So, the event you’ve worried about much of your adult life has finally happened: You need to take over Mom’s or Dad’s financial affairs.
In addition to the stress and sadness over what’s happened, you immediately have to deal with practical matters: Will Mom be able to live in her home again? Can she afford a nursing home? Will insurance cover all of Dad’s medical bills?
And, speaking of bills, you’ve got to start paying them–everything from utilities to credit cards.
Even if you’re not at this point with your parents yet, this list can help you decide what to do now–before anything happens.
8-Step Plan
The need to take over your parents’ financial life, especially if it happens suddenly, can be extremely stressful. However, if you approach it one step at a time, you’ll get a handle on what needs to be done.
1. Find all financial accounts and documents.
2. Collect and start paying bills.
3. Locate power of attorney or living trust.
4. Open your parents’ safe-deposit box - with a witness.
5. Become your parents’ guardian.
6. Document everything you do.
7. Consider hiring a financial planning team.
8. Consider updating investments.
Advance planning tip: There are three important documents you can help your parents prepare before they become ill.
1. A power of attorney form, which allows you to take care of their finances.
2. A health care proxy, which allows you to make life-and-death medical decisions.
3. A will, which determines how their assets will be divided when they're gone.
Source: Written by Teri Cettina, Bankrate.com.
Friday, December 8, 2006
Wednesday, November 22, 2006
Seniors Can Change Medicare Prescription Drug Plans Beginning November 15th
Medicare recipients with changes in their drug needs, who want to explore less costly drug plans, or for other reasons desire to change their last year’s plan, now have the chance to choose a new drug plan that better fits their needs.
Beginning November 15th, the Medicaid Part D enrollment window will re-open for seniors and other Medicare recipients. The window will close December 31st. However, the Centers for Medicare and Medicaid Services state that seniors need to enroll in a new plan by December 8, to ensure their new prescription drug card in early January 2007.
New plans will go into effect January 1, 2007, and remain in place for another year. Alternatively, a recipient satisfied with their current Part D plan does not have to re-enroll. For more information contact 1-800-MEDICARE. Or visit the website: www.medicare.gov for the available Medicare D plans.
Beginning November 15th, the Medicaid Part D enrollment window will re-open for seniors and other Medicare recipients. The window will close December 31st. However, the Centers for Medicare and Medicaid Services state that seniors need to enroll in a new plan by December 8, to ensure their new prescription drug card in early January 2007.
New plans will go into effect January 1, 2007, and remain in place for another year. Alternatively, a recipient satisfied with their current Part D plan does not have to re-enroll. For more information contact 1-800-MEDICARE. Or visit the website: www.medicare.gov for the available Medicare D plans.
Friday, November 3, 2006
Friends of Karen
From time to time we are lucky enough to come in contact with a very special organization filled with very special people and a very worthwhile cause. The attached message is from such an organization and we're proud to share it with you.
DID YOU KNOW?
For over twenty-eight years, Friends of Karen has provided financial, emotional and advocacy support to families with children from birth to 21 years of age with cancer and other life-threatening illnesses and living in the tri-state area. Friends of Karen’s goal is to help maintain the highest quality of life and prevent the financial and emotional collapse of the family, as they go through this most difficult time.
Last year, Friends of Karen helped 577 families with children with life-threatening illnesses. Additionally, we helped 805 of their siblings.
HOW DOES FRIENDS OF KAREN HELP?
They Pay -
• Basic living expenses, such as rent and mortgage, utilities, car payments, etc. that
become unmanageable due to lost wages and the high cost of medical care.
• Medical co-payments, hospital bills including television and telephone
• Transportation to/from medical treatment
• Childcare for siblings
• Health insurance payments
• Special home care needs and food
• Funerals
• Counseling
Friends of Karen’s Back to School program provides much needed school supplies to our Friends of Karen children and their brothers and sisters. Holiday Adopt-A-Family program, which begins in the Fall, assures festive holidays for those unable to provide for themselves because of the cost of their child’s illness, and Children Helping Children programs collaborating with schools and service clubs gives children the opportunity to help other children in their community.
