June 17,1999


WASHINGTON -- The Senate Finance Committee will meet on Wednesday, June 23 to explore considerations for adding a prescription drug benefit to the Medicare program. The hearing will take place at 10:00 am in room 215 of the Dirksen Senate Office Building.

The following witnesses are expected to testify before the Committee:

I. A panel consisting of:

Laura A. Dummit, Associate Director, Health Financing and Public Health Issues, Health, Education, and Human Services Division, General Accounting Office; Washington, D.C.

Michael Gluck, Ph.D., Director of Health Policy Studies, National Academy of Social Insurance; Washington, D.C.

Kevin W. Concannon, Commissioner, Maine Department of Human Services; Augusta, ME

II A panel consisting of:

Alan F. Holmer, President, Pharmaceutical Research and Manufacturers of America; Washington, D.C.

J. Leighton Read, M.D., Chief Executive Officer, Aviron, on behalf of Biotechnology Industry Organization; Washington, D.C.

Jeff Sanders, Senior Vice President, PCS Health Systems, Inc.; Scottsdale, AZ

Morris B. Mellion, Senior Vice President for Health Care Policy and Chief Medical Officer, Blue Cross and Blue Shield of Nebraska; Omaha, NE

Martha A. McSteen, President, National Committee to Preserve Social Security and Medicare; Washington, D.C.


Medicare's most notable shortcoming is that the program has a very limited prescription drug benefit. While most beneficiaries have some form of private or public health insurance to cover expenses not met by Medicare, many of these forms of supplemental coverage either do not offer drug coverage or offer very limited or prohibitively expensive protection for drug expenses. As a result, beneficiaries pay approximately half of their total drug expenses out-of-pocket.

On several occasions, the Congress considered adding coverage for at least a portion of beneficiaries' drug expenses. However, the projected cost of such a benefit, estimated at about $600 per beneficiary annually, or a total of $30 to $40 billion per year, has been the major deterrent to its implementation.

Recently, this issue has received renewed attention as a result of work done by the National Bipartisan Commission on the Future of Medicare, which assembled a reform plan that included a drug benefit. The President has proposed a prescription drug benefit, but has not yet provided details or funding.

During this hearing, the committee will explore a number of design, coverage, and cost issues facing the development of a Medicare prescription drug benefit.