Statements on Introduced Bills and Joint Resolutions

CONGRESSIONAL RECORD
SENATE
STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

By Mr. DURBIN (for himself, Mr. DAYTON, and Mr. LEVIN):

S. 2652. A bill to amend title XVIII of the Social Security Act to deliver a meaningful benefit and lower prescription drug prices under the medicare program; read the first time.

Mr. DURBIN. Mr. President, those who are following the business of the Senate understand that just a few moments ago, we had a vote on the floor of the Senate on the proposed constitutional amendment dealing with same-sex marriage. The final vote, I think, was indicative of the feeling of this body. There were 48 who supported going forward with the debate on this amendment and 50 Senators who opposed it. Of course, 48 Senators does not meet the threshold requirement for approving a constitutional amendment, which is 67 Senators. So that gap of 19 Senators suggests this Senate does not believe it is appropriate for us to move forward on that type of constitutional amendment.

Many of the colleagues on both sides of the aisle spoke to this issue over the last several days and expressed their heartfelt feelings of the underlying issue of same-sex marriage and about the question of whether we should amend the Constitution. The vote today is, I think, a good indication that this is an issue whose time has not come. There is no issue in controversy which requires us to amend the Constitution of the United States of America.

One might ask, if this issue fell so far short, 19 votes short, of what it needed, why did we consider it? For obvious reasons. This debate was not about changing the Constitution. This debate was about changing the subject in the Presidential campaign.

It is understood that if you ask most American families what is important to them the politicians are worried about, they will talk about the obvious things: My job, the fact that my paycheck does not cover the necessities of my family, the cost of health insurance, the availability of quality health care, whether my retirement savings are going to be protected; I am concerned as well about the situation in Iraq; I would like to know when we will stop losing our soldiers, and what do we have ahead of us in terms of Iraq and the $1.5 billion which American taxpayers spend each week in Iraq, how long will that go on? What could we do with $1.5 billion every week in the United States of America for our schools, for providing health care for our children, immunizations.

These are the obvious questions with which most families identify. But if the Presidential election campaign is waged on those issues, the White House and the Republican Party believe they are at a disadvantage because many people, in fact, an amazingly large percentage of Americans, say when asked, they feel our country is going in the wrong direction in terms of its economics to help working families, in terms of creating jobs, keeping good-paying jobs in America, dealing with the fact we still continue to be dependent on the Middle East and Saudi Arabia for our oil which draws us into a terrible situation of dependency, a terrible situation which taxes our resources.

That is what most Americans will identify as the major issues, and those are not issues on which this administration wants to campaign. So they attempted today to change the subject. They wanted to change the subject by changing the Constitution to deal with same-sex marriages, an issue which has not reached a level where it should even be addressed by our Constitution.

I will not go over that whole debate again, but the vote tells the story. The Republican Party in the majority in the Senate was unable to get a majority of votes to support the President's constitutional amendment. The rollcall tells the story. But there are other issues which, frankly, we should now move to, issues about which families across America do care.

I know as I travel around my State of Illinois and talk with families, businesses, labor union leaders, time and again the issue on their minds is the cost of health care in America.

I met 2 days ago in Chicago with a good friend of mine who heads up one of the major labor unions. It is a labor union which represents people who work at grocery stores, United Food and Commercial Workers. I talked with him about his problems.

He said: Senator, virtually every strike we have, virtually every contract negotiation is over the cost of health insurance. We get our workers 50 cents more an hour, and they don't see a penny of it. It all goes into health insurance, and there is less coverage this year than last year. They are upset with their labor leaders and upset with their employers.

Then you talk with businesspeople, businesses small and large, and I hear the same story, businesses which say: We are mom and pop, and we can no longer afford health insurance for the people who work for us; it is just too expensive.

