Senate to begin debate on generic drug plans

WASHINGTON – The hot-button election year issue of prescription drugs reaches the Senate this week as lawmakers debate making lower-cost generic drugs more available and expanding Medicare to help the elderly pay their pharmacy bills.

Senators in both parties would like to fulfill promises from the 2000 campaign season to add prescription drug coverage to Medicare by attaching it to a generally agreed upon generic pharmaceuticals bill.

Competing ideas on how big the prescription drug program should be make it difficult. The House last month narrowly passed a Republican bill to provide the new benefit largely through private insurers

“I’ve been worried about how we are going to proceed,” Senate Republican Leader Trent Lott of Mississippi said, pointing out that neither Senate proposal appears to have the 60 votes needed to prevail. “To set up a process that guarantees mutually assured destruction, I don’t think is a good idea.”

Senate Majority Leader Tom Daschle, D-S.D., said he expects debate to consume two weeks.

The main bill will be a measure aimed at speeding generic drugs to the market by limiting brand-name pharmaceutical companies’ use of patent laws to thwart generic competition. Lawmakers hope to add a Medicare drug benefit to it.

In addition, there is a proposal to allow drugstores and medical distributors to buy U.S.-made and -approved drugs in certain countries where they are sold more cheaply and resell them in the United States.

Congress passed the importation measure in 2000, but officials in both the Clinton and Bush administrations declined to implement it, saying counterfeit medicines might slip through. Republicans who supported it two years ago might decline to do so this time because of opposition from the president.

A 1984 law to encourage lower-cost generic drugs gave their manufacturers that right to file applications against patents held by the brand-name pharmaceutical houses. The big drug companies, however, have used repeated 30-month stays under that law to keep generic versions off the market.

“I think ultimately this bill will pass,” Sen. Charles Schumer, D-N.Y., said of the generic drug measure he wrote with Sen. John McCain of Arizona. He said a Senate committee’s 16-5 vote approving it “showed the breadth of support” it enjoys.

“I think that’s why Daschle wanted this to be the base bill,” Schumer said, acknowledging that Democrats may have trouble amending it to add a Medicare prescription drug benefit.

The generics measure is the proposal that so far has managed to get the most support from both parties.

“That’s the one solid piece they can count on,” said John Rother, policy director for the 35 million-member AARP. “Everything else is an amendment and those are riskier. We’re working in every way we can think of to try to find a way for people to reach across the aisle and come together … but it’s been difficult.”

One Medicare prescription drug plan – offered by Sens. James Jeffords, I-Vt., Charles Grassley, R-Iowa, John Breaux, D-La., and Olympia Snowe, R-Maine – would have monthly premiums likely to be under $30, with a $250 annual deductible.

After that, the beneficiary would pay up to half the cost of a prescription until total out-of-pocket spending reached $2,000. Once beneficiaries had paid $3,700 out of pocket in any year, insurance companies would pay at least 90 percent of all additional prescriptions.

The plan is estimated to cost between $280 billion and $320 billion over 10 years and is similar to the House Republicans’ $320 billion bill.

Snowe said the measure could save the average senior more than $1,600 per year.

Snowe said she hopes the tripartisan approach will help pass a prescription drug benefit this year, instead of being undermined by partisan differences.

“We undertook this effort a year ago when partisan differences threatened to undermine any chance to enact a prescription drug benefit, and believed – then as now – that since seniors cannot put off their illnesses, we must not put off a solution,” Snowe said in a prepared statement. “So we crossed the political divide to develop an innovative plan that can serve as the basis for action.”

A proposal by Democratic Sens. Bob Graham of Florida and Zell Miller of Georgia would cost $500 billion over 10 years. It would require beneficiaries to pay a $25 monthly premium and a $10 copayment on generic drugs or a $40 copayment on brand-name drugs. Out-of-pocket expenditures would be capped at $4,000 a year.