I 
108TH CONGRESS 
2D SESSION 
H. R. 4919
To amend part D of title XVIII of the Social Security Act to provide 
for the offering of a Federal national prescription drug discount card program. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 22, 2004
Mr. ALLEN (for himself and Mr. MICHAUD) introduced the following bill; 
which was referred to the Committee on Energy and Commerce, and in 
addition to the Committee on Ways and Means, for a period to be subse-
quently determined by the Speaker, in each case for consideration of such 
provisions as fall within the jurisdiction of the committee concerned 
A BILL 
To amend part D of title XVIII of the Social Security 
Act to provide for the offering of a Federal national 
prescription drug discount card program.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE; FINDINGS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Medicare Drug Card Guaranteed Savings Act’’. 
(b) FINDINGS.—Congress finds the following: 
(1) Americans who buy their own prescription 
drugs often pay twice as much for prescription drugs
as consumers in foreign nations or as the price the 
Department of Veterans Affairs obtains by negoti-
ating directly with the pharmaceutical manufactur-
ers. In some cases, older Americans pay 10 times 
more for prescription drugs than such customers. 
Prescription drug prices have increased 3.4 percent 
during the first quarter of 2004, nearly three times 
the rate of inflation. 
(2) The Medicare Prescription Drug, Improve-
ment, and Modernization Act of 2003 (Public Law 
No: 108–173) established a program for the en-
dorsement of medicare drug discount card programs 
in order to provide for reduced prices for drugs for 
medicare beneficiaries and provide a subsidy for low-
income medicare beneficiaries. 
(3) There are currently more than 70 endorsed 
medicare drug discount card programs. Medicare 
drug discount card programs can change the drugs 
that they offer and the size of the discounts every 
seven days. Medicare beneficiaries are allowed to 
change their current medicare drug discount card 
program only once, during an annual enrollment pe-
riod between November 15 and December 31, 2004. 
(4) Enrollment in medicare drug discount card 
programs has been less than projected due to the
complexity of the programs, the limited number of 
drugs covered under most programs, the changing 
prescription drug needs of beneficiaries, and bene-
ficiaries’ concern that the programs do not guar-
antee real savings on prescription drug purchases. 
As of July 19, 2004, fewer than 14 percent of low-
income medicare beneficiaries who qualify for the 
$600 subsidy under the law have enrolled in a medi-
care drug discount card program. 
(5) Currently, medicare discount drug card 
sponsors are required to pass on to enrollees only an 
undefined ‘‘share’’ of the rebates they secure from 
drug manufacturers and card sponsors can use the 
remaining savings for administrative costs and prof-
it. The law does not require the sponsors to reveal 
to enrollees the size of the rebates secured from 
drug manufacturers or to disclose what portion of 
those rebates are kept by the sponsors and not 
passed on to enrollees. 
(6) There is a need for a Federal national 
medicare prescription drug discount card program 
that offers guaranteed discounts on all prescription 
drugs and that aggregates the buying power of all 
medicare beneficiaries in order to negotiate signifi-
cant reductions in price.
SEC. 2. OFFERING OF FEDERAL NATIONAL PRESCRIPTION 
DRUG DISCOUNT CARD PROGRAM. 
(a) OFFERING OF PROGRAM.—
(1) IN GENERAL.—Subsection (a)(1) of section 
1860D–31 of the Social Security Act (42 U.S.C. 
1395w–141) is amended—
(A) by striking ‘‘and’’ at the end of sub-
paragraph (A); 
(B) by striking the period at the end of 
subparagraph (B) and inserting ‘‘; and’’; and 
(C) by adding at the end the following new 
subparagraph: 
‘‘(C) to provide for the offering of a Fed-
eral national prescription drug discount card 
program that is available for discount card eli-
gible individuals throughout the United States 
(including the territories) and that meets the 
requirements under subsection (l)(1) in addition 
to the requirements otherwise applicable to an 
endorsed discount card program.’’. 
(2) EXCLUSIVE PROGRAM IN 2005.—Subsection 
(c)(1)(C) of such section is amended—
(A) in clause (i), by striking ‘‘clauses (ii) 
and (iii)’’ and inserting ‘‘clauses (ii) through 
(iv)’’; and