[Congressional Record Volume 140, Number 111 (Thursday, August 11, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 11, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                          HEALTH SECURITY ACT

  The Senate continued with the consideration of the bill.
  Mr. PACKWOOD addressed the Chair.
  The PRESIDING OFFICER. The Senator from Oregon.
  The Senator from Oregon has 29\1/2\ minutes remaining.
  Mr. PACKWOOD. I thank the Chair.
  Mr. President, one of the joys of dealing with this bill is the 
perpetual surprises that you get, not just day to day, but from hour to 
hour.
  I noticed when the distinguished Senator from South Dakota was 
speaking earlier, he had a chart, or maybe it was the Senator from 
Massachusetts, as to how much you would pay under the Dole bill and how 
much you would pay under the Mitchell bill.
  And I noted that they subsidized individuals, the Mitchell bill, up 
to 300 percent of poverty. Now that was news to me; it was the first 
time I knew that. That figure at one time was 240 percent, but only for 
certain categories of children; 200 percent for others.
  That is one of the difficulties of trying to keep track of what is 
going on.
  I mentioned earlier the shifting of the bills. If they were smaller, 
I would say shifting them around under the shells.
  But this does not fit under any normal shell. This is the bill I 
referred to earlier as Lethal Weapon 1, which was introduced last week 
for the first time. We have had this in our possession now--1,400 
pages--we have had it about a week, give or take a few hours. It 
contained lots of things we had never seen before. In theory, we are 
still on the Finance Committee bill. As a matter of fact, we seem to be 
on the majority leader's bill.
  But the night before last, we received this. It has no number on it 
yet. It has been printed. It has not been introduced. It is what I call 
Lethal Weapon 2. And there are things in this different from Lethal 
Weapon 1.
  And I am now told that there is going to be another bill. I do not 
know if it will be as big as that, with numerous changes, things I have 
discovered today are going to be dropped out of the bill, or maybe 
added to the bill.
  I understand now that Congressman Gephardt has added back into the 
Gephardt bill the retiree health insurance provision, where the Federal 
Government is going to pick up 75 or 80 percent of all the retirement 
health costs of people age 55 and up who have retired. That was out of 
the bill. Now it is back in. Maybe it is back in the Clinton-Mitchell 
bill. I do not know.
  So as I address myself to a particular subject at the moment, I 
apologize to the Chair if it is not in the bill we are finally going to 
consider. All I can do is go on what we do have and, at the moment, I 
am going to have to go on the first bill, Lethal Weapon 1.
  I want to talk about a subject that is called essential community 
providers. I also call it a shirttail relative to any willing provider. 
Any willing provider really applies to doctors or individuals who 
provide health services. Essential community providers essentially 
relates to things--clinics, Indian health service, something like that.
  Now here is the situation. This country is moving fast toward what we 
call managed care. We have had it for years in the West. It is much 
more prevalent in the West than it is in the East.
  Managed care is a simple concept. It is most easily illustrated by 
the Kaiser Health Plan in the West.
  Under the Kaiser Health Plan and managed care, they make a deal with 
you. They make a contract with you.
  They say, ``Mr. Jones, Ms. Smith, for a fixed dollar amount, we will 
provide you all of your health care. And it is up to us to live up 
to''--us, Kaiser health clinic--``up to us to live within the amount of 
money we said we'll charge you.''
  Let us say they are going to charge you $250 a month. And if you do 
not go this month, do not go to them at all, you still pay them $250. 
If you do not go next month, you still pay them $250.
  If you do not go for a year, you pay them $3,000. Now, the second 
year you have a bad auto accident. You are in the Kaiser hospital for 6 
or 7 days and you run up $10,000 or $12,000 in bills and you are still 
paying them $3,000 a year.
  In exchange, you have to use Kaiser facilities, the Kaiser doctors, 
the Kaiser hospital, because that is the way they can attempt to get a 
long medical history of you. You are using them all the time. They have 
your records. Their doctors have treated you. They know if you have any 
adverse reactions to prescriptions. They have an entire medical 
history, and they are very good at working at preventive health.