There is another element in this whole equation which we cannot overlook, and that is the cost of prescription drugs. The cost of prescription drugs is not only driving the cost of health insurance to record levels, but it is also pushing a lot of people of limited family means into terrible choices: whether they can afford to buy the prescription drugs that will keep them healthy and, if they do, whether they will have to sacrifice the necessities of life. That is a real issue. That is an issue this campaign ought to be about. Would it not be refreshing if the debate of the week was not over same-sex marriage and its impact on families but the cost of health care and the cost of prescription drugs and their impact on families? I think that is what the voters are waiting for.

If they have any frustration with those of us in public office, it is the fact we talk past them, over them, and around them and never direct to the issues about which they care.

Today I am joining Senator Levin of Michigan and Senator Dayton of Minnesota in introducing S. 2652.

We are going to work to put this bill on the Senate calendar under rule XIV so that Senator Frist can call it up for debate. In other words, what I am trying to do is to accelerate consideration of this bill to blow past all the political issues and the political rhetoric to get into this legislation. The Democratic leader in the other body is working to discharge a companion bill so they can consider it in an expedited manner.

This bill is called the Medicare Prescription Drug Savings Act. We need to expedite this bill. We need to put it on the calendar. We need to stop wasting time on issues going nowhere because seniors and low-income individuals are facing escalating prescription drug prices that are really hurting them personally and diminishing their Medicare drug benefits. Instead of considering bills that do not have the votes to pass, like the one we just finished, we should consider something that is an urgent priority for Americans. Whether one lives in a blue State, a red State, or a purple State, whether one is in a battleground State or it is a State that is decided, they are going to find seniors concerned about the cost of prescription drugs. This is an issue that is bipartisan. It is an issue that affects virtually every family. Over the past 5 years, prescription drug prices have risen between 14 and 19 percent every single year, 5 times the rate of inflation.

One particularly egregious example of drug price inflation in the United States is Novir, an essential ingredient in the HIV cocktail to deal with the HIV/AIDS crisis. The price of an average dose of Novir went up 400 percent this year from $1,600 a year to more than $7,800. That is more than 10 times the cost of the same drug in Canada or in Europe. Americans are paying 10 times the cost of Novir for HIV patients in the United States as the price that is being paid in Canada and Europe.

Last month, the AARP released a study examining prescription drug prices for the 12-month period ending in March 2004. The study revealed that the prices charged by pharmaceutical companies to wholesalers for the top brand-name drugs used by seniors increased at a rate of 7.2 percent. That is faster than the 2 previous years, which is troubling given that inflation actually fell during that same period of time.

Drug discount cards have been suggested as the answer for this problem, but they are not. A fact sheet sent out by the Department of Health and Human Services to 40 million Medicare beneficiaries said that a discount card with Medicare's seal of approval can help save 10 to 25 percent on prescription drugs.

Now, this is the administration plan, a discount card under Medicare for prescription drugs that could save 10 to 25 percent. Well, after the same Department published the drug card prices in May, the Chicago Tribune newspaper looked at what these cards would mean in a suburb of Chicago, the city of Evanston. The Tribune compared the prices at pharmacies in Evanston with what seniors will save with drug discount cards. Take a look at it.

In some cases, the people in Evanston, IL, will actually save less without the card. The drug Lipitor, with the discount card, is $67.07. The lowest retail price, $68.99. Savings, $1.92, or 3-percent savings. Celebrex, 2 percent. Norvasc, in fact, costs more under the discounted card. So this so-called discount card seems to be of little value with drugs that are very popular and well used and prescribed to, such as Lipitor, Celebrex, and Norvasc.

The lack of significant savings from the discount cards that are being touted by the administration is not unique to Illinois or the city of Evanston. Since President Bush announced the idea of a drug discount card in July of 2001, top selling prescription drugs have experienced double-digit increases, eroding any savings that might come from the card.

Remember when the Bush administration said their discount cards would save seniors 10 to 25 percent? Well, price increases are eroding savings. Take a look at what happened to these drugs: Celebrex for arthritis pain went up 23 percent; Coumadin, a blood thinner, 22 percent; Lipitor, 19 percent; Zoloft, 19 percent; Zyprexa, 16 percent; Prevacid, 15 percent; and Zocor, 15 percent.

