[Congressional Record (Bound Edition), Volume 151 (2005), Part 2]
[House]
[Pages 2445-2446]
[From the U.S. Government Publishing Office, www.gpo.gov]




 SETTING THE RECORD STRAIGHT ON THE COST OF THE MEDICARE PRESCRIPTION 
                               DRUG BILL

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentlewoman from Connecticut (Mrs. Johnson) is recognized for 5 
minutes.
  Mrs. JOHNSON of Connecticut. Mr. Speaker, the landmark Medicare 
Prescription Drug and Modernization Act that this body passed in 2003 
was the subject of heated rhetoric and partisan attacks at that time. 
Most recently, we have heard the claim that the costs of this wonderful 
Medicare prescription drug benefit have skyrocketed far above the 
estimates relied upon when we passed the bill in 2003. Allow me to set 
the record straight.
  The cost of the Medicare prescription drug benefit that will 
guarantee every senior in America affordable prescription drug coverage 
has not changed. In November of 2003, the Congressional Budget Office 
estimated that the costs of the drug benefit from 2004 to 2013 would be 
$408 billion. Today, they estimated it at $410 billion.
  In December of 2003, the Centers for Medicaid and Medicare Services, 
using different assumptions, estimated that the cost of the bill over 
the same 10-year period would be $511 billion. Today, they are saying 
it will cost $518 billion. So, whatever estimates we use, whichever set 
of assumptions we wish to rely on, CBO's or CMS', the answer is the 
cost estimates have not changed. They varied about plus or minus 1 
percent.
  So what is the issue? What is the big uproar over? The answer is 
simple. New estimates just released by the administration are for a 10-
year period that begin in 2006, not 2004. These estimates cite a cost 
of $724 billion. That is because they drop 2 years when there was no 
drug program and add 2 years when millions more Medicare beneficiaries 
are going to enjoy the benefits of our Medicare Modernization and 
Prescription Drug Act. It is just that simple. The 10-year estimating 
period changed. So, of course, the estimates went up.
  But it is easy for the estimators to count the new number of people 
who benefit from the program in the 2 additional years and drop the 2 
years when there was no program. It is more difficult for them, and so 
they do not do it, estimate the saving that the Medicare modernization 
and prescription drug bill will enable Medicare to enjoy while at the 
same time improving the quality of care we will be able to deliver to 
our seniors.
  The Medicare Modernization Act fundamentally changed the way Medicare 
delivers care to our seniors. By offering welcome to Medicare physicals 
and disease management programs, we have

[[Page 2446]]

transformed Medicare from simply an illness treatment program to a 
wellness and preventative health program.
  Medicare has always been good at treating our seniors once they got 
sick, but did nothing to prevent them from getting sick. Worse, 
Medicare did nothing to help seniors with chronic illnesses to prevent 
that chronic illness from worsening.
  America's seniors deserve the changes we made in the Medicare 
Modernization Act. That act modernized the delivery system of care to 
enable Medicare to deliver the most recent medical advances to our 
seniors, particularly to those with chronic diseases.

                              {time}  1745

  By moving from an illness model to a preventive care model, we can 
keep seniors out of high-cost care settings, like hospitals and 
emergency rooms. If you are looking for a sensible way to control 
costs, this is the way to do it. Disease management programs, like the 
ones the Medicare Modernization Act have introduced into Medicare, have 
proven they save health care dollars and they improve health care 
quality.
  PacifiCare has already saved $244 million through existing disease 
management programs to their 720,000 Medicare beneficiaries. They have 
saved $75 million through medication management for patients with 
congestive heart failure and reduced hospitalizations by 50 percent. 
They have saved $185 million by improving blood sugar and cholesterol 
levels in diabetics. They have saved $72 annually through their 
congestive heart failure program, which has served 15,000 patients.
  McKesson, which will bring Medicare seniors into the Medicare 
Modernization Chronic Care Improvement Program this year, currently 
saves $3,089 per patient each year in their disease management 
programs. They have reduced emergency department visits by 61 percent. 
They have reduced hospitalizations by 66 percent.
  XLHealth, which operates a Medicare Chronic Care Improvement Program, 
has reduced medical costs in 2,500 Medicare patients since 2000. Their 
disease management program has reduced hospitalizations by 25 percent, 
amputations by more than 50 percent, and heart bypass surgery by 65 
percent.
  The bottom line: disease management programs save money and improve 
health care quality. And thanks to the Medicare Modernization Act, 
these programs will create a better quality of life for seniors with 
congestive heart failure, diabetes, chronic obstructive disease, and 
other chronic illnesses and bend the curve of Medicare's cost growth.
  These recent estimates we have been hearing so much about simply do 
not include any consideration of the power of disease management 
programs to reduce the cost of chronic disease and to improve the 
quality of care in Medicare. Twenty percent of our seniors have five or 
more chronic conditions and account for two-thirds of Medicare 
spending. Twenty percent. Of course disease management will reduce the 
cost of Medicare.
  MMA also initiated another new, though related, development in 
Medicare that will create significant savings while improving quality, 
but isn't reflected in cost estimates drawing attention today. For the 
first time, electronic prescribing will become routine in the Medicare 
program, with electronic medical trends coming along thereafter.
  Electronic prescribing technology will save lives and money by 
eliminating adverse drug interactions, eliminating handwriting errors, 
and by notifying physicians when a lower cost generic alternative is 
available. As we all know, generic drugs often far cheaper than brand 
name drugs. Electronic prescribing will save money, and while this 
technology called for in the MMA, the cost savings are not reflected in 
the cost estimates.
  Repealing the MMA would be the wrong medicine for America's seniors. 
Doing so would deprive them of prescription drugs and the high level of 
coordinated and preventive care that will keep our seniors healthier 
and control Medicare spending by improving the quality of our health 
delivery system.

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