Please visit their website at: www.friendsofkaren.org or call them at 631-473-1768 for more information about their services and their up-coming Open House scheduled for late November.
Friends of Karen, 21 Perry Street, Port Jefferson, NY 11777
“When the parents of a terminally or catastrophically ill child receive financial and emotional help, they then have more time to love.”—Sheila Petersen, Founder, 1978.
DID YOU KNOW?
For over twenty-eight years, Friends of Karen has provided financial, emotional and advocacy support to families with children from birth to 21 years of age with cancer and other life-threatening illnesses and living in the tri-state area. Friends of Karen’s goal is to help maintain the highest quality of life and prevent the financial and emotional collapse of the family, as they go through this most difficult time.
Last year, Friends of Karen helped 577 families with children with life-threatening illnesses. Additionally, we helped 805 of their siblings.
HOW DOES FRIENDS OF KAREN HELP?
They Pay -
• Basic living expenses, such as rent and mortgage, utilities, car payments, etc. that
become unmanageable due to lost wages and the high cost of medical care.
• Medical co-payments, hospital bills including television and telephone
• Transportation to/from medical treatment
• Childcare for siblings
• Health insurance payments
• Special home care needs and food
• Funerals
• Counseling
Friends of Karen’s Back to School program provides much needed school supplies to our Friends of Karen children and their brothers and sisters. Holiday Adopt-A-Family program, which begins in the Fall, assures festive holidays for those unable to provide for themselves because of the cost of their child’s illness, and Children Helping Children programs collaborating with schools and service clubs gives children the opportunity to help other children in their community.
Please visit their website at: www.friendsofkaren.org or call them at 631-473-1768 for more information about their services and their up-coming Open House scheduled for late November.
Friends of Karen, 21 Perry Street, Port Jefferson, NY 11777
“When the parents of a terminally or catastrophically ill child receive financial and emotional help, they then have more time to love.”—Sheila Petersen, Founder, 1978.
Friday, October 27, 2006
The Pension Protection Act of 2006
The Pension Protection Act of 2006 was signed into law by President Bush on August 17, 2006. It is the most significant pension legislation since the Employee Retirement Income Security Act of 1974 (ERISA). Among other things, the new law makes a number of retirement savings incentives permanent, toughens the funding rules that govern traditional pension plans, and authorizes 401(k) plans to provide investment advice and automatic enrollment of participants. These changes should help promote retirement income security.
First, the Pension Protection Act permanently extends a variety of pension and savings incentives that were scheduled to sunset in 2011. The annual limit on Individual Retirement Account (IRA) contributions will increase from $4,000 this year to $5,000 in 2008, and it will be indexed for inflation thereafter. The provision that allows individuals who are at least 50 years old to make an additional "catch-up" contribution of $1,000 a year is also made permanent. Also, starting in 2007, taxpayers will be able to have a portion of their income tax refunds directly deposited into their IRAs.
Similarly, the annual limit on 401(k) plan contributions has increased to $15,000 in 2006 (plus another $5,000 for those over age 50), and these amounts are indexed for future inflation.
The Act also expands the saver's tax credit for low- and moderate-income workers. The credit is equal to a percentage-50, 20, or 10 percent, depending on income level-of up to $2,000 of qualified retirement savings contributions ($1,000 maximum credit in 2006). The credit was scheduled to expire at the end of 2006, but the Act makes it permanent and indexes the income and rate levels for inflation.
Second, the Pension Protection Act toughens the funding rules that govern traditional "defined benefit" pension plans. One provision generally requires employers to fix any funding shortfall within seven years, and new disclosure rules give workers more information about the financial status of their pension plans. Moreover, poorly funded plans will be subject to limitations on benefit increases, lump sum payments, and shutdown benefits. Employers will, however, be able to deduct more in the years in which they can afford to make larger contributions.
The Act also makes it easier for employers to utilize cash balance and other innovative pension plan designs, and it allows employers to set up Roth 401(k) plans, under which employees will be able to designate their salary deferral contributions as after-tax Roth contributions.