  I remember years ago, this was 35 years ago, when I first became 
familiar with Kaiser, even then they were very good about trying to get 
all the people enrolled to do annual physicals and everything they 
could to prevent hospitalization. They once admitted in a hearing in 
the Oregon legislature when I was in the legislature 30 years ago that 
they really were not any better than anybody else at actual hospital 
costs when you were finally hospitalized. What they were better at is 
keeping you from being hospitalized. And we all know it is infinitely 
cheaper to treat somebody out of a hospital than in a hospital.
  We all know the existing practice, good preventive care, annual 
physicals and catch things early--it is cheaper catching things like 
that. They were good. They are good. They were the forerunner. But now 
managed care is running rampant throughout this country, and I use that 
as a good term. I will use Blue Cross/Blue Shield in Oregon as an 
example. We have 2.9 million people in Oregon. Blue Cross/Blue Shield 
insures 1.1 million. That is a large carrier in a State of 2.9 million.
  Ten years ago Blue Cross/Blue Shield had no managed care. Everything 
was what we called indemnity insurance. You bought a policy from Blue 
Cross. There were some deductibles, maybe you paid the first $200, 
there were some copayments--if the doctors visit was $25 you paid $2 or 
$3 or $5 of it and they paid a certain amount over a certain amount--
but they reimbursed the doctors and the hospitals on basically a cost 
basis. What did it cost you to do the operation? $20,000. All right, 
here is your $20,000. There were no efforts to control costs. You were 
just reimbursed on cost.
  It is not unlike what the Federal Government did during World War II 
when we were in an urgent situation. We needed to build ships. We 
needed to build tanks. We just told industry, ``Go ahead, do not worry 
about the cost; we will reimburse you on a cost-plus basis. Get it 
done.''
  It is no wonder that health costs went absolutely through the roof. 
If there was no restraint on what you charged and if the insurance 
company paid what you charged and the individual was not paying it--who 
cared? Until finally medical costs and insurance premiums got so high 
that people began to care. Insurance companies began to care and we 
started through this managed care process.
  I said 10 years ago Blue Cross/Blue Shield in Oregon had zero managed 
care. It was all indemnity, it was all cost reimbursement. Today Blue 
Cross/Blue Shield in Oregon has 62 percent of its enrollees in managed 
care. They expect that to be 90 percent by 1998.
  Remember what I said the trade-off is, though, for managed care. In 
exchange for a guarantee that all of your expenses, all of your medical 
costs will be covered barring very minor exceptions, you agree to use 
the facilities of Kaiser, in the case of Kaiser. They actually have 
hospitals and they actually have doctors they employ. In the case of 
insurance companies, they normally contract with a certain group of 
doctors or they will contract with a certain hospital. They do not 
actually run the hospital themselves, the insurance company, but they 
contract for it and say, ``We have 100,000 enrollees on average, Mr. or 
Ms. Hospital Administration. Out of 100,000 we figure that is 5,000 
patient days a year. Your hospital has been charging $600 a day. We 
will guarantee you 5,000 patient days a year but we are not going to 
pay you $600, we will pay you $400, and we will pay it whether we send 
you 4,000 people or 6,000 people, but we will pay you up front, 
quarterly, and you will be guaranteed that amount of money.''
  The hospital administrator thinks to itself, ``We are running 30 
percent uncollectibles and a third of our beds are empty. Why not? $400 
is better than nothing and it is payment 100 percent guaranteed.''
  So the hospital and the doctors bargain with the insurance company. 
That is a form of managed care. But the key to making it work is that 
the Kaisers of the world, or the insurance companies of the world, have 
control over the delivery of the care so they can manage it. That is 
where the name comes from.
  Now we come down to this issue of any willing provider, or essential 
community providers. Any willing providers being doctors and nurses and 
what not. Essential community providers being the hospitals or the 
clinics.
  Managed care has become so successful and so prevalent in this 
country that many doctors and many hospitals now object if they are 
left out of the reimbursement system from some particular insurance 
company. They want to be inside. They want to be able to say, ``I am a 
willing provider. If you are only reimbursing $800 for an appendectomy 
instead of $1,000, I will do it for $800 and I demand--because I am 
willing to do it for $800, you have to let me in your system.
