Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, I rise today in opposition to H.R. 4. It is a flawed piece of legislation. If there was ever a bill that should have gone through regular order in the committee process,…
Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I rise today in opposition to H.R. 4. It is a flawed piece of legislation. If there was ever a bill that should have gone through regular order in the committee process, it is this one, because we find as we look at it more carefully that there is much more to it than might appear at first glance.
First and foremost, we should recognize that Medicare part D is working. Ninety percent of seniors are covered. Thirty-eight million seniors now have prescription drug coverage.
Additionally, due to private competition, the cost of this program is continuing to fall. Estimates from the Center for Medicare and Medicaid Services have predicted that this program will cost $373 billion less over the next 10 years than was expected in 2005. Seniors are saving an average of $1,200 dollars a year because of those declines.
Market-driven reforms in the 2003 Medicare Modernization Act are working to provide more choices and lower prices.
Rather than establishing a one-size-fits-all government benefits package, the part D program allows beneficiaries to choose from a range of plans that meet their unique needs and circumstances.
It is also important to note that the current private sector negotiating power of part D is greater than a government-run Medicare program. We have heard much from the other side about a government-run program having a bargaining power, but in fact, the four top pharmacy benefit managers cover over 200 million individuals. So they not only negotiate on behalf of the seniors in part D but also on behalf of all the other beneficiaries in their programs throughout the United States, including most Members of Congress in the Federal Employees Health Benefit Plan. So this is over 10 times the number of Medicare beneficiaries than the Secretary would negotiate on behalf of.
Despite these facts, Democrats are continuing to push a bill that could significantly disrupt and dismantle the successful and popular Medicare prescription drug program. They want to remove private competition forces from this successful equation and, instead, have the Secretary of Health and Human Services interfere in and implement a price control system.
Medicare part D is successful because seniors are able to choose plans that cover their drugs and best meet their health needs. Government bureaucrats, instead, would be replaced and would choose what drugs seniors would get, and these bureaucrats would be allowed to set prices for Medicare covered drugs.
The government should not be responsible for making decisions that should be left to seniors. Currently, seniors are able to choose plans. I think we should continue to allow seniors to make their own choices and keep bureaucrats out of seniors' medicine cabinets. The Medicare prescription drug program is working, and we would be wise to resist the Democrats' plan to fix what is not broken.
We can continue to improve prescription drug programs, but we must closely examine these changes so Congress does not do more harm than good by enacting new policies. I encourage my colleagues to vote ``no'' on this bill.
Mr. Speaker, I reserve the balance of my time.
Mr. Speaker, I yield for purposes of controlling time to the ranking member of the full Ways and Means Committee, the distinguished gentleman from Louisiana (Mr. McCrery).
Mr. Speaker, I yield 2\1/2\ minutes to a distinguished member of the Ways and Means Committee, the gentleman from Wisconsin (Mr. Ryan).
At this time, Mr. Speaker, we reserve our time.
Mr. Speaker, I yield for the purpose of making a unanimous consent request to the gentleman from Iowa (Mr. Latham).
(Mr. LATHAM asked and was given permission to revise and extend his remarks.)
Mr. Speaker, I reserve the balance of my time.
Mr. Speaker, at this time I yield 2 minutes to a distinguished member of the Ways and Means Committee and the Health Subcommittee, the gentleman from Texas (Mr. Sam Johnson).
Mr. Speaker, I reserve the balance of my time.
Mr. Speaker, I yield 2 minutes to the gentleman from Texas, the distinguished member of the Ways and Means Committee, Mr. Brady.
Mr. Speaker, I would like to place into the Record four letters, from the American Legion, the Lou Gehrig's Association, the National Alliance on Mental Illness and the American Autoimmune Association, all opposed to H.R. 4, concerned about its effect on the prescription drug benefit for seniors.
The American Legion,
Washington, DC, January 11, 2007.
Hon. Nancy Pelosi,
Speaker, House of Representatives,
Washington, DC.
Dear Speaker Pelosi: The American Legion urges you and your
colleagues to reevaluate the ``noninterference'' provision of
Chairman Dingell's proposed legislation, H.R. 4, The Medicare
Prescription Drug Price Negotiation Act of 2007. It would
amend part D of title XVIII of the Social Security Act to
require the Secretary of Health and Human Services to
negotiate lower covered part D drug prices on behalf of
Medicare beneficiaries.
Each time the Federal government has enacted pharmaceutical
price control legislation, the Department of Veterans Affairs
(VA) has experienced significant increases in its
pharmaceutical costs as an unintended consequence. A
fundamental principle in the price negotiation process so
that the ``lowest price'' establishes the baseline. By simply
raising the baseline, it sustains or possibly increases the
corporate bottom line based on the projected increased volume
in sales. An increased baseline minimizes the margin in
future price negotiations.
The American Legion strongly urges you and your colleagues
to seriously consider the collateral damage that would result
from listing the current ``noninterference'' provision in
section 2 of H.R. 4 on VA's formulary and the Federal Supply
Schedule. This ``noninterference'' provision is not in the
best interest of America's veterans and their families. VA is
a health care provider, whereas Medicare is a health insurer.
