[Congressional Record Volume 140, Number 104 (Tuesday, August 2, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 2, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
              LET US MOVE FORWARD WITH HEALTH CARE REFORM

  The SPEAKER pro tempore. Under he Speaker's announced policy of 
February 11, 1994, and June 10, 1994, the gentleman from Maryland [Mr. 
Hoyer] is recognized for 60 minutes as the designee of the majority 
leader.
  Mr. HOYER. Mr. Speaker, I want to congratulate the gentleman in the 
well who just spoke, the gentleman from Idaho [Mr. LaRocco] for his 
idea. It is obviously a way to save money and give better health care. 
That is what we are about in the Congress this year.
  Mr. Speaker, I am pleased to take this time to talk about health care 
reform. There is no more important issue confronting this Congress. In 
fact, in the next few days the Members of this House, Members of the 
Senate will probably have the opportunity to vote on the most important 
bill that they will vote upon during course of their career, a bill 
which will have a substantial positive impact on the quality of life in 
this country. We in the Congress have been talking about health care 
reform for some 4 or 5 years now. As a matter of fact, as the President 
pointed out, President Nixon himself back in the early 1970's proposed 
a very substantial health care reform bill, much along the lines of the 
bills that we will consider on the floor.
  Prior to that, two decades before, President Truman said that we 
needed to give health care assurance to all Americans.

                              {time}  1740

  Notwithstanding that timeframe in which we have considered health 
care reform, families in America, those who work hard for a living and 
are having a tough time making ends meet, and businessmen and women who 
are seeing a larger and larger part of their payroll going to cover 
insurance premiums, and taxpayers across the country who feel an ever-
growing bite taken out of their tax dollars for Federal, State, and 
local health care costs; they, too, have been talking about the 
problems with health care systems for years, even before we started 
intensively reviewing this subject some 4 or 5 years ago.
  Today, Mr. Speaker, we take the floor to talk about solutions, talk 
about what the American people sent us here to do, take action to solve 
real problems confronting real Americans, not rich Americans, not poor 
Americans, but every American, and particularly the hard-working middle 
class that makes this country what it is. They go to work every day. 
They perform services for their employers, for their neighbors, for 
their communities, which make a difference. They, as we have pointed 
out, play by the rules, and they need to be assured that they and their 
families will have health care that will always be there.
  The solution offered by House Democrats, Mr. Speaker, is the result 
of the input of literally hundreds of thousands of Americans who, over 
the past 5 years, have met with Members of both sides of the aisle, 
talking to them about their concerns, their problems, and the problems 
confronting their families. Democrat Representatives have held 
thousands of town meetings, and Republican Members have as well, to get 
a grasp of the problem their constituents face every day and to learn 
their priorities for a comprehensive solution. As caucus chairman, I 
have presided over nearly 40 meetings of the House Democrats on health 
care over the last 5 years to compare our notes and work together 
towards a real solution, one that builds on the current system, a 
comprehensive solution that works.
  The package House Democrats presented last week is that solution, Mr. 
Speaker. First, it builds, as I said, on the current system. Most 
Americans who work for a living are not sure, and more than 8 out of 10 
of the uninsured either work or have someone who works in their family. 
Eighty percent of the uninsured, a work-related context, they or 
their family members, but they cannot afford insurance, and their 
employers do not provide insurance, and their families are at risk. 
This reform will extend health security to each and every one of the 
250 million Americans that sent each of us in this House here, who said 
to us:

       Go to Washington. Don't just talk. Don't point fingers at 
     one another. Don't carp. Don't play partisan politics with my 
     family's well-being.

  They said: ``Go to Washington. Put your heads together,'' and, as my 
kids used to tell me, ``Be real. Do something for us that will make a 
difference for the security of our families.''
  This reform, of which the majority leader will speak in just a few 
seconds, this reform guarantees, not as an afterthought, but as a 
fundamental principle, the same or better choice of doctor and hospital 
than we in this House have today. This reform cuts the rapid growth in 
health costs through competition so that health insurance remains 
within the reach of average working families, average working families, 
average working families. They are not average at all, and, as we say, 
the common man is indeed a very uncommon person who has made this 
country what it is, but who is now concerned that the hard work he or 
she has extended on behalf of themselves and their families can be lost 
overnight with an illness that can devastate their family. The majority 
leader will, perhaps, speak tonight of the family crisis that he 
confronted when his son was stricken with cancer.
  Mr. Speaker, I have a daughter. She is now 23 years of age. Two and 
half years ago, Mr. Speaker, she was diagnosed with a heart problem. 
She had an extra electrical conduit in her heart, and it made her heart 
beat too fast. It was life threatening. She had an operation at Johns 
Hopkins University, one of the great health care centers in this 
country, and they took out that extra electrical charge. During the 
course of that operation, which took 5\1/2\ hours, they went inside her 
heart. They never had to cut her open. With high technology, two 
catheters up her legs and one through her shoulder blade, they first 
found that extra electrical charge, and then they burned it out. She is 
fine today. Her mother and I did not care what that procedure cost. It 
was irrelevant. Thankfully we were covered by health care 
insurance. Thankfully she is 100-percent healthy today because of that 
high technology, expensive though it was, life changing, life saving 
and giving to our family and to that young woman's assurance of health.

