Medicare Drug Benefit

MEDICARE DRUG BENEFIT -- (Senate - January 09, 2007)

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Mr. DURBIN. Will the Senator yield?

Mr. GRASSLEY. Of course I yield for a question. We very seldom get a chance to debate. That is a welcome opportunity.

Mr. DURBIN. I notice that my friend and colleague from Iowa has been in the Senate for the last several days talking about Medicare prescription Part D, which he played a major role in creating. I know he feels the program as passed into law should not be changed--or at least not along the lines many suggest. However, I ask this question: Does the Senator believe that the current program at the Veterans' Administration which allows that agency to bargain for bulk discounts on behalf of our veterans to reduce the prices of the drugs they buy for our veterans is a good policy?

Mr. GRASSLEY. In the sense of what we can afford for veterans, we ought to think in terms of that we cannot afford enough for veterans who put their lives on the line.

When we have appropriated accounts, there are some limits, as opposed to an entitlement such as Medicare, but it is not as good as what seniors have under this because there are several therapies the Government will not pay for under the veterans program we pay for under Medicare. From that standpoint of the quality of the program, based upon the therapies that are available, it is not as good as what we have in Medicare.

Mr. DURBIN. Would the Senator acknowledge the fact, though, that the Veterans' Administration, because it can bargain on behalf of all veterans and obtain bulk discounts, saves money not only for the veterans who are provided with these drugs but also for our Government; that the pharmaceutical companies, anxious to provide drugs to millions of veterans, will give bulk discounts that will benefit both the Veterans' Administration and the veterans?

Mr. GRASSLEY. The answer is yes. But you get back to the person who came to one of my town meetings and said: The doctor said I ought to have this prescription. Why won't the Veterans' Administration pay for it? I have to have this one, according to the Veterans' Administration, and there is some way it affects me that the other one wouldn't.

We have to take that into consideration as well. Yes, bulk discount gets drugs cheaper, but the Government is not going to pay for every drug. You are going to have the bureaucrat in the medicine cabinet of the veteran, and the bureaucrat is not today in the medicine cabinet of the senior citizen.

You also have to realize that, in addition to the VA having a limited formula, they also do not have the availability of the drug in the pharmacies the way we provide in this Medicare Program.

Mr. DURBIN. Would the Senator from Iowa acknowledge the fact that under the current Medicare prescription Part D, if a senior citizen in Iowa or Illinois signed up for a specific program, there is no guarantee the formulary they signed up for today will be available to that senior next month or even next year? So if the Senator from Iowa is concerned that the VA can't guarantee all drugs, the current Medicare prescription drug Part D Program does not guarantee the formulary. The formulary can literally change by the month, and a senior can find that a valuable and important drug they signed up for is no longer covered.

Mr. GRASSLEY. If you want to say for a period of a year or beyond a year, the answer is yes, but for 12 months, no. But also remember that every year the Secretary of Health and Human Services has to approve these plans, and there are certain basic needs they have to meet. One of those basic needs that is in the law that is not in the VA program is a requirement that every therapy be available.

Mr. DURBIN. I say to the Senator from Iowa, it has been my experience, working with my seniors, that every plan does not offer every drug.

Mr. GRASSLEY. That is true, but every therapy is available.

Mr. DURBIN. That is the same situation the VA faces. The VA may say to that veteran: We believe you should have a generic drug. The veteran may prefer a brand-name drug which is more expensive, but the plan provides the therapy through a generic drug. So in that way, it parallels what the Senator is describing under Medicare prescription Part D.

What I am suggesting, what we are suggesting on this side of the aisle, is not to foreclose the possibility that private plans will continue to offer options under Medicare prescription Part D. What we are trying to add is something that was debated at length and rejected when the bill was written; that is, to allow Medicare as an agency, as a program, to offer its own prescription drug program for seniors, to bargain with pharmaceutical companies to find the lowest prices possible and then allow the seniors to make the choice:

either take the Medicare approach or take a private approach. It gives more choices, not fewer.

Mr. GRASSLEY. Mr. President, I say to the Senator, I want to comment on the first part of what he recently said; that is, that what you say is true in regard to plans changing what drugs can be offered. We require that every therapy be available, but you are right, not every drug is available. And you want what the VA has because it might be better.