  The insurance company says, ``We do not need any more doctors in the 
system, we have all we need to do appendectomies. We know who they are, 
we have a long history on them, and we think they are qualified and we 
do not need any more people.''
  So the doctors ask the legislatures and ask the Congresses to pass 
any willing provider laws that say they have to be let in.
  Think to yourself, in a situation which would be more common to all 
of us, what would you do in this situation? You go out and buy a new 
dishwasher and with the dishwasher comes a little piece of paper that 
says, ``If you would like us to service this dishwasher for the next 3 
years or 5 years, it will cost you $30 a year. If you want to sign this 
contract send it back with your purchase, we will take care of all your 
repairs for nothing.'' So you sign it and send it back to General 
Electric dishwasher.
  The only people who will repair it for nothing are the people that GE 
has contracted with. There may be 1,000 repair shops in the area that 
would be willing to repair your dishwasher, but GE has said we are 
going to use this 30 and, Mr. or Ms. Jones, if you bought our 
dishwasher and bought our service contract, here are the 30 you can 
use. The other 970 say, ``We would like to be in on the deal also,'' 
and GE says, ``We do not need 1,000 people to repair it, we need 30 
good ones we can keep track of.''
  Under the equivalent of an any willing provider statute, all the 
other 970 repair shops could be let in. Now GE has to keep track of 
1,000 of them and decide which ones they want to use. That is in 
essence the concept of any willing provider.
  Picture the same thing again with car repairs. You buy your car, get 
a service contract on it, but you have to get it repaired where the 
person you contract with, the company you contract with, says to get it 
repaired. You do not have to sign up with them, but if you do, that is 
the trade-off.
  Now we come to this bill, at least the one that is before us--this is 
not even before us yet, this one that was given to us last week. It is 
not before us technically, but we are discussing it as if it were. We 
take this bill and we come to a particular section--this is one of the 
reasons it is so hard to figure out what the bill means--section 1462: 
Categories of Providers Automatically Certified.

       (a) In General.--The categories of providers and 
     organizations, including subrecipients, specified in this 
     subsection are as follows:
       (1) Category 1 entities.--The following entities shall be 
     considered category 1 entities:
       (A) Covered entities as defined in section 340B(a)(4) of 
     the Public Health Service Act (42 U.S.C. 256b(a)(4)), except 
     that subsections (a)(4)(L)(iii) and (a)(7) of such section 
     shall not apply.

  That tells you a lot. It does not tell you anything. That is why it 
is hard to go through this bill. So let me tell you what that section 
means.
  Every single health plan in the country--every Blue Cross plan, every 
Blue Shield plan, every Metropolitan Life, every Kaiser plan, every 
self-insured company that insures themselves, will have to contract for 
the provision of services with an absolute litany of organizations. 
They must contract with them. They can no longer say, ``If you sign up 
with us, as Kaiser, and you pay us $250 a month and we take care of all 
of your needs, but you must come to us.'' You can no longer say that.
  Now, if you contract to provide coverage, here are the additional 
organizations that you have to allow, in essence, to be willing 
providers:
  One, federally qualified health centers;
  Two, public housing clinics;
  Three, Indian Health Service clinics;
  Four, urban Indian health clinics;
  Five, Ryan White Act HIV disease clinics;
  Six, maternal and child health clinics;
  Seven, school health service centers;
  Eight, black lung clinics;
  Nine, comprehensive hemophilia diagnostic treatment centers;
  Ten, native Hawaiian health centers;
  Eleven, sexually-transmitted disease clinics;
  Twelve, tuberculosis clinics;
  Thirteen, Medicare disproportionate share hospitals,
  Fourteen, hospitals that serve a high proportion of the poor. That is 
the definition, hospitals that serve a high proportion of the poor.
  Fifteen, mental health and substance abuse clinics;
  Sixteen, runaway homeless youth centers or transitional living 
programs for homeless youth;
  Seventeen, rural health clinics; and
  Eighteen, children's hospitals.
