[Congressional Record (Bound Edition), Volume 149 (2003), Part 12]
[House]
[Pages 16281-16303]
[From the U.S. Government Publishing Office, www.gpo.gov]




 PROVIDING FOR CONSIDERATION OF H.R. 1, MEDICARE PRESCRIPTION DRUG AND 
     MODERNIZATION ACT OF 2003, AND H.R. 2596, HEALTH SAVINGS AND 
                       AFFORDABILITY ACT OF 2003

  Ms. PRYCE of Ohio. Mr. Speaker, by direction of the Committee on 
Rules, I call up House Resolution 299 and ask for its immediate 
consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 299

       Resolved, That upon the adoption of this resolution it 
     shall be in order without intervention of any point of order 
     to consider in the House the bill (H.R. 1) to amend title 
     XVIII of the Social Security Act to provide for a voluntary 
     program for prescription drug coverage under the Medicare 
     Program, to modernize the Medicare Program, and for other 
     purposes. The bill shall be considered as a read for 
     amendment. The previous question shall be considered as 
     ordered on the bill and on any amendment thereto to final 
     passage without intervening motion except: (1) three hours of 
     debate on the bill equally divided among and controlled by 
     the chairmen and ranking minority members of the Committee on 
     Energy and Commerce and the Committee on Ways and Means; (2) 
     the amendment printed in the report of the Committee on Rules 
     accompanying this resolution, if offered by Representative 
     Rangel of New York or his designee, which shall be in order 
     without intervention of any point of order, shall be 
     considered as read, and shall be considered as read, and 
     shall be separately debatable for one hour equally divided 
     and controlled by the proponent and an opponent; and (3) one 
     motion to recommit with or without instructions.
       Sec. 2. Upon the adoption of this resolution it shall be in 
     order on the legislative day of June 26 or June 27, 2003, 
     without intervention of any point of order to consider in the 
     House the bill (H.R. 2596) to amend the Internal Revenue Code 
     of 1986 to allow a deduction to individuals for amounts 
     contributed to health savings security accounts and health 
     savings accounts, to provide for the disposition of unused 
     health benefits in cafeteria plans and flexible spending 
     arrangements, and for other purposes. The bill shall be 
     considered as read for amendment. The previous question shall 
     be considered as ordered on the bill to final passage without 
     intervening motion except: (1) one hour of debate on the bill 
     equally divided and controlled by the chairman and ranking 
     minority member of the Committee on Ways and Means; and (2) 
     one motion to recommit.
       Sec. 3. (a) In the engrossment of H.R. 1, the Clerk shall 
     await the disposition of H.R. 2596 under section 2.
       (b) If H.R. 2596 is passed by the House, the Clerk shall--
       (1) add the text of H.R. 2596 as new matter at the end of 
     H.R. 1;
       (2) conform the title of H.R. 1 to reflect the addition of 
     the text of H.R. 2596 to the engrossment;
       (3) assign appropriate designations to provisions within 
     the engrossment; and
       (4) conform provisions for short titles within the 
     engrossment.
       (c) Upon the addition of the text of H.R. 2596 to the 
     engrossment of H.R. 1, H.R. 2596 shall be laid on the table.
       Sec. 4. During consideration of H.R. 1 and H.R. 2596 
     pursuant to this resolution, notwithstanding the operation of 
     the previous question, the Chair may postpone further 
     consideration of either bill to a time designated by the 
     Speaker.
       Sec. 5. Upon the adoption of this resolution it shall be in 
     order, any rule of the House to the contrary notwithstanding, 
     to consider concurrent resolutions providing for adjournment 
     of the House and Senate during the month of July.
       Sec. 6. The Committee on Appropriations may have until 
     midnight on Thursday, July 3, 2003, to file a report to 
     accompany a bill making appropriations for the Department of 
     defense for the fiscal year ending September 30, 2004, and 
     for other purposes.

  The SPEAKER pro tempore. The gentlewoman from Ohio is recognized for 
1 hour.
  Ms. PRYCE of Ohio. Mr. Speaker, for purposes of debate only, I yield 
the customary 30 minutes to the gentlewoman from New York (Ms. 
Slaughter), pending which I yield myself such time as I may consume. 
During consideration of this resolution, all time yielded is for the 
purposes of debate only.
  Mr. Speaker, House Resolution 299 is a multi-part rule providing for 
the consideration of H.R. 1, the Medicare Prescription Drug and 
Modernization Act of 2003, and H.R. 2596, the Health Savings and 
Affordability Act of 2003.
  This rule provides for consideration of H.R. 1 under a modified 
closed rule, an appropriate rule for such a delicate, complex, and 
historic piece of legislation. The rule provides for 3 hours of general 
debate equally divided between the chairmen and ranking minority 
members of the Committee on Energy and Commerce and the Committee on 
Ways and Means. The rule waives all points of order against 
consideration of H.R. 1.
  After general debate it will be in order to consider an amendment 
printed in the report accompanying this resolution, if offered, by the 
gentleman from New York (Mr. Rangel) or his designee and debatable for 
1 hour. All points of order are waived against the amendment. Finally, 
the rule permits the minority to offer a motion to recommit to H.R. 1 
with or without instructions.
  Section 2 of this rule provides for the consideration of H.R. 2596, 
the Health Savings and Affordability Act of 2003, either today, the 
legislative day of June 26, or tomorrow, June 27, under a closed rule. 
The rule provides 1 hour of general debate in the House equally divided 
and controlled by the chairman and ranking minority member of the 
Committee on Ways and Means. All points of order against the 
consideration of H.R. 2596 are waived. Finally, the rule provides for 
one motion to recommit with or without instructions.

                              {time}  1300

  I would like to take a moment to clarify for my colleagues that upon 
passage of both pieces of legislation, the text of H.R. 2596 shall be 
added as a new matter at the end of H.R. 1. In simple terms, these two 
bills will become one. However, this bill does not preclude either bill 
from moving forward independently.
  Finally, the remaining sections of this rule provide for some 
housekeeping provisions and provisions which will allow this body to 
move forward in the appropriations process.
  Mr. Speaker, today is a historic day. For years now, seniors across 
this country have consistently voiced to Congress the same major 
concerns: the skyrocketing costs of prescription drugs. Their concerns 
are not perceived; they are very, very real. Each year, a typical 
senior pays approximately $1,300 on prescription drugs, filling about 
22 prescriptions on average. Today, the House will consider a

[[Page 16282]]

plan to give all seniors a prescription drug benefit through Medicare.
  In passing this bill, as I believe we will do before this day is 
over, we will renew America's promise to our seniors, reduce the cost 
of prescription drugs, and revolutionize medicine in the 21st century.
  I would like to thank the gentleman from California (Chairman Thomas) 
and the gentleman from Louisiana (Chairman Tauzin) for their exemplary 
cooperation, their remarkable leadership, and inspiring vision they 
have provided on this complex, yet very much-needed legislation. I 
would like to take a moment just to give special thanks to them for 
working so closely with me on a couple of provisions that will greatly 
benefit cancer patients and hospitals across the country. Included in 
this legislation is immediate Medicare coverage for oral anticancer 
drugs through a demonstration project that will offer extraordinary 
support to seniors who are fighting cancer. It will enable them to 
afford the newest lifesaving medicines in the comfort of their own 
homes, rather than be hooked up to chemotherapies by infusions in a 
hospital or clinical setting.
  I also commend the chairmen's interest and support in assisting 
hospitals who serve a disproportionate number of uninsured and indigent 
populations. Hospitals across this country, including many of our 
Nation's children's hospitals, will be better able to serve their 
patients with over $3 billion in additional funding. Finally, rural 
hospitals are finally getting their fair share: $27.2 billion.
  Since 1965, Medicare has provided a guarantee of health care coverage 
for more than 40 million seniors. Today, our seniors are counting on 
the stability, longevity, and integrity of this program for their 
secure retirement. But if we do not act and pass this bill before us 
today, the future of Medicare will be certain: certain bankruptcy. Our 
inaction will have sealed the fate for one of our Nation's most trusted 
programs.
  So today, we will do two long-overdue things. First, we will 
modernize Medicare to save it for future seniors; and, second, we will 
provide the much-needed prescription drug coverage.
  The prescription drug package the House is considering here today 
will provide the same universal guaranteed Medicare health services as 
those that currently exist. If you are 65 or older, you qualify for 
Medicare, and you qualify for this benefit. It is that simple. And we 
provide significant and immediate savings for seniors on their 
medicines. Specifically, this plan provides Medicare beneficiaries with 
a prescription drug discount card offering over 25 percent in savings, 
catastrophic protections, giving seniors 100 percent coverage for out-
of-control drug costs beyond $3,500 year, and full assistance for our 
neediest citizens.
  Equally important, this rule makes in order a provision establishing 
health savings accounts, a revolutionary tool, so that every American, 
not just seniors, can set aside savings now for their medical expenses, 
tax-free. With over 40 million uninsured, this is so important, and the 
plan provides for a catch-up provision so that seniors can take 
advantage and set aside more money more quickly.
  Mr. Speaker, this is a remedy for what ails America's uninsured. Our 
plan is designed for those people who might be shut out of work-based 
coverage and offers all Americans, regardless of their income or age, 
access to health coverage with no bureaucracy or costly mandates.
  Finally, this package includes chronic care management for all 
Medicare beneficiaries.
  Mr. Speaker, one-third of Medicare beneficiaries have one or more 
chronic illnesses. This provision will help better manage diseases, 
reduce health care costs, and enhance health and quality of life.
  So here we are at a major crossroad. Seniors continue to tell us that 
adding a prescription drug benefit to Medicare is not some pie-in-the-
sky policy that they would merely prefer become law. No. The majority 
of seniors are telling us that they cannot go another year without 
help, without any assistance, without any help with their drug costs, 
and without access to higher-quality health care.
  Therefore, some questions need to be asked for those who will come 
forward in the next few hours and oppose this package. Ask them: How is 
this package not an improvement for our seniors who have no coverage 
and are struggling to pay for their medications? And ask them: How is 
the huge prescription drug savings that will result from this plan not 
useful to seniors? Ask them: How is bringing Medicare into the 21st 
century and saving it for future generations not wise for our children, 
our grandchildren, and our great grandchildren?
  Now, some of my colleagues will no doubt put forth $1 trillion, pie-
in-the-sky plans. These packages would bust any budget, Republican, 
Democrat, or otherwise. As a matter of fact, the Democrat substitute 
actually is larger than the sum of two budgets. The Democrat Spratt 
budget had $528 billion for Medicare, and the Democrat Blue Dog budget 
had $400 billion dedicated to Medicare. That is a total of $920 
billion. But the Democrat substitute that they are offering today is 
over $1 trillion, more than the combination of those two Democrat 
budgets. Mr. Speaker, that is unacceptable.
  Mr. Speaker, the lack of prescription drug coverage under Medicare is 
exactly what age discrimination looks like in 2003. Seniors are the 
last group of people who are forced to pay retail costs for their 
medications and, Mr. Speaker, that should be enough of a violation of 
civil rights to get even the ACLU involved.
  I said just a moment ago that today is a historic day, and it is. 
Today we apply a little common sense by recognizing that health care is 
simply not what it was 30 years ago, and that Medicare is not what it 
was 30 years ago. It must change to keep up. Today, we will take the 
first steps in creating the next generation of quality health care, a 
new era where prescription drugs make regular doctor visits less 
frequent, where cutting-edge treatments make hospital stays nearly 
obsolete in the future, and where lifesaving medications reduce 
formerly deadly diseases to mere manageable symptoms within longer and 
healthier lives.
  Today I urge my colleagues to be bold, to be courageous, to show 
leadership, and to take America's health care system into a new 
frontier, a place where it has needed to go for far too long now. Time 
is precious and so are our seniors. I urge this Congress to pass the 
underlying rule and approve H.R. 1, the Medicare Improvement and 
Prescription Drug Act of 2003.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I thank the gentlewoman from Ohio for 
yielding me the customary 30 minutes, and I yield myself such time as I 
may consume.
  Mr. Speaker, this is a very sad day for most of us. A program that 
has served America well and has given peace of mind and good health 
care to seniors for over 40 years is under threat today; and actually, 
what we know is going to be before us is the death of Medicare.
  One of the saddest parts about this bill today is that the Democrats 
have no role in it. To all of my colleagues who showed up last night at 
the Committee on Rules, or this morning, actually, at the Committee on 
Rules with amendments that they thought that they could use to 
strengthen the bill, I apologize to you that there is no possibility in 
the world that you could do it. I hope that you did not hate yourself 
this morning for all the sleep that you lost for nothing.
  Mr. Speaker, this rule is an affront to the democratic process. The 
underlying bill will harm every single one of the 40 million Americans 
served by Medicare. At 1 a.m. this morning, with absolutely no 
meaningful opportunity to review the almost 700-page prescription drug 
legislation, the Committee on Rules met to consider the resolution now 
before us. By now I should be used to it, but we cannot tolerate these 
continual attacks on democracy. When you refuse to allow half this 
House to speak and to give their amendments, you are cutting out half 
of the population of

[[Page 16283]]

the United States from any participation in the legislation that goes 
on here. It defies reason and it defies common sense that political 
expediency and newspaper headlines could force this monumental 
legislation, probably the most monumental that any of us will do in our 
tenure in the Congress of the United States, to force it through the 
Chamber with little more than cursory consideration.
  The other body, on the other hand, has spent over 2 weeks debating 
similar legislation. In stark contrast, we meet when nobody is around, 
up in the attic, as someone said today, and are permitted only 3 hours 
to discuss the largest overhaul of Medicare in its history. The people 
we represent would be disgusted if they understood how this issue is 
being handled.
  We are not naming a post office here. We are considering, as I said, 
the most important change to Medicare since its creation. This decision 
will affect so many people. It is no simple undertaking, and it 
certainly deserves more debate than allowed by this rule.
  To add even more confusion to the messy process, the Committee on 
Rules incorporated the so-called Health Savings Account bill into the 
rule for the Medicare overhaul legislation, so what we are doing here 
are two rules. So-called health savings accounts would create a new tax 
advantage, personal savings accounts, used to pay the out-of-pocket 
medical expenses. At first glance, perhaps it sounds innocuous. But 
when you look at the fine print, you see that it basically amounts to a 
$72 billion tax cut over the next 10 years while the Federal deficit 
continues to grow out of control. Even worse, it is a tax break with a 
destructive purpose: to threaten the traditional employer-based health 
care by actually encouraging companies to reduce their employees' 
health coverage.
  Mr. Speaker, perhaps the most egregious problem with the legislation 
before us is it does nothing to address the skyrocketing prices of 
prescription drugs. Oh, sure, they will tell us that we can import 
drugs from Canada, but the fact of the matter is that an amendment 
inserted into the Senate bill by one of our Senators says that it 
cannot be done unless it is certified by the Secretary of HHS, who has 
stated already that he will not do it. Therefore, any debate today 
about being able to import drugs is absolutely a farce.
  The consumer price index on which Social Security cost-of-living 
adjustments are based rose 98 percent, and the prescription drug costs 
that are crippling older Americans rose even higher. Seniors on 
Medicare are expected to spend $1.8 trillion on prescription drugs over 
the next decade.
  Today's Washington Post tells a story of Marie Urban of Cleveland. 
After her housing and Medicare payment, she has $459 a month for 
utilities, food, car insurance, taxes, and medication. She told The 
Post that some months she has 87 cents left over. This is wrong. She 
deserves better. A few years ago, as a temporary Band-Aid, I organized 
a bus load of seniors to travel to Canada to purchase medications at 
fractions of the prices charged in the American market. We had dozens 
more people interested than we could accommodate, but those who went 
saved anywhere from $100 to $650 on a 3-month supply of medication.
  We are fortunate to live in an age when science provides the 
medications that cure illness and improve the quality of life and 
extend life. But the promise of the wonder drug is meaningless if you 
cannot afford to buy it. The skyrocketing price of prescription drugs 
is the number one concern of American seniors and, indeed, most 
Americans. H.R. 1 does nothing to freeze or reduce the exorbitant cost 
of prescription drugs. In fact, again, the idea of going to Canada and 
handing it out with one hand and taking it away with the other is 
something that the drug companies will be very happy about, because 
they have fought in every possible venue to keep the reimportation of 
drugs.
  At the same time, we hoped that we might do what the Veterans 
Administration has done with great success. By negotiating for the 
people that they represent with the drug companies, they have been able 
to save many of their veterans a great deal of money. Seniors fear this 
bill is a rush to privatize Medicare. We saw the flop of 
Medicare+Choice when many, many private insurance companies pulled out 
completely on senior citizens, leaving many of them in parts of the 
United States completely uncovered. Indeed, they have told us again, 
they do not want to cover a prescription drug program. One hundred 
percent of the people they cover will buy medicine. This is not what 
they consider a good business proposition.
  Forty years ago, Congress created the Medicare program because 
private industry would not offer health insurance to older people. 
Companies saw the older people as a threat to their profits. We should 
have learned this lesson in the 1960s, because nothing has changed; and 
now we are today taking away what is probably the most important issue 
to senior citizens, will they be able to get health care.

                              {time}  1315

  Don Young, who is the President of the Health Insurance Association 
of Americans, quoted here often, has said, ``We caution Congress 
against relying on drug only insurance as a mechanism to deliver a 
benefit.''
  Ira Loss, an analyst with Washington Analysis, said, ``The private 
sector that is supposed to be excited about this isn't. It creates a 
new benefit program built around insurance products that do not exist 
and are likely to never exist.''
  Mr. Speaker, this proposal would replace Medicare's guaranteed 
coverage with what is essentially a voucher program to purchase private 
insurance, assuming that there is an insurer willing to sell it to you. 
But those who want the traditional fee-for-service Medicare will be 
forced to pay higher premiums. We have no idea, for example, what Part 
B would cost because it is not in the bill, which is intended to force 
the beneficiaries out of traditional Medicare and into private 
insurance.
  Mr. Speaker, senior citizens do not want this legislation. We have 
all received call after call and letter after letter beseeching us to 
oppose this plan. They did not contact me because they need 
prescription drug coverage. They called and wrote me because they know 
this bill will not provide them with the help they desperately need.
  According to the Consumers Union, the average Medicare user spends 
$2,318 for prescription medicine. Under this plan, the out-of-pocket 
drugs would rise to $2,954 for the average senior on Medicare. So this 
program is a placebo, not a cure, legislation crafted to provide 
political cover for the majority, not provide prescription drug 
coverage for seniors. Some may argue that this is something better than 
nothing, but it is only a start and, frankly, what we have in Medicare 
has not been that bad. But as many of our constituents say, a bad bill 
is worse than no bill.
  Mr. Speaker, this bill that will raise premiums and reduce their 
choices and dismantle Medicare is a very bad bill. I urge my colleagues 
to oppose the rule.
  Mr. Speaker, I yield such time as she may consume to the gentlewoman 
from California (Ms. Woolsey).
  Ms. WOOLSEY. Mr. Speaker, this sham Republican bill fails to provide 
women with the real prescription drug coverage they need and they 
deserve.
  Here we are, again, discussing ways to help seniors afford the 
prescription drugs that they need. And once again, the majority insists 
on a sham proposal that gives seniors nothing more than a false sense 
of security.
  My female colleagues and I would like to remind everyone that as we 
debate proposals to add a prescription drug benefit to Medicare, the 
decisions we make will overwhelmingly impact our mothers, grandmothers, 
sisters, and aunts. Women are living longer than ever, and longer than 
men--this is good news. However, the poverty that many women experience 
during their final years is certainly not good news.
  There are several reasons women's ``golden years'' are not so golden. 
While most women have worked their entire lives, a good portion of this 
work was not in the paid workforce. You don't earn a pension for time 
spent caring for children or elderly parents.
  When many of our mothers and grandmothers were in the workforce, they 
were denied equal pay for equal work. Some worked only part time, 
trying to balance the responsibilities of their jobs and their 
families. As a

