Relief From Escalating Health Care Costs

WEEKLY SENATE UPDATE
By U.S. Senator Olympia J. Snowe

September 17, for the week of September 19 through September 25, 2004

RELIEF FROM ESCALATING HEALTH CARE COSTS

Recently, alarm bells were sounded when the Center for Medicare and Medicaid Services (CMS) - the federal agency that oversees Medicare and Medicaid - reported that Medicare Part B premiums for outpatient care are expected to substantially increase next year by 17.5 percent. I am deeply concerned that seniors enrolled in traditional Medicare will be forced to shoulder this burden placing their ability to obtain affordable health care at risk.

Nearly 40 years since the Medicare program was enacted - and after the more than 5 years that I worked to add a prescription drug benefit to Medicare - seniors' health care is again being threatened by skyrocketing health care and drug costs.
We have learned from CMS that most of the increase in Part B premiums is a result of eliminating a scheduled 4.5 percent cut in provider payments and, instead, increasing payments to providers by 1.5 percent with Medicare recipients carrying the burden. While it is critical that we ensure providers are being compensated for their efforts, we cannot continue to raise premiums for our Medicare recipients to finance escalating health care costs.

What is also disconcerting is that CMS detailed that a small portion of the Part B increase will subsidize managed care plans (MedicareAdvantage) - which amounts to $1.75 of the $11.60 monthly premium increase. This is simply unacceptable and is tantamount to forcing the majority of seniors who continue to use the trusted fee-for-service Medicare to partially subsidize the minority of seniors in private plans. I have long fought to maintain traditional Medicare for our seniors and will continue to press for accountability to protect the fee-for-service model from any potential erosion at the expense of private health plans.

I have long said that the Medicare Modernization Act that passed Congress last Fall is far from perfect. As we move forward, I remain committed to developing solutions that are both cost-effective and beneficiary-friendly. As a senior member of the Senate Finance Committee which holds jurisdiction over the Medicare program, I believe we must look to ways to not only shore up Medicare, but provide relief to our seniors from the escalating costs of health care.

One such immediate remedy is lowering the costs of prescription drugs. I have worked extensively with my Senate colleagues in writing legislation that will provide cheaper prescription drugs to both Medicare beneficiaries and those not in Medicare. Joining with Senator Ron Wyden (D-OR), I introduced a bill - the "Medicare Enhancement for Needed Drugs Act" (MEND) - that would allow the Secretary of the U.S. Department of Health & Human Services to negotiate drug discounts. The Medicare program, just as the Defense Department and the Veterans Administration already, must be permitted to negotiate drug costs for its beneficiaries.

Equally critical in our quest to secure affordable prescription drugs is to open our markets to allow the importation of medicines from countries with equivalent safety regimes as ours like Canada, Great Britain, and Australia.. As the lead Republican co-sponsor with Senator Byron Dorgan (D-ND) of the only bipartisan prescription drug importation bill in the Senate - the
"Pharmaceutical Market Access and Drug Safety Act" - we clearly can import prescription drugs at a level of safety superior to all others, including our current domestic market. With approval by the Food & Drug Administration (FDA), pharmaceuticals entering the U.S. will be properly labeled, prescribed, tracked and traced. Americans are not threatened by safe imported drugs; they are jeopardized by a lack of access to affordable medication, with our inaction only exacerbating the problem.

There have already been measurable successes in the enactment of the Medicare Modernization Act, certainly including access for the first time to prescription drugs by many seniors who were forced to cut their pills in half or forgo paying their bills because their medications were so prohibitively expensive. But greater progress can certainly be achieved. Seniors are worried about this new drug benefit with far too few signing up. There have been too many misconceptions and false assumptions hindering the full success of the discount drug card program - all of which only serve to devalue the benefit and harm seniors.

It is time that we provide clarity for our seniors, informing them of the services available that will lower the costs of their prescription drugs and strengthen the overall integrity of the Medicare entitlement. We've already taken great steps forward -
we must not now squander our momentum.