The prescription drug discount card is not even really keeping up with the inflation built into prescription drug prices.

Some of my colleagues may say it is not important that the drug card is not producing much savings because the real benefit will start in January of 2006. Unfortunately, rising drug prices will erode that benefit, too.

I will tell my colleagues about one of my constituents. Alois Kessler of Skokie, IL, has $3,200 in drug costs, and his income, which is fixed, is $28,500. Assuming prescription drug prices continue to rise as we have seen them rise and Mr. Kessler stays with the same medication he is currently taking, his drug costs will be approximately $4,800 by 2006, the first year of the new Part D benefit. His income will rise about 3 percent a year. So he will have drug prices at $4,800 and an income of $31,000 a year.

The new program reduces his cost by $1,080 in the first year, so he will still have to pay out-of-pocket $2,120. By 2015, assuming he is still taking the same medication, his drug costs will reach $17,000, and his income will only have risen to around $40,400. One just cannot keep up with an inflation protection in their Medicare or retirement income against drug price increases of this kind.

What can we do about it? What we can do about it is something this bill proposes, and it is something very basic. There is a lot of talk in Congress today about bringing drugs in from Canada and other places. I am open to that conversation, anything to provide relief to seniors and people on limited incomes trying to buy lifesaving drugs.

Look to the north. Canada selling American drugs made in America, inspected in America, approved in America, with research in America, for sale in Canada turn out to be a fraction of the cost of what they are in the United States. With just 2 percent of the worldwide pharmaceutical market, Canada cannot supply the United States no matter how many busloads of seniors we send there.

The United States has 53 percent of the worldwide prescription drug market. Half of it is made up of Medicare beneficiaries. Think about this for a moment. If Medicare, the program that covers seniors, were to sit down with major pharmaceutical companies and bargain for the prices of the drugs, think about their bargaining power. They have the ability to bring prices down for Americans for drugs sold in America rather than reimported in the United States.

The prescription drug benefit bill we passed expressly prohibits Medicare from negotiating for lower prices. That is something the pharmaceutical companies wanted, and they won. They won it at the expense of American consumers.

Today, the Veterans' Administration and the Department of Defense negotiate for VA drug prices and cut down the cost of drugs by almost 50 percent. Take a look at some of these popular drugs and the difference between what is paid in the drugstores of America and what the Federal Government pays for the same drug: Xalatan eyedrops, $41 under the negotiated price of the VA, and $101 is what is paid in the drugstore; Celebrex, the drug we talked about earlier for arthritis, $108 on the Federal Supply Schedule and $173 at the drugstore; Lipitor for cholesterol, $215 in the Federal system, $446 over the counter; Plavix, $257 negotiated, and over-the-counter, $593.

Once you put the bargaining power of the Federal Government behind price negotiations, the prices come down. People can afford the drugs. Families can afford them. The cost of health insurance comes down, but the profits for the drug companies come down, too. That is why this Congress, under the thrall of that special interest group, has refused to give Medicare the power to negotiate.

I will give one specific example we have lived through on Capitol Hill. Many people rail about what happened with the anthrax scare a few years ago. There was a suggestion that the drug Cipro would be used as an antidote to any ill-effects caused by anthrax. We found out Cipro was an expensive drug, and Secretary Tommy Thompson said he would negotiate with the Bayer Company, the company that makes Cipro, to lower prices.

Look what happened when Secretary Thompson tried to do that. He said:

Everyone said I wouldn't be able to reduce the price of Cipro. I am a tough negotiator.

What was the market price when he went into it? It was $4.67 per pill for Cipro. When it was all said and done, we were paying 75 cents. When someone sits down with the drug companies and says, You are overcharging us, we won't pay it, look what happens. Yet when the seniors of America look for the same kind of hard-nosed negotiating to bring down costs for them, this Congress says no; we don't want to give Medicare the ability to negotiate to do the same thing Secretary Thompson achieved when it came to these Cipro tablets. Through negotiation, Secretary Thompson brought down the price of Cipro by 490 percent. Good news for the people who needed Cipro; bad news for the people who need Medicare. But we can't even ask him to stand up for senior citizens in America. Out of the question. Drug companies don't want to lose their profitability.