[[Page 16284]]

result, they've made less over their lifetimes--and now their monthly 
Social Security benefit is smaller. These women deserve financial 
stability, and still, the Republican prescription drug proposal denies 
them the security that comes with knowing that can afford to pay for 
their medical care.
  No one needs a drug benefit more than elderly women. But instead of a 
real prescription drug benefit, all they are getting from the majority 
are empty promises, a ``donut hole'' coverage gap, and increased 
premiums for the services they already enjoy. Our mothers and 
grandmothers deserve better. We can and we must do better. Oppose this 
sham Republican plan, and support the Democratic alternative.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Linda T. Sanchez.)
  Ms. LINDA T. SANCHEZ of California. Mr. Speaker, this sham Republican 
prescription bill provides elderly women with nothing more than a false 
sense of security.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Solis).
  Ms. SOLIS. Mr. Speaker, this bill is a sham. It does not provide 
adequate prescription drug benefit.
  Este projecto de ley no ayudara a los ancionos. No ayudara ni a 
nuestras madres ni a nuestras abuelitas.
  (English translation of the above statement is as follows:)
  It will not help our mothers, nor our grandmothers.
  Mr. Speaker, I rise to call attention to the American women who will 
be disproportionately impacted by Medicare reform. The reality we must 
confront is that women simply live longer than men--about 19 years into 
retirement, while men can expect to live 15 years. So although this 
means we have longer to cherish our mothers and grandmothers, it also 
means that women are more susceptible to multiple and chronic illness, 
and require more long-term care needs.
  It is no surprise then that women comprise the majority of Medicare. 
In fact, we constitute 58 percent of the Medicare population at 65, and 
71 percent at the age of 85. Yet even more crucial is the fact that 
four out of five of America's elderly women are widowed and almost half 
live out their days alone. Compound this misfortune with the reality 
that these widowed women are four times more likely, and a single or 
divorced woman are five times more likely, to live in poverty after 
retirement than a married man.
  America's elderly women, many of whom live alone and in poverty, have 
higher out-of-pocket health care costs and are now being denied access 
to a secure and responsible Medicare prescription drug plan under the 
Republican Plan. Almost 8 out of 10 women on Medicare use prescription 
drugs regularly, though most pay for these medications out-of-pocket. 
Now we are telling these women, who already spend 20 percent more on 
prescription drugs than their male counterparts, that they must 
navigate the privatized ropes, and we can only hope, not guarantee, 
that they will have affordable coverage and monthly premiums. Even 
middle-class women who have made wise financial planning decisions will 
quickly find that high drug costs may undermine any retirement security 
they have worked hard to establish.
  My district, which is predominately Latino, will be one of the 
hardest hit by this new legislation. Latina women make up the largest 
minority percentage (58 percent) on Medicare with incomes less than 
$10,000. These minority women historically rely on public, rather than 
private, health insurance. Now, we are stripping their only health 
coverage security and implementing a new, privatized and completely 
unmapable plan!
  Have we not learned our lessons from Medicare+Choice that private 
plans do not participate in many regions, that their premiums and 
benefits vary greatly by geographic area, that participation by 
Medicare HMO's has been unstable, and that private plans are not less 
costly than traditional Medicare?
  By 2025, Latinos are expected to comprise 18 percent of the elderly 
population and they are continually encountering strategically placed 
barriers that hinder their equal right to quality health care.
  Let's not forget all the mothers, grandmothers, and sisters now and 
in the future for whom Medicare represents a lifeline to a healthy 
retirement. Who wants to tell the millions of hard working women who 
take care of their families that once again, because of irresponsible 
and unbalanced tax cuts, their health care and prescription drug needs 
will be sacrificed?
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Harman).
  Ms. HARMAN. Mr. Speaker, I rise in opposition to the bill to end 
Medicare as we know it, which will hurt our sisters, mothers, and 
grandmothers.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from Wisconsin (Ms. Baldwin).
  Ms. BALDWIN. Mr. Speaker, I rise in opposition to this bill which 
fails to provide women with the affordable and reliable Medicare 
prescription drug coverage that they desperately need and deserve.
  Mr. Speaker, I urge my colleagues to vote against this sham of a 
bill. It seeks to privatize Medicare and does not provide a real, 
guaranteed, affordable drug benefit that our seniors desperately need.
  When I am home in Wisconsin, one of the issues I hear most about, in 
the grocery store, on the street, at the airport baggage claim, or in 
meetings from Monroe to Baraboo, is that seniors cannot afford to pay 
their prescription drug coverage. Seniors send me receipts for their 
drug bills and ask me how they are supposed to afford their rising drug 
costs on a fixed budget.
  The Republican drug bill on the floor today is not going to provide 
seniors with the relief they deserve. Instead of providing a real, 
affordable prescription drug benefit, this bill seeks to privatize the 
Medicare program. It is my belief that privatization of Medicare is 
unwarranted. Medicare has been a vital component of our Nation's health 
care system since its creation in 1965. In fact, Medicare was 
originally created because private insurance plans were simply not 
providing health insurance to seniors and people with disabilities. For 
nearly 40 years, Medicare has done the job that private insurers would 
not--or could not--do.
  Why then, would we rely on private insurers to provide a Medicare 
prescription drug benefit to our Nation's seniors? This bill relies on 
private insurers to provide a prescription drug benefit. Seniors would 
have to join HMOs and private insurance plans to get the benefit. The 
prices and benefits under this private coverage would vary from region 
to region, so that a senior in Wisconsin would have to pay a different 
premium than a senior in Florida. These geographic disparities are 
simply unacceptable.
  There are no assurances in this bill that prescription drugs would be 
affordable. In fact, this bill takes no steps to stop or slow the 
skyrocketing cost of prescription drugs. Instead, this bill provides 
partial coverage of drug spending until $2,000 and then leaves seniors 
high and dry. There is a huge gap in coverage where seniors may pay 100 
percent out of pocket and continue paying premiums, until they reach a 
high out-of-pocket cap. Half of all seniors will fall into this gaping 
hole. I believe seniors deserve affordable drug coverage, and we should 
not help some seniors cover their drug costs while leaving others out 
in the cold.
  Lastly, the Republican drug plan does not offer the same benefit to 
everyone on Medicare. This plan calls for ``means-testing'' for 
Medicare benefits, meaning seniors with higher incomes would have to 
pay more money out-of-pocket before they reach the catastrophic limit. 
This provision would fundamentally change the Medicare program. Since 
its inception in 1965, the central promise of Medicare was that it 
would provide a consistent benefit for everyone, and means-testing 
would violate this promise.
  I support the Democratic proposal that will be offered as an 
amendment today. This proposal would add a new Part D in Medicare to 
provide voluntary prescription drug coverage for all Medicare 
beneficiaries. This proposal would provide the same benefits, premiums, 
and cost sharing for all beneficiaries no matter where they live. It 
would guarantee fair drug prices by giving the Secretary of the 
Department of Health and Human Services the authority to use the 
collective bargaining clout of all 40 million Medicare beneficiaries to 
negotiate drug prices. The savings would then be passed on to seniors. 
In addition, the Democratic proposal makes drugs more affordable by 
allowing the safe reimportation of drugs from Canada and makes lower 
cost generic drugs available more quickly. Unlike the Republican bill, 
there are no gaps in coverage in the Democratic proposal. Coverage is 
provided for any drug a senior's doctor provides. Seniors would be able 
to choose where to fill their prescriptions and would not have to join 
an HMO or private insurance plan to get drug coverage. This is the 
proposal seniors have been asking for, not one full of complexities and 
gaps in coverage like the Republican plan we will vote on shortly.

[[Page 16285]]

  Today we are voting on a bill that is a sham. It is a sad mockery of 
what seniors in our country deserve. Instead of providing a 
comprehensive Medicare prescription drug benefit for America's seniors, 
the Republicans have decided to make sure this bill suits the big drug 
companies and leads down the road of privatizing Medicare. This is just 
plain wrong for the retirees of the greatest generation, who worked 
hard, lived through the depression, won a war, and raised their 
families.
  Seniors need a comprehensive prescription drug benefit that is 
affordable and dependable for all--with no gaps or gimmicks in 
coverage. The Republican proposal fails on all these counts, and I urge 
my colleagues to vote against it.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Mrs. Capps).
  Mrs. CAPPS. Mr. Speaker, I oppose this Republican prescription bill 
because it provides elderly women with nothing more than a false sense 
of security.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Watson).
  Ms. WATSON. Mr. Speaker, I rise in opposition to this sham Republican 
Medicare bill. That is why I wear my black arm band because it is the 
death of Medicare and it does not provide the adequate prescription 
drug coverage our mothers, grandmothers, sisters, and nieces deserve.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Mrs. Davis).
  Mrs. DAVIS of California. Mr. Speaker, I oppose this unacceptable 
bill that is particularly harmful to senior women.
  Mr. Speaker, I rise to talk about older women and their need for a 
real prescription drug benefit. The legislation we have before us 
represents a hollow substitute for a bona fide Medicare prescription 
drug benefit. Some will claim that the Republican Medicare reform 
legislation provides a prescription drug benefit and declare success. 
Well, Mr. Speaker, we aren't fooling anyone.
  We aren't fooling Donna Koski, from San Diego, who cannot afford her 
medication. She wrote to tell me, ``HMOs are no longer helping us with 
the cost [of drugs]. I worked and paid taxes all my life, raised five 
kids in California and now have five grandkids. I can't afford rent or 
so many things that I once took for granted would be there when I 
retired. What is to become of senior citizens [like me]?'' We aren't 
fooling Sidney and Edith Horwitz, from La Jolla, who told me. ``Figure 
out a way to give us drug benefits without joining a HMO. Deregulation 
and outsourcing to private companies has been a travesty to 
consumers.''
  Mr. Speaker, my constituents want an affordable prescription drug 
benefit that will be there when they need it. They do not want to 
privatize Medicare. However, the bill we will discuss dismantles 
Medicare and does nothing to lower prescription drug prices. This 
proposal eliminates the security of traditional Medicare by requiring 
it to compete with private plans in 2010. It would transform Medicare 
from a defined benefit to a defined contribution program and ultimately 
eliminate Medicare as we know it. Because, private Medicare plans tend 
to aggressively recruit younger and healthier seniors, open competition 
will mean rising out-of-pocket costs for the vast majority who would 
choose the stable benefits and premiums of traditional Medicare. The 
result of open competition will be the transformation of today's 
universal, national risk pool into a multitude of regional pools 
segmented by age, income, residence and health status. To many, this 
transformation sounds more like a scheme than meaningful reform.
  Our seniors need more stability and certainty than this--especially 
older women who are counting on Congress to provide a real solution to 
the rising cost of prescription drugs. Women, literally, are the face 
of Medicare. They constitute 58 percent of the Medicare population at 
65. They constitute 71 percent of the Medicare population at 85. Women 
have a greater rate of health problems since they live longer. They 
have lower incomes, which make access to affordable prescription drugs 
more difficult. More than 1 in 3 women on Medicare (nearly 7 million) 
lack prescription drug coverage.
  The Republication Medicare reform plan will only perpetuate these 
health care disparities. Where is the benefit for our seniors who are 
living on a fixed income and cannot afford to pay out-of-pocket during 
the coverage gap? Where is the benefit for the women who, because they 
were stay-at-home mothers and did not earn a pension, cannot afford the 
prescription drugs they desperately need?
  For my constituents, the Republican proposal is not good enough. I 
cannot support this legislation when I know we can do better. We are 
doing more than providing prescription drugs, we are legislating the 
future of Medicare.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from Georgia (Ms. Majette).
  Ms. MAJETTE. Mr. Speaker, I oppose this sham Republican Medicare bill 
because it does not provide the adequate prescription drug coverage 
that our mothers and grandmothers absolutely deserve.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from New York (Mrs. Maloney).
  Mrs. MALONEY. Mr. Speaker, I oppose this Republican Medicare bill, 
and I urge every woman, man, every American to read the fine print. 
There are gaping holes. There are problems. I will put this into the 
Record and I am totally opposed to this bill.
  Mr. Speaker, the health of America's older women is at serious risk. 
Whatever Medicare Prescription Drug bill we pass will have an enormous 
impact on older women, both now and in the future, and women are 
concerned.
  More than half of Medicare recipients age 65 are women; by age 85, 71 
percent are women. And most older women live on fixed incomes. Older 
women tend to have more chronic health conditions than men, and eight 
of ten women on Medicare use prescription drugs regularly.
  In the face of these facts, the ``bait and switch'' tactics of the 
Republican Medicare Prescription Drug bill are simply outrageous. 
Seniors think we're giving them help with high cost drugs. They think 
we're offering them supplemental insurance--guaranteed, cheaper and 
permanent--to ease their burden of skyrocketing drug costs on fixed 
incomes. But the Republican bill is a cruel trick. Seniors who are 
sickest and taking expensive medications--mostly women on fixed 
incomes--get a little bit of help with the first 2000 bucks of drug 
expenses. But then they get the ``donut hole''--a big fat zero until 
they pay a $3000 ransom to get more help with their drug bills.
  The fiscal irresponsibility of the Republican bill is stunning and 
illogical. Instead of putting the purchasing power of America's seniors 
to work as a huge bargaining chip to lower prescription drug costs, the 
Republicans prohibit the Secretary of HHS from negotiating for lower 
drug prices on behalf of seniors. The Democrats believe prescription 
drugs should be affordable for seniors--but our amendments to have the 
Secretary negotiate on seniors' behalf were defeated.
  The height of hypocrisy in the Republican bill is the fact that it 
actually discourages employers from continuing to offer drug coverage 
for retired seniors who have already paid health insurance premiums 
throughout their working lives. The Congressional Budget Office 
estimates that a third of employers will drop retiree drug benefit 
coverage if the Republic bill becomes law.
  Frankly, the Republican Medicare Prescription Drug bill is cruel. 
This is not compassionate conservatism. It is blatant bias against 
elderly, against women, and against the poor. It is the first step in 
doing away with Medicare as an entitlement and it is the first step 
toward dividing our elderly into the needy and those who can afford to 
``buy out''. The purpose of Medicare was to help the elderly with 
needed care as they age, and to do it with dignity and not on the basis 
of ability to pay.
  Prescription drug coverage would save money in the long term because 
drug therapies can be substituted for more costly treatments like 
hospitalization and surgery. But what seniors--men and women--need and 
want is help that they can understand and can rely on, not the ``bait 
and switch'' of the Republican plan.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from Connecticut (Ms. DeLauro).
  Ms. DeLAURO. Mr. Speaker, the Republican Medicare bill fails to 
provide Americans with real prescription drug coverage, that which they 
need and that which they deserve.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from Illinois (Ms. Schakowsky).
  Ms. SCHAKOWSKY. Mr. Speaker, I rise against the Republican bill that

[[Page 16286]]

kills Medicare and fails to provide affordable prescription coverage to 
the elderly and people with disabilities.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Lee).
  Ms. LEE. Mr. Speaker, this bogus Republican prescription drug bill 
will effectively dismantle and kill Medicare and leave millions of 
seniors, especially our women, our mothers, our grandmothers behind.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from Minnesota (Ms. McCollum).
  Ms. McCOLLUM. Mr. Speaker, this Medicare bill fails to provide women 
with real prescription drug coverage they need and deserve.
  Ms. SLAUGHTER. Mr. Speaker, I reserve the balance of my time.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 3 minutes to the gentleman 
from Kentucky (Mr. Fletcher) for some substantive remarks. Dr. Fletcher 
is a member of the Committee on Energy and Commerce and also a member 
of the medical profession, and we look forward to what he has to add to 
this debate.
  Mr. FLETCHER. Mr. Speaker, let me thank the gentlewoman from Ohio 
(Ms. Pryce) for her leadership in chairing our majority conference as 
well as her leadership on this issue and this rule.
  Mr. Speaker, I find it interesting to see and observe the number of 
people that have stood in line here to talk about this bill, even 
though CBO estimates that 93 percent of our seniors will take advantage 
of this bill. That means many of the sisters, mothers and family 
members that these Members have just spoken about will take advantage 
of this legislation. As a matter of fact, I would imagine if we asked 
these Members how many of them take advantage of the Federal Health 
Benefit Plan, that probably the majority of them, if not all of them, 
choose to participate in that.
  Now, we offer something here in this prescription drug bill that 
gives them a similar choice, and yet for some reason they seem to 
deride what we are doing.
  This is the single most pressing health care issue facing our 
country: providing prescription drugs for our seniors. This bill does 
several things. One, it is a voluntary program. Two, it provides 
something that is affordable, not only affordable for seniors but 
affordable for taxpayers, and it is something that far exceeds anything 
that has been looked at or has had a reasonable opportunity of being 
passed that this Congress has ever put forth. It is flexible. It 
provides choice and security. It provides a modernization of Medicare 
that will address the concerns of prevention and chronic disease 
management which are so needed in this country.
  It also prevents a catastrophic illness from bankrupting a family. 
Often a catastrophic illness can bankrupt a family, and we know of 
families that have saved money their entire life and then one illness 
in the family has bankrupted them. This bill absolutely prevents that 
from happening due to the cost of prescription drugs.
  We also find that it helps a number of low income seniors, 
particularly women, and I am shocked that these Members would not stand 
up and support this bill, because women are particularly affected. Many 
women live on fixed incomes of Social Security and are having to choose 
between food and medicine. I saw them as a physician. I saw them as 
patients of mine. In Kentucky nearly 35 percent of Medicare 
beneficiaries will qualify for low income assistance under this bill.
  Mr. Speaker, not only that but in Kentucky, Medicare recipients are 
spending 67 percent of their total prescription drug costs out-of-
pocket, which is the highest in the Nation.
  Additionally, with this bill, they were talking about Democrats not 
having input, but we had 30 hours of debate in the Committee on Energy 
and Commerce. As a matter of fact, a Democratic colleague of mine, the 
gentleman from Texas (Mr. Green) and I put forward an amendment for 
diabetes screening. We passed that. It is part of this bill.
  So I think this is a tremendously important piece of legislation. 
Every senior will have reduced costs in the prescription drug expenses 
that they pay because the Federal Government will negotiate a lower 
price for these drugs. What we see here is an opportunity. We will 
negotiate a lower price for the prescription drugs.
  Mr. Speaker, I would hope Members would support this rule and that 
Members would support this prescription drug bill.
  Ms. SLAUGHTER. Mr. Speaker, we have so little time to try to make any 
points here.
  Mr. Speaker, I yield 2 minutes to the gentleman from Massachusetts 
(Mr. McGovern), a member of Committee on Rules.
  Mr. McGOVERN. Mr. Speaker, this is a sad day for this House and, more 
importantly, it is a sad day for America's senior citizens.
  This bill is a complex and controversial $400 billion Medicare 
privatization plan that will affect the lives of 40 million senior 
citizens. For 38 years Medicare has been there for our parents and our 
grandparents, helping them live longer, more healthy lives. It is a 
sacred promise with the elderly of this country and this House is about 
to radically and fundamentally break that promise.
  If that were not bad enough, the Republican leadership blocks out all 
amendments and all but one substitute to this bill. For example, this 
bill mandates for the first time a co-payment for senior citizens who 
receive Medicare home health care. I have been fighting for years to 
protect home health care from cuts, so I had an amendment before the 
Committee on Rules around 4:30 this morning to eliminate that co-pay 
because I think it is unfair and I think we should help seniors who use 
home health care, not charge them more money. But like every single 
other amendment, Democrat or Republican, my amendment was not made in 
order.
  The other body has spent the last 2 weeks, Mr. Speaker, debating, 
discussing and amending their prescription drug bill. They seem to 
recognize that this is a big deal. So how much time do we give our 
seniors in this House? Not 2 weeks, not even 2 days. Three hours. What 
a terrible disservice to the people I represent, the people we all 
represent.
  This bill ends Medicare as we know it and turns it into a convoluted, 
complicated voucher program of HMOs and PPOs and shifting coverage. It 
is a bill that leaves a huge gap in coverage, penalizing people for 
getting sick. It is a bill that moves us towards privatizing Medicare 
and leaves our seniors at the mercy of the insurance industry and the 
big drug companies. It is a bill that only a CEO could love. Senior 
citizens deserve a drug benefit within Medicare. They should not be 
left at the mercy of the HMO accountants who are more concerned with 
the bottom line and profit margins than with adequate health care.
  Our substitute works like the rest of Medicare. It tackles the high 
cost of drugs and it guarantees our seniors meaningful, consistent 
prescription drug coverage. That is what our seniors deserve. I urge my 
colleagues to vote no on the rule and yes on the Democratic substitute.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from New Hampshire (Mr. Bradley).
  Mr. BRADLEY of New Hampshire. Mr. Speaker, I rise today in support of 
H.R. 1 and the rule that accompanies this important legislation, for 
today we will begin to finally provide for a prescription drug benefit 
under Medicare for America's senior citizens.
  H.R. 1 will ease the financial burden placed on America's seniors, 
improve access to the medications they need, and introduce market 
measures that will curb future cost increases.
  According to a recent study, the House plan, our plan, would reduce 
the average overall cost of prescription drugs by 25 percent through 
aggregating the purchasing power of seniors. In addition to these 
overall savings, the plan provides significant and immediate savings 
for seniors through provisions, including a prescription

[[Page 16287]]

drug discount card which would provide a 10 to 15 percent savings; 
significant front-end coverage with a cost sharing agreement that has 
seniors paying 20 percent on the first $2,000 of drug costs after they 
pay a deductible and a monthly membership fee. Beyond that it involves 
catastrophic protection providing 100 percent coverage for out of 
control drug costs beyond $3,500. And, lastly, and perhaps most 
importantly, assistance for low income seniors, enabling those Medicare 
beneficiaries that have income of 135 percent of the poverty line to 
receive full coverage on their prescription drugs.
  Mr. Speaker, the advancement of medical research and technology has 
led to the development of new drugs that can dramatically reduce the 
need for surgery, for hospitalization and for nursing home care.