  Every health plan has to contract with every one of those 
organizations. Anybody they cover that goes to one of these 
organizations, they have to pay them the same amount as if they went to 
the organization that the organization runs.
  Kaiser would have to say--let us say they have 100,000 people. Kaiser 
has actually 400,000 in Oregon. At the moment, they all must go to the 
Kaiser clinics. Kaiser has two hospitals, almost 600 doctors and close 
to 6,000 employees.
  But now for your $250 a month, you can go to any one of these and 
Kaiser must reimburse them. How on Earth is Kaiser or Blue Cross or 
Metropolitan Life or Aetna supposed to manage this care when you have 
all of these organizations over whom they have no management control, 
free to come and pick off your patients and say, ``Kaiser, pay us.'' 
That is one of the little hidden subsections in this bill.
  Why is it in the bill? You think to yourself, ``That doesn't make any 
sense. Why is it in the bill?'' It is in the bill for a simple reason: 
Many of these organizations do serve the poor, and they fear that as we 
move toward managed care, they will not have a method of collecting 
money sufficient to keep their organizations going.
  A good example would be New York. The State of New York allows 
Medicaid recipients--this is the poorest of the poor--if the Medicaid 
recipient wants to take the Medicaid money that they are entitled to 
and purchase a managed care contract rather than going to the local 
public hospital, free hospital, almost 90 percent of the last 300,000 
Medicaid recipients who have made a choice have chosen managed care.
  There is a wonderful story in the New York Times about the public 
hospitals--they pay no taxes; they are supported by the taxpayers--
saying that the very poor that they treated, that no one else used to 
want, are now going elsewhere under managed care contracts to private 
hospitals.
  They do this as a matter of choice. No one compels them to do this. 
And the poor are not dumb. They are just poor. They know where they get 
better service. They know where they get better quality, faster 
treatment. So they are leaving the Government system, the New York 
municipal hospital system, in droves and going to the equivalent of the 
Blue Cross/Blue Shield managed care programs or the Kaisers of New York 
City.
  So many of these organizations have said to Senator Mitchell, the 
majority leader, ``Please put us in your bill so that we are guaranteed 
if we can drain off some of the patients of Kaiser or Blue Cross/Blue 
Shield that they will have to pay us.''
  Mr. President, that is going to be the breakdown of the managed care 
system.
  Mr. GREGG. Will the Senator yield for a question?
  Mr. PACKWOOD. I will be happy to.
  Mr. GREGG. I am not sure I completely understand this. Basically what 
you are saying is that instead of this bill generating an incentive for 
cost control through allowing managed competition and HMO-type of 
facilities within managed competition to determine who can best provide 
and most efficiently deliver the health care, what this bill does is 
basically punch large holes in the opportunity for cost control by 
creating really nonmarketplace expenditures being put on the backs of 
those who might want to contract with an HMO.
  So it puts a stake through the idea of cost control, does it not?
  Mr. PACKWOOD. It is bigger than a stake; it is bigger than a hole. 
This absolutely rips apart the concept that you are going to manage the 
care of these 100,000 people you have.
  If any organization in this list wants a contract with the HMO, they 
get one--and I cannot think of any other organizations that would not 
fit in this list. I have not gotten to the doctors yet, these are just 
the organizations --if any one of them can come to you, do you know 
what they are going to try to do? They are going to try to pick off 
your best patients, your healthiest patients, the ones that are not 
going to cost them $250 a month and you have to pay. You no longer have 
any control over them. You have it exactly right.
  Mr. GREGG. If the Senator will yield, will this not sort of generate 
like a cottage industry of these types of entities growing up, that 
basically will be able to come in and demand payment as, basically, a 
way of tapping into this revenue stream rather than trying to contract 
the revenue stream? It is going to explode the demand on the system.
  Mr. PACKWOOD. I think you are right. I am not sure how long we have 
had some of these clinics. Runaway homeless youth centers or 
transitional living programs for homeless youth I do not think would 
have been a normal medical provider 10 years ago. Sexually transmitted 
disease clinics, comprehensive hemophilia diagnostic treatment 
centers--Kaiser can do all these things. It is not a question of a need 
that has never been filled before.
