The Prescription Drug Benefit (Part 2)

THE PRESCRIPTION DRUG BENEFIT (Part 2)
House of Representatives
April 06, 2006

BREAK IN TRANSCRIPT

Mr. GINGREY. Mr. Speaker, I thank the gentlewoman so much for being with us tonight and I want to maybe expand just a little bit on her comments in regard to the penalty, as she explained it very carefully as to why that is necessary part of an insurance program.

By the way, Mr. Speaker, that is the exact same situation that exists with Medicare part B. Medicare part B was there in 1965 but it was the optional part. I think former President Truman was the first person to actually voluntarily sign up for part B, the doctor part where it is premium based, and the individual Medicare beneficiary pays 25 percent of the costs and the taxpayer and Medicare, if you will, pays 75 percent.

I will bet you, Mr. Speaker, I will bet you that 98, 99 percent of seniors voluntarily sign up for part B and they do it within the 6-month window of opportunity because if they go beyond that then just like in this part D, because a person on part D is an example, as Representative Drake pointed out. If they do not sign up for it and they go beyond the sign-up period, and then all of the sudden they get sick and they go from taking that one drug a month at $78 that she talked about to taking five at $5,000 a month, then they should pay more for their premium. So it is very important and it is not a punitive thing, but it is there to make the program work.

Mr. Speaker, we are again honored by one of our colleagues who has served in this House. I think this is his fourth term, and I am talking about the gentleman from Minnesota who I think very soon after November will be the United States Senator from Minnesota, and I am speaking none other than Representative MARK KENNEDY.

Representative Kennedy, thank you for being with us tonight. I yield to you at this time.

Mr. KENNEDY of Minnesota. Mr. Speaker, I thank the gentleman for his leadership on this issue and all that he has done to make sure that that our seniors understand how important this program is and how it can really benefit them. Too many are out there trying to just dish the program and spread really complicating lies about it and scaring seniors. That is not what we ought to be doing to our seniors.

We ought to be out there making sure they understand the benefits that can be available to them. Through the efforts of you, so many in the community, as was mentioned, more than 27 million seniors are now enrolled in the Medicare part D prescription drug benefit. They are seeing hundreds, even thousands of dollars of savings. In fact, CMS, the Centers for Medicare and Medicaid Services, have projected that the benefit will save the average senior $1,100 this year. Meanwhile, the AARP and others have found that the benefit lowers the cost of drugs for seniors by an average of 44 percent, with low income seniors seeing price reductions of up to 90 percent.

Better yet, the average senior's monthly premium is 32 percent below the average estimate, a third. This terrific reduction is evidence that the market base competition used by Medicare part D is working to drive down prices and increase the benefits for our seniors. At the same time, CMS has reported that the projected costs of administering the benefit has come down $7.6 billion in 2006 from what they originally estimated, and States will see at least $700 million in additional savings this year.

All of this is very good news. However, the May 15 deadline for eligible seniors to sign up for the plan without penalty is fast approaching. Well, the program's enrollment has surpassed earlier estimates. There is now still more that needs to be done. That is why it is important that community activists and we as Members of Congress have been holding sign-up forms in our districts to spread the facts about this great new voluntary program.

These forums bring together CMS, trained volunteers, seniors and their families together in an environment where questions can be answered and seniors can become informed about which plan best fits their needs so they can begin saving on their drug costs.

I was pleased to hold two large forums in my district in Minnesota earlier this year, and I am working hard with other groups to help hold forums of their own. I want to thank those community groups who work in towns and cities all over this Nation to make sure seniors know their options. These events and other forums are essential to making sure that seniors who want to sign up for the Medicare drug plan are able to do so before May 15.

Mr. Speaker, it is easy for me to stand here and talk about the benefits of this plan, but do not just take it from me. Take it from the seniors who are realizing, in some cases, hundreds of dollars in savings every month. Countless seniors are reporting that they now have more money to use for other things, like paying for their bills or visiting their grandchildren.

Before the Republican Congress acted, we heard terrible stories of seniors forced to choose between life-saving medication and food. We heard these stories years, but we never saw action from our friends on the other side of the aisle, but we acted. Seniors are saving as a result.

I encourage my colleagues, and I thank Dr. GINGREY for his leadership on this, to continue to educate seniors in their districts before this May 15 deadline so every senior has access to affordable drug coverage, and I would turn it back over to the distinguished doctor from Georgia to continue to talk about what kind of benefit seniors are getting and why it is important that we take the time to make sure they understand before the May 15 deadline.