  Mr. Speaker, this reform guarantees, as the majority leader will 
point out, a minimum benefits package so that Americans, like all of 
us, get the care they need, and the costs are borne fairly by all, the 
American family. That is the concept we share, and the concept of 
insurance of course, Mr. Speaker, is that we share. Well, not all who 
are at risk have a loss or health-care-crisis-causing expense, but we 
surely know that some of us will, and we need a system to ensure that 
all of us will be covered in that event.
  This reform, Mr. Speaker, achieves our goals without new Government 
bureaucracies, as the majority leader is going to point out, without 
new broad-based taxes. Democrats feel that we spend enough on health 
care already. We have to spend it smarter, however. For most Americans, 
Mr. Speaker, those with steady jobs and good health coverage, there 
will be little change in how we get coverage. What will change is that 
the cost of our premiums will not rise as fast and as far. What will 
change is the choice of coverage; options will be retained or expanded, 
and the choice will be ours to make, each and every one of us. Each and 
every one of us will have choice, not simply the choice of the 
employer, but the employee as well. What will change is that, when we 
go to bed at night, we need not worry that a child's cough is our first 
step toward financial ruin because we will be covered, covered even if 
that cough develops into a serious illness, even if one loses their job 
or changes their job.
  When Members of the House of Representatives first started to focus 
on the problems that our constituents were having with health care 
several years ago, the gentleman from Missouri [Mr. Gephardt] was 
already working towards solutions. Indeed since his first days here in 
the House in the 1970's, Mr. Speaker, he has been a leader on health 
care reform engaged in making sure that average Americans were not 
forgotten by the system. Those years of hard work, Mr. Speaker, 
culminated in the crafting of a comprehensive solution to those 
problems, one that will not only address the specific problems of 
average Americans, but one that will control the ever-growing numbers 
of tax dollars that go to pay for health care through Medicaid and 
Medicare both at the Federal level and at the State level.

                              {time}  1750

  Because just like at the family table, when we sit down to plan the 
Federal budget each year, an ever growing percentage of the pie is 
going to pay for health care. That is money that is not going to 
critical education programs. That is money that is not going into 
student loans, more police, to build better roads, or to repair our 
bridges.
  Mr. Speaker, at this time I yield to the majority leader. No one in 
this House has been more responsible for making sure that the House of 
Representatives addressed this critical problem for Americans.
  I want to congratulate the gentleman for his work, and yield for a 
more expansive explanation of the program that resulted, as he will 
point out, from the work of major committees of this House, and 
literally every Member of this House has had input into the creation of 
this plan.
  Mr. GEPHARDT. Mr. Speaker, I thank the gentleman for yielding. I 
thank the gentleman for taking this time tonight. I know we have a 
number of Members who want to be involved in this discussion.
  This issue of health care is coming soon to the floor of the House of 
Representatives, and we hope and believe that this will be a historic 
debate in the House over the next weeks, as we in the House, and as all 
Americans, are about to try to make a decision about where we want to 
go with our health care system, whether we need to change it, whether 
we want to make it better, or whether we would continue the status quo.
  As the gentleman has well said, our committees in the House, the 
Committee on Ways and Means, the Committee on Energy and Commerce, the 
Committee on Education and Labor, and other committees, have been 
working for almost a year to put together the legislation that we 
announced on Friday and that we will bring to the floor in the next 
weeks.
  I would like to start tonight, before I describe our plan in some 
detail with some charts, I would like to kind of back up and try to 
explain what this really is all about.
  We hear a lot of terms that are confusing to people. Americans have 
been saying to me, people I have seen in my own district, people around 
the country have been saying, this thing is so complicated. There are 
so many issues, there is so much fine print, there are so many 
different provisions. They hear words like triggers, mandates, 
universal coverage, and lots of issues that most people do not know 
what they mean. They do not know what we are talking about.

  So, to begin tonight, I would like to get us to all back up for a 
minute and talk for a moment about really what this is all about.
  We all know what health care is, we all know what doctors are, 
hospitals, illness, But what is our health care system and how do we 
pay for it? How do we get health care?
  Before World War II in this country, we got health care by going to a 
doctor usually. And if we went to the doctor, we had to have money, and 
we paid the doctor for whatever needed to be done. If you did not have 
the money, you probably did not go to the doctor, because you could not 
afford it.
  In the thirties, we decided that we did not want people to be dying 
and going into their old age with no money. We did not want that. So we 
said we would have a pension system called Social Security. Because at 
the time we passed Social Security in the thirties, lots of elderly 
people, after their productive years, had no savings, had no money. 
Many died destitute, without anything. So we made a decision as a 
country that we would have a Social Security System. We decided that in 
the mid-thirties. We put together a requirement, some would call it a 
mandate, a requirement that every employer in the country and every 
employee would pay a certain amount a month so that when you retired, 
you would have a pension called Social Security. And it has worked. It 
has worked wonderfully. It is the most popular program in America. 
Anyone who would suggest we get rid of that requirements would really 
be in trouble in our political system, because it is a popular program.
  Then in the sixties we found that about half the American people, 
when they hit 65 and after, they again did not have any active income 
coming in, were not able to see a doctor. Half the elderly in America 
in 1965 did not have the money to go and see a doctor. So we made a 
decision as a country that we would have another requirement on 
employers and employees that there would be a tax paid, a Medicare tax, 
and that every senior citizen in the country would have prepaid 
insurance that they could use if they got sick and needed to see a 
doctor. Now almost every American citizen who is retired can go and see 
a doctor and know that Medicare will be there to pay for it.