  The mind of men and women, given an incentive, is amazing, and as 
long as you have this definition of what an essential community 
provider is, my hunch is a lot of people will figure out a way to 
become an essential community provider.
  Mr. GREGG. If the Senator will yield further, it is sort of as if you 
put this huge trough out there and then you arbitrarily allowed anybody 
to be issued a bucket.
  Mr. PACKWOOD. Yes.
  Mr. GREGG. You wanted to run for the trough.
  Mr. PACKWOOD. You have it.
  Mr. GREGG. I was looking at the CBO estimate of the Mitchell bill, 
and I noticed it estimates the baseline goes from $1.2 trillion in 
health care spending--I am sorry. The Mitchell bill goes from $1.3 
trillion to $2.24 trillion in spending. Is that rather dramatic 
increase in spending over a 7-year period probably in part due to this 
sort of lack of cost control within the bill?
  Mr. PACKWOOD. That is a bigger projected increase in spending than if 
we do nothing. The bill actually causes us to spend more than we would 
spend if we do nothing.
  Mr. GREGG. Because the marketplace today is actually functioning with 
some cost controls which are generated by managed care which comes 
through HMO's, which will basically no longer function under this bill.
  Mr. PACKWOOD. Just as we are starting to see this deluge--and again I 
use that word happily--of movement toward managed care, we really have 
only had competition in health delivery in the last 10 years. Even 
Medicare, up until 10 years ago, we reimbursed on cost. ``Tell us your 
cost, hospital, here's the money.''
  Mr. GREGG. Cost plus care.
  Mr. PACKWOOD. Cost plus care. You got it. ``Your cost went up 20 
percent last year? Here is your extra 20 percent.''
  Just as it is working--you are right--we want to drive the stake into 
the heart of the system that is holding down costs.
  I will give you another example. In the metropolitan Portland area--
and again this is a voluntary basis--56 percent of those eligible for 
Medicare have voluntarily signed up with managed care organizations. We 
have eight major--we are only a small State; we only have 2.9 million 
people--we have eight major HMOs in Oregon. Five of them have managed 
care Medicare programs. Of those five, three have had no premium 
increase for 4 years, and they are still surviving. It is working, and 
no one has to join. And yet 56 percent of the Medicare recipients in 
the Portland metropolitan area--it is about a million people--have 
voluntarily signed up, which proves they are satisfied with the 
service, they are hearing about it from their neighbors, and they are 
signing up.

  Mr. GREGG. If the Senator will yield further. But this bill 
essentially creates a mandate, it is a mandate on the local HMO. It 
would undermine that sort of cost control activity.
  Mr. PACKWOOD. Absolutely right. They have to contract with these. And 
they have to contract with every one of these that exist in their 
areas. You may have--I said the first one is federally qualified health 
center. You may have a number of these in the area, in which case you 
contract with all of them. That is just the first definition.
  Mr. GREGG. I thank the Senator.
  Mr. PACKWOOD. How much time do I have remaining?
  The PRESIDING OFFICER. The Senator has 4 minutes remaining.
  Mr. PACKWOOD. How many?
  The PRESIDING OFFICER. Four minutes.
  Mr. PACKWOOD. I thank the Chair. I believe I finished. I yield to the 
minority leader.
  The PRESIDING OFFICER. The Chair would indicate the Republican leader 
has 10 minutes of leader time.
  Mr. DOLE. I thank the Chair, and I thank my colleague from Oregon.
  I know my colleague from Hawaii, Senator Inouye, and Senator Stevens 
want to begin very quickly on the DOD appropriations bill. So I will 
not take but a few moments.
  I first want to personally thank my colleague from Nebraska, Senator 
Kerrey. I was not on the floor when he spoke, but I did pick up some of 
his comments just at a personal level, not anything to do with any 
legislation pending. I appreciated very much his words because of his 
understanding that maybe few have of some of the problems that we have 
to face up to in the next few weeks.