Third, the Pension Protection Act encourages employers to automatically enroll employees in their 401(k) plans. Starting in 2008, employers will be able to satisfy the IRS's so-called "nondiscrimination" test if they automatically enroll each employee in the 401(k) plan, withhold and contribute a few percent of compensation on behalf of those employees, and make small matching contributions. These 401(k) plans will qualify for favorable tax treatment, even if many employees instead elect to contribute at less than the target levels, or not at all.
Also, starting in 2007, employers will have an easier time providing investment advice to help their employees manage their 401(k) accounts. Employers will be able to provide investment advice through computer models that take into account the employee's age, expected retirement age, income, risk tolerance, and other variables. Alternatively, investment advice could be provided by certain third-party experts on an individual basis, but only if that advice is based on a flat fee charged to each employee, regardless of the investments selected or amounts involved. Another provision protects plans that use a diversified stock and bond fund as the default investment, rather than an ultra-safe but low-yield, money market fund. The Act also requires plans that invest in publicly traded employer stock to allow employees to diversify their individual account holdings. In general, employees must have the right to diversify their own contributions immediately and must be allowed to diversify most employer contributions after three years of service. Together, these investment provisions should help employees get better rates of return on their retirement savings.
The Pension Protection Act also accelerates the vesting of employer contributions to 401(k) and similar plans. Starting next year, employer contributions need to be either 100 percent vested after three years of service (down from five years) or 20 percent vested after two years with an additional 20 percent vesting each year thereafter until 100 percent is vested after six years of service (down from three-to-seven-year graduated vesting).
Another provision facilitates phased retirement by allowing workers over the age of 62 to take in-service distributions from their traditional pensions. Eligible workers will be able to go from full-time to part-time work and receive pension benefits to maintain their current income levels. Also, 401(k) plans will be allowed to let participants make hardship withdrawals to help parents or other beneficiaries, even if those beneficiaries are not dependents or spouses.
The Act also includes a number of provisions that make it easier to fund health care and long-term care costs. For example, one provision makes it easier for pension plans to use excess assets to fund retiree health care, and another provision allows long-term care insurance to be offered as part of an annuity or life insurance contract.
Finally, the Act also includes a package of charitable giving incentives and loophole closers. For example, one provision allows tax-free distributions from IRAs for charities. Otherwise taxable distributions of up to $100,000 a year will be excluded from the IRA owner's taxable income as long as the distribution is made after the owner has reached age 70½ and is made payable to the charity.
Another provision makes it harder to take a current deduction for contributions of a future interest in paintings and other collectibles. A charity receiving a fractional interest in tangible personal property must take complete ownership of the property within 10 years or the death of the donor, whichever is first. In addition, the charity must take possession of the property and use it at least once during the 10-year period as long as the donor remains alive.
The Act also increases the penalties on taxpayers and charities that abuse the charitable contribution rules. Also, one provision denies the deduction for contributions of clothing and household items unless the items are in good condition, and another provision requires that donors have a receipt or cancelled check for all cash donations.
Source: NAELA E-Bulletin, October 3, 2006; written by Jon Forman.
First, the Pension Protection Act permanently extends a variety of pension and savings incentives that were scheduled to sunset in 2011. The annual limit on Individual Retirement Account (IRA) contributions will increase from $4,000 this year to $5,000 in 2008, and it will be indexed for inflation thereafter. The provision that allows individuals who are at least 50 years old to make an additional "catch-up" contribution of $1,000 a year is also made permanent. Also, starting in 2007, taxpayers will be able to have a portion of their income tax refunds directly deposited into their IRAs.
Similarly, the annual limit on 401(k) plan contributions has increased to $15,000 in 2006 (plus another $5,000 for those over age 50), and these amounts are indexed for future inflation.
The Act also expands the saver's tax credit for low- and moderate-income workers. The credit is equal to a percentage-50, 20, or 10 percent, depending on income level-of up to $2,000 of qualified retirement savings contributions ($1,000 maximum credit in 2006). The credit was scheduled to expire at the end of 2006, but the Act makes it permanent and indexes the income and rate levels for inflation.
