing a 
pharmaceutical industry which has enormous, enormous power. Our friend 
and colleague, the gentleman from Vermont (Mr. Sanders) has found that 
a month's supply of Tamoxifen that costs an uninsured Maine woman 
between $88.50 a month and $99.50 a month can be purchased in Canada 
for $12.80. This is a national scandal, and it needs to end.
  Now, we are going to enter into a period here where we have a debate 
over competing health care plans. But basically, there is a fundamental 
difference between what we Democrats are proposing and what the 
Republicans are proposing.
  What we are saying is simple. We have to drive down the cost of 
prescription drugs for seniors who simply cannot afford to pay for 
their medication. There is no reason why Medicare should not do what 
United and Aetna and Cigna and the Blue Cross plans do. They negotiate, 
they negotiate lower prescription drug prices for their beneficiaries. 
Why should Medicare not do the same? That is basically what my 
legislation does, the Prescription Drug Fairness for Seniors Act. But a 
discount is not enough. We also need a benefit. A benefit under 
Medicare that will help people pay for their prescription drugs, 
because this will not help people who still cannot afford the high cost 
of their medication. So we need both approaches.
  What we have seen from the Republican side is basically this: 
proposals that first protect the profits of the industry, and only 
second, try to help America's seniors. Why do I say that? The 
Republican plans emerging from the other body and, also here, basically 
involve a subsidy to seniors to buy private health insurance for 
prescription drugs.
  Well, there are two problems with that. There is no way to hold down 
costs if we are going to rely on private prescription drug insurance. 
They are not able to do it internationally, and they are not going to 
be able to do it here.
  But there is a second more fundamental problem. The Health Insurance 
Association of America has made it very clear that the industry will 
not provide stand-alone prescription drug insurance for seniors. Why? 
Because in the words of the executive director, it is like providing 
insurance for haircuts. Everybody is a claimant.
  We have to have some pressure on price. Someone has to sit across the 
table from the pharmaceutical industry and negotiate lower prices. A 
plan that does not do that is a plan that is not going to make drugs 
affordable both for seniors and for the taxpayer. I mean, let us face 
it. If we are going to spend money, Federal money for a benefit, we 
want to make sure we are getting a good deal for the taxpayer. That is 
what Democrats are standing for, and that is not what would happen 
under the Republican proposals.
  Let us step back and look at this other problem. If the private 
health insurance industry is not going to provide stand-alone 
prescription drug coverage, what are we talking about? What we are 
talking about is an illusion, cover, a program that is never going to 
take effect in the real world. That is not what seniors need. Seniors 
need help; they need it now.
  Mr. Speaker, spending on prescription drugs goes up 15 to 18 percent 
every year. If you think this problem is bad today, it is going to be 
much worse in just one year. And so we need to enact legislation this 
year that provides a discount, that provides a benefit, that allows the 
Federal Government to negotiate lower prices, to make sure we have some 
control over some pressure on price of the pharmaceutical industry.
  If we do not do that, basically we will have one of those proposals 
that in the real world will not work, that is designed to help the 
pharmaceutical industry before it really helps seniors. And I think it 
is the wrong way to go.
  Clearly, the Democrats, the folks on this side of the aisle, believe 
that as well.
  Mr. Speaker, I notice our friend and colleague, the gentleman from 
Arkansas (Mr. Berry), has come here; and I can say no one in this 
caucus has done more for the cause of reducing prescription drug prices 
for seniors than the gentleman from Arkansas, and I just want this 
chance to thank him for that.
  Mr. PALLONE. Mr. Speaker, I want to thank my colleague, the gentleman 
from Maine (Mr. Allen). And one of the things that you stress, and I 
think it is so important, because we did have our Republican colleagues 
on the other side precede us this evening, and what they said sounded 
wonderful, and I am convinced, of course, that they are well-
intentioned, but the bottom line is that the Republican leadership 
proposal is illusionary. It is not going to really help the average 
senior citizen. That kind of hoax, if you will, even if it is not 
intentional, I do not believe that it is, is not fair.
  They are crying out for relief. They need attention. They are having 
problems buying prescription drugs, and they tell us about it every 
day. This is real. We just cannot stay here in the Congress, in the 
well here and say that we are going to do something when we are not, or 
certainly something that is not going to be meaningful for them, 
because this is such an important issue.
  I did want to yield to my colleague, the gentleman from Arkansas (Mr. 
Berry). He also is one of the cochairs of our Health Care Task Force; 
and we, of course, have put forth this statement of Democratic 
principles about what we think a prescription drug plan should consist 
of, and he has been tremendously helpful in putting that together as we 
proceed to try to get legislation passed in this Congress over the next 
few months while we are still here. I yield to gentleman.
  Mr. BERRY. Mr. Speaker, I want to thank my distinguished colleague, 
the gentleman from New Jersey, (Mr. Pallone) for his leadership in all 
health care matters, Patients' Bill of Rights, prescription drugs, all 
other health care issues that we have dealt with since I have been in 
the United States Congress. He has done a great job and I appreciate 
him; and I also 
say that to my colleagues, the gentleman from Maine (Mr. Allen), who 
has also provided great leadership on this prescription drug issue, 
along with the gentleman from Texas (Mr. Turner).
  Mr. Speaker, I am on the floor this evening, because, quite simply, 
the prescription drug manufacturers in this country are ripping off the 
American people, and even worse, they are ripping off the senior 
citizens of this country. It is absolutely unbelievable that, as a 
Congress, we allow this to go on day after day after day.
  In the district that I am fortunate enough to represent, I never stop 
and visit anyone that this issue does not

