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Public Statements

Statements on Introduced Bills and Joint Resolutions S. 1153

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Date:
Location: Washington, DC

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

S. 1153. A bill to amend title 38, United States Code, to permit medicare-eligible veterans to receive an out-patient medication benefit, to provide that certain veterans who receive such benefit are not otherwise eligible for medical care and services from the Department of Veterans Affairs, and for other purposes; to the Committee on Veterans' Affairs.

Mr. SPECTER. Mr. President, I have sought recognition to explain the provisions of the "Veterans Prescription Drugs Assistance Act of 2003," a bill that I have introduced today to assist Medicare-eligible veterans struggling with the costs of prescription medications.

I fully understand that Congress, and the President, are working very hard on legislation to take on the larger issue of providing a prescription drug benefit for all American seniors. I applaud that effort, and I will continue to work with my colleagues to see that Congress enacts legislation to help all seniors who struggle with the ever-increasing costs of necessary medications. But in the meantime, as Chairman of the Committee on Veterans Affairs, I offer legislation to allow Medicare-eligible veterans to obtain prescription drugs from the Department of Veterans Affairs, VA, at the significantly discounted costs that VA, as a high-volume purchaser of prescriptions medications, is able to secure in the marketplace.

Earlier this year, VA Secretary Anthony J. Principi was forced to limit access to VA care by suspending new enrollments of non-service-disabled middle and higher income veterans who were not enrolled for care as of January 17, 2003. The Secretary was forced to so act because the number of patients provided care by VA has more than doubled in just five years. And as a result, VA's medical care system has been overwhelmed and, as a consequence, VA has been unable to provide timely access to healthcare for all veterans who have sought it and appointment waiting times have grown to alarming levels. But in almost every news story that followed the Secretary's difficult decision, it was noted that many of the new enrollees who had overwhelmed VA's capacity to provide care were Medicare-eligible veterans who were able to get Medicare-financed care elsewhere—but who were seeking access to the relatively generous prescription drug program provided to veterans under VA care.

Currently, VA provides enrolled patients with prescription medications for $7.00 for each 30-day supply. But to get such prescriptions, the veteran must obtain the full range of medical care from VA. This fact, coupled with the Secretary's decision to close enrollment, means that veterans who are now—or who will be—eligible for Medicare who had not enrolled for VA care prior to January 17, 2003, will be unable to access VA's generous prescription drug benefits. This legislation would provide some relief for those veterans. In addition, I anticipate that it may induce some VA-enrolled Medicare-eligible veterans—those who were happy with their Medicare-financed care but who enrolled for VA care to gain access to VA-supplied drugs—to return to non-VA care with knowledge that they will be able to get their non-VA prescriptions filled through VA. Enactment of this provision, then, would reduce—not exacerbate—VA patient backlog numbers.

The premise of this legislation is straightforward: VA fills and distributes more than 100 million prescriptions each year for its 4.5 million veteran-patients. As a result, it has significant purchasing power—power which, coupled with VA's formulary program, allows it to negotiate very favorable prices for prescription drugs. According to the National Association of Chain Drug Stores, the average "cash cost" of a prescription in 2001 was $40.22. The average VA per-prescription cost in 2001 was $22.87—almost 50 percent less. The average per-prescription price paid by VA this year is up to just under $25—a slower growth rate than the 6.7 percent annual growth experienced in the population at large since 2001.

My purpose is to afford Medicare-eligible veterans access to such discounts. I do not propose that VA be directed to supply drugs to all Medicare-eligible veterans at VA expense, or even with a partial VA subsidy. VA has stated that such a mandate would divert VA funding—which, clearly, is already stretched to the limit—away from VA priority patients: the service-connected, the poor, and those with special needs. I accept VA's statement of concern; I accept and I insist—that scarce funding be directed, first, to meet the needs of priority patients. This legislation, therefore, requires that VA recover the costs of drugs it supplies under this program from veterans who bring their prescriptions from outside doctors to VA.

I do not propose to tell VA in this bill how to recover these costs. VA is better positioned than I to make such judgments. Thus, my legislation provides flexibility to VA to design and test payment mechanisms to best accomplish cost recovery while still easing veterans' access to the drugs they need. It might be that enrollment fees, a copayment structure, or a simple "cost-plus"—for administrative expenses pricing format—or some combination of those mechanisms—works best.
And it might be that different approaches work best in different regions of the country. I intend for the VA to experiment with different pricing structures to determine what works best. But I also intend that veterans get a break on prescription drug pricing.

Those who would benefit from this program are World War II and Korean War veterans who answered their country's call over 50 years ago. As they age, many desperately need relief from high drug prices. My purpose is not to disparage the drug companies; their discoveries have truly been marvels. But that is precious little comfort to a Medicare participant who, whatever the drug's overall utility might be, cannot afford both the drug and food or shelter or heat. Many such persons reside in the Commonwealth of Pennsylvania where, just last month, a genuine titan in the industrial history of the United States, Bethlehem Steel, ceased to exist. Many retired steelworkers who are also veterans—and who never needed VA because of company-paid benefits—have lost their health insurance coverage and, with it, prescription drug benefits.
These people need a break. This bill could provide it.

The premise of this legislation is simple: veteran access to VA market-driven discounts. Yet, the assistance it could provide might be profound. I do hope that Congress will find a way to provide prescription drug benefits to all seniors. But for now, I urge my colleagues to support this bill so that the problem might be solved—or at least reduced—for seniors who served. They deserve it, and we should do it.

I ask unanimous consent that the text of this bill be printed in the RECORD.

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