  I also wanted to just take slight issue with some of my friends, and 
I hope we do not get this game of ``if ours is bad, why, yours is 
worse'' and whatever. I think we have a lot of debate that is going to 
happen here, a lot of things need to be discussed. But I sort of felt 
like I was watching ``Dr. Jekyll and Mr. Hyde.'' Senators Boren, 
Kerrey, and Kohl spoke about the need to be constructive rather than 
destructive, and the need to search for a bipartisan solution rather 
than a bill that splits the Senate down party lines, and I agree.
  I think there is a lot of agreement in the Senate on that general 
theme. Now, maybe we cannot get there. Maybe we ought to try. And it is 
not enough to say we have tried to pass because we have never really 
tried. But moments before these calls for cooperation and consensus, a 
number of my friends on the other side led at least a rather partisan 
attack--and that is not without precedent in this body. I assume there 
may be a lot of it on both sides in the next few weeks--a bit 
misleading attack about the American option, the Dole-Packwood bill, 
and I want to take just a few moments to respond to some of the 
statements that were made.
  I guess, first, I should admit that they now say we have a bill. So 
we stipulate that. There is a bill. There is a Republican bill. It is 
Dole-Packwood and 38 other Republicans. But we have not tried to make 
it a partisan bill. We think there is still opportunities there for 
bipartisanship, and we are not going to close that door until the final 
moment.
  I think it also indicates that we have been trying to propose real 
solutions to real problems. My friend from South Dakota, Senator 
Daschle, stated there was, and I quote, ``a significant degree of 
confusion'' about Senator Mitchell's bill. And that is part of the 
problem. The American people are confused, Members of the Senate are 
confused, and even the authors of the bill are confused as new 
provisions are introduced almost by the hour.
  That is the confusion about the majority leader's bill. Also there 
was a bit of confusion about the Dole-Packwood bill. Senator Daschle 
claimed ours does not do anything to reduce bureaucracy, which I 
thought was rather startling. But maybe he means we did not make it 
grow, it did not expand, which it does not do.
  It is sort of ironic that anyone who may be supporting the majority 
leader's bill and maybe supported the original Clinton bill proclaims 
their concern about the size of bureaucracy. We hope that ours is 
fairly free of any expanding bureaucracy. That was one of the efforts.
  I would point out that the largest section of the Dole-Packwood bill 
is the one that deals directly with administrative simplification 
because we believe most American people believe it is too complicated, 
it is too complex, and there should be an effort by all of us to make 
it much less complicated.
  The Senator from South Dakota also quoted CBO estimates of the cost 
of the Dole-Packwood bill. I wish we had the same pipeline into the CBO 
that the Senator from South Dakota has, but we have not received any 
CBO estimates, and we called Mr. Reischauer, who said that nobody has 
been given any CBO estimates on our bill. And it seems to me that if 
Senator Daschle has CBO estimates, maybe he would be happy to share 
them with us. We would be happy to have those estimates because we 
think it is necessary before we proceed here that we do have estimates 
on all these bills and all the changes and all the modifications. We 
believe it is very important.
  Senator Reid said that the Dole-Packwood bill does not cover dental 
care. That may be true, it may not, but the Dole-Packwood bill does not 
have a one-size-fits-all Government-mandated basic benefits package. We 
leave decisions such as dental coverage up to the consumer. Why not 
leave it up to the consumer? Let them determine whether they want 
dental coverage or substance abuse coverage and the like. We let the 
American people decide what plan best fits their need and pocketbook. 
That is the way we ought to do it.
  Another statement was that our bill still allows for discrimination 
in dealing with preexisting conditions. It seems to me this is one area 
we are all in agreement on. I did not know there was any disagreement 
until earlier today.
  We talk about market reforms and things we ought to do and things we 
agree on. Under the Dole-Packwood bill, insurers would not be allowed 
to deny coverage because of preexisting conditions. It is that simple. 
That is it. That is it. It is what we have been saying.
  And all we are doing is maintaining the status quo. I guess that is 
another charge. In reality, we do not want to disturb the 85 percent, 
the millions of Americans who are fairly well satisfied with their 
health care. We do not want Government intervention. We do not want to 
add about $500 per family for costs. There are a lot of things we do 
not want to do.