                              {time}  1330

  It is high time that we provide America's senior citizens with 
improved access to these drugs at prices they can afford. I urge my 
colleagues to support the rule and to support the legislation.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Ohio (Mr. Brown).
  Mr. BROWN of Ohio. Mr. Speaker, I thank my friend from New York for 
yielding me the time.
  Mr. Speaker, we should reject this rule because H.R. 1 offers the 
wrong vision for Medicare. H.R. 1 asks every Member a fundamental 
question, what do you want Medicare to be? If you want Medicare 
coverage that is guaranteed, dependable, universal and fair, you will 
vote against H.R. 1. If you want Medicare to cover every senior 
everywhere, you will vote against H.R. 1. If you want Medicare to offer 
the same coverage to seniors on Park Avenue as seniors in Appalachian, 
Ohio, you will vote against H.R. 1.
  But Mr. Speaker, if you want Medicare to offer unreliable, selective, 
discriminatory coverage, you will support H.R. 1. If you want Medicare 
to offer seniors in Appalachian, Ohio, less coverage than seniors on 
Park Avenue or no coverage at all, you will vote for H.R. 1. If you 
want Medicare to offer rural seniors coverage, but at three or four 
times the price, then you will vote for H.R. 1. If you want a plan 
written by the drug companies and by the insurance companies because of 
their huge contributions to the Republican Party, if you want that, 
then you will vote for H.R. 1; and if you want a bill that will force 
people who now have prescription drug coverage, a bill that will force 
seniors who now have prescription drug coverage to drop that coverage, 
then you will vote for H.R. 1.
  The gentleman from New York (Mr. Rangel) and the gentleman from 
Michigan (Mr. Dingell) will offer a substitute amendment with a 
different version of Medicare. The Rangel-Dingell substitute 
strengthens Medicare by adding a prescription drug benefit, no 
unaffordable cost sharing, no gaps in coverage. The Rangel-Dingell 
substitute would maintain Medicare's guaranteed coverage, remaining 
faithful to the trust Medicare has earned from America's seniors.
  The Rangel-Dingell substitute harnesses seniors' purchasing power to 
demand better prices from the drug industry. My friend from Kentucky 
had it all wrong when he said the Republican plan does that. The 
Republican plan, because it was written by the drug companies, does 
nothing to bring prices down.
  Vote ``no'' on the rule. Vote ``no'' on H.R. 1. Vote ``yes'' on the 
Rangel-Dingell substitute.
  Ms. PRYCE of Ohio. Mr. Speaker, I am pleased to yield such time as he 
may consume to the gentleman from California (Mr. Issa), my 
distinguished colleague.
  Mr. ISSA. Mr. Speaker, I support this bipartisan, Republican-led, 
legendary, historic event that we are participating in here today.
  Mr. Speaker, I rise today to comment Chairman Thomas, Chairman 
Tauzin, and the House Republican leadership for their work on H.R. 1.
  This landmark legislation will provide America's seniors with a 
lifetime prescription drug benefit through Medicare. This new benefit 
will mean permanent prescription drug access, lower drug costs and a 
limit on catastrophic drug expenses for all beneficiaries.
  I am especially pleased to see that this bill enacts meaningful 
Medicare reforms that specifically affect California and my 
constituents in the 49th Congressional District.
  H.R. 1 includes language that allows the Secretary of Health and 
Human Services to designate plans that serve special needs 
beneficiaries as Specialized Medicare Advantage plans. This provision 
enhances the development of more effective approaches to chronic 
illness care by providing an opportunity for additional frail elderly 
demonstrations to move into mainstream Medicare. One example of this 
type of demonstration is the SCAN program, which currently serves over 
50,000 Southern Californians--including 10,000 who live inside the 49th 
Congressional District.
  I also want to thank leadership for their work to ensure stable 
funding in the Medicaid disproportionate share hospital (DSH) program. 
H.R. 1 provides all states with a one time 20% increase in their DSH 
allotments. This 20% increase means an additional $184 million in 
Fiscal Year 2004 for California's safety net hospitals. This additional 
funding will help ensure that services to the most vulnerable 
populations remain available.
  I believe that we must bring Medicare into the 21st century and that 
no American should be denied needed prescription drugs because he or 
she cannot afford them. I recognize that the lack of a prescription 
drug benefit for our seniors signifies the fact that Medicare has 
fallen behind the times. H.R. 1 is the best prescription drug benefit 
plan for America and I urge my colleagues to support its passage.
  Ms. PRYCE of Ohio. Mr. Speaker, I am pleased to yield such time as he 
may consume to the gentleman from California (Mr. DREIER), my 
distinguished colleague, the chairman of the Committee on Rules, who 
led us through our hearing on this last night to the historic 
conclusion today on the floor.
  Mr. DREIER. Mr. Speaker, the first revision I would like to make to 
my very good friend and the role that I play was leading us through 
this morning as we did, in fact, as has been pointed out, beginning 
late at night. We began late at night because we were all working 
together to fashion a bill which I am convinced that at the end of the 
day will enjoy bipartisan support in this House of Representatives.
  It has been the gentleman from Illinois (Mr. Hastert), the Speaker, 
who, as the author of this legislation, has been in the lead on not 
only the issue of bringing about measures to strengthen and protect and 
improve Medicare but also to put into place a very important expansion 
of medical savings accounts, which I joined him in championing for 
many, many years.
  This is a historic day, as many as have said; and my colleague, the 
gentlewoman from Ohio (Ms. Pryce), has been working diligently over the 
last several days and weeks and months to get us here.
  I mentioned the gentleman from Illinois (Speaker Hastert). There are 
lots of other people, the gentleman from California (Mr. Thomas), the 
chairman of the Committee on Ways and Means; the gentleman from 
Louisiana (Mr. Tauzin), the chairman of the Committee on Energy and 
Commerce; but I would like to talk about the Representatives who did at 
12:50 this morning appear before the Committee on Rules.
  The gentleman from Oregon (Mr. Walden) represented the Committee on 
Energy and Commerce and did a wonderful job; but no one has been more 
intimately involved in dealing with health care issues than the 
gentlewoman from Connecticut (Mrs. Johnson), and I was very impressed 
with the fact that she was able, in her presentation before the 
Committee on Rules, over a 90-minute period, to deal with virtually 
every question that came forward; and, Mr. Speaker, it was so apparent 
that her grasp of this issue, coupled with her commitment to ensure 
that our senior citizens finally have the opportunity for the first 
time under the structure put in place for Medicare have access to 
affordable prescription drugs; and, Mr. Speaker, it was very 
interesting to note that while there was bipartisan praise for the 
gentlewoman from Connecticut (Mrs. Johnson) as this hearing began at 
12:50 this morning, the final panel that came before us at probably 
about 4:30 or so, I cannot remember exactly what time it was, maybe 
4:15 this morning, had a

[[Page 16288]]

Democrat on the final panel praising the gentlewoman from Connecticut 
(Mrs. Johnson), not necessarily agreeing with everything that she said, 
but praising her for the fine work that she has involved herself in on 
this issue.
  I believe that as we look at what it is that we are trying to do here 
there are so many very important and positive developments that have 
taken place. I know my friend from Ohio has just mentioned the very 
important issue of the disproportionate share of hospitals that provide 
assistance under Medicaid. Increasing the level of funding for those 
hospitals that are shouldering that responsibility has been one of the 
challenges that the Los Angeles area, which I am honored to represent, 
has faced; and we, I believe, are going to be able to help deal with 
that.
  At the same time, I have to say that in looking at some of the things 
that have been said that were critical of this rule and of the measure, 
first on the rule, Mr. Speaker, we have put into place what I believe 
is a very fair rule. In the 107th Congress we all know that we dealt 
with this issue, and there was no substitute made in order. So in this 
Congress we have done that, but in bringing the health savings 
accounts, which are a very important item, designed to provide 
incentives for people to make choices and plan for their long-term 
health care needs by bringing this measure in with our very important 
Medicare package, what we have done is we have provided the minority 
with three opportunities, the substitute and two opportunities to offer 
motions to recommit, and there was no substitute offered on the other 
and I suspect we would have made that. We conceivably could have had 
four opportunities for the minority, if they had submitted those to us, 
that would have been made in order; and we, as the majority, have 
basically one opportunity and that is our bill.
  I acknowledge that as members of the majority we have been able under 
Speaker Hastert's leadership to put this package together; but anyone 
who claims that we are not giving an opportunity to the minority for 
their proposals to be considered is really wrong, and we have provided 
the proposal which was submitted to us by the ranking minority member 
of the Committee on Ways and Means and ranking minority member on the 
Committee on Energy and Commerce. So I believe we are going to, as this 
debate proceeds, find that there are Democrats who will want to join 
with us; and I congratulate them for understanding the fact that this 
is going to be the first opportunity to truly provide access to 
affordable prescription drugs to our senior citizens.
  I will tell my colleagues, Mr. Speaker, in voting ``no'' on this 
package, at the end of the day we will see Members saying no to our 
attempt to put into place a program that will meet that very important 
need. So I just want to say that I know there a lot of staff people who 
have been involved in this, and I particularly want to express my 
appreciation to the members of the Committee on Rules, very ably led 
staff on our side by my friend Billy Pitts, and we on this committee 
had members on both the Democratic and the Republican side who did meet 
from 12:50 this morning until our filing of the rule by the gentlewoman 
from Ohio (Ms. Pryce) and I at 6:20 this morning.
  And the reason we did it is that this is such an important issue. The 
reason we did it is that we want to make sure that we get this done for 
the American people, and I am convinced that our chance to come 
together has been made possible by all those who were involved in this, 
and I thank my friend for yielding me the time.
  Ms. SLAUGHTER. Mr. Speaker, I am pleased to yield such time as she 
may consume to the gentlewoman from California (Ms. Pelosi), the 
minority leader.
  Ms. PELOSI. Mr. Speaker, I thank the gentlewoman for yielding me the 
time. I think this is a sham Republican Medicare bill which fails to 
provide women with a real prescription drug benefit which they need and 
they deserve.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from New York (Ms. Velazquez).
  Ms. VELAZQUEZ. Mr. Speaker, I think the sham Republican Medicare bill 
fails to provide women with the real prescription drug coverage that 
they need and deserve.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Ms. Waters).
  Ms. WATERS. Mr. Speaker, I think this is a sham Republican 
prescription bill because elderly women are dying from preventable 
diseases. This is nothing more than a false sense of security.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from California (Mrs. Napolitano).
  Mrs. NAPOLITANO. Mr. Speaker, I think this is an unfinished 
Republican Medicare bill because it does not provide the simple, 
adequate prescription drug coverage for all our mothers, our sisters, 
and our grandmothers.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
California (Mrs. Capps).
  Mrs. CAPPS. Mr. Speaker, I thank my colleague for yielding me the 
time.
  Mr. Speaker, I rise in opposition to this rule and to the Medicare 
bill. The rule is unfair. The bill is unacceptable. It provides spotty 
coverage that will not help seniors with their expensive medications, 
and it reneges on a promise we have made to America's seniors and those 
with disabilities by ending Medicare as we have known it.
  I want to speak about a provision in the bill that still cuts, even 
with yesterday's revisions, hundreds of millions of dollars for cancer 
care. A cut like this will be devastating to seniors with cancer.
  If this bill is passed, cancer centers will close, especially 
satellite centers that are located close to where seniors live. Those 
that remain open will admit fewer patients and lay off oncology nurses.
  Medicare beneficiaries do pay too much for their oncology 
medications. We all agree that we must fix this, but Medicare also pays 
way too little for essential oncology services. The overpayments for 
oncology drugs has been used to pay for treatments oncologists provide 
to cancer patients. So we must fix both parts of this problem.
  The bill fixes overpayment of drugs, but still cuts some $300 million 
from cancer care to do it. The quality of cancer care will suffer.
  The gentleman from Georgia (Mr. Norwood) and I submitted amendments 
last night to fix both parts of this problem and protect the quality of 
cancer care for all Americans, but these amendments were not made in 
order; and now seniors will not only not get sufficient prescription 
drug coverage but those with cancer, seniors with cancer, will see 
their treatments jeopardized, thwarted, cut off. What will seniors with 
cancer do?
  I urge my colleagues to vote against the rule and against this bill.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  In response to the gentlewoman from California (Mrs. Capps), who we 
both share an abiding concern about cancer patients and their 
treatment, I would just like to set the record straight in that the 
bill on the floor today increases oncology practice expenses by $190 
million. That is 83 percent over their current payment, and it is 50 
percent higher than any other specialty. It also includes an average 
sales price plus 12 percent for 2 years. Now, that is $240 to $250 
million on top of a $190 million increase in practice expenses.
  In addition to that, we have provided for oral cancer therapies, the 
new, upcoming way to treat cancer, so that chemotherapies are not the 
only treatment that seniors can get. They can stay home and take a pill 
in their own surroundings rather than go be hooked up to some infusion 
device.
  These are wonderful steps forward for the cancer community.
  Mrs. CAPPS. Mr. Speaker, will the gentlewoman yield?
  Ms. PRYCE of Ohio. I yield to the gentlewoman from California.
  Mrs. CAPPS. Mr. Speaker, I thank my colleague for yielding, and we do

[[Page 16289]]

share a very strong interest in this issue, and we both also know that 
oncology services involve more than the oncologist, and, yes, this bill 
does raise from the terrible low cut that was originally in it some 12 
percent; but it still leaves a huge vacuum for the services that are 
provided by oncology nurses, the whole panoply of outpatient and clinic 
setting services that patients who are receiving chemotherapy, which is 
such a devastating treatment to go through, need in order to maintain.
  It is really a life-and-death situation for people who receive a 
diagnosis of cancer and then find out that they have to go to the 
doctor and get their medication, and then they have to find some way to 
have the services delivered because Medicare will not cover this wide 
comprehensive care in a cancer center, and that is what we need to have 
a full debate upon.
  Ms. PRYCE of Ohio. Reclaiming my time, I disagree with the 
gentlewoman's analysis of how it works. There is a provision that will 
allow physicians to stockpile, if they prefer.

                              {time}  1345

  But on to another issue, Mr. Speaker. There were statements made 
earlier that there were no cost savings in this bill, by a former 
speaker. There are cost savings. There is group purchasing and 
insurance benefits, a 25 to 30 percent savings. There is a discount 
card, 15 to 20 percent savings. There is a Medicare best price, $18 
billion in savings. Average wholesale price reform, $15 billion in 
savings. There is Hatch-Waxman reforms and reimportation reforms, all 
generating savings. And that is how we are able to expand and generate 
better treatment for seniors through the upcoming years.
  Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
Rhode Island (Mr. Langevin).
  Mr. LANGEVIN. Mr. Speaker, I rise in opposition to the proposed rule 
providing for consideration of the Medicare Prescription Drug and 
Modernization Act.
  This rule restricts the House to 3 hours of debate on the largest 
ever overhaul of a program that has been critical to the health of our 
Nation's seniors for 38 years. Furthermore, the rule blocked dozens of 
amendments, including one of my own, which could have resulted in 
tremendous savings for seniors by opening the door for the Health and 
Human Services Department to use the bulk purchasing power of America's 
40 million Medicare beneficiaries to negotiate lower medication prices 
for them.
  As a result, Members are denied the opportunity to address many 
disturbing provisions in this bill. To mention just a few, the failure 
to address the rapidly rising cost of prescription drugs that will soon 
render this benefit meaningless; the tremendous gaps in coverage that 
will result in less help for those who need it most; and the provisions 
that fundamentally alter the structure and entitlement of Medicare by 
requiring the program to compete with private plans beginning in 2010.
  Mr. Speaker, the list of Members' concerns with this bill goes on and 
on and on. The other Chamber has been debating this bill for 2 weeks, 
meanwhile the United States House of Representatives will have a mere 3 
hours of debate on this bill that we are presented with. This is an 
affront to democracy.
  Ms. PRYCE of Ohio. Mr. Speaker, I continue to reserve the balance of 
my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Oregon (Mr. DeFazio).
  Mr. DeFAZIO. Mr. Speaker, I thank the gentlewoman for yielding me 
this time.
  We have heard a lot about the new benefits and protections that will 
be afforded by this bill. Unfortunately, most of the benefits and 
protections will not go to seniors in need, they will go to the 
pharmaceutical and the insurance industry. This bill will do a good job 
of protecting the monopoly profits and price gouging by the 
pharmaceutical industry.
  Perhaps the gentleman from Kentucky has not read or at least he 
doesn't understand the bill. Section 1801 prohibits the Federal 
Government, Medicare, from negotiating lower prices from the 
pharmaceutical industry, a provision inserted at the behest of the 
pharmaceutical industry to protect their profits. The VA negotiates 
very successfully, and that would lower the cost of drugs much more 
than the puny benefits in this bill at a cost of $400 billion. But, no, 
that is prohibited in this legislation.
  The bill does not allow the reimportation of U.S. manufactured drugs 
from Canada because that would provide a greater benefit than the puny 
benefits in this bill. Here are three drugs: Tamoxifen. If we could 
just reimport, if Americans could just buy the drug by mail from 
Canada, they would save 90 percent. But a couple with a $4,500 a year 
drug bill will get a 22 percent benefit under this legislation. For 
Vioxx, for arthritis, 52 percent if you could just buy it in Canada and 
bring it back into this country. Under this bill, a 22 percent 
reduction for seniors who pay $4,500 a year for drugs. And then 
Xalatan, for glaucoma, a little closer, 33 percent from Canada, 22 
percent under this bill.
  So without any cost, without spending $400 billion and without 
spending a penny, but impinging on the profits of the pharmaceutical 
industry, we could provide much better benefits by negotiating or 
allowing reimportation.
  But it does not stop there. It also benefits the insurance industry. 
It is going to drive seniors from Medicare into private insurance, 
provide subsidies to private insurance to provide unspecified benefits 
at a cost to be determined in the future when those benefits might 
become available in the year 2006, and they can be withdrawn at any 
time by those industries.
  This is not the security our seniors deserve and it is outrageous 
that this should be offered without any amendments being allowed to 
this party.
  Ms. PRYCE of Ohio. Mr. Speaker, I continue to reserve the balance of 
my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
Connecticut (Ms. DeLauro).
  Ms. DeLAURO. Mr. Speaker, this House has sometimes risen to the 
occasion on matters of great national importance; the first Gulf War, 
September 11, when we came together to bind the Nation's wounds and 
provide for the national security of the Nation. Unfortunately, this 
legislation does not rise to the occasion. It does not deliver an 
adequate prescription drug benefit or hold down the cost of drugs. What 
it does do is open the door to the privatization of Medicare. It turns 
it over to the HMOs, to the private insurance market which has dropped 
over half of the Medicare enrollees in my State of Connecticut over the 
last 4 years. And seniors have not forgotten.
  This bill does nothing to contain costs. It prohibits the Secretary 
of Health and Human Services from even engaging in negotiations with 
the drug companies to lower prices. As a result, many seniors will pay 
more than they do now and their premiums will rise as the cost of drugs 
rises.
  Throughout my time in Congress, the single most common concern I have 
heard from seniors at the local stop-and-shops where I meet with them 
every weekend is how expensive their prescription drug bills are. 
Seniors know that they are being taken advantage of. They know they can 
get drugs cheaper in Canada and overseas. And when seniors find out 
that we are doing nothing to hold down the excessive profiteering of 
the pharmaceutical companies, when they find out that their coverage 
essentially stops during midsummer while they still have to pay the 
premiums, they are going to feel betrayed. And they are being betrayed.
  If we allow this bill to become law, we would be saying that 
guaranteed health care for our seniors is no longer the obligation or 
the responsibility of this government. I did not come to the Congress 
to preside over the dismantling of Medicare. Our social contract with 
our seniors must be honored, and I urge my colleagues to support a plan

[[Page 16290]]

that does that and not this Republican sham. Oppose the rule and oppose 
the bill.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Tennessee (Mr. Cooper).
  Mr. COOPER. Mr. Speaker, I thank the gentlewoman for yielding me this 
time.
  Mr. Speaker, this should be a great day for this country. We should 
be on the verge of passing a real Medicare prescription drug benefit 
for our seniors. But, unfortunately, we are not. The Republican 
majority is rushing through a sham bill in this House in barely 24 
hours. They would not let anybody see a copy of this bill until 11:50 
p.m. last night. The Committee on Rules' deliberations began at 12:50 
a.m. last night and lasted, as has been mentioned, until 4 a.m.
  What are they afraid of? What are they hiding? And why would they not 
allow amendments like the Dooley amendment to be offered on this floor? 
It is my understanding in the other body that Senators Hagel, Ensign, 
and Clinton will be offering the Dooley approach as a substitute to 
that legislation. The other body has deliberated on this matter for 
some 2 weeks in the full light of day so that all senior citizens 
around this country, all families around this country, could pay 
attention to the details of this legislation and judge for themselves 
whether it is good medicine for the American people or not.
  But not only is the Republican majority hiding the real substance of 
this bill, they have failed to learn the lessons of past efforts of 
this House to reform the health care system. Number one, health care 
legislation that works must not be partisan. This bill is almost an 
entirely Republican-only bill. That dooms it to failure from the start. 
Second, real health care reform must not be overly complex. This is one 
of the most complex bills that seniors could ever imagine facing. The 
red tape is incredible. And, third, this bill should not be overly 
burdensome to seniors, but it is. Watch out when your seniors back home 
realize they have to pay $35 a month for a very questionable benefit.
  There is a donut hole in coverage, and that is almost too complex to 
explain in the 2 minutes I am allowed here, but this bill is so 
inferior to the Dooley bill, which solves these problems in a simple, 
clear and fair fashion. Under the Dooley bill, there is a zero monthly 
premium.
  Mr. Speaker, I urge a ``no'' vote on the previous question.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
Illinois (Mr. Emanuel).
  Mr. EMANUEL. Mr. Speaker, like the preceding speaker before me from 
Tennessee, my good friend, the Dooley-Tauscher bill, I think, addresses 
the right priorities, the right common values we have. It does not try 
to end Medicare as we know it. It keeps Medicare, that has done so well 
over 40 years, intact. And unlike the other bills, it lives within the 
$400 billion frame. It is true to the principles that have held 
Medicare true. It relies on part B of Medicare to deliver the benefit. 
It does not try to privatize that benefit. It is a low-income benefit 
for our seniors. But, most importantly, it is universal in its benefit. 
Everybody would get it. There would be a minimum of a 25 to 30 percent 
discount on drugs.
  One of the biggest debates here is not only a benefit under Medicare 
of prescription drugs, but it is making the drugs that our elderly need 
every day when they go to the drugstore or their local pharmacy, making 
those medications affordable. The benefit accounts for all drug 
spending. That is the core principle here. It is a universal benefit.
  So this is the right type of approach. The other day the Washington 
Post endorsed it. And, today, in the other body, a bipartisan group of 
Senators will be introducing it. I think it expresses our common values 
and our common principles of what is true to our vision of what 
Medicare should be, not what it should not be.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
Florida (Mr. Davis).
  Mr. DAVIS of Florida. Mr. Speaker, one of the things that we can all 
agree upon here today is that there ought to be an open and honest 
debate in our country and with our seniors as to exactly how to 
accomplish writing a prescription drug benefit. There are Democrats 
here who recognize that we have to live within the budget constraints 
that have been forced upon us, and we are ready to take the first step, 
even though it would not be the final step we would take. We are ready 
to work with Republicans.
  This bill that is being forced on the House of Representatives today 
with a minimum amount of debate is a sham. There are many ways to 
illustrate the point. Probably the best is the private insurance 
companies who are being asked to provide this drug benefit are saying, 
once again, we do not want to do it. We do not want your money. There 
are not many people here in Washington who tell the government we do 
not want your money. These private insurance companies do not want to 
write this drug benefit. This bill is a sham.
  The bill sets no details on premium, no details on the scope of the 
coverage. What are seniors getting under this bill? They do not know 
because we honestly do not know. The Dooley bill deserves a debate here 
today. It represents a compromise between what the Senate and the House 
is trying to do here and what the Democrats are proposing in the 
substitute. We deserve to have a debate on the Dooley bill.
  Mr. Speaker, the rule should be defeated, the motion should be 
defeated, and we should debate the Dooley bill.
  Ms. PRYCE of Ohio. Mr. Speaker, I reserve the balance of my time.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as he may consume to 
the gentleman from Massachusetts (Mr. Tierney).
  Mr. TIERNEY. Mr. Speaker, I rise in opposition to this bill, which is 
not modernization of Medicare. It ends it, it does not mend it. And 
there is no choice here for doctors, only for insurance companies. It 
is going to put a lot of seniors who have good retirement plans back 
into the Medicare system without the care and the prescription drugs 
they need.


