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The administration, apparently realizing the proposal's dim chances of passing, quietly releases its new plan for a discount drug card for seniors.
By SARA FRITZ, Times Washington Bureau Chief
© St. Petersburg Times, published March 1, 2002
WASHINGTON -- If there is any doubt that President Bush's proposal for a discount drug card for seniors is no longer a top priority, consider this:
Last year, Bush unveiled his proposal with great fanfare in front of television cameras in the White House Rose Garden. On Thursday, the revised plan was available at an out-of-the-way location belonging to the Government Printing Office.
Although administration officials declined to comment, it appears they have recognized that the president's proposal is going nowhere. Not only have members of Congress declined to support it, but a U.S. District Court judge has threated to kill it on grounds the administration does not have the authority to create it.
Instead of holding a news conference or issuing a press release, the administration simply sent the plan to the GPO for future publication in the Federal Register. The GPO office where it was available is at 800 N Capitol St., in a seedy area of town close to the bus station.
"This announcement is just about as low ball as you can get," said John Rector, executive director of the National Community Pharmacists Association. "They know it is going to be shot down by the judge."
The administration also chose to release it on a day when many other things were happening in Washington, including a speech by the president on retirement security and his proposal for privatizing Social Security.
The plan was released after months of negotiations between the White House and the pharmacy industry failed to produce a compromise.
Led by Craig Fuller, former aide to Bush's father and now executive director of the National Association of Chain Drug Stores, pharmacy executives told White House officials they would drop their lawsuit against the drug card plan if the administration could guarantee that drugstores and consumers were going to get a genuine price cut. No agreement could be reached and, as a result, the plan released Thursday is substantially unchanged from the original proposal unveiled last July.
The pharmacy operators oppose the proposal on grounds it would be a windfall for companies that manage drug benefits, but offer precious little reward to the drugstores or the seniors who buy prescription drugs. Rector said White House officials refused to compromise because the benefit managers would rather have no card than share their profits with consumers and drugstores.
The revised proposal says benefit managers will share a "substantial portion" of the discount they get from the drug manufacturers with consumers "either directly or indirectly through pharmacies" -- a promise the pharmacies say is too vague.
In fact, many pharmacy chains and drug companies already offer their own drug discount cards for low-income seniors. The Pfizer card, for example, enables eligible seniors to buy a month's supply of a Pfizer medicine for $15. The companies would have preferred administering a Medicare-endorsed card, however, because it would attract more customers.
Bush first proposed the creation of a discount drug card for Medicare recipients in a Rose Garden ceremony July 12. Standing with him were representatives of five major prescription drug benefit management companies that had expected to administer the "Medicare-endorsed" cards.
"Present the card at a participating pharmacy and you receive a substantial discount," Bush said, promising that it would be available by Jan. 1, 2002. "It's as easy as that, and it's convenient."
Bush said the card would be a short-term solution for seniors who have no drug coverage -- at least until Congress can enact a law under which Medicare will pay for their prescription drugs.
But the original plan was quickly halted by U.S. District Judge Paul J. Friedman, who said the administration had no statutory authority to create such a program under Medicare.
In a suit seeking to block the drug card program, pharmacy trade associations argued it was devised in secret meetings between Bush-appointee Tom Scully, who heads the Medicare program, and executives of five private companies that stood to gain from it.
Administration officials later admitted that representatives of pharmacies and seniors were excluded from the negotiations.
Even if the administration had the legal right to create such a program without the approval of Congress, Friedman said, the Department of Health and Human Services should have followed the usual procedures: issue regulations, seek public comment and then revise the regulations to respond to public concerns. The government argued it was not obliged to follow these procedures.
Scully, who has been the driving force behind this proposal from the beginning, has been trying for several months to win White House approval to publish the new proposal. The president's top aides are known to be skeptical about embracing a proposal that is likely to be swept aside by Judge Friedman.
Scully could not be reached for comment when the plan was released. But he issued a perfunctory statement saying the new plan demonstrates the president's commitment to health care for seniors.
"Seniors and people with disabilities deserve access to the same kind of group-negotiated bulk prescription drug discounts that most other Americans enjoy through their insurers," said Scully.
"The drug discount program will provide some necessary price relief to the millions of seniors and disabled Americans who are often the only ones who now pay full price for their prescriptions."