  So if we are being charged with being for the status quo, then we 
will plead guilty to that. But it seems to me that we are addressing 
the concerns many people want to address. The Senator from Nebraska 
indicated many things he would like to address. We believe they are 
addressed in our bill.
  The Senator from Nebraska went on to say he did not like everything 
in our bill, but he thought it had a lot of merit. We believe it does. 
We are not a bit defensive about our proposal. Maybe it can be 
modified. Maybe it can be changed. It certainly can be made better. But 
if better means more Government, more bureaucracy, more mandates, more 
price controls or more taxes, then we do not want to make it better. 
That is not better for most Americans. I think that is the bottom line.
  We will admit when it comes to the status quo, our bill does not 
weigh as much as the others. It has about half the number of pages, or 
less. We left out taxes, and we left out mandates, and we left out 
price controls; we left out new agencies. But our 641-page bill does a 
lot more than just maintain the status quo. We think it makes health 
care more accessible and more affordable to millions of Americans and 
that is the goal we hope we can reach.
  And if we reach 91, 92, or 93 percent without mandates and without 
new taxes and without price controls, then I think we come back and see 
where we are and find out what we need to do at that point. And I 
certainly believe if the majority leader finds somebody out here saying 
something has no relevance, no basis in fact to his bill, he will 
probably be on his feet.
  I want to mention just one other thing, and then I will be happy to 
yield the floor.
  I think there is another concern, and I am now checking with my 
Governor, a Democrat, from the State of Kansas, Governor Finney, 
because I remember when the Dole-Packwood bill was introduced, we had a 
letter within a few days from the Governors Association saying, ``Wait 
a minute; we don't like your Medicaid cap.'' I was told that also in 
Boston when I went up to address the Governors what, a month ago, I 
guess, 3 weeks ago. And so we worked with the Governors. And we 
resolved our problems. We will have a letter today hopefully from all 
Governors, not just Republican Governors, saying they do not have a 
problem with those aspects of the American option, with the Dole-
Packwood bill.
  But I think they have a lot of problems--I do not know that to be a 
fact, but I believe that they may have a lot of concerns with reference 
to other bills that are pending. And if I read the Washington Post as 
any guide, the article entitled ``Health Bill `Death' to D.C.,'' which 
quotes delegate Eleanor Holmes Norton as saying the Mitchell bill is 
death to the District, I guess the particular issue raised is how the 
insurance reforms will be implemented and whether the cost of insurance 
to the District will become prohibitive and the number of uninsured 
increased. That is the way she sees it.
  I think we have to take a look at how this impacts on various States. 
I had a phone conversation, I guess night before last, with the 
Governor of Wisconsin, Governor Thompson, who has been very active in 
the Governors' Association with the Democrats and Republicans on health 
care. In fact, you could go back and take a look at the health care 
principles outlined by Democratic and Republican Governors about 8 
months ago. It is pretty much like the Dole-Packwood bill. The thing 
that they did not like in the Dole-Packwood bill was the Medicaid cap, 
and other things they did not like concerning ERISA. But the principal 
thing is the Medicaid cap.
  So they identified a number of concerns in our proposal. Their 
biggest concern was the potential increase in their Medicaid costs as a 
result of the cap on Medicaid which we considered earlier. We think we 
have solved that problem.
  But it does appear that perhaps some of the bills, including the 
majority leader's, would also add burdens on the States. The Governor 
of Wisconsin indicates after a quick look at the majority leader's bill 
that there are additional costs, at least $800 million to $850 million 
in the State of Wisconsin over a period of years. These increased 
burdens come in the form of 177 new administrative responsibilities, 
and additional Medicaid cost as a result of the maintenance of effort 
provision in the bill, as a result of the new 1.75 percent tax on 
health care insurance costs for their State and local employees. Of 
course, we can estimate the cost to the States is the loss of jobs, if 
and when employer mandates kick in, particularly if you have different 
States kicking in at different times. Some States are never going to 
kick in. As indicated by the CBO, it is going to be very hard to 
implement.