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. LaTourette). The Chair has an 
announcement. As indicated by previous occupants of the Chair on June 
27, 2002, and on March 24, 1995, although a unanimous consent request 
to insert remarks in debate may comprise a simple declarative statement 
of the Member's attitude toward the pending measure, it is improper for 
a Member to embellish such a request with other oratory, and it can 
become an imposition on the time of the Member who has yielded for that 
purpose.
  Ms. SLAUGHTER. Mr. Speaker, we will pay attention to that.
  Mr. Speaker, I yield such time as she may consume to the gentlewoman 
from Indiana (Ms. Carson).
  Ms. CARSON of Indiana. Mr. Speaker, I will be brief, and I appreciate 
the opportunity to speak about how the Medicare bill fails to provide 
women with the real prescription drug coverage that they need, 
especially to senior women of this Nation.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
Wisconsin (Mr. Kind).

                              {time}  1400

  Mr. KIND. Mr. Speaker, I rise in opposition to the rule, and 
encourage my colleagues to vote ``no'' on the previous question so we 
can have a real and honest debate today, and make in order the Dooley 
substitute.
  I, along with others in the New Democratic Coalition, have worked 
long and hard to offer a viable alternative to the base bill. The bill 
before us, unfortunately, will jeopardize the very sanctity of the 
Medicare program. The Dooley bill, on the other hand, is simple, 
progressive and affordable. It helps those seniors who needs the most 
assistance, the low-income and those with high drug costs. It offers 
zero premium payments; it is Medicare as seniors know it. The benefits 
are integrated into Medicare part B, and every beneficiary gets a 
guaranteed benefit for no additional premium.

[[Page 16291]]

  Unlike the House and Senate Republican bills, this bill has no gap in 
coverage, and it is fiscally responsible. It fits within the budget 
resolution that was passed earlier this year.
  Later today, it is my understanding that Senators Hagel and Clinton 
and Ensign will be offering the same exact Dooley substitute on the 
Senate floor. We should be allowed to debate the same measure today. I 
urge a ``no'' vote on the previous question.
  Ms. SLAUGHTER. Mr. Speaker, I yield 1 minute to the gentleman from 
California (Mr. Thompson).
  Mr. THOMPSON of California. Mr. Speaker, I rise today against this 
rule. Members should have an opportunity to vote on an enhanced version 
of the bipartisan Senate bill. That is the Blue Dog prescription drug 
benefit bill. Unfortunately for seniors across this country, our 
friends across the aisle have disallowed a debate on this better bill. 
It is better because it has a guaranteed fall-back, which means if 
seniors cannot get a PPO, they will have Medicare. It is better because 
there are no premium supports, which means seniors are not going to be 
penalize for staying in Medicare; and it is better because it does not 
privatize Medicare. Medicare is an important program that has saved the 
lives of many seniors, and an inclusion of a prescription drug benefit 
deserves an open debate.
  Mr. Speaker, I urge opposition to this rule so the Blue Dog proposal 
can be debated and seniors can have the best coverage that we can 
afford at this time.
  Mr. Speaker, today I rise in opposition to the rule of the Republican 
Medicare Prescription Drug Bill, H.R. 1. It serves only one purpose--
ensuring that the voices of several in the Democratic Party are never 
heard on this critical issue.
  I stand here on behalf of the Blue Dog Coalition--a group which 
engaged in this debate by crafting a moderate, affordable prescription 
drug alternative that would have appealed to Members on both sides of 
the aisle. But this body will never consider the Blue Dog substitute, 
because the Rules Committee denied us the opportunity to debate our 
proposal and have a vote on the House floor.
  As you know, the Blue Dogs are a group of fiscally conservative 
Democrats, who are committed--as a coalition--to the passage of a 
prescription drug benefit that fits within our $400 billion budget 
window. On Tuesday evening, the Coalition formally endorsed legislation 
based upon the bipartisan Senate Medicare bill (S. 1).
  The Senate has come together to develop a strong bipartisan benefit. 
It is not perfect. But, in recent years, the perfect has become the 
enemy of the good and, unfortunately, the perfect is out of our price 
range. The Senate offers America's seniors a good benefit. It carries a 
monthly premium of $35. A deductible of $275. A 50 percent cost-share 
through the first $4500 of drug spending. And, it offers a catastrophic 
benefit that kicks in after beneficiaries have spent $3700 out of 
pocket. Further, it corrects a variety of inadequacies in our Medicare 
reimbursement system for rural providers. And, it does all of this 
without putting Medicare on the path to privatization. But, with a 
score of $389 billion, there was some room for improvements. And, that 
is just what the Blue Dog Coalition has done.
  We have strengthened the rural provider package by accelerating the 
start dates to 2004. And, we have improved the adjustments made to the 
wage index labor share--dropping the labor share to 62 percent.
  We have built upon the Senate's critically important fall-back 
provisions. The fall-back means that seniors--such as those living in 
rural areas without two or more plans providing service--will always 
have access to a drug benefit. We have provided an additional layer of 
stability for those seniors, by requiring the fall-back plans to 
contract for two years as opposed to one.
  We have included the Senate Generic drug amendment, which has been 
scored by CBO as a cost-saver because it streamlines and clarifies the 
process by which generic medications can be brought to market. This 
will increase the amount of affordable medications available to all of 
our seniors.
  We have incorporated disclosure requirements, to ensure that our 
plans are fully demonstrating how savings are passed on to our 
beneficiaries.
  We allow the Secretary to negotiate on behalf of all Medicare 
beneficiaries for the best prices possible.
  We permit the re-importation of medications from Canada, provided 
that the Secretary certifies that such action would not jeopardize the 
health and safety of the American public.
  We allow Medicare to operate as the primary payor for all dually 
eligible beneficiaries, lifting some of the financial burden off of the 
shoulders of our states.
  We allow a portion of employer contributions to be counted towards 
the beneficiary out of pocket limits, encouraging our employers to 
continue sponsoring retiree health plans.
  And we are able to make these improvements within the confines of the 
$400 billion budget allocation.
  Unfortunately, the Congressional Budget Office was not able to 
complete a score on our legislation prior to the convening of the Rules 
Committee. However, the majority of the changes we have made to the 
already-scored Senate bill were based upon Senate amendments that have 
either been introduced and passed or are pending introduction. As such, 
they have all been scored by CBO for their sponsoring offices. The 
availability of that information has allowed the Blue Dogs to say with 
certainty that this legislation fits within the $400 billion budget 
window.
  But, Members with questions about the Blue Dog substitute will never 
have the opportunity to pose them because the rule has prevented all 
debate on this alternative. Medicare is a complex program and the 
debate on the addition of a new prescription drug benefit cannot be a 
simple one. Voices should be heard, debate should be had, and all 
options should be fully explored before one course of action is decided 
upon. Unfortunately--to the detriment of this body and America's 
seniors--that is not happening.
  I urge my colleagues to oppose this rule, and in doing so allow the 
House of Representatives to give this critical issue the open and 
deliberate debate that it fully deserves.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Georgia (Mr. Gingrey), another physician in our conference.
  Mr. GINGREY. Mr. Speaker, I thank the gentlewoman from Ohio (Ms. 
Pryce) for giving me an opportunity to speak on this issue. I rise in 
favor of the rule and in favor of this bill.
  I have delivered probably 5,000 or more babies over a 30-year medical 
career; but I will be prouder today of this delivery that we are giving 
to our seniors, that we have promised them for the last 2 years. 
Finally today that delivery will occur. This will be the best delivery 
that I have ever given because what we are talking about is not just a 
prescription drug benefit; we are also talking about modernizing 
Medicare so that it will not be going bankrupt by the year 2030.
  With a prescription drug benefit, we will have an opportunity for our 
seniors to avoid prolonged hospital stays and prolonged nursing home 
stays, difficult expensive surgery. Let them take those medications 
early in the disease process so that high blood pressure does not 
result in a stroke or heart attack or so the diabetes they are 
suffering with does not end up in them being a dialysis patient.
  This is a good bill. This is a bill that our leadership is finally 
going to give to our seniors; and I tell Members this is the day to do 
it, and this is the finest delivery we can offer to our seniors.
  Ms. SLAUGHTER. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, I am sure the gentleman from Georgia (Mr. Gingrey) is 
pleased that the Democrats tried to make the gentleman's amendment in 
order last night.
  Mr. Speaker, I yield 2 minutes to the gentlewoman from California 
(Mrs. Tauscher).
  Mrs. TAUSCHER. Mr. Speaker, I rise today to strongly urge my 
colleagues to vote against the rule and to defeat the previous 
question. This will allow us to debate a much more realistic and 
fiscally responsible Medicare bill.
  It is clear that the status quo is not working to make prescription 
drugs affordable for seniors. It is also clear that our country's 
economic situation does not give Congress a lot of options for solving 
this growing problem. Under the Dooley-Tauscher plan, seniors do not 
have to pay a premium, and the generous low-income benefit far exceeds 
the one offered by the majority. For seniors whose income is 150 
percent of the Federal poverty level, roughly equal to $13,400, they 
will only have a 10 percent cost share.
  Furthermore, any prescription drug plan needs to be part of Medicare,

[[Page 16292]]

which seniors like and trust. Our plan is managed by Medicare. The 
benefit is integrated into Medicare part B, and every beneficiary gets 
a guaranteed benefit at no additional cost. By leveraging the buying 
power of all seniors, our plan allows every single person on Medicare 
to benefit from immediate drug savings regardless of how many 
prescriptions they are filling a month.
  Finally, Mr. Speaker, our seniors need to be protected from 
catastrophic drug costs. Seniors who have high drug costs will be able 
to access the full benefit sooner because our plan focuses on the total 
cost of the drug, not discounted price paid out of pocket. Our plan has 
an extra safety net for those who really need it, people with total 
drug costs of $4,000 a year.
  Under our bill, companies that currently provide prescription drug 
coverage to their retirees will have the incentive to continue doing so 
because the Federal Government will assume the risk of drug coverage 
once beneficiaries reach their deductible.
  We need to be smart and realistic about how we can provide every 
American senior with prescription drug coverage. Given the current 
economic situation, our plan is the one that provides this coverage and 
is fiscally achievable. I urge my colleagues to defeat the previous 
question and support the Dooley-Tauscher substitute.
  Ms. SLAUGHTER. Mr. Speaker, I yield such time as she may consume to 
the gentlewoman from the Virgin Islands (Mrs. Christensen).
  Mrs. CHRISTENSEN. Mr. Speaker, I rise in opposition to the sham 
Republican Medicare bill which fails to provide women with the real 
prescription drug coverage that they need and deserve, and undermines 
the entire program.
  Ms. SLAUGHTER. Mr. Speaker, I yield 2 minutes to the gentleman from 
California (Mr. Dooley).
  Mr. DOOLEY of California. Mr. Speaker, I rise to ask that the 
previous question be defeated so we can offer a real prescription drug 
benefit to seniors. It is unfortunate that the bill being offered by 
our Republican colleagues is one that seniors are going to find is so 
complex that it is going to result in taxpayers displacing a lot of 
private sector contributions which are already providing prescription 
drug benefits.
  Why in the world would we design a drug benefit program where we are 
actually going to be trading taxpayer dollars for dollars that are 
already being spent by corporations for their retirees?
  There is a better alternative, and that is the bill we would like to 
offer, that is, we take the $400 billion that President Bush has talked 
about, roll it into Medicare part B, and use a drug card much like 
President Bush has talked about which ensures that every senior will 
have access to negotiated prices which ensures that they have 10 to 20 
percent savings. We do this without an increase in premiums. We also 
target seniors facing catastrophic health care costs by ensuring that 
after they have purchased drugs that cost $4,000, that the Federal 
Government will be there to pick up the vast majority of their drug 
costs from that point on.
  We also recognize that there are a lot of seniors in this country 
that cannot afford the $4,000, so we provide a low-income benefit that 
provides significant assistance to all those seniors who have incomes 
less than 200 percent of poverty. This would ensure that 50 percent of 
the seniors on Medicare today would have a subsidized low-income 
benefit that would help provide them access to much-needed prescription 
drugs.
  It is time for this Congress to come together and say, if seniors 
have a limited amount of resources, let us target those resources of 
those seniors that are in greatest need. Those are the seniors with 
very high drug costs and those seniors with the least ability to pay, 
and the system should be simple.
  The Republican plan that we are going to be considering on the floor 
today provides seniors the benefit if they are low-income, but not if 
they have $6,000 in assets or a car that is too valuable. We need a 
plan that seniors can understand, that they do not need to be an 
accountant to figure out; and that is what our alternative would 
provide.
  Ms. PRYCE of Ohio. Mr. Speaker, I yield 2 minutes to the gentleman 
from Kentucky (Mr. Whitfield), a member of the Committee on Energy and 
Commerce.
  Mr. WHITFIELD. Mr. Speaker, today represents the culmination of 4 to 
5 years of Congress' efforts to provide a prescription drug benefit for 
senior citizens on Medicare. Two years ago, the House of 
Representatives passed a prescription drug benefit for senior citizens. 
Last year we did the same. The Senate did not do it the year before, 
nor did they do it last year; but this year both the House and the 
Senate will pass a prescription drug benefit.
  This is a meaningful plan. It is going to provide basically free 
medicines for any senior citizen on Medicare who is at 135 percent of 
the poverty level and below. The only thing they will be expected to 
pay is a small $2 copay for generic drugs and a small $5 copay for 
name-brand drugs.
  I have heard a lot of comments today about private insurance 
companies are going to be involved in administering this plan. I think 
it is important to recognize that today's Medicare plan uses private 
insurance companies to handle all of the reimbursement charges for 
Medicare. So we are not doing anything dramatically different in this 
bill than what is being done today.
  I would also say the fact that this bill would provide catastrophic 
coverage for seniors is going to be a tremendous benefit. It will give 
them the peace of mind to know that no matter how high their drug costs 
may be, at some point the Federal Government will pay for all of it, 
the taxpayers will pay for all of it. I would also say that this bill 
provides an important rural health benefit package that is going to 
benefit all of rural America. It also provides additional monies, 
important monies that are needed for disproportionate share hospitals. 
It will benefit every children's hospital in America today. All those 
hospitals that provide care for people on Medicaid will receive 
additional funds. I think this is an important bill, and I urge Members 
to vote for the previous question and to adopt this new prescription 
drug benefit for Medicare beneficiaries.
  Ms. SLAUGHTER. Mr. Speaker, I yield myself the balance of my time.
  Today, the House votes on the biggest change in Medicare in its 40-
year history, a change that will affect 40 million Americans; but the 
Republican leaders have rigged the rules to prevent the House from 
voting on serious alternatives offered by Republicans and Democrats 
alike.
  Mr. Speaker, I will call for a ``no'' vote on the previous question 
in the hope that the House gets the chance to consider an additional 
alternative that the Republican leaders fear. If the previous question 
is defeated, I will offer an amendment to the rule that will make in 
order the Dooley prescription drug alternative substitute. It makes all 
senior citizens enrolled in Medicare part B eligible for prescription 
drug assistance without increasing their premiums. Unlike the 
Republican bill, it has no sickness penalty or doughnut hole that 
seniors can fall through. Unlike the Republican bill, it does not 
encourage companies to drop seniors' existing drug plans.
  Let me make it clear that a ``no'' vote on the previous question will 
not stop the consideration of H.R. 1. It will simply allow the House to 
vote on the Dooley substitute. However, a ``yes'' vote on the previous 
question will prevent the House from voting. I urge a ``no'' vote.
  Mr. Speaker, I ask unanimous consent that the text of the amendment 
be printed in the Record immediately prior to the vote on the previous 
question.
  The SPEAKER pro tempore (Mr. LaTourette). Is there objection to the 
request of the gentlewoman from New York?
  There was no objection.
  Ms. SLAUGHTER. Mr. Speaker, I yield back the balance of my time.

[[Page 16293]]


  Ms. PRYCE of Ohio. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, passing this plan is the right thing to do. It makes the 
kind of commonsense changes to the health care system in this country 
that the American public needs. Adding this Medicare benefit will renew 
our promise to our seniors. It will reduce the cost of prescription 
drugs, and it will revolutionize medicine for the 21st century. Seniors 
deserve this assistance now. They deserved it yesterday. They deserved 
it last week; and actually, they deserved it last year. It is time for 
this body to act. I urge my colleagues to support this fair rule and 
pass the needed reform today.

                              {time}  1415

  The material previously referred to by Ms. Slaughter is as follows:

    Previous Question for H. Res. 299--Rule on H.R. 1 and H.R. 2596 
Medicare Prescription Drug and Modernization Act and Health Savings and 
                           Affordability Act

       In the first section of the resolution strike ``and (3)'' 
     and insert the following:
       ``(3) the further amendment in the nature of a substitute 
     specified in section 7 of this resolution if offered by 
     Representative Doley of California or a designee, which shall 
     be in order without intervention of any point of order, shall 
     be considered as read, and shall be separately debatable for 
     60 minutes equally divided and controlled by the proponent 
     and an opponent; and (4)''
       At the end of the resolution add the following new section:
       ``Sec. 7. The further amendment in the nature of a 
     substitute referred to in the first section of this 
     resolution is as follows:''
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Medicare 
     Rx Now Act of 2003''.
       (b) Amendments to Social Security Act.--Except as otherwise 
     specifically provided, whenever in this Act an amendment is 
     expressed in terms of an amendment to or repeal of a section 
     or other provision, the reference shall be considered to be 
     made to that section or other provision of the Social 
     Security Act.
       (c) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.

                        TITLE I--MEDICARE RX NOW

Sec. 100. Purpose.

  Subtitle A--Part B Drug Benefit with High Deductible and No Premium

Sec. 101. Inclusion of high-deductible outpatient prescription drug 
              benefit under part B.
Sec. 102. Provision of benefits through medicare approved prescription 
              drug plans.

           Subtitle B--Benefits for Low-income Beneficiaries

Sec. 111. Benefits for low-income beneficiaries.
Sec. 112. Improving enrollment process under medicaid.

