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Public Statements

Prescription Drug and Medicare Improvement Act

By:
Date:
Location: Washington, DC

PRESCRIPTION DRUG AND MEDICARE IMPROVEMENT ACT

    Ms. STABENOW. Mr. President, last night's vote on the Medicare prescription drug bill is one of the toughest votes I have cast since becoming Senator in 2001.

    As the people of Michigan know, I made the issue of adding a prescription drug benefit to Medicare one of the centerpieces of my 2000 campaign. I told Michiganians that if they sent me to the Senate, I would fight to add a meaningful prescription drug benefit to Medicare. I also said I would do everything within my power to lower prescription drug prices for everyone.

    For years, I have crisis-crossed Michigan and listened to seniors who desperately need help with paying for their medicines. I have heard from middle class, retired people who have had to cut pills in half because they could not afford to pay for their full prescriptions. I have gone with seniors to Canada where they could actually afford to buy American-made prescription drugs because they cost so much less north of the border.

    Since 2001, I have sponsored and co-sponsored bills that would provide a comprehensive prescription drug benefit in Medicare and lower prices for all Americans. These are the goals that I have fought for and have spoken out for on this Senate floor time and time again.

    Specifically, I have cosponsored S. 7, a bill that would provide a meaningful Medicare prescription benefit. And I have co-sponsored bills to open the border to Canada to allow families to purchase low-cost, F.D.A.-approved drugs made in the U.S. that have been sold in Canada for half the price or less.

    I have co-sponsored legislation creating more competition to lower prices by allowing more generics, or unadvertised brands on the market and helping States set up bulk purchasing programs to lower prices for those without health insurance to help pay for their prescription drugs.

    I have particularly focused on lowering prices for all Americans because the soaring cost of prescription drugs is hurting all of us.

    When a brand-name prescription drug goes up in price three times the rate of inflation, everyone is affected by that. It hurts our seniors, many of whom must pay for prescriptions directly out of their pockets. It harms our businesses by dramatically increasing their health care costs. The average small business has seen their health care premiums double in the last 5 years. This affects our ability to grow and to provide new jobs.

    The bill that the Senate passed last night only accomplishes some of my goals. It has its strengths and weaknesses. It is a step in the right direction, but only a beginning step.

    On a positive note, this bill establishes an outpatient prescription drug benefit for all seniors for the first time since the entire program was created in 1965.

    Currently, Medicare only covers prescription drugs for those who are in the hospital. As we all know, this has been a seniors challenge for our seniors.

    Unfortunately, the benefit is confusing and will vary depending upon decisions made by insurance companies, but at least this bill establishes for the first time that there should be a benefit.

    The bill provides a benefit for low income seniors who make less than 160 percent of poverty. Married couples earning less than $19,392 per year will receive a comprehensive prescription drug plan. This will help approximately 350,000 seniors in Michigan. Again, this is a step in the right direction.

    This bill also provides a catastrophic benefit for seniors who have extraordinary prescription drug bills each year. For some seniors, it is not uncommon for them to have monthly prescription drug bills of over $1,000 per month or $12,000 per year. This bill has a catastrophic cap at $5,800 per year. After $5,800, seniors would only have to pay 10 percent of additional out-of-pocket costs in one year. This is a positive step.

    This bill also includes several improvements in payments for Medicare providers. Since 1997, many Medicare providers have been underpaid and have been forced to make difficult decisions regarding serving new Medicare patients. Specifically, this bill provides increased payments for rural providers such as hospitals, ambulance services, and home health agencies. This is important to the people of Michigan.

    The bill also makes great strides in helping to lower prescription drug prices for all Americans. For the first time, we have closed loopholes in our drug laws that have allowed brand name drug makers to keep lower cost generic drugs off the market. This bill will mean that there will be more competition between similar drugs and thus lower prices for families, for businesses, and for everyone using prescriptions drugs. This is a positive aspect that I have been fighting for, for the last 2½ years.

    It also includes a provision that I have long championed that will allow pharmacies and families to purchase lower priced prescription drugs from Canada. In some cases, the same drugs that are sold in Canada can cost up to 50, 60, or 70 percent less than they cost here in the U.S. That makes absolutely no sense.

    Regrettably, opponents of this type of free market competition attached a provision that allows the Secretary of Health and Human Services to stop its implementation. I hope that HHS Secretary Tommy Thompson will not block it and allow U.S. citizens to get lower priced, FDA approved, American made prescription drugs from Canada.

    Unfortunately, this bill has serious drawbacks as well which is why it has been such a difficult situation for me. The Republican Congress, along with the President, has not been willing to allocate enough funding to provide a comprehensive benefit to most of our middle class seniors.