Second, the Pension Protection Act toughens the funding rules that govern traditional "defined benefit" pension plans. One provision generally requires employers to fix any funding shortfall within seven years, and new disclosure rules give workers more information about the financial status of their pension plans. Moreover, poorly funded plans will be subject to limitations on benefit increases, lump sum payments, and shutdown benefits. Employers will, however, be able to deduct more in the years in which they can afford to make larger contributions.
The Act also makes it easier for employers to utilize cash balance and other innovative pension plan designs, and it allows employers to set up Roth 401(k) plans, under which employees will be able to designate their salary deferral contributions as after-tax Roth contributions.
Third, the Pension Protection Act encourages employers to automatically enroll employees in their 401(k) plans. Starting in 2008, employers will be able to satisfy the IRS's so-called "nondiscrimination" test if they automatically enroll each employee in the 401(k) plan, withhold and contribute a few percent of compensation on behalf of those employees, and make small matching contributions. These 401(k) plans will qualify for favorable tax treatment, even if many employees instead elect to contribute at less than the target levels, or not at all.
Also, starting in 2007, employers will have an easier time providing investment advice to help their employees manage their 401(k) accounts. Employers will be able to provide investment advice through computer models that take into account the employee's age, expected retirement age, income, risk tolerance, and other variables. Alternatively, investment advice could be provided by certain third-party experts on an individual basis, but only if that advice is based on a flat fee charged to each employee, regardless of the investments selected or amounts involved. Another provision protects plans that use a diversified stock and bond fund as the default investment, rather than an ultra-safe but low-yield, money market fund. The Act also requires plans that invest in publicly traded employer stock to allow employees to diversify their individual account holdings. In general, employees must have the right to diversify their own contributions immediately and must be allowed to diversify most employer contributions after three years of service. Together, these investment provisions should help employees get better rates of return on their retirement savings.
The Pension Protection Act also accelerates the vesting of employer contributions to 401(k) and similar plans. Starting next year, employer contributions need to be either 100 percent vested after three years of service (down from five years) or 20 percent vested after two years with an additional 20 percent vesting each year thereafter until 100 percent is vested after six years of service (down from three-to-seven-year graduated vesting).
Another provision facilitates phased retirement by allowing workers over the age of 62 to take in-service distributions from their traditional pensions. Eligible workers will be able to go from full-time to part-time work and receive pension benefits to maintain their current income levels. Also, 401(k) plans will be allowed to let participants make hardship withdrawals to help parents or other beneficiaries, even if those beneficiaries are not dependents or spouses.
The Act also includes a number of provisions that make it easier to fund health care and long-term care costs. For example, one provision makes it easier for pension plans to use excess assets to fund retiree health care, and another provision allows long-term care insurance to be offered as part of an annuity or life insurance contract.
Finally, the Act also includes a package of charitable giving incentives and loophole closers. For example, one provision allows tax-free distributions from IRAs for charities. Otherwise taxable distributions of up to $100,000 a year will be excluded from the IRA owner's taxable income as long as the distribution is made after the owner has reached age 70½ and is made payable to the charity.
Another provision makes it harder to take a current deduction for contributions of a future interest in paintings and other collectibles. A charity receiving a fractional interest in tangible personal property must take complete ownership of the property within 10 years or the death of the donor, whichever is first. In addition, the charity must take possession of the property and use it at least once during the 10-year period as long as the donor remains alive.
The Act also increases the penalties on taxpayers and charities that abuse the charitable contribution rules. Also, one provision denies the deduction for contributions of clothing and household items unless the items are in good condition, and another provision requires that donors have a receipt or cancelled check for all cash donations.
Source: NAELA E-Bulletin, October 3, 2006; written by Jon Forman.
Friday, October 6, 2006
What is Special Needs Law?
What is Special Needs Law?
Special Needs Law is the practice of law dedicated to helping persons with disabilities (“special needs”) and their families by navigating their government benefits and estate planning options.
