[Congressional Record (Bound Edition), Volume 149 (2003), Part 21]
[House]
[Pages 29576-29578]
[From the U.S. Government Publishing Office, www.gpo.gov]




                       MEDICARE CONFERENCE REPORT

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 7, 2003, the gentleman from New Jersey (Mr. Pallone) is 
recognized for half the time until midnight as the designee of the 
minority leader, which is approximately 10 minutes.
  Mr. PALLONE. Mr. Speaker, I just tell my colleague from Massachusetts 
that I will be glad to have him join in and make some comments during 
the course of my 10 minutes if he likes.

[[Page 29577]]

  I just wanted to follow up on some of the debate that was held this 
evening on the motion to instruct from the gentlewoman from Nevada and 
particularly pay attention to some of the comments that were made by 
some of my Republican colleagues who I know are well-intentioned but I 
think were very wrong in what they said about this Medicare conference 
report that we are going to be voting on in a few days.
  First of all, I mentioned earlier when the gentlewoman from New 
Mexico said that Medicare is very successful, and I said to her at the 
time, well, if it is very successful, then why are the Republicans in 
this Medicare conference report trying to essentially change and gut 
and I think destroy Medicare the way we know it?

                              {time}  2340

  Now, what the Democrats have been saying all along is, if you have a 
pot of money and you want to provide prescription drugs to senior 
citizens pursuant to the Medicare program, which you admit is a 
successful program, then why not just add the prescription drug benefit 
to the existing Medicare program?
  We know right now that all seniors are entitled to Medicare, because 
if they are over a certain age, they are entitled to Medicare. It is an 
entitlement. We have a program for hospital care; we have a part B 
program for doctor care. And what the Democrats have been saying is we 
can simply do for prescription drugs the same thing we do with the 
physician care, the physician payment. Like part B, which right now 
says if you pay $50 a month, and after the first $100 deductible, 80 
percent of your doctor bills are paid for by the Federal Government, up 
to a certain amount, at which time 100 percent of your bills are paid 
for by the Federal Government. Democrats have been saying we can add a 
prescription drug benefit to Medicare in the same way.
  And what we actually proposed and voted on here in the House of 
Representatives during the summer was exactly that, a program that 
would say you pay $25 a month premium, after the first $100 deductible 
on your drug bills, 80 percent of the cost is paid for by the Federal 
Government. You have a 20 percent copay. And at a certain point, after 
you have paid a certain amount out of pocket, 100 percent of the costs 
are paid for by the Federal Government. Very simple. It builds on the 
existing Medicare program.
  That is not what the Republicans are doing here. This is not even 
about a prescription drug benefit any more, because they are not 
providing a meaningful benefit. And I want to associate myself with the 
remarks made by the gentleman from Indiana (Mr. Burton) when he said 
this is not even a benefit you will want to sign up for because you 
will end up paying more out of pocket than you will get back in actual 
benefit. So it is not a real benefit. It is not a meaningful benefit. 
It is not an affordable benefit. It is not a comprehensive benefit.
  Most importantly, the only way you get this prescription drug benefit 
under the Republican proposal is if you join an HMO. You are forced, 
contrary to what some of my colleagues said on the other side of the 
aisle, you are forced under this Republican plan to join an HMO. 
Because the only way you could get any kind of prescription drugs 
without the HMO or the private plan is if it is not available in your 
area.
  What the Republicans have done is they are putting so much money, 
they are giving $12 million, $1 billion, they are adding all this money 
to the private plans, to the HMOs, giving them all this extra money so 
that certainly there is going to be someone who is going to offer this 
managed care HMO plan, this private plan in your particular State or 
your particular jurisdiction, so you will be shut out. You will not be 
able to have traditional Medicare and get any kind of prescription drug 
benefit.
  Now, I know that some of the discussion here tonight is, well, why 
does the AMA, the doctors support this? Well, why does the AARP support 
this? Why do the drug companies support this? There is a very simple 
answer to that, and it is that they are all getting a piece of the 
action. The AARP is essentially an insurance company, so they want to 
sell insurance. They think it is great. The insurance companies are all 
getting extra money, HMOs, private insurance companies, all getting big 
windfall profits from the Federal Government under this bill.
  And the doctors? Well, they have been suffering. They face a 4.5 
percent cut in their reimbursement rate. So what the Republican bill 
does is wipe out that cut and give them a 1.5 percent increase, I 
think. So, naturally, they feel well it is better to have a 1.5 percent 
increase than a 4 percent cut, so they get a piece of the pie. They 
think it is great.
  Then what about the drug companies? Well, it is a windfall for them 
because there is no competition. There is no price controls. There is a 
specific provision in the bill that says that the Secretary of Health 
and Human Services and the Medicare administrator cannot negotiate 
price reductions. We do it for the Veterans' Administration. We do it 
for the Department of Defense for our military. But we are not allowed 
to do it under this bill because the drug companies want a windfall.
  Well, all that I have been saying and all the Democrats have been 
saying is if you really believe that HMOs and private plans can compete 
with the traditional Medicare, then why not just have pure competition? 
Do not give them all this money. Do not give the HMOs all this money, 
the insurance companies all this money. Do not give the windfall and 
prohibit the Secretary of Health and Human Services from negotiating 
prices. Have real competition. Say that the private plans have to 
really compete with the private plans and do not get any additional 
money. Or, in the case of the drug companies, have the Medicare 
administrator essentially negotiate through competition price 
reductions. That is what negotiation is all about. It is a form of 
competition. Do not say that they do not have the power to negotiate.
  The one thing I want to say, and then I will yield to my colleague 
from Massachusetts, I listened to what the gentleman from Indiana (Mr. 
Burton) said and he talked about reimportation. Reimportation is a form 
of competition. If you say that Canadian drugs can come in here, you 
are creating a form of free-market competition with the companies here 
that want to charge the higher prices.
  But, no, we cannot have competition, we cannot have free market, we 
have to prohibit the Canadian drugs from coming in here. This bill is 
not competition. This is a windfall for the HMOs. This is a giveaway to 
the drug companies and the insurance companies.
  And I want to yield to my colleague from Massachusetts because he 
wants to talk about the date.
  Mr. DELAHUNT. Mr. Speaker, I want to pose a question to the gentleman 
from New Jersey (Mr. Pallone) and then restate the question that I was 
going to ask to the gentleman from Indiana (Mr. Burton).
  I think it is important that the seniors in this country who happen 
to be viewing us tonight understand that next year, when they go to 
their local pharmacist and present their Medicare card, will they get a 
drug benefit under this particular proposal?
  Mr. PALLONE. Reclaiming my time, Mr. Speaker, they will get nothing. 
They will get nothing, because under the Republican proposal, and I 
think it is very important that you mentioned it, this plan does not go 
into effect until the year 2006.
  Mr. DELAHUNT. Mr. Speaker, if the gentleman will continue to yield to 
me, seniors better live to 2006. They do not want to get sick in 2003 
or 2004 or 2005.
  Now, I look at my two colleagues from the other side of the aisle, 
and I think we can all agree that next year, 2004, happens to be an 
election year. Is that an accurate statement?
  Mr. PALLONE. Absolutely, for President, Senate, and House.
  Mr. DELAHUNT. If the gentleman will continue to yield, the gentleman 
from Minnesota (Mr. Gutknecht) and

