This week, the Senate turned back three amendments designed to provide a Medicare prescription drug benefit. The votes came during debate on a bill (S. 812) that would speed the Food and Drug Administration’s approval of low-cost generic drugs. The amendments were defeated when they failed to garner the 60 votes needed to waive a point of order against any legislation that would spend more than $300 billion over ten years as provided in the FY2002 budget resolution.
The first amendment, offered by Sen. Bob Graham (D-FL), was based on the Democratic bill (S. 2625) he has sponsored. The amendment was defeated on July 23 by a vote of 52-47. The Congressional Budget Office (CBO) said the bill would have cost $421 billion over five years. The Medicare Outpatient Prescription Drug Act would have created a new voluntary Medicare prescription drug benefit. The benefit would have included a $25 monthly premium and no deductible. Beneficiaries would have paid a $10 copayment for generic drugs, a $40 copayment for preferred brand-name drugs, and a $60 copayment for nonpreferred brand-name drugs. Beneficiaries would have had full coverage once their out-of-pocket expenses reached the catastrophic limit of $4,000. Additionally, the legislation would have sunset in 2010.
The other amendment, offered by Sen. Charles Grassley (R-IA), was based on a “tripartisan” bill (S. 2729) he has sponsored with Sens. John Breaux (D-LA) and James Jeffords (I-VT). The amendment was defeated on July 23 by a vote of 48-51. The CBO estimated the bill would have cost roughly $370 billion over ten years. The 21st Century Medicare Act would have created a new voluntary, fee-for-service Medicare prescription drug benefit. The benefit would have included a $24 monthly premium and a $250 deductible. Beneficiaries would have paid for 50 percent of their drug costs up to $3,450, and they would have been required to pay no more than 10 percent of their drug costs once they reached the catastrophic limit of $3,700.
Low-income beneficiaries would have received additional assistance under both bills.
Moments before the vote, Sen. Olympia Snowe (R-ME) said, “I hope we will not allow a 60-vote threshold to stand between us and the possibility of passing a meaningful benefit for our nation’s seniors.” Speaking in support of the “tripartisan” plan, Sen. Snowe said that the plan “is the only plan that has across-the-aisle political support,” adding, “It is also estimated under the tripartisan plan that 99 percent of seniors will participate, and 80 percent of those who do will never reach our benefit limit of $3,450.”
Calling the Democratic bill “a solid, affordable Medicare prescription drug benefit that offers senior citizens and disabled Medicare beneficiaries the protection they need at a price they can afford,” Sen. Edward Kennedy (D-MA) added, “There is no deductible, there are no gaps, there are no loopholes.”
The third amendment was defeated on July 24 by a vote of 51-48. Although the amendment would have cost $160 billion over ten years, it was defeated on a point of order because it had not been approved by the Senate Finance Committee. Sponsored by Sen. Chuck Hagel (R-NE), the amendment would have provided catastrophic coverage for Medicare beneficiaries on a sliding scale. Beneficiaries would have been required to pay a $25 annual fee with no monthly premiums. Under the sliding scale, out-of-pocket expenses would have been capped at $1,500 for beneficiaries earning up to 200 percent of the poverty level and $5,500 for beneficiaries earning up to 600 percent of the poverty level. For beneficiaries earning more than 600 percent of poverty out-of-pocket expenses would be capped at 20 percent of their income. The coverage would have been provided through a discount card administered by a private company.
“None of the programs we have debated over the last few days have been perfect,” stated Sen. Hagel. Speaking to his amendment, he said, “This proposal is the common ground….We stay within the $300 billion budget cap that this body voted on for a prescription drug plan over the next 10 years. It is immediate, it is permanent, and it uses the present market system.”
Just hours after the defeat, the sponsors of each amendment continued to meet to discuss a compromise between the three proposals. Senate Majority Leader Tom Daschle (D-SD) and Senate Minority Leader Trent Lott (R-MS) have said that they are willing to consider other proposals in order to pass a prescription drug benefit this year.
Medicaid Funding
After defeating the prescription drug proposals, the Senate on July 25 agreed to an amendment that would provide $9 billion to states over the next 18 months to temporarily assist in averting state budget deficits. The amendment was adopted when Senators voted, 75-24, to waive a budget point of order against the amendment.
Sponsored by Sens. John Rockefeller (D-WV) and Susan Collins (R-ME), the amendment would provide $6 billion to states by temporarily increasing the federal-state Medicaid matching rate and holding harmless each state’s Medicaid matching rate for the next 18 months. An additional $3 billion would be made available to states in the form of a temporary block grant that states could use to provide social services such as child care.
Speaking in support of the amendment, Sen. Rockefeller said, “It is a creative and good approach.”
Sen. Collins agreed, saying the amendment “would help protect vital programs for those who can least bear the cuts in services.”