  Now, in 1994, 30 years after Medicare, we are discussing whether or 
not we should have a requirement in our society that every employer and 
every employee should pay something as prepaid insurance so that when 
we get sick, there will be something there to help us pay the doctor 
and the hospital to get us well.
  Now, after World War II, a lot of Americans who worked decided that 
we needed to have prepaid insurance, and a thing called Blue Cross and 
Blue Shield came into being. It was set up by doctors and hospitals, 
and it was offered to ordinary Americans to prepay their health 
insurance costs. I will never forget when my mom and dad, my dad was a 
milk truck driver in St. Louis, my mom was a secretary, they both 
worked, and my dad got the Blue Cross. I was a young kid, but I 
remember him coming home and saying we are now in Blue Cross and Blue 
Shield to pay the doctor. It was a wonderful day. We were in Blue Cross 
and Blue Shield, and I knew that if I had to go to the doctor, we would 
be able to pay. It wasn't just dad getting out the wallet to see what 
he had. We would be able to pay through our insurance.
  But then we got sophisticated, and smart insurance companies and 
employees figured out that if we got more well people in our plan and 
we segregated our people into a plan with only well people and young 
people, we could get a cheaper rate, because we would not have to pay 
for the sicker, older people. And then someone else figured out that if 
we could get well people together and young people together, if we 
could keep the cancer patients out and the heart patients and the 
tuberculosis patients, and all the people that had illnesses, if we 
could kick them out of the plan, we could have a cheaper plan.
  Then we figured out, some people figured out, well, gee, I am young 
and healthy, I don't even need a plan. Why should I pay anything? I 
will just stay out of the plan because I will pick the plan up when I 
hit 50 years old, or maybe I will just wait for Medicare. Maybe I will 
be lucky and never need to prepay for health insurance, so I will just 
stay out. And we got more and more sophisticated and more and more 
smart, and we got everybody in little-bitty groups and got all 
fragmented and isolated and pulled apart from one another. And the 
whole idea of insurance from the beginning was not that we would all 
get fragmented, but that we would all be in the same pool. And if you 
are in the same pool, then you do not have to pay as much, and it is 
like that fire extinguisher, all of you know about fire extinguishers. 
You know about a fire extinguisher. When you need it, you need it. You 
really need it.
  We have a fire extinguisher in our house, and I go by it every night 
and I look at it and I do not even think about it. I do not care about 
it. It never crosses my mind.
  But if we have a fire in the House, boy, am I going to want to have 
that fire extinguisher. It is going to be the most important thing in 
my life, to get the fire out.

                              {time}  1800

  That is health insurance. You do not need it until you need it. And 
it has to be affordable. It has to be a fire extinguisher that you can 
always afford. But what we have done over the last 40 years is segment 
and isolate and fragment and get everybody into a different group, and 
we have lost the idea of community that was the basic idea of 
insurance.
  So the main reason for this bill and the reason that we want the 
American people to understand and to be for this bill is that the bill 
is about getting everybody back into the pool, back into the prepaid 
health pool, on a level playing field, paying more or less the same 
amount of money so that when you need that plan, it is there for 
everybody.
  Now, this is not just about rights. We Democrats are known for 
talking about rights. We are good at that. We believe people do have 
rights. And I believe people have a right to an insurance policy. But I 
also think to have rights you have to have responsibilities. You have 
to be responsible. And a lot in this bill is about responsibility as 
well as rights. Because we are not going to have any rights if we are 
not all responsible.
  One of the tenets, the basic tenets of this bill is that everybody 
pays and everybody gets. We do not want that young person to be able to 
decide anymore, I do not need to afford insurance, I am well, I do not 
need it. You may need it. You may get sick. You may be a burden on the 
rest of society. So you need to pay; you need to be responsible. And 
employers need to be responsible.
  This bill is more about responsibility than it is rights, but it is 
about both.
  Now, let me, if I can, give an explanation of what our bill does, 
what it does not, address some of the concerns, some of the special 
areas of concern so that have everyone who is watching and in the hall 
tonight can understand.
  First, it ensures that everyone will have a health insurance policy 
by January 1, 1999. Now, there are some that would say, do it tomorrow. 
There are some who would say, do it next year. We will get a huge 
debate about when to start this. I understand that.
  The effort here is to find a date that is reasonable. This is a big 
change. We are asking people to get involved in health insurance. And I 
know they cannot do it overnight. And I am thinking about my small 
business people in St. Louis and Jefferson County, Saint Genevieve 
County, MO. I do not want to ask them to do something they cannot do. I 
want to give them time.

