House Allows Drug Benefit for Military Retirees

Buried in a massive bill authorizing Department of Defense programs is a small but significant provision that indicates just how politically irresistible it has become for Congress to try to help people afford prescription drugs.

The provision guarantees that all 1.4 million military retirees will be able to buy such medicine at the same deeply discounted prices available to active military personnel. The military receives price discounts of 24% to 70% off the average manufacturers’ price, according to the nonpartisan Congressional Research Service.

The bill passed the House on Thursday, 353 to 63, and a similar provision is contained in the pending Senate version of the measure.

But it remains uncertain whether the provision aiding military retirees signals potential progress on the far thornier question of extending prescription drug coverage to the 40 million elderly and disabled who have Medicare insurance.

President Clinton heralded the provision as a signal that Congress could come together without partisanship on the far larger proposal. He noted that the plan for military retirees relies on allowing a government agency to negotiate volume discounts on drugs and pass along those savings to the elderly, which is similar to a key part of the plan Clinton has proposed for Medicare beneficiaries.

“The bipartisan spirit of this proposal for military retirees shows us the way forward for all retirees,” said Clinton in a speech this week.

“We want our seniors, all of them, to live longer, healthier lives.”

However, it is far from clear that the ready agreement on the prescription drug issue for military retirees is a harbinger of any kind.

The military enjoys such a respected position that few dare oppose it. Even PhRMA, the powerful organization that represents prescription drug manufacturers, decided against weighing in against the provision, despite a public pledge to oppose any legislation that looked even faintly like it would lead to government regulation of drug prices.

“We don’t have any comment,” said Jeffrey Trewhitt, a spokesman for PhRMA, as the House debated the defense bill.

However, lawmakers on Capitol Hill said that officials from the organization told them they disliked the provision but believed it would be politically dangerous to oppose it.

PhRMA has fought vigorously to stop legislation that takes a similar approach to helping Medicare beneficiaries.

The military gets one of the best deals the government has to offer when it comes to buying prescription drugs. Officers on active duty and their families can get medication free from military treatment facilities on bases. They also have access to low-cost drugs through a mail-order program--often as low as $8 for a 90-day supply.

For retirees the system is far less advantageous. If the retirees are lucky enough to live near a military base, they can take advantage of the free prescriptions at base pharmacies. If they live far away from a base, they have limited coverage and in many cases none at all.

The reason the drugs are so cheap is that the military negotiates directly with drug companies through the Defense Supply Center, a government entity.

The House bill would allow all military retirees to buy through the mail-order system. It would also give them a drug benefit through the military health insurance program, allowing them to purchase drugs at more modest discounts at pharmacies that contract to cover military personnel.

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This story states that “officers on active duty and their families can get medication free from military treatment facilities on bases.” In fact, enlisted men and women are also eligible.

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