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Office of the Press Secretary

For Immediate Release April 26, 2000
                        REMARKS BY THE PRESIDENT

                           The Roosevelt Room

9:55 A.M. EDT

THE PRESIDENT: Thank you very much. Thank you. I am on my way to North Carolina for another leg of our New Markets tour to close the digital divide. But before I leave I want to say a few words about an important study that Senator Daschle, Congressman Gephardt and I have just been briefed on regarding the growing cost of prescription drugs and the burden these costs are placing on seniors and on disabled Americans.

The study is from Families USA. It is a careful and compelling piece of work. And I thank Families USA president Ron Pollock for providing it and for being here with us today.

For over a year now I have been arguing that we as a nation ought to use this historic moment of strength and prosperity to meet our long-term challenges, especially the challenge of helping all our seniors afford prescription drugs that can lengthen and enrich their lives. More than three in five American seniors today lack affordable and dependable prescription drug coverage. Today's report shows that the burden on these seniors is getting worse.

According to the report, the price of the prescription drugs most often used by seniors has risen at double the rate of inflation for six years now, including this past year. The burden of these rapidly rising prices falls hardest on seniors who lack drug coverage because they don't receive the benefits of price discounts that most insurers negotiate. Indeed, the gap between drug prices for people with insurance versus those without insurance nearly doubled from 8 to 15 percent between 1996 and 1999.

Seniors living on fixed incomes simply can't cope with these kinds of price increases forever. That's why we should take action to help them and do it now. In my budget, I propose a comprehensive plan to provide a prescription drug benefit that is optional, affordable, and accessible for all. A plan based on price competition, not price controls; a plan that will boost seniors' bargaining power to get the best prices possible; a plan that is part of an overall effort to strengthen and modernize Medicare so we will never have to ask our children to shoulder our burden when the baby boom generation retires.

I'm gratified to see growing bipartisan support for adding a prescription drug benefit to Medicare. But earlier this month, leaders in the House put forth the outlines of a plan that has as a stated goal providing access to affordable coverage for all seniors. It's good if we agree on the goal. Unfortunately, the plan they propose won't achieve the goal. Instead it would subsidize insurance companies to offer prescription drug only policies for middle-income seniors, for policies the insurance industry itself has already said it will not offer.

And because the plan would provide direct premium support only to low-income seniors and disabled Americans, it would do nothing for those seniors with modest middle-class incomes between $15,000 and $50,000. Nearly half of all the Medicare beneficiaries who lack prescription drug coverage fall into this category. For them, rising drug prices are eating away at financial independence.

For example, according to this new report, a widow taking medication for diabetes, hypertension and high cholesterol, who lives on $16,700 a year, must spend about $2,000 a year, or 14 percent of income, on these drugs. That's not unusual, and for a nation that cares about seniors, it's not acceptable. A person like that should be covered in our initiative.

The majority's plan also is a phantom as long as the leadership insists on moving forward with a budget resolution that would spend every dime of the surplus, and then some, over the next 10 years on tax cuts. If the responsible and unrealized realistic spending cuts this budget calls for don't materialize, the tax cut will make it impossible to pay down the debt, it would leave nothing left for prescription drug benefit. Any prescription drug plan that is not adequately financed, if not available in fact, is not affordable to all, and therefore, is not a real plan at all.

The balanced budget I propose would provide a voluntary benefit for all seniors, with plenty left over to pay down the debt, lengthen the life of Social Security and Medicare, and increase investments in education, as well as finance a responsible tax cut. It provides a prescription drug benefit that all seniors can afford in a way America can afford.

I'm encouraged by the progress we've made on this issue. Now both parties have come to support the idea of adding voluntary prescription drug benefits to Medicare. Both parties have agreed to the principle that the benefits should be available and affordable to all Americans. There's no reason we can't come to an agreement on the details of how to provide it. Fundamentally, again, as with so many of the things we deal with here in Washington, this should not be a Republican or a Democratic partisan issue. It should be an American issue.

I want to thank Senator Daschle and Representative Gephardt for their support and their leadership on this issue, and I'd like to ask them now to say a few words, beginning with our leader in the House, Mr. Gephardt.

REPRESENTATIVE GEPHARDT: Thank you, Mr. President. Welcome, everyone. We have just received a briefing from Ron Pollock of Families USA, with new numbers on drug prices. The new numbers are, frankly, bad news for America's senior citizens. As you've just heard, on average, the prices of the top 50 drugs taken by seniors increased by nearly twice the rate of inflation in 1999, and this is just the average. Nearly one-third of the drugs rose at three times inflation, and one-fifth of them rose at four times inflation.

We've been saying it for several years now, seniors are having serious trouble paying for their prescription drugs. What we have today is more evidence that the problem is not going to go away by itself. Seniors need help affording their prescriptions, and they deserve help. And we're here today to reaffirm the Democrats are determined to give them that help.