  So we picked a time that we thought was reasonable. Two years for 
companies over 100; 4 years for companies below 100. So we give the 
small companies the longest time to get ready for this change. But on 
that date, it has to happen.
  Now, why is it important that this requirement happen? We hear all 
kinds of arguments: Well, let us put in a trigger. Let us take time. 
Let us see what can happen.
  Let me tell you why it is important. It is important because people 
want and deserve certainty. Business people tell me all the time, I do 
not care what the rules are but just tell me what the rules are. Do not 
keep me up in the air. I need to plan my life. I have got to plan my 
business. If you tell me this is something that we are all going to do, 
that is fine. But tell me when it is going to happen. Do not put 
something out there and leave it totally uncertain and we never know 
what is going to happen.
  So I think we need to plant the flag. We need to let people know what 
the requirement is.
  Now, we need to help, and we will get to that in a moment, small 
employers who are going to have some difficulty doing this. We 
understand that. We are not going to ask someone to do something that 
is impossible or unreasonable. But we need to make it certain so it is, 
in our bill, certain.
  Second, we accomplish everybody being involved in health care 
coverage through employer/employee shared responsibility. And we ask 
employers to contribute 80 percent and employees 20 percent. Why do we 
pick those numbers?
  Well, again, it is a reasonable solution. There are some employers 
that pay 100 percent today. There are some that pay 90; some who pay 
80; some pay 75; some pay 70; some pay 50; some pay none.
  We have got people at all different places on the racetrack. And if 
we are going to ask everybody to do the same thing, then we have got to 
find a consensus. You may say 70 would be better. Somebody else may say 
50 would be better.
  One of the problems we have is that a lot of people are at 80. A lot 
of people that have insurance are at 90, and a lot are at 100. If we go 
to 50, then they are going to get worried that their employers will 
say, well, the national standard now is 50. You need to come down from 
90 to 50.
  All the time today, when I go home, people who have insurance are 
saying, what does this bill mean to me? What is going to happen to me? 
Am I going to have my insurance reduced? Am I going to have to pay 
more? That is a very legitimate question.
  So we believe if we go below 80/20, employer/employee share, that a 
lot of people who have insurance will feel disadvantaged, and they will 
be asked by their employers to go to a lower amount. So we have tried 
to pick what we feel is a consensus and an area that is reasonable in 
splitting the difference between what exists today.
  Third, as I said, we have subsidies for small employers and families. 
I will explain more in a moment exactly how those work. But obviously, 
if we are asking employers and employees who have not been involved in 
health insurance, hey, you have to get involved, we have to help them 
at least for a period of transition, of 5 years, so they have the 
wherewithal to be involved.
  Fourth, we have a program that is an option called Medicare Part C. 
Why have we gone to this? The reason we have gone to this is because 
there needs to be a place where small employers, where Medicaid 
patients, where unemployed people, part-time people, seasonally 
unemployed people, in other words, where people who have had trouble 
getting insurance can be certain that they can get insurance. And that 
is Medicare Part C. It is like the Medicare program, but it is not the 
same as the classical Medicare program for the elderly.

  It would allow people in that program to make choices. First of all, 
you will have a choice if you even want Medicare C. Second, if you are 
in Medicare C, if that is your choice, you still have choices. You can 
buy a managed care plan, an HMO, as many senior citizens do today and 
like it very much and get a very good deal. Or many of the people in 
Medicare C will be able to have a voucher and be able to go out and but 
any fee-for-service plan. That is a plan where you can pick any doctor 
you want, or they can go by some other managed care plan. Or many in 
Medicare C will be able to buy health care exactly as the Members of 
Congress and other Federal employees do, through what we call the 
Federal Employees Health Benefit Plan, which has a whole array of 
choices that people will have.
  We are not trying to limit people's choices. We are trying to 
increase choices. We are trying to foster competition. We are trying to 
get people to make choices between plans so that we get the best 
possible product, highest quality at the lowest possible price, which 
is, as in health care, what we want in everything else.
  We believe, therefore, that we will constrain costs without cost 
controls, without premium caps by the very competition that we will 
foster.
  Again, you get everybody back in the pool. You get everybody on more 
or less of a level playing field. And then let the competition start. 
And believe me, I believe with all my heart there will be a tremendous 
competition in this country for the health care dollars that will be 
there.
  What are the options today? Some people say, well, you are going to 
have two-tier health care. Do you know what you have today? You have 
four tier, at least, private payment, Medicare, Medicaid and no pay, 
four different ways of payment.
  Under our program, you are either going to have private or you are 
going to have Medicare A, B and C, the Medicare programs.

