Prescription Drug and Medicare Improvement Act of 2003 - Resumed

PRESCRIPTION DRUG AND MEDICARE IMPROVEMENT ACT OF 2003—RESUMED

    Mr. GRASSLEY. Mr. President, I thank the Senator from Maine for her very fine statement. More important, a thank-you to her is warranted because of the long hours of work she has put into this subject of Medicare and prescription drugs. The strengthening and improvement of Medicare and a prescription drug program has been something the Senator from Maine has worked on for a long time. So I not only compliment her on her statement today, but I thank her for the work she has done in putting together the product that is before us. Even more so than the product that is before us, I acknowledge the work she was part of during the years 2001 and 2002 as part of the tripartisan group of Senators, including Senators BREAUX, JEFFORDS, HATCH, Senator Snowe, and this Senator from Iowa, because it was the months of work during the spring of 2001 through the summer of 2001, and then picking up again in the spring of 2002, until we brought a bill to the floor 1 year ago now to discuss. The success of that work then laid the foundation for what we can do right now. That involved hours and hours of work for individual Members of the Senate, and more work yet for the staffs of each of those Members. So I thank her for putting in the time in 2001 and 2002, which did not yield a successful product at that point but very much made it possible for us early in the year 2003 to be before the Senate. Again, I thank the Senator from Maine for that foundational work.

    I think the next speaker will be the Senator from Louisiana, Senator Breaux. While the Senator from Maine and I might be able to say we were part of the foundation of the bill that is before us, Senator Breaux was in the trenches digging the footing for that foundation years before we got involved, because he was a member of what was called the Commission on Medicare, later called the Breaux Commission. Because of his work—even before our work on the tripartisan bill—I acknowledge the extra effort the Senator from Louisiana has brought to this point. So I thank him and, for a second time, I thank the Senator from Maine.

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    Mr. GRASSLEY. Mr. President, I am happy we are here today on what I think is the first day of maybe 2 weeks of work in the Senate to pass a bill many Members thought would pass last summer but got tied up in some election year political maneuvering in the Senate and did not happen.

    We have an opportunity this year—because this bill has broad bipartisan support based on the vote of 15-6 out of our committee, such a vote gives an opportunity to bring this issue to fruition—to present a bill to the President of the United States yet this summer.

    Last Thursday, the Finance Committee did report out a breakthrough bill that would make prescription drug coverage a reality for 40 million Medicare beneficiaries. The committee approval was of a sweeping package of new comprehensive prescription drug benefits and other program improvements that makes very good sense but also keeps good our commitment to our seniors.

    Since 1965, seniors have had drug insurance without prescription drugs. We have had health insurance without prescription drugs. By passing our bill last Thursday, the Finance Committee made history and came one step closer to changing the fact that prescription drugs were never a part of the Medicare Program unless they were administered in a hospital situation.

    How did we get to the point we are today, where it looks as if we have broad bipartisan support for this legislation? This important breakthrough came because of the tireless work of our committee members, both Democrat and Republican, that has been going on over the last 5 years, going back to the time when Senator Breaux, who just spoke and deserves a lot of credit for bringing us this far—and also Senator Frist—led the way on prescription drugs before any of us were paying much attention or even listening. Then Senators SNOWE, HATCH, and JEFFORDS carried the torch for 2 years, working with Senator Breaux and this Senator from Iowa on what we called then the tripartisan bill. It is tripartisan instead of bipartisan because Senator Jeffords officially, even though he sits with the Democrats, considers himself not a member of that party but an independent Member of the Senate.

    The tripartisan effort, of which I was a part, was something on which I was proud to work but, more importantly, not just as an end in itself but, in hindsight, now I can say it set the stage, the foundation work, for where we are today on a bill that is even better than the tripartisan bill.

    How do you get this far? The breakthrough came because of the President's unyielding commitment to getting something done for seniors once and for all. It takes more than just the Senate, it takes more than just the Senate and the House, it takes the President—all three—to bring legislation to what we call law.

    This budget that the President put forth put real money on the table for prescription drugs—$400 billion over 10 years. So the Finance Committee wasted no time in taking advantage of that $400 billion that was in the budget for a specific proposal of prescription drugs and reporting out this good bill. I am glad about that; otherwise, we would not be here—without this budget leeway.