Any possible Medicare savings would likely result in a
reciprocal cost to VA.
Sincerely,
Paul A. Morin,
National Commander.
Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from New Jersey (Mr. Frelinghuysen).
(Mr. FRELINGHUYSEN asked and was given permission to revise and extend his remarks.)
Mr. Speaker, I yield 1 minute to the gentlewoman from Illinois (Mrs. Biggert).
Mr. Speaker, I yield 1 minute to the gentleman from Nebraska (Mr. Smith).
Mr. Speaker, I yield 1 minute to the gentleman from Georgia (Mr. Gingrey).
Mr. Speaker, I yield 1 minute to the gentleman from Texas (Mr. Sessions).
Mr. Speaker, I would include in the Record a letter from the Congressional Budget Office saying that CBO estimates H.R. 4 would have a negligible effect on Federal spending.
U.S. Congress,
Congressional Budget Office,
Washington, DC, January 10, 2007.
Hon. John D. Dingell,
Chairman, Committee on Energy and Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: At the request of your staff, the
Congressional Budget Office has reviewed H.R. 4, the Medicare
Prescription Drug Price Negotiation Act of 2007, as
introduced on January 5, 2007. The bill would revise section
1860D-11(i) of the Social Security Act, which is commonly
known as the ``noninterference provision'' because it
prohibits the Secretary of Health and Human Services from
participating in the negotiations between drug manufacturers,
pharmacies, and sponsors of prescription drug plans (PDPs)
involved in Part D of Medicare, or from requiring a
particular formulary or price structure for covered Part D
drugs.
H.R. 4 would require the Secretary to negotiate with drug
manufacturers the prices that could be charged to PDPs for
covered drugs. However, the bill would prohibit the Secretary
from requiring a particular formulary and would allow PDPs to
negotiate prices that are lower than those obtained by the
Secretary. The bill would also require the Secretary to
report to the Congress every six months on the results of his
negotiations with drug manufacturers.
CBO estimates that H.R. 4 would have a negligible effect on
federal spending because we anticipate that the Secretary
would be unable to negotiate prices across the broad range of
covered Part D drugs that are more favorable than those
obtained by PDPs under current law. Since the legislation
specifically directs the Secretary to negotiate only about
the prices that could be charged to PDPs, and explicitly
indicates that the Secretary would not have authority to
negotiate about some other factors that may influence the
prescription drug market, we assume that the negotiations
would be limited solely to a discussion about the prices to
be charged to PDPs. In that context, the Secretary's ability
to influence the outcome of those negotiations would be
limited. For example, without the authority to establish
formulary, we believe that the Secretary would not be able to
encourage the use of particular drugs by Part D
beneficiaries, and as a result would lack the leverage to
obtain significant discounts in his negotiations with drug
manufacturers.
Instead, prices for covered Part D drugs would continue to
be determined through negotiations between drug manufacturers
and PDPs. Under current law, PDPs are allowed to establish
formularies--subject to certain limits--and thus have some
ability to direct demand to drugs produced by one
manufacturer rather than another. The PDPs also bear
substantial financial risk and therefore have strong
incentives to negotiate price discounts in order to control
their costs and offer coverage that attracts enrollees
through features such as low premiums and cost-sharing
requirements. Therefore, the PDPs have both the incentives
and the tools to negotiate drug prices that the government,
under the legislation, would not have. H.R. 4 would not alter
that essential dynamic.
I hope this information is helpful to you. The CBO staff
contacts for further information are Eric Rollins and Shinobu
Suzuki.
Sincerely,
Donald B. Marron,
Acting Director.
Mr. Speaker, I yield 1 minute to the gentleman from Alabama (Mr. Bachus).
Mr. Speaker, at this time I yield 1 minute to the gentleman from Texas (Mr. Hensarling).
Mr. Speaker, at this time I yield 1 minute to the gentlewoman from West Virginia (Mrs. Capito).
Mr. Speaker, for the purposes of a unanimous consent request, I yield to the gentleman from Florida.
(Mr. YOUNG of Florida asked and was given permission to revise and extend his remarks.)
Mr. Speaker, I yield 30 seconds to the gentleman from Georgia (Mr. Price).
Mr. Speaker, I yield myself the balance of my time.
Mr. Speaker, this noninterference language that we have been talking about, that has been in legislative proposals for both Democrats and Republicans for the last decade, actually stops the Secretary of Health and Human Services from negotiating drug prices. And the reason that this has been part of bipartisan legislation for so long and was actually a part of the motion to recommit in 2000 that more than 200 Democrats voted for is because it was important to structure a plan that allowed beneficiaries to work with their doctors, not with the government, to determine the best access to treatment and the best treatment that worked for them. That is why you have seen so many coalitions come out against this proposal, particularly those that work with the most vulnerable of the Medicare beneficiaries.
I would urge a ``no'' vote on H.R. 4.