What is a “special needs” trust?
“Special Needs” is just a term to describe any trust intended to provide benefits without causing the beneficiary to lose public benefits he or she is entitled to receive.
What kinds of public benefits do special needs trust beneficiaries receive?
Each special needs trust can be intended to protect different public benefits. Most commonly, special needs trusts are intended to permit Supplemental Security Income (SSI) and Medicaid recipients to receive some additional services or goods.
Does the existence of a special needs trust qualify the beneficiary for public benefits?
No. The existence of a special needs trust does not itself make public benefits available; the beneficiary must qualify for the benefits program already, or qualify after the trust is established. If properly established, the special needs trust will not cause of loss of benefits (although in some circumstances the level of benefits may be reduced), but the trust does not make it easier to qualify.
What is a “supplemental benefits” trust?
Some lawyers prefer to use the term “supplemental benefits” rather than “special needs.” Occasionally, the term “supplemental needs” is used. All are interchangeable, and describe the purpose of the trust rather than being a limited legal term.
Who can establish a special needs trust?
Anyone can establish a special needs trust, but there are two general categories of such trusts: self-settled and third-party trusts, which we will go into in detail in the next newsletter.
Lawrence Eric Davidow is a founding memeber and the Treasurer of the Special Needs Alliance (www.specialneedsalliance.com) which is a premier alliance of leading law firms throughout the country who are dedicated to the area of planning for those with special needs. These hand-picked law firms have the resources to devise solutions and insure financial security for special needs clients nationwide.
Special Needs Law is the practice of law dedicated to helping persons with disabilities (“special needs”) and their families by navigating their government benefits and estate planning options.
What is a “special needs” trust?
“Special Needs” is just a term to describe any trust intended to provide benefits without causing the beneficiary to lose public benefits he or she is entitled to receive.
What kinds of public benefits do special needs trust beneficiaries receive?
Each special needs trust can be intended to protect different public benefits. Most commonly, special needs trusts are intended to permit Supplemental Security Income (SSI) and Medicaid recipients to receive some additional services or goods.
Does the existence of a special needs trust qualify the beneficiary for public benefits?
No. The existence of a special needs trust does not itself make public benefits available; the beneficiary must qualify for the benefits program already, or qualify after the trust is established. If properly established, the special needs trust will not cause of loss of benefits (although in some circumstances the level of benefits may be reduced), but the trust does not make it easier to qualify.
What is a “supplemental benefits” trust?
Some lawyers prefer to use the term “supplemental benefits” rather than “special needs.” Occasionally, the term “supplemental needs” is used. All are interchangeable, and describe the purpose of the trust rather than being a limited legal term.
Who can establish a special needs trust?
Anyone can establish a special needs trust, but there are two general categories of such trusts: self-settled and third-party trusts, which we will go into in detail in the next newsletter.
Lawrence Eric Davidow is a founding memeber and the Treasurer of the Special Needs Alliance (www.specialneedsalliance.com) which is a premier alliance of leading law firms throughout the country who are dedicated to the area of planning for those with special needs. These hand-picked law firms have the resources to devise solutions and insure financial security for special needs clients nationwide.
Wednesday, September 27, 2006
No Will? State may decide
The problem: My father is 86, my mother, 84. My father doesn't think he needs a will because my mother will inherit everything when he dies. We're concerned that he does need a will to ensure that everything goes smoothly upon his passing. Is there a way to spell out what will happen when he dies?
The rules: Everyone should have a will - regardless of age, health or wealth - as a part of a comprehensive estate plan. Without an appropriate plan, a person's estate could pass through "intestacy," which means New York state law would determine how the estate is distributed.
Strategy: Your parents should create a comprehensive estate plan, which may include joint ownership, beneficiary designations and wills.
How it works: It may be true that your father's assets will pass to your mother immediately upon his death. But that depends on how he owns his assets. For instance, if your parents own their assets together as "joint tenants with right of survivorship," those assets will go directly to the surviving spouse automatically when one of them dies. This also is true if your parents have named each other as beneficiaries on their "in trust for" accounts, retirement accounts, annuities and life insurance policies.