                TITLE II--RURAL HEALTH CARE IMPROVEMENTS

Sec. 201. Fairness in the medicare disproportionate share hospital 
              (DSH) adjustment for rural hospitals.
Sec. 202. Immediate establishment of uniform standardized amount in 
              rural and small urban areas.
Sec. 203. Establishment of essential rural hospital classification.
Sec. 204. More frequent update in weights used in hospital market 
              basket.
Sec. 205. Improvements to critical access hospital program.
Sec. 206. Redistribution of unused resident positions.
Sec. 207. Two-year extension of hold harmless provisions for small 
              rural hospitals and sole community hospitals under 
              prospective payment system for hospital outpatient 
              department services.
Sec. 208. Exclusion of certain rural health clinic and Federally 
              qualified health center services from the prospective 
              payment system for skilled nursing facilities.
Sec. 209. Recognition of attending nurse practitioners as attending 
              physicians to serve hospice patients.
Sec. 210. Improvement in payments to retain emergency capacity for 
              ambulance services in rural areas.
Sec. 211. Three-year increase for home health services furnished in a 
              rural area.
Sec. 212. Providing safe harbor for certain collaborative efforts that 
              benefit medically underserved populations.
Sec. 213. GAO study of geographic differences in payments for 
              physicians' services.
Sec. 214. Treatment of missing cost reporting periods for sole 
              community hospitals.
Sec. 215. Extension of telemedicine demonstration project.
Sec. 216. Adjustment to the medicare inpatient hospital PPS wage index 
              to revise the labor-related share of such index.
Sec. 217. Establishment of floor on geographic adjustments of payments 
              for physicians' services.

                        TITLE I--MEDICARE RX NOW

     SEC. 100. PURPOSE.

       The purpose of this title is to provide for outpatient 
     prescription drug benefits to medicare beneficiaries in the 
     following manner:
       (1) Medicare beneficiaries enrolled under medicare part B 
     qualify for outpatient prescription drug benefits after an 
     annual deductible (initially set at $4,000) has been met. 
     This benefit is available without any additional premium.
       (2) There are fixed dollar copayments for this coverage, 
     with the average of such copayments equal to 20 percent of 
     the benefits and the amount of the copayments varying 
     depending upon whether the drugs are generic, preferred 
     brand-name, or non-preferred brand-name drugs.
       (3) The benefits are provided through medicare-approved 
     prescription drug plans. These plans may be current plans, 
     such as Medicare+Choice plans, employer-based retiree 
     coverage, medigap plans, State assistance programs, medicaid, 
     drug discount card plans, and other qualified plans (as 
     determined by the Secretary). All of these plans must offer, 
     in addition to the high-deductible coverage, discounts for 
     prescription drugs both while the annual deductible is being 
     satisfied and after it is satisfied.
       (4) To assure access to medicare-approved prescription drug 
     plans for all medicare beneficiaries, the Secretary will 
     solicit bids for prescription drug discount plans that will 
     be available in all geographic regions to all medicare 
     beneficiaries.
       (5) All pharmacies that comply with electronic claims 
     processing standards may provide drugs under the program.
       (6) This title also provides for the availability of 
     additional benefits in the form of a waiver of the annual 
     deductible and reduced copayments, thereby providing 
     immediate entitlement to prescription drug benefits, for 
     medicare beneficiaries who have incomes under 200 percent of 
     the poverty line and who are not eligible for medicaid 
     prescription drug benefits.

  Subtitle A--Part B Drug Benefit with High Deductible and No Premium

     SEC. 101. INCLUSION OF HIGH-DEDUCTIBLE OUTPATIENT 
                   PRESCRIPTION DRUG BENEFIT UNDER PART B.

       (a) Coverage.--Section 1832(a) (42 U.S.C. 1395k(a)) is 
     amended--
       (1) by striking ``and'' at the end of paragraph (1);
       (2) by striking the period at the end of paragraph (2) and 
     inserting ``; and''; and
       (3) by adding at the end the following new paragraph:
       ``(3) entitlement to have access to a prescription drug 
     plan that provides discounts on purchases for outpatient 
     prescription drugs and, effective beginning with 2006, for 
     payment made on his behalf (subject to the provisions of this 
     part) for high-deductible outpatient prescription drug 
     coverage under section 1845.''.
       (b) Description of High-Deductible Prescription Drug 
     Benefit.--Title XVIII is amended by inserting after section 
     1844 the following new section:


                ``outpatient prescription drug coverage

       ``Sec. 1845. (a) High-Deductible Outpatient Prescription 
     Drug Coverage Defined.--
       ``(1) In general.--For purposes of this part, the term 
     `high-deductible outpatient prescription drug coverage' means 
     payment of--
       ``(A) expenses for covered outpatient prescription drugs 
     incurred in a year after the individual has incurred expenses 
     for such drugs in the year of an amount equal to the annual 
     deductible specified in paragraph (2); reduced by
       ``(B) cost-sharing described in paragraph (3).

     For periods before 2006, such coverage shall consist of 
     access to discounts for prescription drugs under a medicare-
     approved prescription drug plan.
       ``(2) Annual deductible.--
       ``(A) In general.--The annual deductible under this 
     paragraph--
       ``(i) for 2006 is equal to $4,000; and
       ``(ii) for a subsequent year is equal to the amount 
     specified in subparagraph (B) for that year, except that, if 
     the amount specified in such subparagraph is not a multiple 
     of $10, it shall be rounded to the nearest multiple of $10.
       ``(B) Inflationary adjustment.--The amount specified in 
     this subparagraph--
       ``(i) for 2006, is $4,000; or
       ``(ii) the amount specified in this subparagraph for a 
     subsequent year is the amount specified in this subparagraph 
     for the previous year increased by the annual percentage 
     increase in average per capita aggregate expenditures for 
     covered outpatient prescription drugs in the United States 
     for medicare beneficiaries, as determined by the Secretary 
     for the 12-month period ending in July of the previous year.

[[Page 16294]]

       ``(3) Cost-sharing.--
       ``(A) Three-tiered copayment structure.--Subject to the 
     succeeding provisions of this paragraph , in the case of a 
     covered outpatient drug that is dispensed in a year to an 
     eligible individual, the individual shall be responsible for 
     a copayment for the drug in an amount equal to the following 
     (or, if less, the price for the drug negotiated pursuant to 
     subsection (c)(5)):
       ``(i) Generic drugs.--In the case of a generic covered 
     outpatient drug, the base copayment amount specified in 
     accordance with subparagraph (B) for each prescription (as 
     defined by the Secretary) of such drug.
       ``(ii) Preferred brand name drugs.--In the case of a 
     preferred brand name covered outpatient drug, 4 times the 
     copayment amount applied under clause (i) for each 
     prescription (as so defined) of such drug.
       ``(iii) Nonpreferred brand name drug.--In the case of a 
     nonpreferred brand name covered outpatient drug, 150 percent 
     of the copayment amount applied under clause (ii) for each 
     prescription (as so defined) of such drug.
       ``(B) Establishment of base copayment amount consistent 
     with 80:20 benefit ratio.--For each year beginning with 2006 
     the Secretary shall establish a base copayment amount in a 
     manner consistent with the principle (subject to reasonable 
     rounding rules) that the ratio of the aggregate amount of 
     benefits provided under this section to the aggregate 
     copayments under this paragraph for each year should be 
     approximately equal to 80 to 20.
       ``(C) Discounts allowed for network pharmacies.--A 
     medicare-approved prescription drug plan may reduce 
     copayments for its designees below the level otherwise 
     provided under this paragraph, but in no case shall such a 
     reduction result in an increase in payments made by the 
     Secretary under this section to a plan.
       ``(D) Treatment of medically necessary nonpreferred 
     drugs.--A nonpreferred brand name drug shall be treated as a 
     preferred brand name drug under this paragraph if such 
     nonpreferred drug is determined (pursuant to procedures 
     established under subsection (c)(6)) to be medically 
     necessary.
       ``(E) Requirement for designation of preferred brand name 
     drugs.--Within each category of therapeutic-equivalent 
     covered outpatient prescription drugs (as defined by the 
     Secretary, in consultation with the Medicare Payment Advisory 
     Commission, each medicare-approved prescription drug plan 
     shall provide for the designation of at least one preferred 
     brand name covered outpatient drug.
       ``(4) Payment of benefits beyond deductible.--
       ``(A) In general.--There shall be paid from the Federal 
     Supplementary Medical Insurance Trust Fund, in the case of 
     each individual who is covered under the insurance program 
     established by this part and incurs expenses for covered 
     outpatient prescription drugs with respect to which benefits 
     are payable under this section, amounts equal to the amounts 
     provided under paragraph (1).
       ``(B) Counting of incurred expenses.--Expenses with respect 
     to covered outpatient prescription drugs under this section 
     shall--
       ``(i) be treated as incurred regardless of whether they are 
     reimbursed by a third-party payor;
       ``(ii) not be treated as incurred unless the expenses were 
     incurred during a period in which the individual was covered 
     under this part; and
       ``(iii) not be treated as incurred unless information 
     concerning the transaction giving rise to such expenses has 
     been electronically transmitted by the pharmacy or other 
     entity dispensing the covered outpatient prescription drugs 
     to the medicare-approved prescription drug plan consistent 
     with electronic claims standards established under subsection 
     (c)(3).''.

     SEC. 102. PROVISION OF BENEFITS THROUGH MEDICARE APPROVED 
                   PRESCRIPTION DRUG PLANS.

       (a) In General.--Section 1845 of the Social Security Act, 
     as inserted by section 101(a), is further amended by adding 
     at the end the following:
       ``(b) Provision of Benefits Through a Medicare Approved 
     Prescription Drug Plan.--
       ``(1) In general.--In the case of an individual entitled to 
     benefits for high-deductible outpatient prescription drug 
     coverage under this section, the individual shall obtain such 
     benefits through a medicare-approved prescription drug plan 
     that is designated under this subsection.
       ``(2) Designation process.--The Secretary shall provide for 
     a process for designation of medicare-approved prescription 
     drug plans consistent with the following:
       ``(A) Frequency of designations.--The Secretary shall 
     permit individuals, on an annual basis and at such other 
     times during a year as the Secretary may specify, to change 
     the plan designated.
       ``(B) Dissemination of information.--The Secretary shall 
     provide for the dissemination of information on designation 
     of plans under this subsection. Such dissemination may be 
     coordinated with the dissemination of information on 
     Medicare+Choice plan selection under part C.
       ``(C) Default assignment.--In the case of an individual who 
     is enrolled under this part who has not otherwise designated 
     a medicare-approved prescription drug plan, the Secretary 
     shall assign the individual to an appropriate prescription 
     drug discount card plan serving the area in which the 
     individual resides.
       ``(D) Deemed designation.--The Secretary may deem an 
     individual who is enrolled in a medicare-approved 
     prescription drug plan described in subparagraph (A) through 
     (E) of subsection (c)(2) as having designated such plan, but 
     shall permit the individual to designate a prescription drug 
     discount card plan instead. The Secretary shall establish 
     rules in cases where an individual is enrolled in more than 
     one such plan.
       ``(3) Designee defined.--In this section, the term 
     `designee' means such an individual who makes such a 
     designation and, with respect to a plan, an individual who 
     has designated that plan under this subsection.
       ``(c) Medicare-Approved Prescription Drug Plans.--
       ``(1) In general.--For purposes of this part, the term 
     `medicare-approved prescription drug plan' means a health 
     plan or program described in paragraph (2) that--
       ``(A) beginning with 2006, provides at least high-
     deductible outpatient prescription drug coverage to designees 
     of that plan or program;
       ``(B) meets the applicable requirements of paragraph (3) 
     and succeeding paragraphs of this subsection with respect to 
     such designees;
       ``(C) has entered into an agreement with the Secretary to 
     provide and exchange electronically such information as the 
     Secretary may require for the administration of the program 
     of benefits under this section; and
       ``(D) meets such additional requirements as the Secretary 
     may specify, including requiring the provision of appropriate 
     periodic audits.
       ``(2) Types of plans and programs that may qualify.--The 
     types of plans and programs that may qualify as a medicare-
     approved prescription drug plan are the following:
       ``(A) A Medicare+Choice plan.
       ``(B) A group health plan, including a retirement health 
     benefits plan, that provides prescription drug coverage.
       ``(C) A State plan under title XIX.
       ``(D) A health benefits plan under the Federal employees' 
     health benefits program under chapter 89 of title 5, United 
     States Code.
       ``(E) A medicare supplemental policy.
       ``(F) State pharmaceutical assistance program.
       ``(G) A prescription drug discount card plan (described in 
     subsection (d)).
       ``(H) Any other prescription drug plan that is determined 
     to meet such requirements as the Secretary establishes.
       ``(3) Administration through card-based electronic 
     mechanism.--
       ``(A) Use of medicare prescription drug card.--Claims for 
     benefits under this section under a medicare-approved 
     prescription drug plan may only be made electronically 
     through the use of an electronic prescription card system (in 
     this paragraph referred to as the `system').
       ``(B) Standards for electronic prescription card system.--
     The Secretary shall establish standards for the system, 
     including the following:
       ``(i) Cards.--Standards for claims cards to be used by 
     designees under the system.
       ``(ii) Coordination of electronic information.--Standards 
     for the real-time transmittal among pharmacies, medicare-
     approved prescription drug plans, and the Secretary 
     (including an appropriate data clearinghouse operated by or 
     under contract with the Secretary) of information on expenses 
     incurred for covered outpatient prescription drugs by 
     designees.
       ``(iii) Confidentiality.--Standards that assure the 
     confidentiality of individually identifiable information of 
     designees and that are consistent with the regulations 
     promulgated under section 264(c) of the Health Insurance 
     Portability and Accountability Act of 1996.
       ``(iv) Electronic transmittal of prescriptions.--
     Prescriptions must be written and transmitted electronically 
     (other than by facsimile), except in emergency cases and 
     other exceptional circumstances recognized by the Secretary.
       ``(v) Provision of information to prescribing health care 
     professional.--The program provides for the electronic 
     transmittal to the prescribing health care professional of 
     information that includes--

       ``(I) information (to the extent available and feasible) on 
     the drug or drugs being prescribed for that patient and other 
     information relating to the medical history or condition of 
     the patient that may be relevant to the appropriate 
     prescription for that patient;
       ``(II) cost-effective alternatives (if any) for the use of 
     the drug prescribed; and
       ``(III) information on the drugs included in the applicable 
     formulary.

     To the extent feasible, such program shall permit the 
     prescribing health care professional to provide (and be 
     provided) related information on an interactive, real-time 
     basis.
       ``(C) Standards.--
       ``(i) Development.--The Secretary shall provide for the 
     development of uniform

[[Page 16295]]

     standards relating to the electronic prescription drug 
     program described in subparagraph (B). Such standards shall 
     be compatible with standards established under part C of 
     title XI.
       ``(ii) Advisory task force.--In developing such standards 
     the Secretary shall establish a task force that includes 
     representatives of physicians, hospitals, pharmacies, 
     beneficiaries, pharmacy benefit managers, individuals with 
     expertise in information technology, and pharmacy benefit 
     experts of the Departments of Veterans Affairs and Defense 
     and other appropriate Federal agencies to provide 
     recommendations to the Administrator on such standards, 
     including recommendations relating to the following:

       ``(I) The range of available computerized prescribing 
     software and hardware and their costs to develop and 
     implement.
       ``(II) The extent to which such standards and systems 
     reduce medication errors and can be readily implemented by 
     physicians, pharmacies, and hospitals.
       ``(III) Efforts to develop uniform standards and a common 
     software platform for the secure electronic communication of 
     medication history, eligibility, benefit, and prescription 
     information.
       ``(IV) Efforts to develop and promote universal 
     connectivity and interoperability for the secure electronic 
     exchange of such information.
       ``(V) The cost of implementing such systems in the range of 
     hospital and physician office settings and pharmacies, 
     including hardware, software, and training costs.
       ``(VI) Implementation issues as they relate to part C of 
     title XI, and current Federal and State prescribing laws and 
     regulations and their impact on implementation of 
     computerized prescribing.

       ``(iii) Deadlines.--

       ``(I) The Secretary shall constitute the task force under 
     clause (ii) by not later than April 1, 2004.
       ``(II) Such task force shall submit recommendations to the 
     Secretary by not later than January 1, 2005.
       ``(III) The Secretary shall provide for the development and 
     promulgation, by not later than January 1, 2006, of national 
     standards relating to the electronic prescription drug 
     program described in clause (ii). Such standards shall be 
     issued by a standards organization accredited by the American 
     National Standards Institute (ANSI) and shall be compatible 
     with standards established under part C of title XI.

       ``(4) Acceptance of claims through all qualifying 
     pharmacies.--A medicare-approved prescription drug plan 
     shall--
       ``(A) permit the participation of any pharmacy that meets 
     terms and conditions that the plan has established;
       ``(B) provide for acceptance and process of claims for 
     designees from any pharmacy that meets standards the 
     Secretary has established under paragraph (3) to carry out 
     real-time transmittal of claims to such plans and that 
     provides for disclosure, in the case of dispensing of a brand 
     name drug to a designee, of information on the availability 
     of generic equivalents at reduced cost to the designee; and
       ``(C) permit enrollees to receive benefits (which may 
     include a 90-day supply of drugs or biologicals) through a 
     community pharmacy, rather than through mail order, with any 
     differential in cost paid by such enrollees.
       ``(5) Requirement to negotiate discounts and generic 
     equivalents.--A medicare-approved prescription drug plan 
     shall provide designees of the plan with the following:
       ``(A) Negotiated prices.--Access to negotiated prices 
     (including applicable discounts) used for payment for covered 
     outpatient drugs, regardless of the fact that no benefits or 
     only partial benefits may be payable with respect to such 
     drugs because of the application of the deductible under 
     subsection (a)(2) or copayment under subsection (a)(3) or 
     because the drugs are procured before January 1, 2006.
       ``(B) Generic equivalents.--Information on the availability 
     of generic equivalents at reduced cost to such designees.
       ``(6) Treatment of nonpreferred brand name drugs.--
       ``(A) Procedures regarding the determination of drugs that 
     are medically necessary.--
       ``(i) In general.--A medicare-approved prescription drug 
     plan shall have in place procedures on a case-by-case basis 
     to treat a nonpreferred brand name drug as a preferred brand 
     name drug for purposes of subsection (a) if the nonpreferred 
     brand name drug is determined--

       ``(I) to be not as effective for the designee in preventing 
     or slowing the deterioration of, or improving or maintaining, 
     the health of the individual; or

       ``(II) to have a significant adverse effect on the 
     individual.

       ``(ii) Requirement.--The procedures under clause (i) shall 
     require that determinations under such clause are based on 
     professional medical judgment, the medical condition of the 
     enrollee, and other medical evidence.
       ``(B) Procedures regarding appeal rights with respect to 
     denials of care.--Such a plan shall have in place procedures 
     to ensure a timely internal review (and timely independent 
     external review) for resolution of denials of coverage in 
     accordance with the medical exigencies of the case in 
     accordance with requirements established by the Secretary 
     that are comparable to such requirements for Medicare+Choice 
     organizations under part C and to ensure notice to designees 
     regarding such procedures. A designee shall have the further 
     right to an appeal of such a denial of coverage in the same 
     manner as is provided under section 1852(g)(5) in the case of 
     a failure to receive health services under a Medicare+Choice 
     plan.
       ``(7) Prompt payment of pharmacies for covered benefits.--
     Medicare-approved prescription drug plans shall provide for 
     payment to qualifying pharmacies of benefits under subsection 
     (a)(4) promptly in accordance with rules no less generous 
     than the rules applicable under section 1842(c)(2)(B).
       ``(8) Education.--Medicare-approved prescription drug plans 
     shall apply methods to identify and educate providers, 
     pharmacists, and designees regarding--
       ``(A) instances or patterns concerning the unnecessary or 
     inappropriate prescribing or dispensing of covered outpatient 
     prescription drugs;
       ``(B) instances or patterns of substandard care;
       ``(C) potential adverse reactions to covered outpatient 
     prescription drugs;
       ``(D) inappropriate use of antibiotics;
       ``(E) appropriate use of generic products; and
       ``(F) the importance of using covered outpatient 
     prescription drugs in accordance with the instruction of 
     prescribing providers.
       ``(9) Not at financial risk.--The entity offering a 
     medicare-approved prescription drug plan shall not be at 
     financial risk for the provision of high-deductible 
     prescription drug coverage under the plan to designees, but 
     there shall be performance incentives (based on risk 
     corridors negotiated between the entity and the Secretary and 
     subject to audit) in relation to the administration of the 
     contract and the entity's ability to reduce costs through 
     appropriate incentive mechanisms.
       ``(10) Provision of data.--The entity offering such a plan 
     shall provide the Secretary with such information as is 
     required to make payments to the entity under this section.
       ``(d) Prescription Drug Discount Card Plans.--
       ``(1) Solicitation of bids.--The Secretary shall solicit 
     bids from entities to offer prescription drug discount card 
     plans to individuals enrolled under this part either 
     nationwide or in large geographic areas. The Secretary shall 
     award bids in a manner so that such plans are offered in all 
     areas of the United States. The Secretary may not award a 
     contract based on such a bid to an entity with respect to a 
     plan unless the entity and plan meet the applicable 
     requirements to be a medicare-approved prescription drug plan 
     under this section.
       ``(2) Limitation on benefits.--The entity offering a 
     prescription drug discount card plan shall not offer (or 
     charge for) benefits to designees of the plan in addition to 
     high-deductible prescription drug coverage, access to 
     negotiated prices, and other benefits required under this 
     section and, in the case of subsidy eligible individuals, 
     benefits under subsection (h).
       ``(e) Payment of Plans.--
       ``(1) In general.--The Secretary shall provide, in the 
     contract entered into between the Secretary and entities that 
     offer medicare-approved prescription drug plans, for payment 
     to the plans for high-deductible prescription drug coverage 
     offered through the plan, including expanded coverage for 
     low-income individuals under subsection (g) and taking into 
     account performance incentives described in paragraph (2). In 
     addition, in the case of prescription drug discount card 
     plans, the Secretary shall provide for payment of 
     administrative costs in carrying out the contract (taking 
     into account the performance incentives described in 
     paragraph (2)), based on rates negotiated between the 
     Secretary and the entity in the solicitation process under 
     subsection (d).
       ``(2) Incentives for cost and utilization management and 
     quality improvement.--The Secretary shall include in the 
     contract such financial or other performance incentives for 
     cost and utilization management and quality improvement as 
     the Secretary may deem appropriate.
       ``(f) Covered Outpatient Prescription Drugs Defined.--
       ``(1) In general.--Except as provided in this subsection, 
     for purposes of this section, the term `covered outpatient 
     prescription drug' means--
       ``(A) a drug that may be dispensed only upon a prescription 
     and that is described in subparagraph (A)(i) or (A)(ii) of 
     section 1927(k)(2); or
       ``(B) a biological product described in clauses (i) through 
     (iii) of subparagraph (B) of such section or insulin 
     described in subparagraph (C) of such section,
     and such term includes a vaccine licensed under section 351 
     of the Public Health Service Act and any use of a covered 
     outpatient drug for a medically accepted indication (as 
     defined in section 1927(k)(6)).
       ``(2) Exclusions.--
       ``(A) In general.--Such term does not include drugs or 
     classes of drugs, or their medical uses, which may be 
     excluded from coverage or otherwise restricted under section