[[Page 6706]]

come up, that we do not have to talk about the fact that we have senior 
citizens that have to make a decision on a daily basis whether or not 
to buy something to eat or to buy their medicine. This is a situation 
that we cannot allow to go on.
  Mr. Speaker, I come from a small town. If we had someone in that 
small town going door to door, stealing from senior citizens, taking 
the money out of their pocket, throwing them into such economic 
circumstances that they were not able to buy food or stay alive because 
they did not have the money to buy their medicine, we would go find 
that person, and we would lock them up, I hope; but at the very least 
we would stop it from happening.
  Yet we are allowing the prescription drug manufacturers in this 
country to continue to go into our citizens' homes on a daily basis and 
create this situation, and they are doing it legally.
  Americans are just simply overcharged for these products, and it is 
not right. The taxpayers of this country pay for the research and 
development, most of it that takes place through grants, through tax 
credits, through various other mechanisms that we make possible. These 
same companies have the lowest taxes on their profits of any companies 
in the country.
  Americans pay for this research that the whole world benefits from; 
and yet we are charged two to three times as much for these products as 
any other nation in the world. It is just simply not fair, and it is 
time the Congress does something about it.
  When you have something that is this unfair, it is the job of the 
United States Congress to step in and do something about it.
  Mr. Speaker, I beg my colleagues this evening to recognize this 
problem and do the right thing. We have just seen in the last few 
months a great uproar in this country over whether or not a young man 
from Cuba would be sent back to be with his father, or whether he would 
stay here.

                              {time}  1845

  We are all concerned about that situation. That situation pales in 
comparison to the hardship that our senior citizens are put in every 
day because of prescription drug companies in this country are charging 
them far more than they charge anyone else in the world, and they just 
simply cannot afford it. And we, as a Nation, cannot afford it anymore. 
Mr. Speaker, I beg my colleagues to take this opportunity to do 
something about it.
  Mr. PALLONE. Mr. Speaker, I thank the gentleman, and I think that he 
really brings home this whole issue of price discrimination and that is 
really what goes on and the heart of what our constituents' concerns 
are. They say it to us every day.
  We had 2 weeks back in the district the last 2 weeks, and I just 
heard it so many times over and over again. And I do not think it 
matters where we are, Arkansas, New Jersey. Wherever we are, we just 
hear so many seniors that tell us that the costs are just too 
exorbitant, that they cannot pay them.
  Mr. Speaker, I thank the gentleman for all his help in helping us put 
together the Democratic principles in the plan that we have been 
developing.
  Mr. Speaker, I know that I do not have a lot of time left; but I 
wanted to, if I could in the time that I do have, to basically outline 
what the Democratic position is.
  Democrats believe that in order to develop a meaningful Medicare 
prescription drug benefit, two crucial characteristics of the 
prescription drug marketplace for seniors have to be recognized.
  The first is that the high cost of prescription drugs is not a 
problem exclusive to low-income seniors. Millions of middle-class 
seniors are feeling the effects of excessive prescription drug costs as 
well.
  And the second is the price discrimination that seniors without 
health insurance are subject to when purchasing pharmaceuticals. I 
think tonight my colleagues outlined the problems with the costs and 
the problems that so many seniors are having now in terms of their 
ability, or their inability, to purchase medicine or prescription 
drugs.
  But the bottom line is that a Medicare drug benefit should be offered 
to every Medicare beneficiary, and it should be voluntary and 
affordable. Seniors who have coverage they like should be able to keep 
that coverage. Seniors who have no coverage at all, or inadequate 
coverage, should be able to get the coverage they need. Low-income 
seniors should receive subsidies for the cost of benefits, including 
complete subsidies for those with the least ability to pay.
  In addition, Democrats say that the coverage should consist of a 
meaningful, defined benefits package, including guaranteed access to 
medically necessary drugs. It must provide so-called catastrophic 
coverage for seniors with excessive drug costs, and it must be 
administered through a purchasing mechanism that maximizes the 
purchasing power of Medicare beneficiaries. By doing so, the program 
can reduce the costs of drugs to seniors and make the benefit 
affordable to the taxpayers.
  Finally, Mr. Speaker, I will say there is broad support for what I 
have outlined and what my colleagues have outlined tonight amongst 
Democrats in the House of Representatives and in the Senate. All of 
these criteria about what this prescription drug benefit should include 
have been incorporated into the Medicare drug benefit plan that 
President Clinton has proposed.
  But Democrats are not in the majority in either House of the 
Congress. We need the support of Republicans on a bipartisan basis if 
we are to succeed. I heard my colleagues on the other side of the aisle 
say that they want to provide a meaningful benefit. And my goal really, 
and the goal of us collectively, is to convince the Republican 
leadership to buy into these same principles that the Democrats have 
put forward so that we can provide seniors with the care they need to 
live out their golden years with the dignity that they deserve. I do 
not want any more of my constituents coming up to me at any point and 
saying that they have to make a choice between drugs and food or drugs 
and other necessary services.

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