Now, let me point out then why our program is better. In the VA, 30 percent of drugs are covered, 70 percent not covered. In our program, if a senior finds him or herself in a plan where at the end of the year it has changed, they have choices of several plans to go to. The VA does not have that choice. There is no place a veteran can go. There is no place my constituents could go when they came to me and said: Why don't you cover this drug? My doctor says I need it because of what it does to me that the other one won't--or just the opposite.

Mr. DURBIN. If I could say to the Senator from Iowa, I have found my veterans to be very happy with the VA program. It is a very affordable program.

Mr. GRASSLEY. I have, too, so I agree with the Senator.

Mr. DURBIN. It is growing dramatically in size, which suggests more veterans are using it. But going back to Medicare Prescription Part D, we are not suggesting that Medicare offering its own program as an option is going to be mandatory on seniors. It is still their decision whether they want to use the Medicare approach--which we are supporting on this side of the aisle, which allows for these discounted drugs--or if they feel a private plan is better for them, better for their needs, better for their pocketbook. It is just a consumer choice. But that choice is not available today.

Medicare cannot offer to the seniors, under Medicare Prescription Part D, an option. What is wrong with Medicare offering that option and competing with these private insurance companies?

Mr. GRASSLEY. Well, can I ask a question without answering the Senator's question?

Mr. DURBIN. Certainly. Of course.

Mr. GRASSLEY. Because I was very joyful the Senator was coming out here. I saw him come out. I probably irritated him or something.

Here is what I was hoping we would be debating. Because the whole point of the last 2 days is: From President Clinton in June 1999, all the way through bills that the Senator's party introduced in 2003, we had the noninterference clause in it. I want you to know I felt very comfortable adopting a Democrat noninterference clause in my bill that is now law, and I was hoping the Senator was going to come out and give some justification why his party--mostly in his party; there were some on our side who would agree--why his party would change its mind after President Clinton thought that what we have been doing for 50 years was working so well in the Federal Employees Health Benefit Program that he wanted to do it. And he said you get lower drug prices by doing it that way.

Several bills--I think I said seven bills--introduced by Democrats had the same principle in it. And now you don't like it. I don't understand why. I was hoping that was why the Senator came out to debate.

Mr. DURBIN. Mr. President, I would say to my friend from Iowa, that is why I was asking the questions because I think the questions get beyond the word ``noninterference' into the reality of the choice we are suggesting.

I do not believe it is an interference to the rights of seniors eligible under Medicare Prescription Part D to give them an additional choice. And that is all we are asking: Allow Medicare to offer to the seniors another choice. They can reject it. They can accept it. I do not think that is mandatory or interfering.

I think, frankly, that a free-market Republican such as my good friend from Iowa would grasp that as a good option. It means the private insurance companies would then have to do their best to compete with Medicare. If Medicare offers a better plan, seniors can take it. If it does not, they can take private insurance options that are currently available.

Mr. GRASSLEY. If it is a good idea, I think the Senator from Illinois would do the consumers more good by offering a Government program to compete with Wal-Mart, maybe.

Mr. DURBIN. I would say, when it comes to the Medicare program, we know this was created by the Senator's committee. And I salute him for his leadership. But it is in fact a Government program. In fact, it is a program that is subsidized by our Federal Government. It is not just allowing little, private entities to compete. We provide a subsidy to them. We have constructed a plan which has a doughnut hole where there is a period of no coverage. We have constructed an approach that some seniors find very hard to understand. But regardless, it is a Government creation. What we are suggesting is a Medicare option is not unreasonable. It still leaves the final choice in the hands of the seniors. They make the final choice what is best for them, what is best for their family, and what is best for their budget.

Mr. GRASSLEY. Mr. President, I think I have to give a bottom line and say it is working. Or if that is not good enough for you--after 2 years--that it is something that is working, it is something that is needed, it is something that Republicans got passed. And we did not get it passed without Democratic help, thank God--it was bipartisan--otherwise we would not have gotten it done. But for 4 years we were waiting for something to happen on your side of the aisle. It did not happen.