We propose offering any senior -- any senior -- who wants it a new Medicare prescription drug benefit, coverage that will use the clout of volume discounts to end price discrimination against seniors, and make needed prescriptions affordable for all seniors. This is a benefit that is the most efficient and cost-effective when offered through Medicare.

It's sometimes hard to remember, but in 1963, before we enacted Medicare, half the senior citizens in the country had no health insurance. Democrats responded, often over the prolonged opposition of Republicans, by creating Medicare. In the more than 30 years since, Medicare has dramatically improved the lives and the quality of lives of all of our seniors. Today about half the seniors have no prescription drug coverage, just like half the seniors in 1963 had not health insurance coverage.

Democrats have responded once again, over Republican opposition, with a proposal to update Medicare with a drug benefit. Such a benefit would offer real help to the majority of seniors who don't have meaningful coverage today. The most recent Republican proposal, as the President said, would not.

Apparently, we're close enough to the election next fall that Republicans have decided that they can't continue simply to stonewall on prescription drug coverage. Unfortunately, their program is fundamentally flawed. They propose to over inadequate subsidies to a limited number of seniors to buy an undefined private policy that, if you listen to the insurance industry, probably won't be offered anyway. And they've yet to prove that they're serious about paying for any benefit at all. Their budget was an empty gesture, but their massive tax cuts show us where their priorities really are.

Talk is cheap; prescription drugs are not. They're expensive, and they're getting more expensive every day. Seniors need help now. Every time I'm home, as I was last week, I have senior citizens come up to me and say, can you get this bill passed this year? If you're a senior and you need prescription drugs that you can afford now, you need it now. You can't wait for next year. If congressional Republicans will agree to work with us in a meaningful way to make compromises, to do the hard work to achieve a consensus between the parties and between the views, we can get a bill done this year -- in fact, this summer.

We look forward to that. And I look forward to the day we can meet here with the President with a bill that gets the job done.

I'd like to now call on Tom Daschle.

SENATOR DASCHLE: I want to thank the President for making time today to hold this very important conference, and thank him for his continued efforts to highlight the need for dependable, affordable prescription drug coverage for all Americans, especially our older Americans.

I also want to thank Families USA for this eye-opening report. The rising cost of prescription drugs is on the list of concerns of just about every older American. By showing how fast those costs are escalating, you are helping move affordable prescription drugs higher up on Congress' list of priorities.

You almost need to take a nitroglycerin tablet just to read this report. Some of the numbers are truly shocking. In one year, from January of 1999 to January of 2000, prices for the 50 prescription drugs most commonly used by seniors rose twice as fast as inflation. One drug, a potassium replacement medication, rose 20 times faster than inflation. Price increases like these could be difficult for many people to absorb, but for seniors living on fixed incomes, they are an even bigger hardship.

The bottom line is there has never been a great need for an affordable Medicare prescription drug benefit than now. Fortunately, there is also never been a greater opportunity than we have right now because of the surplus to create such a benefit.

Mr. President, you have done your part. You have presented Congress with your plan for a Medicare prescription drug benefit and asked us either to work with you to pass your plan or to come up with one of our own. On behalf of Senate Democrats and working with House Democrats, I am pleased to inform you that we will do our part as well.

We are in the final stages of developing our own plan to add a voluntary, affordable and universal Medicare prescription drug benefit. Our plan is similar in many ways to the one that you have proposed. We hope to unveil it in the very near future. We hope our Republican colleagues will work with us to come up with a plan that we can all support and pass this year.

A year ago, prescription drugs weren't even on their agenda. We think it's a sign of progress the Republicans are at least now talking about prescription drugs. We're concerned, though, that their actions, as the future Speaker said, don't match their words. On the Senate floor, Republicans refused even to offer amendments that would provide for a Medicare drug benefit. Ironically, they have even referred to our prescription drug amendments as "poison pills" in their effort to pass more tax breaks for the wealthy.

At the same time, they've proposed a budget that uses virtually every penny of the surplus for tax cuts, leaving nothing for prescription drugs. It's still early in the budget process; we hope the numbers in this report will persuade Republicans to rethink the numbers in their budget.

We need to put an affordable prescription drug benefit ahead of even bigger tax cuts for those who need them least. More importantly, we hope this report will bring about the consensus we need -- a consensus on this important health benefit this year.

THE PRESIDENT: Thank you very much. Before I close I would just like to ask all of you to join me in expressing our appreciation to Ron Pollock and Families USA. They've been there on these issues year in and year out. I don't think they get as much acknowledgement as they deserve. But this is further evidence that the proposal we have is right for America from a source that everybody can trust.

Thank you, Ron. (Applause.)

END 10:15 A.M. EDT