Congressman Dennis Cardoza
18th Congressional District of California

The bill, H.R. 3672, would eliminate a controversial provision in the new law, which prohibits Medicare from using its immense bargaining clout to reduce prescription drug prices.

"It’s outrageous that higher drug prices will be forced on many seniors because of special interest language that prohibits Medicare from negotiating lower drug prices," Cardoza said. "The Veterans Administration is allowed to bargain for cheaper drugs on behalf of our veterans. Why is Medicare being prevented from bargaining to reduce prescription drug prices for America’s seniors?"

The Medicare bill will take effect in 2006 and cost estimates from the Congressional Budget Office have estimated that the overall cost to the federal government will rise at least to $1 trillion in the next decade. Cardoza contends that passage of H.R. 3672 will lower not only prescription drug prices but protect Medicare itself by lowering the overall cost of the program.

Soaring drug prices put Medicare benefits at risk in the future by growing the cost of the program enormously. According to a report by the Center for Economic and Policy Research, seniors will pay 60% more in 2006, when the prescription drug benefit goes into effect, than in 2000 even after adjusting for inflation. Seniors who paid, on average, 6% of their annual income for prescription drugs in 2000 will spend 9% in 2006 and 13% in 2013.

"Even with help from the federal government, many seniors will be paying more out-of-pocket expenses in 2006 than they do now because drug prices will continue to increase unless we act to slow them down," Cardoza said.

A report released by the House Government Reform Committee comparing the prices seniors in America pay for the five most prescribed drugs to other industrialized countries reveals that American seniors pay considerably more. The average cost for Prilosec, Plavix, Zocor, Prevacid, and Celebrex, the five most common prescribed drugs, show that U.S. drug prices are 174% higher than the United Kingdom, 152% higher than Canada, and 142% higher than France.

"We must do all we can to rein in prescription drug prices to protect Medicare benefits and help seniors. Putting profits for HMOs and big drug companies over the needs of seniors and the disabled is not the solution our seniors deserve," Cardoza said. "We must do better."