I thank the distinguished chairman for yielding. Mr. Speaker, the chairman of the Energy and Commerce Committee, Mr. Dingell, has been here in Congress the longest, he is the dean of the House of Representatives, and I am sure that he…
I thank the distinguished chairman for yielding.
Mr. Speaker, the chairman of the Energy and Commerce Committee, Mr. Dingell, has been here in Congress the longest, he is the dean of the House of Representatives, and I am sure that he remembers under the Clinton administration when they attempted to expand the discounts for a segment of the population using this same approach you are doing with H.R. 4. In fact, this occurred in 2000 in a hearing on the Veterans Administration. I would like to take you through this, Mr. Dingell, and perhaps even be willing to let you reply to some of the questions I have for you. Because if you think you can repeal the law of economics, you can't, because in 1990, Congress gave Medicaid access to the low prices that are achieved by the Veterans Administration and the results were not good for our veterans.
The drug manufacturers in turn reacted. What did they do? It ended up that the deep discounts that the veterans were getting were not provided. In some cases the VA saw the prices for the drugs for our veterans go up by 300 percent. That is why the American Legion has come out against this bill, H.R. 4. They feel it is going to impact veterans so significantly that the prices will go up, like they did in 1990, 300 percent.
Advocates of this bill claim that negotiations will lower drug prices for Medicare part D beneficiaries. When I look at my congressional district, almost 80 percent of the seniors on Medicare are covered with drug coverage from Part D and they are all satusfield. So I again can't understand in light of the fact it is going to perhaps see cost- shifting to the veterans in this country like the American Legion thinks, why would you want to change something that is working so fabulously after all the extensive work that the seniors have done to comply and get involved?
Various times during the Clinton administration, not the Bush administration, the Clinton administration, proposals were made to expand the discount veterans enjoy to a wider population, just like you want to do today.
One was a simple demonstration to add some Federal Employee Health Benefit Plan, FEHBP, participants to the Federal Supply Schedule (FSS) Drug Pricing Program and later to extend the FSS to the Medicare population. Does this sound familiar to my colleagues? So back in 2000, July, the Clinton administration wanted to do precisely what we are doing today. The veterans had a hearing on this. Testimony was offered by the Clinton administration. The Clinton administration officials came out, and let me give you one of their quotes:
This is from the honorable Edward Powell, Jr., Assistant Secretary for Financial Management, Department of Veterans Affairs. He said: ``VA is concerned about any significant cost impact to its program resulting from this pilot . . . ''
I would just conclude that, Mr. Dingell, this has already been tried. It doesn't work.
Veterans' Drug Prices Go Up With H.R. 4 Passage
Advocates of H.R. 4 claim that negotiation will lower drug
prices for Medicare Part D beneficiaries. This is bad
legislation for several reasons. Of special concern to me is
the harm it would do to veterans who rely on Department of
Veterans Affairs (VA) health care for affordable medications.
Various times during the Clinton administration, proposals
were made to expand the discounts veterans enjoy to wider
populations. One was a demonstration to add some Federal
Employee Health Benefits Plan (FEHBP) participants to the
Federal Supply Schedule (FSS) Drug Pricing Program, and
later, to extend the FSS to the Medicare population (sound
familiar?). On the former, I chaired a hearing July 25, 2000.
Testimony, and later analysis, revealed that expanding the
discounts veterans get to OPM would have increased drug costs
to veterans. Ultimately, the SAMBA demonstration was not
carried through because of this objection.
Here is some testimony from that hearing:
``. . . VA is concerned about any significant cost impact
to its program resulting from the pilot . . .'' The Honorable
Edward A. Powell, Jr., Assistant Secretary For Financial
Management, Department Of Veterans Affairs.
``We are concerned that this pilot will increase the cost
of pharmaceuticals purchased by the VA and will result in
diminished health care for sick and disabled veterans.''
Richard A. Wannemacher, Jr., Assistant National Legislative
Director For Medical Affairs, Disabled American Veterans.
``Perhaps it should go without saying, but I must call your
attention to the fact that Congress already has spoken on the
issue of expanded access to FSS pricing on several previous
occasions. In fact, I am aware of at least four separate laws
over the past 10 years enacted purely to correct the
unintended adverse consequences on VA of changes in federal
pharmaceutical pricing laws. In each of these cases. the
unintended consequences were the result of a law passed by
Congress to achieve some other purpose, and VA was an injured
bystander.'' Robert B. Betz, Ph.D., Executive Director,
Department of Veterans' Affairs Pharmaceutical Procurement
initiative Adding Federal Employee Health Benefit Plan
Participants to the Federal Supply Schedule Drug Pricing
Program.
Following my hearing, an August 2000 GAO report,
Prescription Drugs: Expanding Access to Federal Prices Could
Cause Other Changes, stated, ``Drug manufacturers could
respond to a mandate that they extend federal prices to a
larger share of purchasers by adjusting their prices to
others. ``
Still further, former VA Acting Secretary during the
Clinton Administration, Hershel W. Gober, wrote in the Sept-
Oct 2004 issue of DAV Magazine ``Similarly, in 1999, when
attempts were made to extend the FSS pricing schedule to the
Medicare population we estimated that extending discounted
government prices for pharmaceuticals to the Medicare
population would increase the VA's annual pharmaceutical
costs by $500-600 million. Now, years later, the impact will
be even greater on the already constrained VA budget if FSS
special discount drug prices are extended to the Medicare
population and states.''
Why are Democrats proposing this harm to veterans again,
when Medicare Part D is working?
Medicare beneficiaries are already receiving substantial
drug discounts, through plan negotiation that works just as
FEHBP works for federal and legislative employees, including
Members of Congress. Do not increase costs for your veterans.
Oppose H.R. 4. H.R. 4 will endanger the health, lives and
budgets of veterans.
I thank the chairman.
Mr. Speaker, the motion to recommit will mean that under section 4, the Secretary's actions shall not result in drug price increases paid by veterans. This means, my colleagues, includes the Department of Veterans' Affairs or veterans themselves.
Certainly what both distinguished chairmen have mentioned is clear. I think that all Members should understand that. I support the motion to recommit.
H.R. 4 will most certainly increase VA drug prices. (1) This happened in 1990, Congress gave Medicaid access to VA, shooting up some VA drug prices 300 percent. (2) Next, when the Clinton Administration's Office of Personnel Management tried to expand VA's discounts to a group within FEHBP in 2000, Clinton's own VA balked, as did a witness from Disabled American Veterans. (3) Just recently former Clinton Administration VA Acting Secretary Hershel W. Gober, wrote in a 2004 issue of DAV Magazine that VA estimated in 1999 ``extending discounted government prices to Medicare would increase VA's annual drug costs by $500-$600 million''.
Please don't turn your back on the brave men and women who defend our Nation. Support this motion to recommit in order to ensure that H.R. 4 will not adversely affect drug prices for veterans.