Mr. GINGREY. Mr. Speaker, I would just like to say I thank the gentleman, and I think the seniors are very fortunate, whether MARK KENNEDY is serving in this United States House of Representatives or representing them in the other body soon as a senator in the United States Senate. They are indeed fortunate to have his compassion and caring attitude, and I commend him for that.

Mr. Speaker, I think what I would like to do here for a minute is sort of frame this problem, before we delivered on this prescription drug benefit, to make sure that our colleagues and anybody within shouting or listening distance might possibly be watching our proceedings tonight, did they understand the situation that existed before we delivered on this promise of a prescription drug benefit part D under the Medicare program. Where were the seniors getting their prescription drug coverage before this plan?

Well, this first slide, Mr. Speaker, I want to make sure that my colleagues can see this. There were a number of people. This is about 26 percent, an estimate of seniors that had employment-based plans. We talked about that. We have talked about the fact that people worked 25, 30 years for a company, and part of their retirement benefit may be a little pension hopefully and a little health care benefit, in many cases to include a prescription drug coverage.

Now, there has been concern among these 26 percent because even before we brought forward this well-conceived, well-thought-out plan, in fact it was thought out pretty well, as I pointed out earlier on March 9, 2000, by President Clinton and the Democratic leadership in the Senate. They just did not deliver on it, but the 26 percent were concerned because employers were dropping these plans or changing the guidelines. All of a sudden a senior gets a letter in the mail, and it says, oh, by the way, first of the year, you are going to have to pay, instead of 20 percent of the premium, you are going to have to pay 30, and oh, by the way, it is no longer going to cover prescription drugs or we have got a very limited formulary; it is not going to cover your hearing aid or your eyeglasses or whatever or even worse than that, Mr. Speaker, would be the ultimate dear John letter. That is a letter, that pink slip, that says, guess what, we are dropping your coverage; we are going to completely drop your prescription coverage or may, in fact, drop the whole health insurance coverage, and this has happened.

It was happening, and under this plan, though, to prevent that, to try to stop that, we, in designing this plan, this Republican majority, this President, under our leadership, we said, look, we will help you, John Q. Employer, if you will continue these plans and you will not renege on these promises. We will reimburse you, really, for some of the cost of those plans so that you do not drop them.

Again, I go back to my Clinton press release. One of the things that they called for in 2000, optional of course for all beneficiaries as we said earlier, but also provides financial incentives for employers to develop and retain their retiree health coverage. That is what Clinton and the Democrats called for. This is another thing that they have been railing against, the fact that we have incentivized these employers not to drop these plans.

Well, okay, 26 percent have employment-based plans. Three percent individually purchase policies. That would be like my mom, Helen Gingrey, my precious mom who has a medigap policy, but now, unfortunately, the prescription part of that was so expensive that she had to drop it. Of course, the Department of Veterans Affairs and TRICARE, we talked about that. That is about 3 percent. About 12 percent are covered by the State Medicaid program. Some are more generous than others, I think very generous in my State of Georgia, and then some other State-based programs and other sources, 6 percent.

But the real eye-opener on this chart, on this pie graph, is that 40 percent before this plan, 40 percent were getting prescription drug coverage out of their own pocket. In other words, they had no coverage, and they had no bargaining power, Mr. Speaker. They simply went to the drugstore and they paid sticker price, you know, like buying an automobile and not getting any discount because you did not know to ask for one. They had no clout, one individual and elderly, frail senior, and so they were paying sticker price, and that was the problem. That is why we knew that we had to do something, especially for the neediest, especially for those who literally were breaking pills, running out of medication, not going to the drugstore because they are embarrassed that they could not pay.

It is an act of compassion on our part, really, for the neediest seniors especially, and of course, now, the good news is that, and this next slide shows, a total of 27 million seniors now have coverage under Medicare Part D.

I see that the gentlewoman from Virginia has been kind enough to stay with us, despite the lateness of the hour, and I want to yield a little time to her and maybe we can get engaged in a little bit of a colloquy in talking about the some of the things that we both notice in our district.

Mrs. DRAKE. Mr. Speaker, I thank you for that, and you brought up the issue of your mother, and that is a very important thing for us seniors to be thinking about because many of our seniors did buy the supplements that you are talking about that gave them some health care coverage as well as their prescription drug benefits.

My daughter's mother-in-law has one of those, and she is paying over $300 a month for it. So we went online, and we looked at what can she get today under this new program. So I think it is important that people like your mother do not think that because they have one of those plans from before that that is good enough, that they can go on today and save an incredible amount of money. You can go into plans today that give you the health care coverage, as well as the prescription drug coverage, but there, again, with that reduced premium, my daughter's mother-in-law is going to save over $100 a month by going in and revamping that policy.