    The bill we passed out of committee last Thursday night is a balanced, bipartisan product that flowed from good faith, from fair dealing, and from a commitment to consensus across party lines. So it is my hope that this same spirit will prevail on the floor of the Senate during the debate on this bill. I have no reason to believe it will not. I believe the debate in our committee, by both Republicans and Democrats, was just the type of debate you ought to have but do not often see in committees, particularly on very sweeping legislation, which is what this bill happens to be.

    I intend to do everything I can to ensure a safe and successful passing of this legislation. To do that, I intend to work hard to keep the climate on the Senate floor as reasonable and most certainly bipartisan as it was in our Finance Committee through the course of last Thursday.

    Of course, legislation of this size and scope does not make everybody happy. You cannot expect that it would. This bill cannot and will not be all things to all people. I expect to hear from many Senators about provisions, whether they be large provisions or smaller, less significant provisions in the bill, with which Members might not be happy. Of course, in the process of legislating, I welcome those who want to tell me about those with which they are happy as well. Sometimes we tend more toward the negative than the positive. I think there is a lot about this legislation—most of this legislation—that is very positive.

    I pledge to work with all Senators in the days ahead to address concerns people have in the underlying bill. But I will keep my eyes on that larger prize, the promise we have expressed in so many elections, both Republican and Democrat, to modernize and strengthen Medicare, to move Medicare into the practice of medicine of the 21st century. One of the major steps in that move to improve Medicare is providing a prescription drug benefit.

    If we were writing a Medicare bill for the first time and we were doing that in the year 2003, it would not be like 1965 when prescription drugs were only 1 percent of the cost of medicine. Today it is a much larger part of the cost of medicine and is part of keeping people out of hospitals. Obviously, we would write prescription drugs in that 2003 brandnew Medicare bill if we were writing a brand-new bill.

    I am keeping my eye on that larger prize. That prize is passage of a comprehensive prescription drug benefit that will give immediate assistance, starting next January, 2004, and continuing as a permanent part of Medicare, to every citizen in America. If I were to generalize about a prescription drug benefit: First, it is voluntary. People don't have to buy into it if they don't want. It is very comprehensive and it is universal.

    The bill before us puts that prize in our path. The Prescription Drug and Medicare Improvement Act brings Medicare, then, into the 21st century. The bill provides affordable prescription drug coverage on a voluntary basis to every senior in America. The coverage is stable. It is predictable. It is secure. Most important, the value of the coverage does not vary based on where you live and whether you have decided to join a private health plan. For Iowans and others in rural America who have too often been left behind by most Medicare private health plans, this is an important accomplishment that I insisted be in our bill when delivered to the Senate floor.

    Overall, we rely on the best of the private sector to deliver drug coverage, supported by the best of the public sector to secure consumer protections and important patient rights. This combination of public and private resources is what stabilizes the benefit and helps keep the costs down.

    Keeping costs down is essential because what I hear from the seniors in Iowa is not about a specific program, it is: Why are prescription drug costs so high? To them, so unreasonable. Keeping drug costs down is essential, not just for seniors but for the program as a whole.

    Across this bill we have targeted our resources very carefully, giving additional help to our lowest income seniors. Consistent with a policy of targeted policymaking, we have worked hard to keep existing sources of prescription drug coverage viable. Our goal, ever since we started on the tripartisan proposal 2 years ago, was not to replace private dollars with public dollars. This bill accomplishes that by keeping Medicare State pharmacy assistance programs and retiree health benefits strong. Surely any change of this magnitude will have some ripple effect on other sources of coverage.

    Regarding company-based benefits, our bill gives employers more flexibility than ever to participate fully in the new drug benefit.

    We all know about the pressures employers face in maintaining health care coverage under mounting cost pressures. Decisions about scaling back coverage or even a company dropping it altogether are bound to be made regardless of whether we pass this bill. In the days ahead, we will work to encourage employer participation in the new drug benefit. But I am confident the balanced policy before us is a good place to start.

    I would like to speak about our fee-for-service improvements in this bill designated as S. 1.

    There is a very important aspect of this bill. It is called the Medicare Improvement Act for a reason. Beyond just prescription drugs, our bill is a milestone accomplishment for improving traditional Medicare, especially Medicare being delivered to rural America.