Incidentally, they are very profitable. Let me show you some charts. This indicates the profitability of Fortune 500 drug companies versus the profits for all Fortune 500 companies in the year 2002. Look at what drug companies on the red bars have done on profitability: 17 percent as opposed to 3.1 percent; in this chart, 27.6 percent to 10.2 percent. They are making money hand over fist. They are charging seniors and families across America record high prices for drugs. They are increasing the cost of those drugs every single year and passing them along directly, raising health insurance costs, making it more difficult for seniors to keep up with the drugs they need to stay healthy.

I think the bill I have introduced with Senators LEVIN and DAYTON answers the need. I believe the bill which we will attempt to put on the Senate calendar today, so we can vote it before we leave for anybody's convention, is going to go a long way toward helping America's seniors. The Medicare Prescription Drug Savings Act instructs the Secretary of Health and Human Services to offer a nationwide Medicare-delivered prescription drug benefit in addition to the PDP and PPO plans available in the 10 regions. We keep in place what is in the Medicare bill passed last year, we just add a new player. The new player is Medicare providing prescription drugs with negotiated prices. We set a uniform national premium of $35 for the first year for this prescription drug benefit, and we negotiate group purchasing agreements on behalf of beneficiaries who choose to receive their drugs through the Medicare-administered benefit. It is voluntary. Those who choose to receive their drugs will have negotiated lower prices. Those who enroll can stay enrolled as long as they want.

Not only will this bill provide seniors with lower cost drugs, it will give them a choice to enroll in a Medicare-delivered plan, cutting down on the confusion the privately delivered system has already created. Critics and the pharmaceutical industry would say my bill is about price controls and big government. How do you explain the Veterans' Administration? Aren't we saying for our veterans we want to bring down the cost of pharmaceutical drugs? Have you spoken to a veteran lately who has gone to the VA hospital to sign up for the monthly drug benefit because it is so attractive for him and his family? That tells me government can play an important role and have a voice in buying in bulk and bringing down costs.

Who supports this bill we are trying to bring to the calendar? The Alliance for Retired Americans, AFL-CIO, American Nurses Association, Campaign for America's Future, USAction, Consumers Union, the Service Employees International Union, AFSCME, the American Federation of Teachers, Families USA, the Center for Medicare Advocacy, and the National Committee to Preserve Social Security and Medicare.

If you don't think this is a timely issue, pick up this morning's New York Times and take a look at the front-page story. The bill we passed, signed by President Bush, has America running in the wrong direction. Front-page headline:

Drug Law [signed by President Bush] Is Seen Leading To Cuts in Retiree Plans.

Let me read one or two paragraphs:

New government estimates suggest that employers will reduce or eliminate prescription drug benefits for 3.8 million retirees when Medicare offers its coverage in 2006.

That is the plan we referred to earlier passed by Congress.

That represents one-third of all retirees with employer-sponsored drug coverage, according to documents from the Department of Health and Human Services.

No aspect of the new law causes more concern among retirees than the possibility they might lose benefits they already have.

That is what the administration offers us: discount cards which don't offer a real discount, the loss of prescription drug coverage already available for 3.8 million retirees, and, finally, a plan that is offered to seniors that is almost impossible to describe and follow because it is so complicated in its minutiae and detail, and it does not include a provision that allows Medicare to bargain for the best prices, the same bargaining power which we use over and over again to help veterans and many other Americans.

Before the end of the day, we are going to ask that this bill be brought to the calendar. I don't know what else we will consider today, but if my colleagues in the Senate will go home and ask a random sample of anybody on the street corner, or in the shopping center, about the cost of prescription drugs and what it means, they will understand that whatever the next item of business might be in the Senate, it cannot really match in importance what this issue means to families across the United States of America.

I yield the floor.