I know a lot of our seniors got kind of hung up on the thought of deductibles and things like that, but there again, you need to understand that when Medicare set the plan, when Congress passed the plan, they put a cap on what a deductible could be of $250, and many of these plans have no deductibles. We keep talking about a donut hole where there will be a gap in coverage at a certain point, and what I say in my meetings is, if you did not have any coverage, you have been living in a black hole. You can pick a plan that has no gap in coverage based on what you want to pay monthly and how to streamline it for you.

The other point I wanted to make as you continue on is one of the questions I have really been asked is what if I take no medication. Isn't that a wonderful thing for our seniors today? I always look at them and say I bet you bought a homeowner's policy and you have insurance on your car and you buy those before you need them. Same thing for our seniors with prescription drug coverage.

When they go in and look at these programs, there are so many options, low-price options, that it is worth that for the peace of mind to know that next year when you go to open enrollment, you can always change the plan, upgrade the plan, but you are in the plan.

So I thank you for letting me talk about your mother.

Mr. GINGREY. Mr. Speaker, I thank the gentlewoman and my mother thanks the gentlewoman, but you have made such a great point about the option, and Representative Drake talked about the number of plans in Virginia. It is kind of similar in Georgia. There may be almost 50 plans, but there are only 18 companies.

But what that means is companies, good companies, offer more than one plan, so that seniors have the option, as she described, to say, well, if somebody says well I do not need that, I have got the Methuselah gene, that means you live a long, healthy life. A person like that might say, well, I do not take anything, I buy a few over-the-counter drugs a year and I bet I do not spend $200 a year. Well, God bless them. They are lucky. They are fortunate, but what Representative Drake is talking about is that very next week may be the time that the chest pain strikes and all of the sudden you have a coronary bypass or stints put in and you are on five or six medications. That happened to yours truly a couple or 3 years ago, and then all of the sudden you are kind of stuck.

So what the gentlewoman from Virginia was saying is look, seniors, if you are in that fortunate situation, do not roll the dice on this because you could come up snake eyes. Go ahead and take one of these plans where the monthly premium is 20 bucks a month. There is no deductible. There is a donut hole, but you are not worried about that donut hole because you are blessed with that Methuselah gene. Then later on, as she so correctly pointed out, if something does happen, then you can switch, and you do not have to pay a penalty because you did not sign up; you did not roll the dice and come up snake eyes.

Then the corollary to that is say someone who has a lot of prescription drug costs, they are already on six or eight drugs and they are spending $10,000 a year, and they look at that and they say hey, look, give me one, I will pay a higher monthly premium, I may pay 60 bucks a month premium, but that plan gives me coverage in that so-called donut hole. That is important because they are already spending a lot of money, and so you tailor these. The companies are actually doing that. I think it is a great thing.

Mrs. DRAKE. That is what is so important is that our seniors have choices, and you mentioned our veterans. I just wanted to finish up with them and let you finish up this evening and to remind our veterans that they are the only group of people that keep their veterans benefits and can purchase into Medicare Part D as well. So that gives them the ability, if there are medications they need that are not covered by the VA, that they can be covered by Medicare Part D. So I want to make sure that they understand that since they are the only group that can have both.

So certainly thank you again for letting me be here. Thank you for letting me talk about your mom and talking about our veterans, and there are so many things to talk about with the program. I would like to encourage everyone, if there is a workshop in their area, to please attend because it is amazing the questions and the answers and the much better understanding and that you realize this is a good product for seniors. The price is so much lower, and it gives them so many choices.

Mr. GINGREY. Well, I thank the gentlewoman, and I know she is looking forward to going back into the 2nd District of Virginia tomorrow, and I am sure she is one of the many Republican Members who have got those town hall meetings scheduled to get those remaining 6 or 8 million signed up, and I thank her.

At the outset, I said do not just take our word for it, and I have been expounding a little bit for the last 50 minutes, but I did want to give some anecdotal stories, and let us do that for a moment, Mr. Speaker.

Barbara W. From El Mirage, Arizona, had no prescription drug coverage. She spent more than $2,600 a year on medication just this past year. She wanted an inexpensive plan with a low premium, so she did enroll in the part D plan, and it only had a $6.14 monthly premium. In 2006, she will save $1,800, nearly $200 a month, the lady from Arizona. God bless her.

Here is another, Mr. Speaker. Sandra S. from Woodland Hills, California. In 2005, she spent $4,600 per year on prescription drugs. She read about Medicare part D in the Los Angeles Times. I am sure they weren't praising it, but thank goodness she read about it. She called 1-800-MEDICARE for help. She wanted a plan with no donut hole. We just talked about that a minute ago. Her plan has a $50 monthly premium, no deductible, no gap in coverage and, of course as all those plans, it has that catastrophic coverage. So that if you really get into a year where you have out-of-pocket expenses of $3,600, out of your own pocket, then after that, the insurance pays 95 percent and you only pay 5 percent. What a godsend. Total savings for Sandra, $2,400 a year.