    Included in our bill is the best rural improvement and Medicare equity package that the Senate has ever seen. I insisted on including it in the committee mark because the most important Medicare reforms involved fixing outdated and bureaucratic formulas that penalize rural States. This package passed the Senate 86 to 12 last month on the jobs and growth package. But it was tabled in conference between the House and the Senate.

    I hope that vote is very strongly regarded today by the Senate so that we don't even have to deal with this discussion on the floor of the Senate as we did then on the tax bill.

    Because this rural health package, or Medicare equity package—whatever you want to call it—was dropped in conference, the President wrote a letter shortly thereafter endorsing these same provisions. I am pleased to include them here today with his support.

    At this point, I ask unanimous consent to have printed in the RECORD the President's letter.

    Mr. GRASSLEY. Mr. President, I thought I would read at least the last paragraph by President George Bush.

    I will support the increased Medicare funding for rural providers contained in your amendment—

    Meaning the Grassley amendment—

    as a part of a bill that implements our shared goal for Medicare reform.

    What the President is talking about in this letter is just exactly what we have before the Senate—the same amendment included in this prescription drug bill on rural equity that passed the Senate 86 to 12 a month ago.

    We have the prescription drug bill and the Medicare reform bill before us. These two are married up at a point that the President's letter refers to.

    I want people to know that including this is something I discussed with the President on at least two occasions before his May 22 letter to me. One time in early December when the President asked me to come to the White House to discuss early on the process for moving this legislation along, I had an opportunity to remind him at that particular point about the speech he gave in August 2002 in Davenport, IA, during a political event at which he appeared for Congressman NUSSLE of Iowa. The President rightly complimented Congressman NUSSLE for leading efforts in the other body to help rural equity. I reminded the President that the short reference he gave in his otherwise long speech was used by Congressman NUSSLE in his TV ads in eastern Iowa during last fall's election. I wanted the President to be reminded that all Iowa heard him—not just a few Republicans at the NUSSLE campaign event in August—but all Iowans heard him throughout the fall campaign with parts of his speech being reproduced on this campaign ad.

    I also had an opportunity early in April to talk to the President when the President once again visited with me about provisions of the prescription drug bill. He makes reference to that in the second paragraph of the letter. He said:

    When we met in the Oval Office in early April, we discussed our concerns that rural Medicare providers needed additional help, and we committed to addressing their problems. We agreed on the need to address issues faced by rural hospitals, skilled nursing facilities, home health agencies, and physicians.

    The President is well aware of his communicating this directly to the people of Iowa even before I had my discussions with the President on these issues. I am glad the President is committed to fulfilling his statement to the people of Iowa that he made last summer.

    This rural health care safety net is otherwise coming apart. That is why this rural equity issue is so important. The bill before the Senate begins to mend it. The hospitals and home health agencies in rural America lose money on every Medicare patient they see. Rural physicians are penalized by bureaucratic formulas that reduce payments below those of their urban counterparts for the very same service. Our bill takes historic steps toward correcting geographic disparities that penalize rural health care providers. I will summarize some of these.

    On hospitals, we eliminate the disparity between large urban hospitals and small urban hospitals, as well as rural hospitals, by equalizing the inpatient-based payment. The hospitals in my State and other rural areas are paid 1.06 percent less on every discharge. That is a $14 million loss every year just for my State. It is time to make this change permanent.

    We also revised the labor share of the wage index in the inpatient hospitals. The wage index calculation kills our hospitals in rural areas. They have to compete with larger hospitals in bigger cities for the same small pool of nurses and physicians. But because of the inequities in the wage index, they aren't able to offer the kinds of salaries and benefits that attract health care workers in cities.

    Our bill begins adjusting the labor-related share downward to correct these inequities. We strengthen and improve the Critical Access Hospital Program which has been so successful in keeping open the doors of some of our most remote hospitals.

    I think in my State of Iowa, almost a third of our hospitals have changed to what we call "critical access hospitals."

    Also, in this bill, we create a low-volume adjustment for those critical access hospitals and for other rural hospitals that aren't able to qualify for the Critical Access Hospital Program.