                              {time}  1810

  Believe me, Mr. Speaker, a furious competition is going on today for 
Medicare patients in all parts of the country, to get them into managed 
care in the Medicare Program. I was in an HMO in my own district where 
they are offering all the Medicare benefits, $1,200 worth of 
prescription drugs free, as an inducement to get into their HMO, and 
they are making money.
  What does that tell you? That tells you that real competition 
produces real results, that people really will compete. Managed care 
plans will go after all of these people that will be covered under our 
health care system. Therefore, competition will make all policies of 
all people more affordable than they are today.
  Mr. Speaker, the problem with the health care system has been that 
costs have been going up at 20 and 30 and in some areas of the country 
40 percent and 50 percent a year, driving people out of health care, 
because they cannot afford it.
  The reason to get everybody involved in the health care system, Mr. 
Speaker, and to have real competition, is to keep health care 
affordable for all Americans.
  Mr. ABERCROMBIE. Will the gentleman from Maryland yield for a 
question?
  Mr. HOYER. I yield to the gentleman from Hawaii.
  Mr. ABERCROMBIE. Mr. Speaker, in that context, the gentleman from 
Missouri has made a point about how this competition will work for the 
advantage of small companies, of small business. Some businesses, small 
businesses, are offering their employees insurance now.
  What I am interested in is, under the guaranteed health plan that we 
are proposing, would small companies who do comply now be 
disadvantaged, and/or how can we get those companies that will have the 
period of time to phase in their coverage be given an incentive to join 
as soon as possible, so that we don't have some in the plan and some 
out of the plan?
  Mr. GEPHARDT. Mr. Speaker, if the gentleman will continue to yield, I 
think there is a clear advantage for any company and any person who has 
health insurance today, first of all. I'm going to talk more about that 
in a minute. However, the great advantage they will get is that by 
getting everybody involved and by having more competition, we will have 
lower costs and lower cost increases for everybody who has insurance.
  Small businesses today, as the gentleman knows, are getting out of 
health care because they couldn't afford the cost increases. Part of 
the reason they cannot afford the cost increases is because maybe their 
competitors do not provide insurance, and add their costs to their 
policies.
  Mr. ABERCROMBIE. Isn't it a fact that many businesses are now 
providing insurance, and those that do not have the cost shift it onto 
those who are already paying their insurance?
  Mr. GEPHARDT. Exactly. I often say that health care is unlike any 
other commodity we buy. If I go down to the corner car dealer and buy a 
car today, and they roll it out and I get the keys and I say, ``This is 
great, but I don't have any money, I don't intend to pay,'' they will 
take the keys back. I will not get the car.
  If I have a heart attack here in the next 5 minutes and you all take 
me over to the emergency room over here and I go in and say, ``I don't 
have any money and I don't have any insurance,'' they will probably 
take care of me. Then they will add the cost of that to your policy and 
his policy and their policy and this gentleman's. Everybody who has a 
policy will have to pay for me, so I am a freeloader in that case.

  It is because, as a compassionate, decent society, we are willing to 
say, ``We are not going to have anybody die in the streets.'' We are 
going to take care of people if they have needs, even if they have no 
money, even if they have no insurance, and it should be that way. We 
are not going to change that.
  As long as we allow people to not be involved in health care 
insurance, the people who have insurance are going to pay their bills, 
and it is wrong. It is wrong for them to be stuck with their bills.
  Mr. ABERCROMBIE. Is it the case, then, that this plan will enable 
working people who cannot now afford insurance and companies who wish 
to be able to give their employees insurance, thus stabilizing their 
businesses, the opportunity to be able to get guaranteed, affordable 
insurance?
  Mr. GEPHARDT. Absolutely. Most of the small employers that I have 
talked to who do not provide insurance want to provide insurance. It is 
not a matter of being selfish. It is not a matter of not wanting to get 
their people involved. They would love to do it. They just have not 
been able to figure out how they can afford it.
  One of our main purposes here, Mr. Speaker, is to allow them to be 
able to afford to give their people what they both want, which is 
guaranteed health insurance.
  As I said, we have a choice of plans. In the private sector you have 
to have one managed care plan, one play where you can choose your own 
doctor. Again, some can choose through the Federal employees' plan. 
Some can choose, if they want, Medicare C.
  We also put an option in for a medical savings account. We have not 
talked much about this, but it is a very attractive option. You can 
fulfill your requirement in this plan by saying to your employee, ``We 
are going to buy a $2000 deductible major medical policy,'' and put the 
difference between buying that kind of policy and the premium for a 
comprehensive policy in the bank.
  We get a tax deduction for doing it. It is not taxed. Then the 
interest can grow, and every year you can put that amount of money in 
the bank as the premium, instead of paying it to an insurance company, 
and the employee can use the savings to go pay doctors' bills. Then 
when they get to $2,000 a year, the insurance policy kicks in, so the 
options are many.
  Finally, we have a nationally guaranteed benefit package. Many people 
have said, ``Why do you have to define what the package is?''
  The reason to do that is, again, if we do not get people on a level 
playing field, if we do not have a package that everybody is required 
to have, then we are going to have, again, all of the segregating going 
on; you know, fragmenting: ``I am well, I do not need a policy,'' or 
``I will buy a little bitty policy that covers one hospital day a year, 
and that is it,'' or ``I will buy a policy that really does not do 
anything, so I will avoid the costs.''
  Again, we all have to be on a level playing field, so the benefit 
package includes prescription drugs, hospital stays, doctor's visits, 
preventive care, mental health, long-term care, and it is a good 
program. It includes all of the different benefits that a normal, 
rational policy would have.
  I have tried to explain this to people, and I don't know how to quite 
get it across. They say, ``Is this a rich package or is it a meager 
package?'' The only analogy I can think of is an automobile. I have 
said, ``It is not a Cadillac and it is not a motor scooter.'' It is 
somewhere in between.