[[Page 29578]]

the gentleman from Indiana (Mr. Burton) are both here, so let me just 
emphasize this. One of the great bipartisan efforts that this House has 
witnessed since I have served in this Congress is under the leadership 
of both of those gentlemen, along with yourself, the gentleman from 
Illinois (Mr. Emanuel), and other Democrats when we got through this 
Chamber against the forces of the pharmaceutical industry. And it was a 
shock for everyone, the right of Americans to reimport drugs from 
Canada. And so they deserve credit along with those who worked very 
hard to get it accomplished.
  But can the gentleman from Indiana (Mr. Burton) tell me, is there 
anything in this bill that will be coming to the floor this week that 
allows for reimportation? And if it does, is it real and tangible, 
something, as the gentleman from New Jersey indicates, which will allow 
for real competition? Because you know and the gentleman from Minnesota 
(Mr. Gutknecht) knows and the gentleman from New Jersey (Mr. Pallone) 
knows, they purchase their drugs significantly cheaper in Canada than 
our folks do here.
  Mr. BURTON of Indiana. Mr. Speaker, if the gentleman from New Jersey 
will yield, the language in the bill is essentially the same as it is 
right now, and that is that the head of the health agency, HHS, all he 
has to do is say there is a safety issue, which he has already said, 
and there will be no reimportation.
  Mr. DELAHUNT. So there is no reimportation under this bill. That is 
important.
  Mr. PALLONE. Mr. Speaker, I think the gentleman from Massachusetts is 
making a very good point, which is essentially this bill is nothing but 
an election-year gimmick. The bottom line is if they are really serious 
about providing a prescription drug benefit, and I will grant I do not 
like what they are suggesting, because I do not think it is a real 
benefit, why are they not doing it now? Why are they not doing it in 6 
months? Why are they not doing it in a year? They wait until 2006 
because they do not have any intention of doing anything, and they are 
hoping people do not find out until 2006 what a terrible bill this is.
  As the gentleman from Indiana (Mr. Burton) said, even if you bought 
into the idea we could wait until 2006, and I do not, why not let 
reimportation take place in the meantime, so at least people can get 
the cheaper drugs from Canada? But they are not going to do that 
because they want the drug companies to have the windfall, and the drug 
companies are against reimportation.
  Mr. DELAHUNT. Mr. Speaker, if the gentleman will yield for a moment, 
what is happening here is competition is being precluded by this bill 
and huge amounts of dollars, tens of billions of dollars, are being 
given to the pharmaceutical industry. That is what this bill is about.

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