[[Page 16296]]

     1927(d)(2), other than subparagraph (E) thereof (relating to 
     smoking cessation agents), or under section 1927(d)(3), as 
     the Secretary may specify and does not include such other 
     medicines, classes, and uses as the Secretary may specify 
     consistent with the goals of providing quality care and 
     containing costs under this section.
       ``(B) Avoidance of duplicate coverage.--A drug prescribed 
     for an individual that would otherwise be a covered 
     outpatient prescription drug under this section shall not be 
     so considered if payment for such drug is available under 
     part A or under this part (other than under this section).''.
       (b) No Effect on Part B Premium.--
       (1) In general.--Section 1839(a) (42 U.S.C. 1395r(a)) is 
     amended by adding at the end the following new paragraph:
       ``(5) Notwithstanding the previous provisions of this 
     subsection, in computing actuarial rates there shall not be 
     taken into account benefits and administrative costs that are 
     attributable to the prescription drug coverage provided under 
     section 1845.''.
       (2) Special enrollment period; waiver of late enrollment 
     penalty.--
       (A) Section 1837 (42 U.S.C. 1395p) is amended by adding at 
     the end the following new subsection:
       ``(k) There shall also be a general enrollment period 
     during the period beginning on July 1, 2005, and ending on 
     November 30, 2005.''.
       (B) Section 1838(a) (42 U.S.C. 1395q(a)) is amended--
       (i) by striking ``or'' at the end of paragraph (2);
       (ii) by striking the period at the end of paragraph (3) and 
     inserting ``, or''; and
       (iii) by adding at the end the following new paragraph:
       ``(4) in the case of an individual who enrolls pursuant to 
     subsection (k) of section 1837, January 1, 2006.''.
       (C) Section 1839(b) (42 U.S.C. 1395r(b)) is amended by 
     inserting ``or a general enrollment period under section 
     1837(k)'' after ``not pursuant to a special enrollment period 
     under section 1837(i)(4)''.
       (3) Government contribution.--Section 1844(a)(1) (42 U.S.C. 
     1395w(a)(1)) is amended--
       (A) by striking ``plus'' at the end of subparagraph (A);
       (B) by striking ``; plus'' at the end of subparagraph (B) 
     and inserting ``, plus''; and
       (C) by adding at the end the following new subparagraph:
       ``(C) a Government contribution equal to the aggregate 
     amounts expended from the Trust Fund for benefits and 
     administrative expenses attributable to the prescription drug 
     coverage provided under section 1845; plus''.
       (c) Medicare as Primary Payor.--Section 1862(b) (42 U.S.C. 
     1395y(b)) is amended by adding at the end the following new 
     paragraph:
       ``(7) Exception for outpatient prescription drug benefit.--
     The previous provisions of this subsection shall not apply to 
     benefits provided under section 1845.''.

           Subtitle B--Benefits for Low-income Beneficiaries

     SEC. 111. BENEFITS FOR LOW-INCOME BENEFICIARIES.

       (a) In General.--
       (1) First dollar coverage.--Section 1845, as inserted by 
     section 101(b), is amended by adding at the end the following 
     new subsection:
       ``(g) First Dollar Coverage for Certain Low-Income 
     Individuals.--
       ``(1) In general.--In the case of a subsidy eligible 
     individual (as defined in paragraph (2)), this section shall 
     be applied as if the annual deductible were equal to zero 
     but, with respect to costs incurred before the amount of the 
     annual deductible otherwise applicable, the following 
     copayment amounts shall apply:
       ``(A) 10 percent copayment for individuals with incomes up 
     to 150 percent of poverty.--For subsidy eligible individuals 
     with income that does not exceed 150 percent of the poverty 
     line, the copayment amounts shall be the copayments amounts 
     specified in subsection (a)(3), which reflects an average 
     benefit percentage of 90 percent.
       ``(B) 50 percent copayment for individuals with incomes 
     above 150 percent of poverty.--For subsidy eligible 
     individuals with income that exceeds 150 percent of the 
     poverty line, the copayment amounts shall be the copayments 
     amounts specified in subsection (a)(3) increased by 150 
     percent, which reflects an average benefit percentage of 50 
     percent, but in no case shall such copayment amount exceed 
     the price negotiated for the drug involved.
       ``(2) Determination of eligibility.--
       ``(A) Subsidy eligible individual defined.--For purposes of 
     this section, subject to subparagraph (D), the term `subsidy 
     eligible individual' means an individual who--
       ``(i) is enrolled under this part;
       ``(ii) has income below 150 percent (or such higher 
     percent, not to exceed 200 percent, as a State may specify 
     under subparagraph (B)) of the Federal poverty line; and
       ``(iii) is not eligible for medical assistance with respect 
     to prescription drugs under title XIX.

     For purposes of this section, an individual shall not be 
     treated as eligible for medical assistance with respect to 
     prescription drugs under title XIX (including under a waiver 
     under section 1115) only if, with respect to such assistance, 
     the individual is charged a copayment greater than a nominal 
     amount (as described in section 1916(a)(3)) and there is no 
     monthly or similar dollar limit established for the amount of 
     such assistance over any period of time.
       ``(B) Coverage of individuals with income up to 200 percent 
     of poverty at state option.--One of the 50 States or the 
     District of Columbia may, at its option and subject to 
     section 1935(c), specify a percent of income, that exceeds 
     150 percent but does not exceed 200 percent, that will apply 
     for purposes of this subsection to individuals residing in 
     the State.
       ``(C) Determinations.--The determination of whether an 
     individual residing in a State is a subsidy eligible 
     individual shall be determined under the State medicaid plan 
     for the State under section 1935(a) or by the Social Security 
     Administration. There are authorized to be appropriated to 
     the Social Security Administration such sums as may be 
     necessary for the determination of eligibility under this 
     subparagraph.
       ``(D) Income determinations.--For purposes of applying this 
     subsection--
       ``(i) income shall be determined in the manner no less 
     restrictive than the manner described in section 
     1905(p)(1)(B); and
       ``(ii) the term `Federal poverty line' means the official 
     poverty line (as defined by the Office of Management and 
     Budget, and revised annually in accordance with section 
     673(2) of the Omnibus Budget Reconciliation Act of 1981) 
     applicable to a family of the size involved.
       ``(E) Treatment of territorial residents.--In the case of 
     an individual who is not a resident of the 50 States or the 
     District of Columbia, the individual is not eligible to be a 
     subsidy eligible individual but may be eligible for financial 
     assistance with prescription drug expenses under section 
     1935(f).
       ``(3) Administration of subsidy program.--The Secretary 
     shall provide a process whereby, in the case of an individual 
     who is determined to be a subsidy eligible individual and who 
     is enrolled in a medicare-approved prescription drug plan--
       ``(A) the Secretary provides for a notification of the 
     entity offering the plan that the individual is eligible for 
     a subsidy under paragraph (1);
       ``(B) such entity adjusts the benefits for prescription 
     drug coverage accordingly and submits to the Secretary 
     information on the amount of such benefits provided; and
       ``(C) the Secretary periodically and on a timely basis 
     reimburses the entity for the amount of such benefits 
     (including reasonable related administrative costs) that are 
     provided only because of the application of this subsection.
       ``(4) Relation to medicaid program.--
       ``(A) In general.--For provisions providing for eligibility 
     determinations, and additional financing, under the medicaid 
     program, see section 1935.
       ``(B) Coordination.--The Secretary shall develop and 
     implement a plan for the coordination of prescription drug 
     benefits under this part with the benefits provided under the 
     medicaid program under title XIX, with particular attention 
     to insuring coordination of payments and prevention of fraud 
     and abuse. In developing and implementing such plan, the 
     Secretary shall involve the States, the data processing 
     industry, pharmacists, and pharmaceutical manufacturers, and 
     other experts and representatives of low-income medicare 
     beneficiaries.''.
       (2) Reduction in catastrophic copayments for low income 
     individuals.--Section 1845(a), as inserted by section 101(b), 
     is amended--
       (A) in paragraph (3)(A), by inserting ``and paragraph (5)'' 
     after ``Subject to the succeeding provisions of this 
     paragraph''; and
       (B) by adding at the end the following new paragraph:
       ``(5) Reduction in copayments for low-income individuals to 
     10 percent.--In the case of a subsidy eligible individual 
     with income that does not exceed 150 percent of the poverty 
     line (as defined for purposes of subsection (g)), the 
     copayment otherwise applicable under paragraph (3) shall be 
     \1/2\ of the copayment amount otherwise applicable.''.
       (b) Medicaid Amendments.--
       (1) Determinations of eligibility for low-income 
     subsidies.--
       (A) Requirement.--Section 1902(a) (42 U.S.C. 1396a(a)) is 
     amended--
       (i) by striking ``and'' at the end of paragraph (64);
       (ii) by striking the period at the end of paragraph (65) 
     and inserting ``; and''; and
       (iii) by inserting after paragraph (65) the following new 
     paragraph:
       ``(66) provide for making eligibility determinations under 
     sections 1845(a)(5), 1845(g), and 1935(a).''.
       (2) New section.--Title XIX of such Act is further 
     amended--
       (A) by redesignating section 1935 as section 1936; and
       (B) by inserting after section 1934 the following new 
     section:


  ``special provisions relating to medicare prescription drug benefit

       ``Sec. 1935. (a) Requirement for Making Eligibility 
     Determinations for Low-Income Subsidy.--

[[Page 16297]]

       ``(1) In general.--As a condition of its State plan under 
     this title under section 1902(a)(66) and receipt of any 
     Federal financial assistance under section 1903(a), a State 
     shall--
       ``(A) make determinations of eligibility for subsidies 
     under (and in accordance with) sections 1845(g) and 
     1845(a)(5);
       ``(B) inform the Secretary of such determinations in cases 
     in which such eligibility is established; and
       ``(C) otherwise provide the Secretary with such information 
     as may be required to carry out section 1845.
       ``(2) State option for coverage of additional low-income 
     individuals.--A State may elect under paragraph (2)(B) of 
     section 1845(g) to cover additional low-income medicare 
     beneficiaries under the prescription drug subsidy program 
     provided under such subsection, subject to contribution under 
     subsection (c).
       ``(b) Payments for Additional Administrative Costs.--
       ``(1) In general.--The amounts expended by a State in 
     carrying out subsection (a) are, subject to paragraph (2), 
     expenditures reimbursable under the appropriate paragraph of 
     section 1903(a); except that, notwithstanding any other 
     provision of such section, the applicable Federal matching 
     rates with respect to such expenditures under such section 
     shall be increased as follows (but in no case shall the rate 
     as so increased exceed 100 percent):
       ``(A) For expenditures attributable to costs incurred 
     during 2006, the otherwise applicable Federal matching rate 
     shall be increased by 10 percent of the percentage otherwise 
     payable (but for this subsection) by the State.
       ``(B)(i) For expenditures attributable to costs incurred 
     during 2007 and each subsequent year through 2013, the 
     otherwise applicable Federal matching rate shall be increased 
     by the applicable percent (as defined in clause (ii)) of the 
     percentage otherwise payable (but for this subsection) by the 
     State.
       ``(ii) For purposes of clause (i), the `applicable percent' 
     for--
       ``(I) 2007 is 20 percent; or
       ``(II) a subsequent year is the applicable percent under 
     this clause for the previous year increased by 10 percentage 
     points.
       ``(C) For expenditures attributable to costs incurred after 
     2013, the otherwise applicable Federal matching rate shall be 
     increased to 100 percent.
       ``(2) Coordination.--The State shall provide the Secretary 
     with such information as may be necessary to properly 
     allocate administrative expenditures described in paragraph 
     (1) that may otherwise be made for similar eligibility 
     determinations.
       ``(c) State Contribution at SCHIP Matching Rate Towards 
     Additional Low-Income Subsidies for Optional Subsidy Eligible 
     Individuals Covered Under State Option.--In the case of a 
     State that specifies a percent of income under section 
     1845(g)(2)(B) for a quarter, the amount of payment made to 
     the State under section 1903(a)(1) for the quarter shall be 
     reduced by the product of--
       ``(1) 100 percent less the enhanced FMAP described in 
     section 2105(b) for that State and quarter; and
       ``(2) the additional amount of payment made under section 
     1845 because of the application of such specification.''.
       (b) Phased-In Federal Assumption of Medicaid Responsibility 
     for Cost-Sharing Subsidies for Dually Eligible Individuals.--
       (1) In general.--Section 1903(a)(1) (42 U.S.C. 1396b(a)(1)) 
     is amended by inserting before the semicolon the following: 
     ``, reduced by the amount computed under section 1935(d)(1) 
     for the State and the quarter''.
       (2) Amount described.--Section 1935, as inserted by 
     subsection (a)(2), is amended by adding at the end the 
     following new subsection:
       ``(d) Federal Assumption of Medicaid Prescription Drug 
     Costs for Dually-Eligible Beneficiaries.--
       ``(1) In general.--For purposes of section 1903(a)(1), for 
     a State that is one of the 50 States or the District of 
     Columbia for a calendar quarter in a year (beginning with 
     2006) the amount computed under this subsection is equal to 
     the sum of the product described in paragraph (3) plus the 
     product of the following:
       ``(A) Medicare benefits for medicaid eligibles.--The total 
     amount of payments made in the quarter because of the 
     operation of section 1845 that are attributable to 
     individuals who are residents of the State and are eligible 
     for medical assistance with respect to prescription drugs 
     under this title. For purposes of this subparagraph, an 
     individual shall not be treated as eligible for medical 
     assistance with respect to prescription drugs under title XIX 
     (including under a waiver under section 1115) only if, with 
     respect to such assistance, the individual is charged a 
     copayment greater than a nominal amount (as described in 
     section 1916(a)(3)) and there is no monthly or similar dollar 
     limit established for the amount of such assistance over any 
     period of time.
       ``(B) State matching rate.--A proportion computed by 
     subtracting from 100 percent the Federal medical assistance 
     percentage (as defined in section 1905(b)) applicable to the 
     State and the quarter.
       ``(C) Phase-out proportion.--The phase-out proportion (as 
     defined in paragraph (2)) for the quarter.
       ``(2) Phase-out proportion.--For purposes of paragraph 
     (1)(C), the `phase-out proportion' for a calendar quarter 
     in--
       ``(A) 2006 is 90 percent;
       ``(B) a subsequent year before 2014, is the phase-out 
     proportion for calendar quarters in the previous year 
     decreased by 10 percentage points; or
       ``(C) a year after 2013 is 0 percent.
       ``(3) Product.--The product described in this paragraph for 
     a State for a calendar quarter is the State matching rate 
     described in paragraph (1)(B) for that State and quarter 
     multiplied by the additional expenditures made under section 
     1845 as a result of the following:
       ``(A) Reductions in catastrophic copayments.--The 
     application of subsection (a)(5) thereof.
       ``(B) First dollar coverage.--The application under 
     subsection (g) of reduced copayments amounts insofar as such 
     amounts are less than 25 percent of the amount of the price 
     otherwise negotiated for the drug involved.
       (3) Medicaid providing wrap-around benefits.--Section 1935, 
     as so inserted and amended, is further amended by adding at 
     the end the following new subsection:
       ``(e) Medicaid as Secondary Payor.--In the case of an 
     individual who is entitled to benefits under part B of title 
     XVIII and is eligible for medical assistance with respect to 
     prescribed drugs under this title, medical assistance shall 
     continue to be provided under this title for prescribed drugs 
     to the extent payment is not made under such part B, without 
     regard to section 1902(n)(2).''.
       (4) Clarifying amendments.--Section 1905(p)(3) (42 U.S.C. 
     1396d(p)(3)) is amended--
       (A) in subparagraph (B), by inserting ``, but not including 
     any copayments under section 1845'' after ``section 1813''; 
     and
       (B) in subparagraph (C), by inserting ``, but not including 
     any deductible under section 1845'' after ``section 
     1833(b)''..
       (d) Treatment of Territories.--
       (1) In general.--Section 1935 of such Act, as so inserted 
     and amended, is further amended--
       (A) in subsection (a) in the matter preceding paragraph 
     (1), by inserting ``subject to subsection (f)'' after 
     ``section 1903(a)'';
       (B) in subsection (c)(1), by inserting ``subject to 
     subsection (f)'' after ``1903(a)(1)''; and
       (C) by adding at the end the following new subsection:
       ``(f) Treatment of Territories.--
       ``(1) In general.--In the case of a State, other than the 
     50 States and the District of Columbia--
       ``(A) the previous provisions of this section shall not 
     apply to residents of such State; and
       ``(B) if the State establishes a plan described in 
     paragraph (2) (for providing medical assistance with respect 
     to the provision of prescription drugs to medicare 
     beneficiaries under section 1845(g)), the amount otherwise 
     determined under section 1108(f) (as increased under section 
     1108(g)) for the State shall be increased by the amount 
     specified in paragraph (3).
       ``(2) Plan.--The plan described in this paragraph is a plan 
     that--
       ``(A) provides medical assistance under section 1845(g) 
     with respect to the provision of covered outpatient drugs to 
     low-income medicare beneficiaries whose income does not 
     exceed an income level specified under the plan; and
       ``(B) assures that additional amounts received by the State 
     that are attributable to the operation of this subsection are 
     used only for such assistance.
       ``(3) Increased amount.--
       ``(A) In general.--The amount specified in this paragraph 
     for a State for a year is equal to the product of--
       ``(i) the aggregate amount specified in subparagraph (B); 
     and
       ``(ii) the amount specified in section 1108(g)(1) for that 
     State, divided by the sum of the amounts specified in such 
     section for all such States.
       ``(B) Aggregate amount.--The aggregate amount specified in 
     this subparagraph for--
       ``(i) 2006, is equal to $25,000,000; or
       ``(ii) a subsequent year, is equal to the aggregate amount 
     specified in this subparagraph for the previous year 
     increased by annual percentage increase specified in section 
     1845(a)(2)(B) for the year involved.
       ``(4) Report.--The Secretary shall submit to Congress a 
     report on the application of this subsection and may include 
     in the report such recommendations as the Secretary deems 
     appropriate.''.
       (2) Conforming amendment.--Section 1108(f) (42 U.S.C. 
     1308(f)) is amended by inserting ``and section 
     1935(f)(1)(B)'' after ``Subject to subsection (g)''.
       (e) Medicaid Reduction of Copayments for QMBs.--Section 
     1905(p)(3) (42 U.S.C. 1396d(p)(3)) is amended by adding at 
     the end the following new subparagraph:
       ``(E) The difference between the copayment amounts 
     established under sections 1845(g)(1)(A) and 1845(a)(5) for 
     covered outpatient drugs and the nominal copayment amounts 
     that would apply to such drugs if covered under this title, 
     pursuant to section 1916(a).''.

[[Page 16298]]

       (f) Renegotiation of Pharmacy Plus Waivers.--In the case of 
     States which as of the date of the enactment of this Act have 
     entered into demonstration projects (popularly known as 
     pharmacy plus waivers) under section 1115 of the Social 
     Security Act under which the State is provided flexibility to 
     offer medical assistance for prescription drug coverage in 
     return for limitations on payments for certain optional 
     populations, the Secretary of Health and Human Services shall 
     renegotiate such projects in order to account for the 
     additional prescription drug benefits made available under 
     the amendments made by this title.

     SEC. 112. IMPROVING ENROLLMENT PROCESS UNDER MEDICAID.