    These hospital corrections are not partisan rhetoric. They are supported by the nonpartisan Medicare Payment Advisory Commission, by the Center for Medicare Systems Administrator—and he did that in a recent letter to the House Ways and Means Committee—and also by 31 bipartisan members of the Senate Rural Health Caucus.

    For doctors, our bill removes a penalty which Medicare imposes on those who choose to practice in rural States. Medicare adjusts payments to doctors downward based on just where they live. We believe the value of the physician service is the same regardless of where that doctor may live. Medicare doesn't recognize that. Our bill begins to change that.

    Our bill also provides assistance to other rural health care providers such as ambulance services, and home health agencies which millions of seniors in rural areas rely on every day.

    Providers in rural States such as Iowa practice some of the lowest cost, highest quality medicine in the country. This is widely understood by researchers, academics, and citizens of those States, but it surely isn't recognized by Medicare. Medicare, instead, rewards providers in high-cost, inefficient States with bigger payments that have the perverse effect of incentivizing overutilization of services and, in the end, giving poor quality.

    These policies are paid for, not by taking resources away from the prescription drug package or by taking money away from those high-cost States but by other modifications to the Medicare Program that makes just plain, good policy sense.

    These rural health care provisions are a fair and balanced approach to improving equity in rural America. My colleagues on the Finance Committee—a lot of them from these same rural States—recognize that. And I think on this vote we had a month ago I can say that the full Senate recognizes that.

    I would speak last about the Medicare Advantage or the preferred provider organization parts of our legislation. Because beyond prescription drugs, and beyond the issue of rural health care, our bill goes to great lengths to make better benefits and more choices available for our seniors. In fact, one of the things that has been a focal point of this legislation over the 2 or more years we have adopted it has been to give seniors the right to choose.

    Mr. President, I see that you are rapping the gavel. Can you tell me what that is all about?

    The PRESIDING OFFICER. The Senator's time has expired. The time until 12:30 is equally divided.

    Mr. GRASSLEY. Could I ask, since there are not other people here, maybe for 3 more minutes?

    Mr. BREAUX. Mr. President, I would respond, Senator Dorgan wants 15 minutes, and then that is it.

    Mr. GRASSLEY. I will put the rest of my statement in the RECORD.

    Mr. BREAUX. It may work out. How much time do we have, I ask the Chair?

    The PRESIDING OFFICER. Thirty-seven and a half minutes.

    Mr. BREAUX. That is fine. Go ahead.

    Mr. GRASSLEY. Well, the Senator from North Dakota is here.

    Mr. BREAUX. I say to the Senator from North Dakota, the Senator wants to complete his statement.

    Mr. GRASSLEY. Two more minutes?

    Mr. BREAUX. Two more minutes.

    The PRESIDING OFFICER. The Senator from Iowa.

    Mr. GRASSLEY. Mr. President, we want to give seniors the right to choose in as many areas as we can. That is why I use the word "voluntary." And that is why I use the phrase "the right to choose what they might consider better Medicare programs than traditional."

    Our bill specifically authorizes provider organizations to participate in Medicare. The idea is these kinds of lightly managed care plans more closely resemble the kinds of plans that we choose for the Federal Government and which close to 50 percent of working Americans have today but only 13 percent of the people in Medicare have that today.

    Preferred provider organizations have the advantage of offering the same benefit of traditional Medicare, including prescription drugs, but on an integrated, coordinated basis. This bill creates new opportunities for chronic disease management and access to innovative new therapies.

    PPOs might not be right for everyone. We are going to let seniors make that choice. Our bill sets up a playing field for preferred provider organizations to compete for beneficiaries. We believe PPOs can be competitive and offer stronger, more enhanced benefits.

    In the days ahead, I will be working with colleagues on both sides of the aisle to ensure that we set up the right system, one that is truly competitive and viable for these preferred provider organizations. No senior has to choose this new program. Our prevailing policy has been, and always will be, one that lets seniors keep what they have if they like it with no changes. All the seniors, regardless of whether they choose a PPO or not, can still get prescription drugs.

    We have 2 long weeks ahead of us. My commitment is to stay here until the lights go out to ensure that we pass a balanced bipartisan bill.

    I thank my colleagues on the Senate Finance Committee for their fine work to get us this far.

    I yield the floor.