However, if your father owns any assets in his name alone, without a designated beneficiary, those accounts and assets will need to pass through probate via the instructions in his will. A will controls the disposition of probate assets upon death.
In their wills, your parents can name their beneficiaries, appoint an executor to administer their estate and provide for the payment of funeral expenses and/or taxes. If any of their children have disabilities, their wills also could create a special needs trust for that child's benefit.
Result: With proper planning, your father can dictate how his assets will be distributed after he dies, and his family can have certainty in knowing how his estate will be distributed.
Written by Karen E. Klein, Newsday, 9/23/06.
The rules: Everyone should have a will - regardless of age, health or wealth - as a part of a comprehensive estate plan. Without an appropriate plan, a person's estate could pass through "intestacy," which means New York state law would determine how the estate is distributed.
Strategy: Your parents should create a comprehensive estate plan, which may include joint ownership, beneficiary designations and wills.
How it works: It may be true that your father's assets will pass to your mother immediately upon his death. But that depends on how he owns his assets. For instance, if your parents own their assets together as "joint tenants with right of survivorship," those assets will go directly to the surviving spouse automatically when one of them dies. This also is true if your parents have named each other as beneficiaries on their "in trust for" accounts, retirement accounts, annuities and life insurance policies.
However, if your father owns any assets in his name alone, without a designated beneficiary, those accounts and assets will need to pass through probate via the instructions in his will. A will controls the disposition of probate assets upon death.
In their wills, your parents can name their beneficiaries, appoint an executor to administer their estate and provide for the payment of funeral expenses and/or taxes. If any of their children have disabilities, their wills also could create a special needs trust for that child's benefit.
Result: With proper planning, your father can dictate how his assets will be distributed after he dies, and his family can have certainty in knowing how his estate will be distributed.
Written by Karen E. Klein, Newsday, 9/23/06.
Thursday, August 3, 2006
Senate OKs plans to allow prescription drug imports from Canada
WASHINGTON (AP) — The Senate opened the way Tuesday to let Americans import prescription drugs into the United States from Canada, seeking to ease a regulatory ban on cheaper medicine crossing the border.
The proposal, which was approved 68-32, would create a Canadian loophole on a Food and Drug Administration ban on importing prescription medicine into the United States. It was offered as part of a $31.7 billion Homeland Security Department spending blueprint for the fiscal year that begins Oct. 1.
The department's Customs and Border Protection bureau began aggressively seizing Tamiflu, Viagra and other incoming prescription medications at borders in November. Prescription drugs — even those manufactured in the United States — are generally sold at cheaper prices in Canada.
"We should demand that (Customs and Border Protection) focus on the true priority that we face on the war on terror," said Sen. David Vitter, R-La., of efforts to secure U.S. borders. "Stripping small amounts of prescription drugs from the hands of seniors .... that should not be a priority."
Vitter's plan, which was embraced by Democrats, specifically would prohibit Customs and Border Protection from stopping people with doctors' prescriptions for FDA-approved drugs from bringing the medicine into this country from Canada.
But Republican leaders vociferously opposed the plan for fear, they said, the drugs could be unsafe for consumers — or even present a terror risk.
Sen. Judd Gregg, R-N.H., said the proposal was an attempt to push the FDA into reversing itself while "creating a massive hole on our capacity to secure our borders and protect ourselves."
"If I were a creative terrorist, I would say to myself, 'Hey, listen, all I've got to do is produce a can here that says 'Lipitor' on it, make it look like the original Lipitor bottle, which isn't too hard to do, fill it with anthrax," Gregg said.
Lipitor is a cholesterol-lowering drug.
Aides warned that the drug import plan was likely to be stripped out of the legislation — as it has been in past years — whenever it got to a conference of House and Senate lawmakers who will negotiate the final version. The administration also has opposed efforts to loosen the restrictions.
Two House spending bills this year — to fund the Homeland Security and Agriculture departments in 2007 — include the drug importation plan, said Kirstin Brost, spokeswoman for Rep. David Obey of Wisconsin, the top Democrat on the House Appropriations Committee.