       (a) Automatic Reenrollment Without Need To Reapply.--
       (1) In general.--Section 1905(p) (42 U.S.C. 1396d(p)) is 
     amended--
       (A) by redesignating paragraph (6) as paragraph (9); and
       (B) by inserting after paragraph (5), the following new 
     paragraph:
       ``(6) In the case of an individual who has been determined 
     to qualify as a qualified medicare beneficiary or to be 
     eligible for benefits under section 1902(a)(10)(E)(iii), the 
     individual shall be deemed to continue to be so qualified or 
     eligible without the need for any annual or periodic 
     application unless and until the individual notifies the 
     State that the individual's eligibility conditions have 
     changed so that the individual is no longer so qualified or 
     eligible.''.
       (2) Conforming amendment.--Section 1902(e)(8) (42 U.S.C. 
     1396a(e)(8)) is amended by striking the second sentence.
       (b) Use of Simplified Application Process.--Such section 
     1905(p) is further amended by adding at the end the following 
     new paragraph:
       ``(7) A State shall permit individuals to apply to qualify 
     as a qualified medicare beneficiary or for benefits under 
     section 1902(a)(10)(E)(iii) through the use of the simplified 
     application form developed under section 1905(p)(5)(A) and 
     shall permit such an application to be made over the 
     telephone, the Internet, or by mail, without the need for an 
     interview in person by the applicant or a representative of 
     the applicant.''.
       (c) Role of Social Security Offices.--
       (1) Enrollment and provision of information at social 
     security offices.--Such section is further amended by adding 
     at the end the following new paragraph:
       ``(8) The Commissioner of Social Security shall provide, 
     through local offices of the Social Security Administration--
       ``(A) for the enrollment under State plans under this title 
     for appropriate medicare cost-sharing benefits for 
     individuals who qualify as a qualified medicare beneficiary 
     or for benefits under section 1902(a)(10)(E)(iii); and
       ``(B) for providing oral and written notice of the 
     availability of such benefits.''.
       (2) Clarifying amendment.--Section 1902(a)(5) (42 U.S.C. 
     1396a(a)(5)) is amended by inserting ``as provided in section 
     1905(p)(10)'' before ``except''.
       (d) Outstationing of State Eligibility Workers at SSA Field 
     Offices.--Section 1902(a)(55) (42 U.S.C. 1396a(a)(55)) is 
     amended--
       (1) by striking ``subsection (a)(10)(A)(i)(IV), 
     (a)(10)(A)(i)(VI), (a)(10)(A)(i)(VII), or 
     (a)(10)(A)(ii)(IX)'' and inserting ``paragraph 
     (10)(A)(i)(IV), (10)(A)(i)(VI), (10)(A)(i)(VII), 
     (10)(A)(ii)(IX), or (10)(E)''; and
       (2) in subparagraph (A), by inserting ``and in the case of 
     applications of individuals for medical assistance under 
     paragraph (10)(E), at locations that include field offices of 
     the Social Security Administration''.

                TITLE II--RURAL HEALTH CARE IMPROVEMENTS

     SEC. 201. FAIRNESS IN THE MEDICARE DISPROPORTIONATE SHARE 
                   HOSPITAL (DSH) ADJUSTMENT FOR RURAL HOSPITALS.

       (a) Equalizing DSH Payment Amounts.--
       (1) In general.--Section 1886(d)(5)(F)(vii) (42 U.S.C. 
     1395ww(d)(5)(F)(vii)) is amended by inserting ``, and, after 
     October 1, 2003, for any other hospital described in clause 
     (iv),'' after ``clause (iv)(I)'' in the matter preceding 
     subclause (I).
       (2) Conforming amendments.--Section 1886(d)(5)(F) (42 
     U.S.C. 1395ww(d)(5)(F)) is amended--
       (A) in clause (iv)--
       (i) in subclause (II)--

       (I) by inserting ``and before October 1, 2003,'' after 
     ``April 1, 2001,''; and
       (II) by inserting ``or, for discharges occurring on or 
     after October 1, 2003, is equal to the percent determined in 
     accordance with the applicable formula described in clause 
     (vii)'' after ``clause (xiii)'';

       (ii) in subclause (III)--

       (I) by inserting ``and before October 1, 2003,'' after 
     ``April 1, 2001,''; and
       (II) by inserting ``or, for discharges occurring on or 
     after October 1, 2003, is equal to the percent determined in 
     accordance with the applicable formula described in clause 
     (vii)'' after ``clause (xii)'';

       (iii) in subclause (IV)--

       (I) by inserting ``and before October 1, 2003,'' after 
     ``April 1, 2001,''; and
       (II) by inserting ``or, for discharges occurring on or 
     after October 1, 2003, is equal to the percent determined in 
     accordance with the applicable formula described in clause 
     (vii)'' after ``clause (x) or (xi)'';

       (iv) in subclause (V)--

       (I) by inserting ``and before October 1, 2003,'' after 
     ``April 1, 2001,''; and
       (II) by inserting ``or, for discharges occurring on or 
     after October 1, 2003, is equal to the percent determined in 
     accordance with the applicable formula described in clause 
     (vii)'' after ``clause (xi)''; and

       (v) in subclause (VI)--

       (I) by inserting ``and before October 1, 2003,'' after 
     ``April 1, 2001,''; and
       (II) by inserting ``or, for discharges occurring on or 
     after October 1, 2003, is equal to the percent determined in 
     accordance with the applicable formula described in clause 
     (vii)'' after ``clause (x)'';

       (B) in clause (viii), by striking ``The formula'' and 
     inserting ``For discharges occurring before October 1, 2003, 
     the formula''; and
       (C) in each of clauses (x), (xi), (xii), and (xiii), by 
     striking ``For purposes'' and inserting ``With respect to 
     discharges occurring before October 1, 2003, for purposes''.
       (b) Effective Date.--The amendments made by this section 
     shall apply to discharges occurring on or after October 1, 
     2003.

     SEC. 202. IMMEDIATE ESTABLISHMENT OF UNIFORM STANDARDIZED 
                   AMOUNT IN RURAL AND SMALL URBAN AREAS.

       (a) In General.--Section 1886(d)(3)(A) (42 U.S.C. 
     1395ww(d)(3)(A)) is amended--
       (1) in clause (iv), by inserting ``and ending on or before 
     September 30, 2003,'' after ``October 1, 1995,''; and
       (2) by redesignating clauses (v) and (vi) as clauses (vii) 
     and (viii), respectively, and inserting after clause (iv) the 
     following new clauses:
       ``(v) For discharges occurring in the fiscal year beginning 
     on October 1, 2003, the average standardized amount for 
     hospitals located in areas other than a large urban area 
     shall be equal to the average standardized amount for 
     hospitals located in a large urban area.''.
       (b) Conforming Amendments.--
       (1) Computing drg-specific rates.--Section 1886(d)(3)(D) 
     (42 U.S.C. 1395ww(d)(3)(D)) is amended--
       (A) in the heading, by striking ``in different areas'';
       (B) in the matter preceding clause (i), by striking ``, 
     each of'';
       (C) in clause (i)--
       (i) in the matter preceding subclause (I), by inserting 
     ``for fiscal years before fiscal year 2004,'' before ``for 
     hospitals''; and
       (ii) in subclause (II), by striking ``and'' after the 
     semicolon at the end;
       (D) in clause (ii)--
       (i) in the matter preceding subclause (I), by inserting 
     ``for fiscal years before fiscal year 2004,'' before ``for 
     hospitals''; and
       (ii) in subclause (II), by striking the period at the end 
     and inserting ``; and''; and
       (E) by adding at the end the following new clause:
       ``(iii) for a fiscal year beginning after fiscal year 2003, 
     for hospitals located in all areas, to the product of--
       ``(I) the applicable standardized amount (computed under 
     subparagraph (A)), reduced under subparagraph (B), and 
     adjusted or reduced under subparagraph (C) for the fiscal 
     year; and
       ``(II) the weighting factor (determined under paragraph 
     (4)(B)) for that diagnosis-related group.''.
       (2) Technical conforming sunset.--Section 1886(d)(3) (42 
     U.S.C. 1395ww(d)(3)) is amended--
       (A) in the matter preceding subparagraph (A), by inserting 
     ``, for fiscal years before fiscal year 1997,'' before ``a 
     regional adjusted DRG prospective payment rate''; and
       (B) in subparagraph (D), in the matter preceding clause 
     (i), by inserting ``, for fiscal years before fiscal year 
     1997,'' before ``a regional DRG prospective payment rate for 
     each region,''.

     SEC. 203. ESTABLISHMENT OF ESSENTIAL RURAL HOSPITAL 
                   CLASSIFICATION.

       (a) Classification.--Section 1861(mm) (42 U.S.C. 1395x(mm)) 
     is amended--
       (1) in the heading by adding ``Essential Rural Hospitals'' 
     at the end; and
       (2) by adding at the end the following new paragraphs:
       ``(4)(A) The term `essential rural hospital' means a 
     subsection (d) hospital (as defined in section 1886(d)(1)(B)) 
     that is located in a rural area (as defined for purposes of 
     section 1886(d)), has more than 25 licensed acute care 
     inpatient beds, has applied to the Secretary for 
     classification as such a hospital, and with respect to which 
     the Secretary has determined that the closure of the hospital 
     would significantly diminish the ability of medicare 
     beneficiaries to obtain essential health care services.
       ``(B) The determination under subparagraph (A) shall be 
     based on the following criteria:
       ``(i) High proportion of medicare beneficiaries receiving 
     care from hospital.--(I) A high percentage of such 
     beneficiaries residing in the area of the hospital who are 
     hospitalized (during the most recent year for which complete 
     data are available) receive basic inpatient medical care at 
     the hospital.
       ``(II) For a hospital with more than 200 licensed beds, a 
     high percentage of such beneficiaries residing in such area 
     who are hospitalized (during such recent year) receive

[[Page 16299]]

     specialized surgical inpatient care at the hospital.
       ``(III) Almost all physicians described in section 
     1861(r)(1) in such area have privileges at the hospital and 
     provide their inpatient services primarily at the hospital.
       ``(ii) Significant adverse impact in absence of hospital.--
     If the hospital were to close--
       ``(I) there would be a significant amount of time needed 
     for residents to reach emergency treatment, resulting in a 
     potential significant harm to beneficiaries with critical 
     illnesses or injuries;
       ``(II) there would be an inability in the community to 
     stablize emergency cases for transfers to another acute care 
     setting, resulting in a potential for significant harm to 
     medicare beneficiaries; and
       ``(III) any other nearby hospital lacks the physical and 
     clinical capacity to take over the hospital's typical 
     admissions.
       ``(C) In making such determination, the Secretary may also 
     consider the following:
       ``(i) Free-standing ambulatory surgery centers, office-
     based oncology care, and imaging center services are 
     insufficient in the hospital's area to handle the outpatient 
     care of the hospital.
       ``(ii) Beneficiaries in nearby areas would be adversely 
     affected if the hospital were to close as the hospital 
     provides specialized knowledge and services to a network of 
     smaller hospitals and critical access hospitals.
       ``(iii) Medicare beneficiaries would have difficulty in 
     accessing care if the hospital were to close as the hospital 
     provides significant subsidies to support ambulatory care in 
     local clinics, including mental health clinics and to support 
     post acute care.
       ``(iv) The hospital has a committment to provide graduate 
     medical education in a rural area.
       ``(C) Quality care.--The hospital inpatient score for 
     quality of care is not less than the median hospital score 
     for qualify of care for hospitals in the State, as 
     established under standards of the utilization and quality 
     control peer review organization under part B of title XI or 
     other quality standards recognized by the Secretary.

     A hospital classified as an essential rural hospital may not 
     change such classification and a hospital so classified shall 
     not be treated as a sole community hospital, medicare 
     dependent hospital, or rural referral center for purposes of 
     section 1886.''.
       (b) Payment Based on 102 Percent of Allowed Costs.--
       (1) Inpatient hospital services.--Section 1886(d) (42 
     U.S.C. 1395ww(d)) is amended by adding at the end the 
     following:
       ``(11) In the case of a hospital classified as an essential 
     rural hospital under section 1861(mm)(4) for a cost reporting 
     period, the payment under this subsection for inpatient 
     hospital services for discharges occurring during the period 
     shall be based on 102 percent of the reasonable costs for 
     such services. Nothing in this paragraph shall be construed 
     as affecting the application or amount of deductibles or 
     copayments otherwise applicable to such services under part A 
     or as waiving any requirement for billing for such 
     services.''.
       (2) Hospital outpatient services.--Section 1833(t)(13) (42 
     U.S.C. 1395l(t)(13)) is amended by adding at the end the 
     following new subparagraph:
       ``(B) Special rule for essential rural hospitals.--In the 
     case of a hospital classified as an essential rural hospital 
     under section 1861(mm)(4) for a cost reporting period, the 
     payment under this subsection for covered OPD services during 
     the period shall be based on 102 percent of the reasonable 
     costs for such services. Nothing in this subparagraph shall 
     be construed as affecting the application or amount of 
     deductibles or copayments otherwise applicable to such 
     services under this part or as waiving any requirement for 
     billing for such services.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to cost reporting periods beginning on or after 
     October 1, 2004.

     SEC. 204. MORE FREQUENT UPDATE IN WEIGHTS USED IN HOSPITAL 
                   MARKET BASKET.

       (a) More Frequent Updates in Weights.--After revising the 
     weights used in the hospital market basket under section 
     1886(b)(3)(B)(iii) of the Social Security Act (42 U.S.C. 
     1395ww(b)(3)(B)(iii)) to reflect the most current data 
     available, the Secretary shall establish a frequency for 
     revising such weights, including the labor share, in such 
     market basket to reflect the most current data available more 
     frequently than once every 5 years.
       (b) Report.--Not later than October 1, 2004, the Secretary 
     shall submit a report to Congress on the frequency 
     established under subsection (a), including an explanation of 
     the reasons for, and options considered, in determining such 
     frequency.

     SEC. 205. IMPROVEMENTS TO CRITICAL ACCESS HOSPITAL PROGRAM.

       (a) Increase in Payment Amounts.--
       (1) In general.--Sections 1814(l), 1834(g)(1), and 
     1883(a)(3) (42 U.S.C. 1395f(l); 1395m(g)(1); 42 U.S.C. 
     1395tt(a)(3)) are each amended by inserting ``equal to 102 
     percent of'' before ``the reasonable costs''.
       (2) Effective date.--The amendments made by paragraph (1) 
     shall apply to payments for services furnished during cost 
     reporting periods beginning on or after October 1, 2003.
       (b) Coverage of Costs for Certain Emergency Room On-Call 
     Providers.--
       (1) In general.--Section 1834(g)(5) (42 U.S.C. 1395m(g)(5)) 
     is amended--
       (A) in the heading--
       (i) by inserting ``certain'' before ``emergency''; and
       (ii) by striking ``physicians'' and inserting 
     ``providers'';
       (B) by striking ``emergency room physicians who are on-call 
     (as defined by the Secretary)'' and inserting ``physicians, 
     physician assistants, nurse practitioners, and clinical nurse 
     specialists who are on-call (as defined by the Secretary) to 
     provide emergency services''; and
       (C) by striking ``physicians' services'' and inserting 
     ``services covered under this title''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply with respect to costs incurred for services 
     provided on or after January 1, 2004.
       (c) Modification of the Isolation Test for Cost-Based CAH 
     Ambulance Services.--
       (1) In general.--Section 1834(l)(8) (42 U.S.C. 1395m(l)), 
     as added by section 205(a) of BIPA (114 Stat. 2763A-482), is 
     amended by adding at the end the following: ``The limitation 
     described in the matter following subparagraph (B) in the 
     previous sentence shall not apply if the ambulance services 
     are furnished by such a provider or supplier of ambulance 
     services who is a first responder to emergencies (as 
     determined by the Secretary).''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall apply to ambulances services furnished on or after the 
     first cost reporting period that begins after the date of the 
     enactment of this Act.
       (d) Reinstatement of Periodic Interim Payment (PIP).--
       (1) In general.--Section 1815(e)(2) (42 U.S.C. 1395g(e)(2)) 
     is amended--
       (A) in the matter before subparagraph (A), by inserting ``, 
     in the cases described in subparagraphs (A) through (D)'' 
     after ``1986''; and
       (B) by striking ``and'' at the end of subparagraph (C);
       (C) by adding ``and'' at the end of subparagraph (D); and
       (D) by inserting after subparagraph (D) the following new 
     subparagraph:
       ``(E) inpatient critical access hospital services;''.
       (2) Development of alternative methods of periodic interim 
     payments.--With respect to periodic interim payments to 
     critical access hospitals for inpatient critical access 
     hospital services under section 1815(e)(2)(E) of the Social 
     Security Act, as added by paragraph (1), the Secretary shall 
     develop alternative methods for such payments that are based 
     on expenditures of the hospital.
       (3) Reinstatement of pip.--The amendments made by paragraph 
     (1) shall apply to payments made on or after January 1, 2004.
       (e) Condition for Application of Special Physician Payment 
     Adjustment.--
       (1) In general.--Section 1834(g)(2) (42 U.S.C. 1395m(g)(2)) 
     is amended by adding after and below subparagraph (B) the 
     following:

     ``The Secretary may not require, as a condition for applying 
     subparagraph (B) with respect to a critical access hospital, 
     that each physician providing professional services in the 
     hospital must assign billing rights with respect to such 
     services, except that such subparagraph shall not apply to 
     those physicians who have not assigned such billing 
     rights.''.
       (2) Effective date.--The amendment made by paragraph (1) 
     shall be effective as if included in the enactment of section 
     403(d) of the Medicare, Medicaid, and SCHIP Balanced Budget 
     Refinement Act of 1999 (113 Stat. 1501A-371).
       (f) Permitting CAHs To Allocate Swing Beds and Acute Care 
     Inpatient Beds Subject to a Total Limit of 25 Beds.--
       (1) In general.--Section 1820(c)(2)(B)(iii) (42 U.S.C. 
     1395i-4(c)(2)(B)(iii)) is amended to read as follows:
       ``(iii) provides not more than a total of 25 extended care 
     service beds (pursuant to an agreement under subsection (f)) 
     and acute care inpatient beds (meeting such standards as the 
     Secretary may establish) for providing inpatient care for a 
     period that does not exceed, as determined on an annual, 
     average basis, 96 hours per patient;''.
       (2) Conforming amendment.--Section 1820(f) (42 U.S.C. 
     1395i-4(f)) is amended by striking ``and the number of beds 
     used at any time for acute care inpatient services does not 
     exceed 15 beds''.
       (3) Effective date.--The amendments made by this subsection 
     shall with respect to designations made on or after October 
     1, 2004.
       (g) Additional 5-Year Period of Funding for Grant 
     Program.--
       (1) In general.--Section 1820(g) (42 U.S.C. 1395i-4(g)) is 
     amended by adding at the end the following new paragraph:
       ``(4) Funding.--
       ``(A) In general.--Subject to subparagraph (B), payment for 
     grants made under this subsection during fiscal years 2004 
     through 2008

[[Page 16300]]

     shall be made from the Federal Hospital Insurance Trust Fund.
       ``(B) Annual aggregate limitation.--In no case may the 
     amount of payment provided for under subparagraph (A) for a 
     fiscal year exceed $25,000,000.''.
       (2) Conforming amendment.--Section 1820 (42 U.S.C. 1395i-4) 
     is amended by striking subsection (j).

     SEC. 206. REDISTRIBUTION OF UNUSED RESIDENT POSITIONS.

       (a) In General.--Section 1886(h)(4) (42 U.S.C. 
     1395ww(h)(4)) is amended--
       (1) in subparagraph (F)(i), by inserting ``subject to 
     subparagraph (I),'' after ``October 1, 1997,'';
       (2) in subparagraph (H)(i), by inserting ``subject to 
     subparagraph (I),'' after ``subparagraphs (F) and (G),''; and
       (3) by adding at the end the following new subparagraph:
       ``(I) Redistribution of unused resident positions.--
       ``(i) Reduction in limit based on unused positions.--

       ``(I) In general.--If a hospital's resident level (as 
     defined in clause (iii)(I)) is less than the otherwise 
     applicable resident limit (as defined in clause (iii)(II)) 
     for each of the reference periods (as defined in subclause 
     (II)), effective for cost reporting periods beginning on or 
     after January 1, 2004, the otherwise applicable resident 
     limit shall be reduced by 75 percent of the difference 
     between such limit and the reference resident level specified 
     in subclause (III) (or subclause (IV) if applicable).
       ``(II) Reference periods defined.--In this clause, the term 
     `reference periods' means, for a hospital, the 3 most recent 
     consecutive cost reporting periods of the hospital for which 
     cost reports have been settled (or, if not, submitted) on or 
     before September 30, 2002.
       ``(III) Reference resident level.--Subject to subclause 
     (IV), the reference resident level specified in this 
     subclause for a hospital is the highest resident level for 
     the hospital during any of the reference periods.
       ``(IV) Adjustment process.--Upon the timely request of a 
     hospital, the Secretary may adjust the reference resident 
     level for a hospital to be the resident level for the 
     hospital for the cost reporting period that includes July 1, 
     2003.
       ``(V) Affiliation.--With respect to hospitals which are 
     members of the same affiliated group (as defined by the 
     Secretary under subparagraph (H)(ii)), the provisions of this 
     section shall be applied with respect to such an affiliated 
     group by deeming the affiliated group to be a single 
     hospital.