    They arbitrarily picked a figure of $400 billion in total spending for 10 years even though we know that it would take twice that amount to provide American seniors with the same kind of prescription drug coverage that we in the Congress enjoy. Why was that decision made? I have always said this is a question of values and priorities.

    Which is more important, or more effective, putting money in people's pockets and improving the quality of life for Americans, another trillion dollar tax cut for the privileged few, or meaningful prescription drug benefit that will help our seniors and their families afford live saving medicine and put money back in people's pockets through lower prescription drug prices.

    The answer to that question, I believe, is very clear. Unfortunately, misplaced priorities have resulted in a prescription drug plan that is much less than American families need and deserve.

    There are many short-comings in this plan that I will continue to do everything in my power to correct.

    For example, the drudge benefit stops when a senior's drug expenditures are between $4,500 and $5,800. During that period, after seniors have spent $4,500 on their prescription drug costs, and before they reach $5,800, seniors would pay 100 percent of that $1,300 in prescription drug bills. This is a major gap in coverage.

    Secondly, the copayments, the deductibles, the premiums are too high and too unpredictable. The $35 premium often quoted is not even guaranteed in the bill. Seniors will be left to the mercy of insurance companies that will decide the premiums and the benefits that will be provided. This is not in the bill. It is up to the insurance companies.

    Another very important issue relates to those who already have prescription drug coverage. There is currently not enough incentive in this plan to make sure employers do not drop existing prescription drug coverage for their retirees. This is a very important issue for the retirees in Michigan.

    I will continue to fight for changes in this legislation to protect those who currently have coverage, who have worked hard their whole lives, who have retired and have been fortunate enough to have good benefits and are very concerned that they not lose them, as we work to help others who do not have coverage. It makes no sense to set up a system that might actually take away benefits currently being provided to retirees through private insurance.

    Furthermore, one of the most negative parts of this bill is the fact that it does not allow seniors to get their prescription drugs through the traditional Medicare system as their first choice. Under the bill passed by the Senate, seniors must pick a private prescription drug plan or enroll in a private PPO or HMO if one is available to them.

    Traditional Medicare, that seniors know and depend on, is only available if private plans are not available. Does this make sense? Only if you are a pharmaceutical company or an insurance company. I believe seniors should have many choices, including the choice to stay in the Medicare Program they know and trust.

    As I have said so many times before on this Senate floor, when given a choice between traditional Medicare and a Medicare HMO, 89 percent of our American seniors and persons with disabilities have chosen traditional Medicare—89 percent.

    This choice is not available to them under this bill. I believe this is a major flaw that I will continue to do everything I can to correct.

    During debate on this bill, I sponsored and cosponsored and supported amendments that would have corrected all of these problems. These amendments would have stopped the benefit shutdown, reduced out-of-pocket costs, protected current retiree coverage, and provided a real comprehensive Medicare prescription drug benefit. Regrettably, none of these important amendments received the necessary support from my Republican colleagues to pass.

    When deciding how I would cast my vote on this bill, I looked at all of these things: the positive and the negative. I evaluated whether or not this was a step forward for Michigan families, for Michigan workers, for Michigan businesses and, most importantly, for our seniors who have waited too long for help to pay for their medicine.

    After many hours of thoughtful review and discussions with those affected by this legislation, I voted in favor of this bill last night, not because it was the best we can do but because it is a first step in the right direction. This direction—the direction in which we need to move—is for a real, meaningful prescription drug benefit for our seniors who have waited too long for their Government to act.

    We were successful in improving this bill in some ways during this debate, but much more needs to be done. There will be other opportunities to do so, and I will take them.

    This bill does not take effect until 2006. So between now and then I will be fighting hard to provide seniors with the real prescription drug benefit they need and deserve, and I will continue to help lead the fight to lower prescription drug prices for everyone.

    As we know, this legislation is not finished. It must now go to a conference committee, a joint committee between the Senate and the House of Representatives, where differences between the Senate and House bills will be addressed. There are critical differences between the two bills.

    The House of Representatives passed, by only one vote, a bill that truly begins to unravel Medicare. The House started down the road of privatizing the health care system of senior citizens and the disabled in our country. They voted to begin the process of turning back the clock to the days when too many seniors and families could not find or afford private insurance.

    If I had been in the House of Representatives last evening, where I served for 4 years, I would have voted no. If the House bill comes before the Senate as it is currently written, I will vote no. Unlike the Senate, where we worked in a bipartisan way to develop a plan that the majority of Senators could support, the House process was very partisan and polarizing, and it resulted in an extreme plan that could not be supported by my Democratic colleagues who care deeply about strengthening and preserving Medicare for the future.

    Our seniors expect and deserve the best plan we can offer. I will continue to work with my colleagues to achieve that goal. And I hope and pray that we will be successful.

    Madam President, I yield the floor and suggest the absence of a quorum.

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