I think we have a couple more that I wanted to show. Barbara L. from Kemp, Texas. In 2005, spent $2,100 on prescription drugs. She enrolled in an AARP part D plan. They have a very good plan. So in 2006 she expects to pay $360. Barbara saved $1,740.

Well, I could go on and on, but let me just say one other thing, because I mentioned AARP, the American Association of Retired Persons. I am proudly one of them. I am not retired, but I was eligible and got my card at age 50, so I have had it a while. Thirty-seven million seniors are members. And AARP is not typically a conservative organization, supportive of Republican ideas. More typically, they are supportive of the Democrat line of thought, and yet they have supported this program.

My colleagues on the other side of the aisle came down to the well, Member after Member after Member, telling members of AARP to tear up their cards and throw them out the window. Thank God for AARP.

In fact, we had a press conference today, Mr. Speaker, talking about the plan and what the Republican Members are going to do when we go back to our districts, and we have 76, count them, 76 organizations that are supporting this program. The AIDS Institute, Alzheimer's Association, American Geriatric Society, American Pharmacists Association, Association of Black Cardiologists, National Hispanic Medical Association, National Alliance For the Mentally Ill, National Alliance for Hispanic Health, the Generic Pharmaceutical Association, and Easter Seals. I could go on and on, but there are 76.

Let me talk briefly as we close about groups misleading seniors about Medicare part D. In fact, they were out there protesting our press conference on the terrace of the Cannon Building this afternoon. Guess who was there chanting against seniors? MoveOn.org and far left shadow groups.

So let's see. Doctors, pharmacists, hospitals, health care providers and AARP, versus MoveOn.org, NANCY PELOSI, and other far-left groups. Who do you trust with senior health? I think the answer is pretty obvious, Mr. Speaker, and I am proud to be part of the solution and not part of the problem.

Mr. HUNTER. Mr. Speaker, will the gentleman yield?

Mr. GINGREY. Mr. Speaker, I want to yield very quickly to the chairman of the House Armed Services Committee, my chairman, and I am talking about the gentleman from California, Representative Duncan Hunter. I gladly yield to the chairman.

Mr. HUNTER. I thank my friend for yielding, Mr. Speaker, and I would just take a minute. I have been watching my friend and the gentlewoman from Virginia (Mrs. Drake), and I just wanted to tell you how proud I am of the job that you do representing your districts and representing those great contingencies of American veterans and active duty service people in your district.

I wanted to say, and I know you have been talking about health care, but I wanted to talk about another type of security just for one second, and that is national security. And I know my friend has been to Iraq, and I think he is going again soon, and many other Members of this body, Democrat and Republican, are going. Now is the time when America should take heart.

I have watched the newspapers and the mood of this House as of late, and I feel, especially coming from the Democrat side, the message is one that I have seen before. It is a message that we saw in the 1980s, when Ronald Reagan faced down the Soviet Union, and you had calls from the far left to the effect that President Reagan was going to have a war with the Soviets, that he needed to acquiesce, he needed to engage, even as they ringed our allies in Europe with SS-20 missiles. And yet Ronald Reagan stood tough. He stood for a policy of peace through strength. And at one point the Soviets picked up the phone and said, can we talk? And when we talked, we talked about the disassembly of the Soviet empire.

Similarly he stood tough in Central America, and today those two nations in question, El Salvador and Nicaragua, have fragile democracies because of America. Today, we are providing that military shield in Iraq while we put this fragile government together, a government based on something new in that part of the world: Freedom and representative government.

You know, this has been done on the shoulders of the great American servicemen and women who serve us in that very troubled and difficult part of the world. And their job is dusty and dirty and sometimes bloody, but it is worthwhile. And what they are giving to us, if we can stabilize that country and that neighborhood and have a country that has a benign relationship towards the United States, will accrue to the benefit of generations of Americans.

So now is the time to take heart. Now is the time to not fail. Now is the time to stand firm, and I want to thank the gentlemen for his work on Armed Services and the Rules Committee, for the great work he does in that regard.

Mr. GINGREY. Mr. Speaker, I thank the gentleman so much in these closing seconds. And of course we know of the work of the esteemed chairman of the House Armed Services Committee, Representative Duncan Hunter. What a wonderful way to close this hour.

What is more important than the defense of this Nation, as this great patriot just described, and providing health care for our precious seniors?

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