       ``(ii) Redistribution.--

       ``(I) In general.--The Secretary is authorized to increase 
     the otherwise applicable resident limits for hospitals by an 
     aggregate number estimated by the Secretary that does not 
     exceed the aggregate reduction in such limits attributable to 
     clause (i) (without taking into account any adjustment under 
     subclause (IV) of such clause).
       ``(II) Effective date.--No increase under subclause (I) 
     shall be permitted or taken into account for a hospital for 
     any portion of a cost reporting period that occurs before 
     July 1, 2004, or before the date of the hospital's 
     application for an increase under this clause. No such 
     increase shall be permitted for a hospital unless the 
     hospital has applied to the Secretary for such increase by 
     December 31, 2005.
       ``(III) Considerations in redistribution.--In determining 
     for which hospitals the increase in the otherwise applicable 
     resident limit is provided under subclause (I), the Secretary 
     shall take into account the need for such an increase by 
     specialty and location involved, consistent with subclause 
     (IV).
       ``(IV) Priority for rural and small urban areas.--In 
     determining for which hospitals and residency training 
     programs an increase in the otherwise applicable resident 
     limit is provided under subclause (I), the Secretary shall 
     first distribute the increase to programs of hospitals 
     located in rural areas or in urban areas that are not large 
     urban areas (as defined for purposes of subsection (d)) on a 
     first-come-first-served basis (as determined by the 
     Secretary) based on a demonstration that the hospital will 
     fill the positions made available under this clause and not 
     to exceed an increase of 25 full-time equivalent positions 
     with respect to any hospital.
       ``(V) Application of locality adjusted national average per 
     resident amount.--With respect to additional residency 
     positions in a hospital attributable to the increase provided 
     under this clause, notwithstanding any other provision of 
     this subsection, the approved FTE resident amount is deemed 
     to be equal to the locality adjusted national average per 
     resident amount computed under subparagraph (E) for that 
     hospital.
       ``(VI) Construction.--Nothing in this clause shall be 
     construed as permitting the redistribution of reductions in 
     residency positions attributable to voluntary reduction 
     programs under paragraph (6) or as affecting the ability of a 
     hospital to establish new medical residency training programs 
     under subparagraph (H).

       ``(iii) Resident level and limit defined.--In this 
     subparagraph:

       ``(I) Resident level.--The term `resident level' means, 
     with respect to a hospital, the total number of full-time 
     equivalent residents, before the application of weighting 
     factors (as determined under this paragraph), in the fields 
     of allopathic and osteopathic medicine for the hospital.
       ``(II) Otherwise applicable resident limit.--The term 
     `otherwise applicable resident limit' means, with respect to 
     a hospital, the limit otherwise applicable under 
     subparagraphs (F)(i) and (H) on the resident level for the 
     hospital determined without regard to this subparagraph.''.

       (b) Conforming Amendment to IME.--Section 1886(d)(5)(B)(v) 
     (42 U.S.C. 1395ww(d)(5)(B)(v)) is amended by adding at the 
     end the following: ``The provisions of subparagraph (I) of 
     subsection (h)(4) shall apply with respect to the first 
     sentece of this clause in the same manner as it applies with 
     respect to subparagraph (F) of such subsection.''.
       (c) Report on Extension of Applications Under 
     Redistribution Program.--Not later than July 1, 2005, the 
     Secretary shall submit to Congress a report containing 
     recommendations regarding whether to extend the deadline for 
     applications for an increase in resident limits under section 
     1886(h)(4)(I)(ii)(II) of the Social Security Act (as added by 
     subsection (a)).

     SEC. 207. TWO-YEAR EXTENSION OF HOLD HARMLESS PROVISIONS FOR 
                   SMALL RURAL HOSPITALS AND SOLE COMMUNITY 
                   HOSPITALS UNDER PROSPECTIVE PAYMENT SYSTEM FOR 
                   HOSPITAL OUTPATIENT DEPARTMENT SERVICES.

       (a) Hold Harmless Provisions.--
       (1) In general.--Section 1833(t)(7)(D)(i) (42 U.S.C. 
     1395l(t)(7)(D)(i)) is amended--
       (A) in the heading, by striking ``small'' and inserting 
     ``certain'';
       (B) by inserting ``or a sole community hospital (as defined 
     in section 1886(d)(5)(D)(iii)) located in a rural area'' 
     after ``100 beds''; and
       (C) by striking ``2004'' and inserting ``2006''.
       (2) Effective date.--The amendment made by subsection 
     (a)(2) shall apply with respect to payment for OPD services 
     furnished on and after January 1, 2004.
       (b) Study; Adjustment.--
       (1) Study.--The Secretary shall conduct a study to 
     determine if, under the prospective payment system for 
     hospital outpatient department services under section 1833(t) 
     of the Social Security Act (42 U.S.C. 1395l(t)), costs 
     incurred by rural providers of services by ambulatory payment 
     classification groups (APCs) exceed those costs incurred by 
     urban providers of services.
       (2) Adjustment.--Insofar as the Secretary determines under 
     paragraph (1) that costs incurred by rural providers exceed 
     those costs incurred by urban providers of services, the 
     Secretary shall provide for an appropriate adjustment under 
     such section 1833(t) to reflect those higher costs by January 
     1, 2005.

     SEC. 208. EXCLUSION OF CERTAIN RURAL HEALTH CLINIC AND 
                   FEDERALLY QUALIFIED HEALTH CENTER SERVICES FROM 
                   THE PROSPECTIVE PAYMENT SYSTEM FOR SKILLED 
                   NURSING FACILITIES.

       (a) In General.--Section 1888(e)(2)(A) (42 U.S.C. 
     1395yy(e)(2)(A)) is amended--
       (1) in clause (i)(II), by striking ``clauses (ii) and 
     (iii)'' and inserting ``clauses (ii), (iii), and (iv)''; and
       (2) by adding at the end the following new clause:
       ``(iv) Exclusion of certain rural health clinic and 
     federally qualified health center services.--Services 
     described in this clause are--

       ``(I) rural health clinic services (as defined in paragraph 
     (1) of section 1861(aa)); and
       ``(II) Federally qualified health center services (as 
     defined in paragraph (3) of such section);

     that would be described in clause (ii) if such services were 
     not furnished by an individual affiliated with a rural health 
     clinic or a Federally qualified health center.''.
       (b) Certain Services Furnished by an Entity Jointly Owned 
     by Hospitals and Critical Access Hospitals.--For purposes of 
     applying section 411.15(p)-(3)(iii) of title 42 of the Code 
     of Federal Regulations, the Secretary shall treat an entity 
     that is 100 percent owned as a joint venture by 2 Medicare-
     participating hospitals or critical access hospitals as a 
     Medicare-participating hospital or a critical access 
     hospital.
       (c) Technical Amendments.--Sections 1842(b)(6)(E) and 
     1866(a)(1)(H)(ii) (42 U.S.C. 1395u(b)(6)(E); 
     1395cc(a)(1)(H)(ii)) are each amended by striking ``section 
     1888(e)(2)(A)(ii)'' and inserting ``clauses (ii), (iii), and 
     (iv) of section 1888(e)(2)(A)''.
       (d) Effective Date.--The amendments made by subsection (a) 
     shall apply to services furnished on or after January 1, 
     2004.

     SEC. 209. RECOGNITION OF ATTENDING NURSE PRACTITIONERS AS 
                   ATTENDING PHYSICIANS TO SERVE HOSPICE PATIENTS.

       (a) In General.--Section 1861(dd)(3)(B) (42 U.S.C. 
     1395x(dd)(3)(B)) is amended by inserting ``or nurse 
     practitioner (as defined in subsection (aa)(5))'' after ``the 
     physician (as defined in subsection (r)(1))''.
       (b) Prohibition on Nurse Practitioner Certifying Need for 
     Hospice.--Section 1814(a)(7)(A)(i)(I) (42 U.S.C. 
     1395f(a)(7)(A)(i)(I)) is amended by inserting ``(which for 
     purposes of this subparagraph does not include a nurse 
     practitioner)'' after ``attending physician (as defined in 
     section 1861(dd)(3)(B))''.

[[Page 16301]]



     SEC. 210. IMPROVEMENT IN PAYMENTS TO RETAIN EMERGENCY 
                   CAPACITY FOR AMBULANCE SERVICES IN RURAL AREAS.

       Section 1834(l) (42 U.S.C. 1395m(l)) is amended--
       (1) by redesignating paragraph (8), as added by section 
     221(a) of BIPA (114 Stat. 2763A-486), as paragraph (9); and
       (2) by adding at the end the following new paragraph:
       ``(10) Assistance for rural providers furnishing services 
     in low medicare population density areas.--
       ``(A) In general.--In the case of ground ambulance services 
     furnished on or after January 1, 2004, for which the 
     transportation originates in a qualified rural area (as 
     defined in subparagraph (B)), the Secretary shall provide for 
     an increase in the base rate of the fee schedule for mileage 
     for a trip established under this subsection. In establishing 
     such increase, the Secretary shall, based on the relationship 
     of cost and volume, estimate the average increase in cost per 
     trip for such services as compared with the cost per trip for 
     the average ambulance service.
       ``(B) Qualified rural area defined.--For purposes of 
     subparagraph (A), the term `qualified rural area' is a rural 
     area (as defined in section 1886(d)(2)(D)) with a population 
     density of medicare beneficiaries residing in the area that 
     is in the lowest three quartiles of all rural county 
     populations.''.

     SEC. 211. THREE-YEAR INCREASE FOR HOME HEALTH SERVICES 
                   FURNISHED IN A RURAL AREA.

       (a) In General.--In the case of home health services 
     furnished in a rural area (as defined in section 
     1886(d)(2)(D) of the Social Security Act (42 U.S.C. 
     1395ww(d)(2)(D))) during 2004, 2005, and 2006, the Secretary 
     shall increase the payment amount otherwise made under 
     section 1895 of such Act (42 U.S.C. 1395fff) for such 
     services by 5 percent.
       (b) Waiving Budget Neutrality.--The Secretary shall not 
     reduce the standard prospective payment amount (or amounts) 
     under section 1895 of the Social Security Act (42 U.S.C. 
     1395fff) applicable to home health services furnished during 
     a period to offset the increase in payments resulting from 
     the application of subsection (a).

     SEC. 212. PROVIDING SAFE HARBOR FOR CERTAIN COLLABORATIVE 
                   EFFORTS THAT BENEFIT MEDICALLY UNDERSERVED 
                   POPULATIONS.

       (a) In General.--Section 1128B(b)(3) (42 U.S.C. 1320a-
     7(b)(3)), as amended by section 101(b)(2), is amended--
       (1) in subparagraph (F), by striking ``and'' after the 
     semicolon at the end;
       (2) in subparagraph (G), by striking the period at the end 
     and inserting ``; and''; and
       (3) by adding at the end the following new subparagraph:
       ``(H) any remuneration between a public or nonprofit 
     private health center entity described under clause (i) or 
     (ii) of section 1905(l)(2)(B) and any individual or entity 
     providing goods, items, services, donations or loans, or a 
     combination thereof, to such health center entity pursuant to 
     a contract, lease, grant, loan, or other agreement, if such 
     agreement contributes to the ability of the health center 
     entity to maintain or increase the availability, or enhance 
     the quality, of services provided to a medically underserved 
     population served by the health center entity.''.
       (b) Rulemaking for Exception for Health Center Entity 
     Arrangements.--
       (1) Establishment.--
       (A) In general.--The Secretary of Health and Human Services 
     (in this subsection referred to as the ``Secretary'') shall 
     establish, on an expedited basis, standards relating to the 
     exception described in section 1128B(b)(3)(H) of the Social 
     Security Act, as added by subsection (a), for health center 
     entity arrangements to the antikickback penalties.
       (B) Factors to consider.--The Secretary shall consider the 
     following factors, among others, in establishing standards 
     relating to the exception for health center entity 
     arrangements under subparagraph (A):
       (i) Whether the arrangement between the health center 
     entity and the other party results in savings of Federal 
     grant funds or increased revenues to the health center 
     entity.
       (ii) Whether the arrangement between the health center 
     entity and the other party restricts or limits a patient's 
     freedom of choice.
       (iii) Whether the arrangement between the health center 
     entity and the other party protects a health care 
     professional's independent medical judgment regarding 
     medically appropriate treatment.

     The Secretary may also include other standards and criteria 
     that are consistent with the intent of Congress in enacting 
     the exception established under this section.
       (2) Interim final effect.--No later than 180 days after the 
     date of enactment of this Act, the Secretary shall publish a 
     rule in the Federal Register consistent with the factors 
     under paragraph (1)(B). Such rule shall be effective and 
     final immediately on an interim basis, subject to such change 
     and revision, after public notice and opportunity (for a 
     period of not more than 60 days) for public comment, as is 
     consistent with this subsection.

     SEC. 213. GAO STUDY OF GEOGRAPHIC DIFFERENCES IN PAYMENTS FOR 
                   PHYSICIANS' SERVICES.

       (a) Study.--The Comptroller General of the United States 
     shall conduct a study of differences in payment amounts under 
     the physician fee schedule under section 1848 of the Social 
     Security Act (42 U.S.C. 1395w-4) for physicians' services in 
     different geographic areas. Such study shall include--
       (1) an assessment of the validity of the geographic 
     adjustment factors used for each component of the fee 
     schedule;
       (2) an evaluation of the measures used for such adjustment, 
     including the frequency of revisions; and
       (3) an evaluation of the methods used to determine 
     professional liability insurance costs used in computing the 
     malpractice component, including a review of increases in 
     professional liability insurance premiums and variation in 
     such increases by State and physician specialty and methods 
     used to update the geographic cost of practice index and 
     relative weights for the malpractice component.
       (b) Report.--Not later than 1 year after the date of the 
     enactment of this Act, the Comptroller General shall submit 
     to Congress a report on the study conducted under subsection 
     (a). The report shall include recommendations regarding the 
     use of more current data in computing geographic cost of 
     practice indices as well as the use of data directly 
     representative of physicians' costs (rather than proxy 
     measures of such costs).

     SEC. 214. TREATMENT OF MISSING COST REPORTING PERIODS FOR 
                   SOLE COMMUNITY HOSPITALS.

       (a) In General.--Section 1886(b)(3)(I) (42 U.S.C. 
     1395ww(b)(3)(I)) is amended by adding at the end the 
     following new clause:
       ``(iii) In no case shall a hospital be denied treatment as 
     a sole community hospital or payment (on the basis of a 
     target rate as such as a hospital) because data are 
     unavailable for any cost reporting period due to changes in 
     ownership, changes in fiscal intermediaries, or other 
     extraordinary circumstances, so long as data for at least one 
     applicable base cost reporting period is available.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to cost reporting periods beginning on or after 
     January 1, 2004.

     SEC. 215. EXTENSION OF TELEMEDICINE DEMONSTRATION PROJECT.

       Section 4207 of Balanced Budget Act of 1997 (Public Law 
     105-33) is amended--
       (1) in subsection (a)(4), by striking ``4-year'' and 
     inserting ``8-year''; and
       (2) in subsection (d)(3), by striking ``$30,000,000'' and 
     inserting ``$60,000,000''.

     SEC. 216. ADJUSTMENT TO THE MEDICARE INPATIENT HOSPITAL PPS 
                   WAGE INDEX TO REVISE THE LABOR-RELATED SHARE OF 
                   SUCH INDEX.

       (a) In General.--Section 1886(d)(3)(E) (42 U.S.C. 
     1395ww(d)(3)(E)) is amended--
       (1) by striking ``wage levels.--The Secretary'' and 
     inserting ``wage levels.--
       ``(i) In general.--Except as provided in clause (ii), the 
     Secretary''; and
       (2) by adding at the end the following new clause:
       ``(ii) Alternative proportion to be adjusted beginning in 
     fiscal year 2004.--
       ``(I) In general.--Except as provided in subclause (II), 
     for discharges occurring on or after October 1, 2003, the 
     Secretary shall substitute the `62 percent' for the 
     proportion described in the first sentence of clause (i).
       ``(II) Hold harmless for certain hospitals.--If the 
     application of subclause (I) would result in lower payments 
     to a hospital than would otherwise be made, then this 
     subparagraph shall be applied as if this clause had not been 
     enacted.''.
       (b) Waiving Budget Neutrality.--Section 1886(d)(3)(E) (42 
     U.S.C. 1395ww(d)(3)(E)), as amended by subsection (a), is 
     amended by adding at the end of clause (i) the following new 
     sentence: ``The Secretary shall apply the previous sentence 
     for any period as if the amendments made by section 202(a) of 
     the Medicare Rx Now Act of 2003 had not been enacted.''.

     SEC. 217. ESTABLISHMENT OF FLOOR ON GEOGRAPHIC ADJUSTMENTS OF 
                   PAYMENTS FOR PHYSICIANS' SERVICES.

       Section 1848(e)(1) (42 U.S.C. 1395w-4(e)(1)) is amended--
       (1) in subparagraph (A), by striking ``subparagraphs (B) 
     and (C)'' and inserting ``subparagraphs (B), (C), (E), and 
     (F)''; and
       (2) by adding at the end the following new subparagraphs:
       ``(E) Floor for work geographic indices.--
       ``(i) In general.--For purposes of payment for services 
     furnished on or after January 1, 2004, and before January 1, 
     2008, after calculating the work geographic indices in 
     subparagraph (A)(iii), the Secretary shall increase the work 
     geographic index to the work floor index for any locality for 
     which such geographic index is less than the work floor 
     index.
       ``(ii) Work floor index.--For purposes of clause (i), the 
     term `applicable floor index' means--

       ``(I) 0.980 with respect to services furnished during 2004; 
     and
       ``(II) 1.000 for services furnished during 2005, 2006, and 
     2007.

       ``(F) Floor for practice expense and malpractice geographic 
     indices.--For purposes of payment for services furnished on 
     or

[[Page 16302]]

     after January 1, 2005, and before January 1, 2008, after 
     calculating the practice expense and malpractice indices in 
     clauses (i) and (ii) of subparagraph (A) and in subparagraph 
     (B), the Secretary shall increase any such index to 1.00 for 
     any locality for which such index is less than 1.00.''.

  Ms. PRYCE of Ohio. Mr. Speaker, I yield back the balance of my time, 
and I move the previous question on the resolution.
  The SPEAKER pro tempore (Mr. LaTourette). The question is on ordering 
the previous question.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Ms. SLAUGHTER. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  Pursuant to clauses 8 and 9 of rule XX, this 15-minute vote on 
ordering the previous question will be followed by 5-minute votes on 
adopting the resolution, if ordered, and on adopting House Resolution 
297 which was debated earlier today.
  The vote was taken by electronic device, and there were--yeas 226, 
nays 203, not voting 6, as follows:

                             [Roll No. 321]

                               YEAS--226

     Aderholt
     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole
     Collins
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     English
     Everett
     Feeney
     Ferguson
     Flake
     Fletcher
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Harris
     Hart
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Janklow
     Jenkins
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     McCotter
     McCrery
     McHugh
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Upton
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                               NAYS--203

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Case
     Clay
     Clyburn
     Conyers
     Cooper
     Costello
     Cramer
     Crowley
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Edwards
     Emanuel
     Emerson
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Frost
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Hall
     Harman
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Majette
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McIntyre
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--6

     Brown-Waite, Ginny
     Cummings
     Gephardt
     Johnson (CT)
     McInnis
     Smith (WA)


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (during the vote). Members are advised that 2 
minutes remain in this vote.

                              {time}  1436

  Mr. SANDLIN and Mr. TURNER of Texas changed their vote from ``yea'' 
to ``nay.''
  So the previous question was ordered.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. LaTourette). The question is on the 
resolution.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.


                             Recorded Vote

  Ms. SLAUGHTER. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. This will be a 5-minute vote, followed by a 
second 5-minute vote on the question of adoption of House Resolution 
297 debated earlier today.
  The vote was taken by electronic device, and there were--ayes 221, 
noes 203, not voting 11, as follows:

                             [Roll No. 322]

                               AYES--221

     Aderholt
     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Barton (TX)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Castle
     Chabot
     Chocola
     Coble
     Cole
     Collins
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     DeMint
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Emerson
     English
     Everett
     Feeney
     Ferguson
     Fletcher
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Hall
     Harris
     Hart
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Isakson
     Issa
     Janklow
     Jenkins
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     McCotter

[[Page 16303]]


     McCrery
     McHugh
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Tauzin
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner (OH)
     Upton
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Young (AK)
     Young (FL)

                               NOES--203

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Bartlett (MD)
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Case
     Clay
     Clyburn
     Conyers
     Cooper
     Costello
     Cramer
     Crowley
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Flake
     Ford
     Frank (MA)
     Frost
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hefley
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Majette
     Maloney
     Markey
     Marshall
     Matheson
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McIntyre
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Toomey
     Towns
     Turner (TX)
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Waters
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--11

     Carter
     Gephardt
     Gutknecht
     Istook
     Jones (NC)
     Matsui
     McInnis
     Rush
     Smith (WA)
     Watson
     Wolf


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (during the vote). Members are advised there 
are 2 minutes remaining in this vote.

                              {time}  1444

  So the resolution was agreed to.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Stated against:
  Mr. MATSUI. Mr. Speaker, on rollcall No. 322, had I been present, I 
would have voted ``no.''
  The SPEAKER pro tempore. Pursuant to section 6 of House Resolution 
299 and clause 1 of rule XXI, all points of order are reserved against 
provisions contained in the bill making appropriations for the 
Department of Defense for the fiscal year ending September 30, 2004, 
and for other purposes.

                          ____________________