  I guess it is a Ford Taurus, maybe. I don't want to give an ad for 
any car. Maybe it is a Chevy Lumina, or something. It is one of those 
kind of family cars that is not too big and not too little, but it 
works. I do not think it has a CD player in it, and it may have a radio 
and a heater, but it is a good car. It is serviceable, it gets the job 
done.
  Finally, Mr. Speaker, our plan, and this is important, one of my 
great worries about health care is we get everybody involved and then 
we do not have an adequate delivery system out there to help them. They 
have coverage but there is no doctor in their community, there is no 
hospital, there is no clinic.
  So we have a substantial part of our bill that is to induce doctors 
and health professionals to go to rural areas and to go to inner cities 
that are now underserved, to also build clinics in rural areas, in 
inner city areas, where they do not have the kind of facilities that we 
need. So that is a very important part of our plan.
  Mr. Speaker, let me quickly go through the rest of the charts to 
explain. What does our plan do for the American people? It provides 
guaranteed health insurance that can never be taken away.
  If you change jobs, you don't lose your coverage.
  No preexisting conditions or exclusions.
  It provides a choice of doctors.
  It keep insurance costs down.
  People with health coverage now stay the same or get better.
  That brings me to the next chart. People, as I said, have asked, 
``What happens to me if I have already got health insurance. What does 
your plan do to me?'' Your present coverage will stay the same or it 
will get better. There is nothing in our plan that says, ``Your plan 
has to be reduced.'' If you have a good plan, you will keep it.
  However, there are other advantages for passing our plan. First of 
all, you will not be able to lose your coverage because of illnesses, 
as you can today. There are a lot of plans out there that if you get 
sick, they boot you out. We do not allow that anymore.
  Third, if you change jobs, a lot of people do not want to change jobs 
because the new job does not have coverage. Our plan takes care of that 
and says, ``You will have coverage wherever you go.''
  Your parents in the Medicare program or your grandparents will get 
prescription drugs in the classical Medicare program. We are going to 
have a long-term care program through the States that will help us with 
home health care and keeping people out of nursing homes.
  Again, we are going to increase the number of providers in rural and 
urban areas and we are going to simplify the forms.

                              {time}  1820

  A lot of people have said, how is this plan different from the 
Clinton plan?
  First, no mandatory alliances. We listened and we learned and we 
decided they were not helpful.
  Second, no new large government bureaucracies to run the system.
  Third, no automatic price controls as Government would serve only as 
a backup to the private sector efforts.
  Fourth, no disruption to the large majority of Americans who already 
have health insurance. And again we guarantee every American to choose 
their own doctor and health plan and we establish a Federal safety net 
insurance plan to ensure that an affordable plan is available to every 
American.
  A lot of our Members have said, ``This sounds great, but golly, what 
does it do to the Federal budget? Doesn't it bust the budget?'' Well, 
no, it does not. The plan is paid for and I will explain in a moment 
how we do that, but our preliminary estimates from the Congressional 
Budget Office is that we reduce the deficit by $2 billion in the first 
5 years and by 15 additional billion dollars reduction in deficit 
in the second 5 years. So the plan is not going to hurt the budget, it 
will help get the deficit down.

  How will the plan be paid for?
  First, from slowing the growth of Medicare and Medicaid which saves 
money that we can use for this plan.
  Second, a gradual and moderate increase of 45 cents in the tax on 
tobacco products.
  Third, we eliminate a present tax subsidy for what are called 
cafeteria plans, plans with many options in them that few but some 
employers have.
  And, fourth, a 2-percent surcharge on private health insurance 
premiums.
  Many have said: What does this mean to me? How do I come out if I 
have a family plan? If I am an employer, what are my obligations going 
to be?
  On this chart we have example 1, a single-parent working family with 
1 child with different income levels, $11,000 down to $27,600. We then 
have what the annual family premium would be under our plan. It would 
be about $800 per family. That would be the family cost. But the actual 
premium owed because of the subsidies for the individual families would 
go from zero dollars if you are a low-income family, the highest as you 
can see would be $69 for a family earning $27,000 and up. That would be 
$69 a month. For two-parent working families we can see different 
income levels. Again, $16,000 to $38,000. We see what the family 
premium is. About $1,100 per year. But with the subsidies, depending 
upon their income, their monthly payment would be a range from zero 
dollars to a maximum of $49 a month.
  The next chart shows the protections for low-wage workers and other 
low-income individuals. Here we have different income level 
individuals. For these people, individuals about $7,000 a year, single 
parents $11,000 a year, two-parent families, $16,000 a year, they would 
have no premiums, no premium obligations, no cost sharing and a 
comprehensive package for children. If they earned more than that, 
$7,000 to $17,000 as an individual, $11,000 to $27,000 as a single-
parent family, or $16,000 to $38,000 as a two-parent family, they would 
have premium subsidies, they would be helped on a sliding scale. There 
would be no cost sharing for pregnant women, children, and cash 
recipients. Again, a comprehensive benefit package for children.
  Some people have asked me: Give me a hypothetical. Talk to me about a 
small company in my district and what would happen to them. So we 
picked out the Acme Shoe Co., employing four low-wage workers, what 
would happen to them if this bill became law? In 4 years, they would 
have 4 years in which they would have to do nothing. But on January 1, 
1999, they would be required to cover 80 percent of their employees' 
health insurance. They could do it by enrolling employees in Medicare 
Part C, or offering a choice of at least two private plans, one where 
you choose your own doctor, one managed care. They could buy a medical 
savings account for the employee, $2,000 deductible, put the rest in 
the bank. Or they could put them into the Federal employees type plan. 
So there are options.
  These payments are fully deductible to the company, they can write 
them off their income tax, and Acme would be subsidized for 50 percent 
of their employees' health care costs. So that rather than paying 80 
percent, they would only pay 40 percent. Because again for 5 years we 
would be helping them be able to pay for their employees' health care 
costs.
  Small business people have been very concerned about this package, 
and with good cause. Many of them are basically getting by, they are 
worried about new costs. We reduce again their premiums, depending on 
their size and the low-wage mix, by up to 50 percent of their 
requirement to buy these policies. In a minute, I will show exactly in 
dollars and cents what they would owe. But they also get some other 
benefits.