So could I end by saying one thing? In case my word is not so good, I would quote from the LA Times. It is in response to what the Senator said about the VA program. And I do not have any problems with the VA program. But it says here:

VA officials can negotiate major price discounts because they restrict the number of drugs on their coverage list. In other words, the VA offers lower drug prices but fewer choices.

Now, do we want to give the seniors of America fewer choices? I think you do. The route you are going, that is where you are going to end up.

Mr. DURBIN. Mr. President, I would say to the Senator from Iowa, it is true that the VA formulary for eligible drugs is a more restrictive list. I do not know if that will be the same case when Medicare--if they are allowed to--offers an option. But ultimately the choice is in the hands of the seniors. If they think the formulary that is offered by Medicare is too restrictive, they do not have to choose it. It is their ultimate decision. It is the concept of freedom. And I know the Senator from Iowa embraces that concept. I hope he will consider our approach.

Mr. GRASSLEY. So I cannot attribute this specifically to the Senator from Illinois, but the Senator is talking about choice now, and if there is anything people have choice on, it is all the plans that are available. But from your side of the aisle, starting in 2004, all I heard was there was too much choice, too much choice, too many plans.

So I do not know for sure if you and your party know where you are coming from, whether choice is OK, how much choice is OK. Maybe you are leading us down the line where we are going to end up, if you get too much Government interference, we will not have choice.

Mr. DURBIN. I would say to my colleague, when it comes to this issue, my experts are pharmacists. Just like so many towns in Iowa, there are many towns in Illinois where the drugstore pharmacy is a community center, and people come to trust their druggist, trust their pharmacist. What I did, as Medicare Prescription Part D came on line, was to visit those drugstores and sit down with the pharmacist. And I will tell you quite candidly, many times they were dealing with seniors who had reached a point in life where a lot of information was difficult to evaluate, and they had to work with their pharmacist to find the best option.

So if there was a criticism on our side, it was the fact that there was so much information being given to seniors with a limited amount of time to make a decision. I think the Senator from Iowa would concede that some seniors needed the help of family members or pharmacists or counselors at senior centers to help them make this decision.

But on the final analysis, I hope the Senator will be open to the concept that if Medicare offers an option, it is just another choice for seniors. Take it or leave it. It is still ultimately their decision.

Mr. GRASSLEY. Mr. President, let me suggest to you that the committee that has jurisdiction over it, which I am no longer chairman of, has a tradition of trying to work through things. I want you to know I am committed to looking if there are better ways of doing it. But I think it is pretty difficult to argue with a program that has come in with senior citizens, by 80 percent in more than one poll, saying they are satisfied and, secondly, a program--what Government program have you ever seen come in without big cost overruns?

This one has come in now with the latest projection by CBO that it is going to cost $189 billion less than we anticipated it would cost. And we got lower Federal costs. We got lower premiums for the seniors. We got 35-percent lower drug prices for the 25 drugs most used by seniors. We got lower State costs, because the States do not have to pick up the duel eligibles as they used to.

There is something good coming out of the discussion the Senator and I are having. If we would have had this discussion 3 years ago, you would have said what we were doing was going to bring holy hell and not do any good and it would never work. At least now there is some acceptance of the program. So maybe with a little bit more dialog we will come around to the point where you are saying: Maybe, Senator Grassley, you were right.

Mr. DURBIN. Mr. President, I am always--in fact, I have been quoted in your campaign literature sometimes saying nice things about you.

Mr. GRASSLEY. I noticed you have not said that so I can quote you again.

Mr. DURBIN. I am being very careful this time around. And I would be happy to acknowledge you are my friend and a great leader, and you have done a great job here. And put it in your next brochure if it will help.

But I want to close by saying thank you for this dialog. It is rare on the floor of the Senate, and we need more of it. I would say, when it comes to perfect laws, I think aside from the Ten Commandments, most laws could stand an amendment or two. So I hope you will be open to the possibility of improving Medicare Prescription Part D.

Mr. GRASSLEY. Remember, the bill you want to amend is a bipartisan bill. Remember that.

Mr. DURBIN. I thank the Senator.

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