The House has approved efforts to import drugs in six spending bills over the last seven years, Brost said, but the idea far has survived the conference only once. But that year, 2000, the plan was eventually dropped because it was written in a way that couldn't be carried out, Brost said.
While importing drugs into the United States is illegal, the FDA generally has not stopped small amounts purchased for personal use. Still, the FDA says it cannot guarantee the safety of imported drugs.
Customs and Border Protection began seizing controlled substances in September 2004, and expanded that operation last November to include non-controlled substances. The Bush administration has opposed efforts to loosen the restrictions.
As of March, Customs officials had seized nearly 13,000 packages of drugs coming into the country, although the medications' origins were not known, according to data provided by Sen. Bill Nelson, D-Fla.
"This is going to ensure that Americans, especially the frail, elderly, or those with debilitating conditions, are going to be able to at least have a chance of affording the medications that they need," Nelson said.
Copyright 2006 The Associated Press. All rights reserved. Updated 7/11/2006, USA TODAY
The proposal, which was approved 68-32, would create a Canadian loophole on a Food and Drug Administration ban on importing prescription medicine into the United States. It was offered as part of a $31.7 billion Homeland Security Department spending blueprint for the fiscal year that begins Oct. 1.
The department's Customs and Border Protection bureau began aggressively seizing Tamiflu, Viagra and other incoming prescription medications at borders in November. Prescription drugs — even those manufactured in the United States — are generally sold at cheaper prices in Canada.
"We should demand that (Customs and Border Protection) focus on the true priority that we face on the war on terror," said Sen. David Vitter, R-La., of efforts to secure U.S. borders. "Stripping small amounts of prescription drugs from the hands of seniors .... that should not be a priority."
Vitter's plan, which was embraced by Democrats, specifically would prohibit Customs and Border Protection from stopping people with doctors' prescriptions for FDA-approved drugs from bringing the medicine into this country from Canada.
But Republican leaders vociferously opposed the plan for fear, they said, the drugs could be unsafe for consumers — or even present a terror risk.
Sen. Judd Gregg, R-N.H., said the proposal was an attempt to push the FDA into reversing itself while "creating a massive hole on our capacity to secure our borders and protect ourselves."
"If I were a creative terrorist, I would say to myself, 'Hey, listen, all I've got to do is produce a can here that says 'Lipitor' on it, make it look like the original Lipitor bottle, which isn't too hard to do, fill it with anthrax," Gregg said.
Lipitor is a cholesterol-lowering drug.
Aides warned that the drug import plan was likely to be stripped out of the legislation — as it has been in past years — whenever it got to a conference of House and Senate lawmakers who will negotiate the final version. The administration also has opposed efforts to loosen the restrictions.
Two House spending bills this year — to fund the Homeland Security and Agriculture departments in 2007 — include the drug importation plan, said Kirstin Brost, spokeswoman for Rep. David Obey of Wisconsin, the top Democrat on the House Appropriations Committee.
The House has approved efforts to import drugs in six spending bills over the last seven years, Brost said, but the idea far has survived the conference only once. But that year, 2000, the plan was eventually dropped because it was written in a way that couldn't be carried out, Brost said.
While importing drugs into the United States is illegal, the FDA generally has not stopped small amounts purchased for personal use. Still, the FDA says it cannot guarantee the safety of imported drugs.
Customs and Border Protection began seizing controlled substances in September 2004, and expanded that operation last November to include non-controlled substances. The Bush administration has opposed efforts to loosen the restrictions.
As of March, Customs officials had seized nearly 13,000 packages of drugs coming into the country, although the medications' origins were not known, according to data provided by Sen. Bill Nelson, D-Fla.
"This is going to ensure that Americans, especially the frail, elderly, or those with debilitating conditions, are going to be able to at least have a chance of affording the medications that they need," Nelson said.
Copyright 2006 The Associated Press. All rights reserved. Updated 7/11/2006, USA TODAY
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