I’m here to celebrate 20 years since the passage of the Part D Medicare Prescription Drug Benefit.
Tomorrow, December 8, is that day.
Now, there was a time when the seniors of America on Medicare didn’t have access to nationwide prescription drug benefits.
As I indicated, 20 years ago tomorrow, President George W. Bush signed into law a nationwide prescription drug benefit for our nation’s seniors.
At that time, I was chairman of the Finance Committee, and I was proud to be the lead author Medicare Part D.
It wasn’t easy. It took several years to bring members of both political parties in the Senate and House, along with a president – in this case, President Bush– to accomplish this monumental task.
As I remember, both political parties were blaming each other, over a period of five or six years, [for] why we don’t have a prescription drug bill […].
Throughout 2001, 2002 and 2003, I led bipartisan negotiations that eventually produced the Medicare Prescription Drug, Improvement and Modernization Act of 2003, which is the official title of that legislation.
In 2003, I said this, a quote from that period of time: “Medicare is part of our [country's] social fabric. We're not only saving it, but we're also improving it.”
Of course, that still rings true today.
Today, 52 million seniors are voluntarily enrolled in a Medicare Part D plan, because this is not a requirement of Medicare.
In 2023, 804 stand-alone prescription drug plans were offered across the nation, with the average Iowan having over 20 plans to choose from to meet whatever their special needs were.
Over the lifetime of the program, the average annual Medicare Part D base beneficiary monthly premium has been between $27 [and] $36 a month.
I remember some of the discussions we were having back there as we developed this legislation. We thought to ourselves, we had to be very careful the initial premiums were not over $40 a month, because we figured that was just too high for anyone to participate in this new program. We thought, at that time, they would continue to go up according to inflation.
As you can see, after 20 years, the base beneficiary monthly premium is still below $40 a month, which, obviously, is a surprise to those of us who were involved, at that time, in writing this legislation -- but a very positive surprise.
Access and affordability have been a key hallmark of the Medicare Part D program, but so has good stewardship of taxpayer dollars.
In the first decade of the program, the nonpartisan Congressional Budget Office projected Medicare Part D would cost taxpayers roughly$550 billion for that decade. It ended up costing $353 billion, which was 36 percent less than the nonpartisan Congressional Budget Office projected in 2003.
Most federal projections of costs of almost any government program always tend to be much greater than CBO estimated. This is another one of those pleasant surprises that have come out of what we thought would actually materialize as we wrote this legislation.
I know that seniors have appreciated this nationwide prescription drug benefit and its use of a market-based approach.
Market-based approach is pretty important, because a lot of people like to have one single government program that dictates to each participant only that one choice –and that’s the choice the government offers. In this particular case, we know we’ve had plenty of choices to meet the needs of Americans in different ways, according to their like.
Recently, Iowans have told me how Medicare Part D has helped make their lives easier.
A lady by the name of Kay from Mt. Vernon, Iowa said this:
“I am 100 percent satisfied with Medicare Part D. It’s given me peace of mind and cost savings that make room in my budget for other living expenses.”
Julie from Dubuque, Iowa said this:
“I wouldn’t possibly be able to afford oncological care without insurance. My advice for Iowans becoming eligible for Medicare: Sign up for Medicare Part D. Use a trusted source to navigate all the plans. I’m glad to have choices, not one-size-fits-all.”
An Iowan who volunteers with the Senior Health Insurance Information Program (SHIIP) said this:
“As a SHIIP volunteer, I like to help people find the best plan to fit their needs and their finances. One individual was taking 35 daily prescription medications that would have cost 10,000 dollars per month without Part D. For this Iowan, Medicare Part D was, by definition, lifesaving.”
I’m glad Medicare Part D has benefited these seniors.
Medicare Part D has shown that empowering patients with health plan transparency and choice can bring about significant savings for patients and taxpayers.
Even though Medicare Part D has been around for these 20 years, I’ve consistently conducted oversight and worked to make it better for seniors and taxpayers.
During Medicare Part D’s implementation, I held the Centers for Medicare and Medicaid Services accountable and consistently conducted oversight that ranged from making sure seniors could access their prescription drugs, all the way to ensuring taxpayer dollars were wisely spent.
I’ve also worked to advance commonsense reforms for seniors, for providers and for taxpayers.
Twenty years ago, we modernized Medicare to improve access for seniors while ensuring fiscal sustainability for taxpayers.
I don’t know why, for sure, in 1966, when Medicare was set up it didn’t include prescription drugs. I assume at that particular time, prescription drugs were about one or two percent of the cost of the delivery of medicine in the United States; today, I think it’s somewhere between 15 and 20 percent.
These patient-centered principles can be applied to the latest front in the fight to lower prescription drug costs by shining sunlight on powerful drugmiddlemen called pharmacy benefit managers.
By bringing transparency to the PBM industry, we will empower patients, employers, providers and insurers to make informed decisions based on the true value, if any, PBMs provide.
When consumers are empowered, they can demand change or pursue better alternatives, unleashing market forces that foster innovation and apply downward pressure on prices.
The Senate has an opportunity to take action to reduce costs for patients and taxpayers alike. We should let the successes of Medicare Part D’s patient-centered approach guide us.
My colleagues are going to say I took advantage of commemorating 20 years of Part D being a successful program for keeping drug prices down for seniors to take a whack at PBMs.
But I think we all ought to think in terms of these powerful middlemen between companies and you as a consumer, the local pharmacy... we don’t have any idea what they’re doing.
We know they have something to do with setting prices, setting rebates [and] determining what drugs are in what formularies. But beyond that, we don’t know whether the rebates they give benefit the insurance companies, the pharmaceutical companies, the PBMs themselves or you as a consumer. And we ought to know that.
Senator Wyden -- my democrat friend, he and I traded of chairingthe Finance Committee from time to time – he and I started working on PBMs about five years ago.
We were the only two who were interested in it. But it’s reached the stage where at least four committees of the United States Senate and one committee of the House of Representatives have put out bills to make the opaque environment in which PBMs operatemore transparent.
We aren’t saying that what they’re doing is wrong, [just that] we ought to know what they’re doing – for the benefit of the consumer, but also for the benefit of the American taxpayer. Because, through Medicare and Medicaid, the government is the biggest purchaser of drugs in the United States, and maybe we can save the taxpayer some money.
Besides being here on the floor of the United States Senate to praise the Congress of 2003 for passing the Prescription Drug Part D Program for Medicare, I didn’t want to lose the opportunity to urge action on PBM legislation so that we can know what’s going on in the pricing of drugs, the formularies and who benefits from it.
Because transparency brings accountability.
Maybe transparency won’t be enough when we’re all done, but I wouldn’t know where to tell you to go if you wanted to change some law right now to transform this system. I think transparency will do a great deal of good.
I yield the floor.
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