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Floor Speech
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Mr. GRASSLEY. Madam President, I come to the floor to celebrate 20 years since the passage of the Part D Medicare prescription drug benefit. Tomorrow, December 8, is that day.
There was a time when the seniors of America on Medicare didn't have access to nationwide prescription drug benefits, so, as I indicated, 20 years ago tomorrow, President George W. Bush signed into law a nationwide prescription drug benefit for our Nation's seniors.
At that time, I was chairman of the Finance Committee, and I was proud to be the lead author on Medicare Part D. It wasn't easy. It took several years to bring Members of both political parties in the Senate and the House, along with a President--in this case, President Bush--to accomplish this monumental task.
As I remember, both political parties were blaming each other over a period of maybe 5 or 6 years for why we didn't have a prescription drug bill and probably blaming each other. Throughout 2001, 2002, and 2003, I led bipartisan negotiations that eventually produced the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, which is the official title of that legislation.
In 2003, I said this, a quote from that period of time:
Medicare is part of our country's social fabric. We're not only saving it, but we're also improving it.
Of course, that still rings true today.
Today, 52 million seniors are voluntarily enrolled in a Medicare Part D plan, because it is not a requirement of Medicare. In 2023, 804 stand-alone prescription drug plans were offered across the Nation, with the average Iowan having over 20 plans to choose from to meet whatever their special needs are. Over the lifetime of the program, the average annual Medicare Part D base beneficiary monthly premium has been between $27 to $36 a month.
I remember some of the discussions that we were having back then as we tried to develop this legislation. We thought to ourselves that we had to be very careful that the initial premiums were not over $40 a month because we figured that was just too high for anybody to participate in this new program. We knew or at least thought at that time that they would continue to go up according to inflation, but, as you can see, after 27 years, the base beneficiary monthly premium is still well below $40 a month, which obviously is quite a surprise to those of us who were involved at that time in writing this legislation but a very positive surprise.
Access and affordability have been a key hallmark of the Medicare Part D Program, but so has good stewardship of the taxpayers' dollars. In the first decade of the program, the nonpartisan Congressional Budget Office projected that Medicare Part D would cost taxpayers roughly $550 billion for that decade. It ended up costing $353 billion, which was 36 percent less than the nonpartisan Congressional Budget Office projected in 2003.
Most Federal projections of cost of almost any government program always tend to be much greater than CBO estimated. So this is another one of those pleasant surprises that have come out of what we thought would actually materialize as we were writing this legislation.
I know that seniors have appreciated this nationwide prescription drug benefit and its use of a market-based approach. A market-based approach is pretty important because a lot of people like to have one single government program that dictates to each participant only that one choice, and that is the choice the government offers. In this particular case, we know we have had plenty of choices to meet the needs of Americans in different ways according to their likes.
Recently, I have been told by my constituents how Medicare Part D has helped make their lives easier.
There is a lady by the name of Kay from Mount Vernon, IA, who wrote this:
I am 100 percent satisfied with Medicare Part D. It's given me peace of mind and cost savings that make room in my budget for other living expenses.
Julie from Dubuque, IA, said this:
I wouldn't possibly be able to afford oncological care without this insurance. My advice for Iowans becoming eligible for Medicare: Sign up for Medicare Part D. Use a trusted source to navigate all the plans. I'm glad to have choices, not one-size-fits-all.
An Iowan who volunteers with the Senior Health Insurance Information Program said this:
As a SHIIP volunteer--
SHIIP is the Senior Health Insurance Information Program-- I like to help people find the best plan to fit their needs and their finances. One individual was taking 35 daily prescription medications that would have cost $10,000 per month without Part D. For this Iowan, Medicare Part D was by definition, lifesaving.
I am glad Medicare Part D has benefited these seniors.
Medicare Part D has shown that empowering patients with health plan transparency and choice can bring about significant savings for patients and taxpayers.
Even though Medicare Part D has been around for at least 20 years, I have consistently conducted oversight and worked to make it better for seniors and taxpayers. During Medicare Part D's implementation, I held the Center for Medicare and Medicaid Services accountable and consistently conducted oversight that ranged from making sure seniors could access their prescription drugs all the way to ensuring that taxpayer dollars were wisely spent.
I have also worked to advance commonsense reforms for seniors, for providers, and for taxpayers. Twenty years ago, we modernized Medicare to improve access for seniors while ensuring fiscal sustainability for taxpayers.
I don't know why for sure, in 1966 when Medicare was set up, why it didn't include prescription drugs, but I assumed at that particular time that prescription drugs were about 1 or 2 percent of the cost of medicine in the United States or the delivery of medicine in the United States. Today, I think it is somewhere between 15 and 20 percent.
These patient-centered principles that I have talked about can be applied to the latest front in the fight to lower prescription drugs by shining sunlight on powerful drug middlemen called pharmacy benefit managers. By bringing transparency to the PBM industry, we will empower patients, employers, providers, and insurers to make informed decisions based on the true value, if any, that PBMs provide.
When consumers are empowered, they can demand change or pursue better alternatives. Unleashing market forces that foster innovation and apply downward pressure on prices is the way to get there.
The Senate has an opportunity to take action to reduce costs for patients and taxpayers alike. We should let the successes of Medicare Part D's patient-centered approach guide us.
Now, my colleagues are going to say that I took advantage of commemorating 20 years of Part D being a successful program for seniors and keeping drug costs down for seniors to take a whack at PBMs. But I think we all ought to think in terms of these powerful middlemen between the companies and you as the consumer or the local pharmacy, and we don't have any idea what they are doing. We know they have something to do with setting prices, setting rebates, determining what drugs are in what formularies, but beyond that, we don't know whether the rebates they give benefit the insurance companies, the pharmaceutical companies, the PBMs themselves, the pharmacies, or you as a consumer, and we ought to know that.
Senator Wyden, my Democratic friend--he and I traded off sharing the Finance Committee from time to time. He and I started working on PBMs probably about 5 years ago. We were the only two who were interested in it, but it has reached a stage where at least four committees of the U.S. Senate and one committee of the House of Representatives have put out bills to make the opaque environment in which PBMs operate more transparent.
Now, we aren't saying that what they are doing is wrong; we are only saying we ought to know what they are doing for the benefit of the consumer but also for the benefit of the American taxpayer because, through Medicare and Medicaid, government is the biggest purchaser of drugs in the United States, and maybe we can save the taxpayers some money.
So besides being here on the floor of the U.S. Senate to praise the Congress in 2003 for passing the prescription drug Part D program for Medicare, I didn't want to lose the opportunity to urge action on PBM legislation so that we can know what is going on with the pricing of drugs, the formularies, and who benefits from it because, with transparency, there brings accountability. Maybe transparency won't be enough when we are all done, but I wouldn't know where to tell you to go if you wanted to change some law right now to transform this system, but I think transparency will do a great deal of good.
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