  We are going to community rating. A lot of small businesses today 
have to pay much higher rates than large businesses because they do not 
have the buying power. They do not have enough people to bring to the 
plan. We have thrown that out. We say a small business under our plan 
has just as much buying power as a huge corporation. So that is a big 
benefit for all of our small business people.
  Third, we have included a change in workers' compensation, so that we 
are now going to require that the health insurance be the place where 
we get workers' comp injuries taken care of. That is going to lower 
workers' compensation insurance premiums for our small employers, 
another benefit for small businesses, of passing our plan.
  Fourth, they are going to have access to this Medicare C program. 
Again, they do not have to choose it. It is an option. But it is a good 
option for many small businesses because it is a reasonable insurance 
premium.
  Fifth, they can buy this medical savings account again. They do not 
have to buy any insurance plan, they can put the money in the bank, buy 
a high deductible policy and help their people that way.
  Finally, self-employed individuals who today get a zero tax deduction 
when they buy their health care under our plan will get an 80-percent 
tax deduction for the cost of their health care policy.
  The next chart is very specific and tells exactly what our small 
employers and other employers would have to pay. What we did on this 
chart was take 18 hypothetical firms, we put down the number of 
employees in each firm, so we have firm 1 has 5 employees, firm 3 has 
100 employees, and on down. Then we put the average wage in that firm, 
the first 6 firms have a low average wage, $11,000 a year, the second 
group of firms have a higher wage, $25,000 average a year. Then the 
third firms come in at about $40,000 a year. Then we have put the exact 
annual average employer payment per worker with the subsidies for these 
firms. Firm 1 would have to pay about $1,200 per year per employee. Or 
to analogize it to a minimum wage increase, 61 cents an hour is what it 
would cost them. Firm 2 would have to pay 78 cents an hour. Firm 3, 
$1.26 an hour, then on down, they are at about that level. So for about 
$1.26 an hour, firms who today do not cover people could cover their 
people.
  We did a minimum wage increase in 1988 of about 90 cents an hour. I 
know a lot of small employers found that a hard thing to do, but they 
did it. If we are able to pass this health care plan, we are not going 
to have a minimum wage increase for 4 years, maybe longer. Why would 
we? We are asking firms to come up with the analogy of a minimum wage 
increase, $1.20 an hour, or 61 cents an hour or 78 cents an hour. There 
would be no reason to have a minimum wage increase. We would not do 
that, because they are being asked to do this. So it really is asking 
small employers to do little more than a minimum wage increase, to get 
all their people covered. I think it is a good deal. Plus the subsidy 
would go to firms who now cover as well as to those who do not now 
cover. For the 70-percent of small business that now buys insurance, 
they would get the subsidy help. We would lower their costs of 
insurance for the people that are already doing what they have been 
asked.
  The next chart talks about the needs of rural America. I will not go 
through every part of it. Suffice it to say that we have got lots of 
inducements for doctors and health professionals to go to rural areas 
and we have got money in the program funded to build bricks and mortar 
and health care clinics throughout rural America.
  For senior citizens, a new prescription drug benefit would be added 
to the Medicare Program, would provide unlimited prescription drug 
coverage with a $1,000 cap on out-or-pocket costs per year.

                             {time}   1830

  Finally, I do not think the alternative plans that we are hearing 
about will work. If I thought they would, I would be for them.
  The reason is this: If we just do insurance reform, all we are doing 
is saying to everybody, ``Hey you cannot get in that little fragmented 
group anymore. You have to pay for the cancer patients. We are not 
going to keep them out of your plan anymore. You have to pay for 
them.'' That is going to add to everybody's costs.
  I do not want to pass a bill that just says to most Americans, ``Hey, 
you are going to pay more of a health care premium. Congratulations. 
That is health care reform.'' We have to do something more than that. 
We have to get everybody in the pool. If all we do is say you cannot 
kick out the cancer patient anymore, we also have to say we are going 
to bring in the people that do not have coverage. If we are going to 
raise your premium because we are making everybody be in the pool who 
is sick, we will then have to bring in the people who have opted out of 
the system because they do not want to pay premiums so that as the 
premium goes up, it comes back down because we get the people involved 
who have opted out of the system.
  So these alternative plans that say we can do this incrementally, 
slowly, I think are wrong. I think we will have another catastrophic 
bill out here where we make a lot of pretenses about what we have done, 
and then the people find out it does not work, we have to take it back 
out.
  Let me sum up with this: I think this issue is the most fundamental 
issue that we will face while we are in the Congress. This question is 
about who we are and what we are for.
  The gentleman from Maryland [Mr. Hoyer] has told the story of his 
daughter. When my son was 2 he had cancer. They gave him no hope, said 
he would not live for 6 weeks. We could not even talk to him. He was 
too young to understand what was wrong with him and why he hurt so 
badly. We were lucky. Like Steny, we had health insurance. We were very 
lucky. We had wonderful doctors and nurses who helped us. We prayed. We 
had people who helped us in our church, at my work, at my wife's work. 
Everybody got behind us to help us get through this crisis.
  Many a night in the hospital I met with parents. You know when you 
are in that kind of a situation you pour your heart out to somebody who 
has gone through the same travail. I would sit there as he got the 
chemotherapy and the drip treatment and I would talk to other fathers 
and mothers. Many of them were from rural Missouri, rural Illinois, St. 
Louis, workers. These are workers. These are not people that did not 
work. These are workers who did not have health insurance. They told me 
their great worry was not that their kid was going to die of cancer. 
Their great worry was that their kid was going to die because they did 
not have the $200 or the $300 for the next chemotherapy treatment.

