Questionable Activites During and After Medicare Prescription Drug Legislation

QUESTIONABLE ACTIVITIES DURING AND AFTER MEDICARE PRESCRIPTION DRUG LEGISLATION PASSED THE HOUSE -- (House of Representatives - February 03, 2004)

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Mr. TIERNEY. I thank the gentleman from New Jersey, Mr. Speaker.

I think people are just outraged by what is going on in this administration and with the Republican majority in the House and Senate here. This is a bad bill to begin with, the prescription Medicare bill, the so-called Medicare reform bill, but when we add to that what can only be described as an affront or a blow to Congress' credibility, the aspect of finding the chairman, the man in charge of writing this legislation, actually closing the doors and excluding Democrats in the process, kept them out of any way of improving what turned out to be a terrible bill, ending up being offered over $2 million, if the stories are correct, $2 million a year from PhRMA, the organization that was out there lobbying for this bill, the organization that has over 600 lobbyists crawling around the Halls of Congress.

If the rumors are true, then it is $2 million to the person who excluded Democrats from the process, that closed the doors, that negotiated the end of the bill, that formulated the bill that ended up giving, by some estimates, a $139 billion boondoggle to the prescription drug companies and manufacturers by putting in a provision that says the government cannot negotiate a better price. And all of this to the detriment of our seniors.

I think people ought to be outraged. I know they are in my district. I can tell the gentleman from New Jersey that a couple from Beverly, Massachusetts, told me that they are seniors and they depend on Medicare; that the bill has to be killed, they said. Means testing, forcing them into HMOs, destroying Medicare forever was not worth the meager drug benefit they are going to get at the end of the day. Nothing was more important for them than to get rid of that bill and write another bill.

Another couple from Hamilton, Massachusetts, wrote to me. The woman said, "My husband and I are retired and our savings are rapidly declining because of prescription drug costs. To deny Americans the right to purchase legally prescribed drugs from Canada is counterproductive. We realize this bill is being driven by special interests exerting a stranglehold over this Nation's senior citizens, and that is particularly galling."

They recognize that this bill should have done something, at least about reimportations of FDA-approved safely packaged and transported drugs; and it did nothing. Even though this House passed an independent bill instructing the FDA to do that in conference, again behind closed doors, with Democrats excluded, and with the chairman who is now said to be offered a $2 million-a-year job by the very people who get the most benefit out of this bill, the special interests, even with that, it just gets worse and worse.

I had a pharmacist write me: "Why aren't the pharmaceutical manufacturers asked to lower their costs to participate in the program?" Pharmacies were asked. "This is one of the reasons medications are cheaper in neighboring countries." Because in neighboring countries pharmaceutical companies are required to lower their prices. "Drug companies must reduce their prices to consumers if they are going to participate in government programs."

Unfortunately for him and other constituents in my district and my colleagues' districts, this is not happening under this bill. The Medicare reform legislation is nothing more than a cruel hoax on Americans.

Let us remember back in the State of the Union address when the President brought with him a woman by the name of Elsie Blanton. He had Ms. Blanton up there in the gallery; and he said his spokespeople said, at that time of the State of the Union address, that Ms. Blanton is on Medicare, a supplemental policy that does not include prescription drug coverage. Ms. Blanton spends approximately $900 per month on prescription drugs when unable to obtain free samples from her doctors or the pharmaceutical companies. Ms. Blanton's prescription drug costs account for three quarters of her monthly income. Her monthly income is only $1,190 in Social Security benefits. Ms. Blanton's income is just above the 150 percent of the Federal poverty level for 2003.

Now, supposedly, Ms. Blanton was there because she was an example of someone who was to benefit from this terrible bill. But according to the Center for American Progress, Elsie Blanton will not see any assistance for years under this bill. The new prescription drug benefit does not even begin until 2006. Ms. Blanton does not qualify for the $600 of interim assistance.

So Ms. Blanton will continue to have to spend at least three quarters of her monthly income on prescription drugs for the next 2 years. In fact, because prescription drug costs rise faster than Social Security benefits, she will probably have to spend even more of her income on her medicines. She is going to have higher costs next year. She will have to pay more for her Medicare benefits next year, because higher payments to private plans and other changes are going to cause everyone's Medicare premium to go up. And the new law also raises the Medicare deductible.

She will potentially have higher costs when the benefit does begin. She could save much less than promised once the new prescription drug benefit begins because premiums and the benefit design are largely left to private health insurers and pharmaceutical companies. It is at their discretion, the insurance companies and the pharmaceutical companies, that they will decide what benefits and what prescription drugs are in there. So higher premiums.

The President had assumed Ms. Blanton would be able to get a drug benefit for a premium of $35 a month, but we know by reading the bill that, in fact, private insurers will set their own premiums, and they can be much higher than $35 a month. The President assumed that all of Ms. Blanton's medicines would be covered under the new benefit, but in fact there is no way to know that because we know that insurance companies and the pharmaceutical manufacturers will decide what drugs are covered.

Even if the medicines Ms. Blanton needs are covered when she signs up for the plan, we know from reading the bill that that list can change at any time after she originally signs on. And if the medicines she needs are not covered, any money she spends out of her own pocket on those medicines will not count toward the benefits' out-of-pocket limit.

She will go months without assistance, even after it kicks in. With monthly drug spending of $190 a year, assuming that all of her drugs are covered, Ms. Blanton will receive no assistance from March and through June of every year until she hits another higher limit. It is during that period of time, after March and before June, that she will be in that so-called donut hole or gap of benefits where she gets nothing at all, despite the fact that she continues to pay her premiums during that period.

What will happen to Elsie Blanton should not happen to anybody in this country, particularly on a bill of this nature. And if that is the best the people that proposed this bill have to show Ms. Blanton, who has this terrible result, then this country is in a sorry way and seniors are being deprived.

Never again should an industry be allowed to come in here and write a bill; should people that are now being offered $2 million a year by that industry be able to shut Democrats out of the process so they cannot improve the bill and write a bill that changes what the Senate had, changes what the House had; and after a so-called conference comes out with a bill that actually does worse for seniors, has them paying more for their prescription drugs and getting less benefits. Nevermore should that happen.

If this continues to happen, and if what I heard earlier tonight, and what I think our colleague from Illinois is going to talk about, if this administration now has the audacity to take millions of dollars in taxpayer money and go out on the stump and on the TV and try to convince seniors who got a bad deal that they actually got a good deal, then we should have an investigation done and talk about the propriety of that, possibly violations of campaign laws, certainly violations of taxpayer rights, and get to the bottom of this.

This is a bad bill, done in a bad way, by people benefiting from it getting too involved and people on the floor of this House potentially having an interest now in working for those same countries that made billions of dollars of benefits. It does not sound good, it does not look good, the American people do not feel it is right, and they have every right to be concerned.

Mr. Speaker, I thank the gentleman for his time.

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