  Nobody in this country should be awake at night worrying that a loved 
one is going to die, not because of the disease but because they do not 
have the wherewithal to get the therapy to solve the disease.
  We can do this. This is a great country, it is a just country, it is 
a decent country. Just as in 1935 we did Social Security and said 
elderly people will not die in poverty, and just as in 1965 we said 
elderly people will be able to go and see a doctor and will not be 
denied health care, in 1994 we have to say that every American has the 
right and the responsibility to have decent, just, fair health care. We 
can do this. We can get the votes for this. We can make this decision. 
The American people want this to happen, and we must stand in an active 
sense and with common sense and courage and vote for it in these next 
weeks.
  Mr. SKAGGS. Mr. Speaker, will the gentleman yield?
  Mr. GEPHARDT. I yield to the gentleman from Colorado.
  Mr. SKAGGS. Mr. Speaker, I really want to congratulate the leader on 
his presentation of a very, very complex and far-reaching proposal. I 
think all of us are particularly sensitive to the plight of small 
businesses in this country right now. They are the biggest source of 
job creation. I know when I am home in Westminster, CO, what I hear 
about a lot with regard to health care reform is how is small business 
going to handle what they see as another cost in a world that is 
already squeezing them real hard.
  How under the plan that you have just outlined are small businesses, 
who now cannot afford insurance, going to be able to handle this 
additional requirement?
  Mr. GEPHARDT. First, again, they will have 4 years to get ready to do 
this. There is no requirement until 1999.
  After 1999 there are 5 years in which they will be subsidized up to 
50 percent of their costs by the way the plan works. In other words, 
they will not have to pay the full costs of their employees' policies. 
They only have to pay half the cost that they would ordinarily have to 
pay.
  Third, because we are getting everybody involved, everybody's health 
costs will be held down. The cost increases that we have experienced in 
the last 10 years will not happen anymore in the future, because 
through real competition, everybody's costs will be held down so that 
the small employer who has been unable to do this, who has wanted to do 
it, will now find it affordable and be able to do this with their 
employees.
  Mr. SKAGGS. Long lead time, phase-in, subsidy, cost containment.
  Mr. GEPHARDT. Exactly. Now we need to start remembering also not just 
the people who do not do this now, we also need to remember the 70 
percent of small businesses that do this. They are here too, they are 
Americans too, and they are asking us tonight and in the days ahead to 
get everybody involved. They do not want to be disadvantaged. They do 
not want to be competing against people that are not doing this when 
they are doing it. They want everybody in the pool. They want fair 
rules. They want everybody on a level playing field.
  So it is right to be worried about those who are not doing it and 
what we are asking them to do. But it is also right to find a way for 
them to be able to afford this so it does not threaten their business. 
I think we have done that.

  But we also need to think of the majority of small businesses that 
are doing this today, that are playing by the rules, that are doing the 
right thing and have found a way to do it.
  Mr. HOYER. Mr. Leader, I thank you for your statement and for the job 
you have done. Our time is just about up, but in closing you might want 
to reference something that we discussed, and that is the cost of doing 
nothing.
  The gentleman talked about a 2-percent premium tax. Right now the 
average American who has insurance is paying about an 18 percent to 25 
percent premium tax for those people who are not in the system, for the 
so-called uncompensated care people who go to the emergency room and do 
not have any insurance. But somebody picks up the bill for the heat, 
and for the lights, for the doctors, for the nurses, for the 
instruments and everything, and of course it is the premium payers, 
whether they are business or individuals, the premium payers.
  Mr. GEPHARDT. One way to say it is that we have universal treatment 
in this country, but we do not have universal coverage. It goes back to 
the story that if I have a heart attack and I go to emergency room, and 
I do not have any money for coverage, I get taken care of, and then it 
is tacked on to everybody else's bill.
  The head of Aetna Insurance told me recently that he thinks in the 
last 10 years, 12 years, or 15 years that at least half of his price 
increases on health insurance have been because of uncompensated care. 
So half of the reason, roughly half of the reason all of us have seen 
all of these cost increases in our health insurance is because we have 
been unable or unwilling to find a way to get everybody involved in 
health care insurance.
  Mr. HOYER. Of course, that is being made worse by the fact that 
thousands of people a month now are losing their health insurance, and 
as they lose their health insurance the number of people having 
uncompensated care will go up and, therefore, the cost of those of us 
who have insurance inevitably goes up.
  Mr. GEPHARDT. So it cannot be insurance reform alone. If all we do is 
reform the insurance system, everybody's costs will go up. 
They did that in the State of New York, and instead of having 83 
percent of the people covered, more people got out. So if all you do is 
insurance reform, you are going to reduce the number of people that are 
covered rather than increase it. We need to get everybody involved.
  Mr. HOYER. Mr. Leader, I thank you for your statement. We will be 
discussing this some more as the week goes on.

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