  So we are waiting to hear from our Governor, and I am certain that 
many Governors are hoping to get a State-by-State analysis from the 
Governors Association because the Governors are there every day. They 
are on the firing line every day. They are talking with their taxpayers 
every day, and they are going to be very concerned about what any of us 
do, Republicans or Democrats. I think they have been fairly objective 
and fairly nonpartisan in addressing concerns in the so-called Dole-
Packwood bill, and I assume they will do the same with the majority 
leader's bill unless everything is resolved.
  We sort of looked at the States. And we have former Governors in our 
midst right now, Senator Craig of New Hampshire, Senator Bond, and 
there are a number of former Governors on the Democratic side. And I 
think they watch very closely at what happens in Congress, particularly 
something like health care that is going to affect everyone.
  I think we also have to ask about the implications of the rules for 
mandatory costs as envisioned in the Mitchell bill. Those States like 
California, Florida, Iowa, and Texas, which will put in place 
purchasing alliances will be permitted to ask this question. I think 
this is a fair question. And the preliminary CBO report projects that a 
State-by-State mandate would produce inefficient reallocations of 
business activity moving across State lines. Maybe that is true. Maybe 
it is not. But it is raised in the CBO report, not some Republican 
newsletter.
  I think all of these are questions that we must ask our Governors. 
And, as I said, I think they may have as much or more at stake than we 
have. We pass the legislation. We pass mandates. The thing that the 
Governors hate is unfunded mandates. We say, ``OK. You go ahead and do 
it. We don't have any money. But there is a mandate. You figure out how 
you can do it.'' And I must say that the President has indicated his 
opposition to any mandates. I think most every Senator knows that we 
have to be very careful in whatever we may pass; that we listen 
carefully to Governors, whether they be Democrats or Republicans.
  Finally, I would say the Capitol is filled with rumors about maybe 
the House is not taking up health care next week, and maybe not for the 
next couple of weeks. The majority leader is here. He may have more 
information than I have.
  I just ask the question. I think it is because of the question 
Senator Helms raised. Some were chuckling about Senator Helms' 
amendment. The reason they cannot take up the House bill, as I 
understand it, is because they do not have CBO numbers.
  That is precisely what Senator Helms was suggesting--that we not 
proceed until we had numbers. We do not have numbers on our bill yet. I 
am not certain we have all the numbers on the majority leader's most 
recent entry.
  It is very important that we have at least some guideline as to what 
it is going to cost and who it is going to cost, and all the other 
things that the CBO should provide to us.
  So I understand there may be a meeting at 4 o'clock. Maybe at that 
time we will be informed of what may be the pleasure of the House. That 
may not affect our schedule directly. But I think it will have a big 
impact indirectly.
  Mr. MITCHELL. Mr. President, I listened with interest to the remarks 
of my friend, the distinguished Republican leader, and I, perhaps 
better than any other Member of the Senate, can understand his 
sensitivity to the criticism of his bill. Everything in life is 
relative. Before he becomes too defensive, and if he wants to feel 
better, I would suggest that he take the Congressional Record of the 
past few days and read what his colleagues have been saying about me 
and my bill.
  I think it will make him feel a little bit better because the words 
were far more critical, and indeed in some respects inflammatory, than 
anything I believe that has been said about his bill.
  So on the theory that misery loves company, I commend to him the 
Congressional Record for the last few days to read some of the words 
that his colleagues have said about me, and perhaps he will not feel 
quite as badly about any criticism of his bill.
  Mr. President, I have not heard the so-called rumor about the House 
of Representatives, except from the minority leader. So he may have a 
better pipeline than I do into the House leadership. But I will be 
talking with the House leaders later today.
  In any event, I think it clear given the different rules of the two 
bodies that the length of consideration of any bill will be much 
greater in the Senate, that it is going to take some weeks for the 
Senate to consider this important matter. By contrast, the House under 
their rules can obtain a rule which would permit consideration in a 
matter of a few days, if they like. Therefore, I think it appropriate, 
and I think the most prudent course of action is for the Senate to 
proceed in an effort to complete action irrespective of what the House 
does because the fact of the matter is whenever they begin they might 
well finish before we do even though we start a lot earlier.
  But I will be meeting later today with the House leadership and will 
of course, as is my practice, discuss that with the Republican leader 
following that meeting.
  Mr. President, is it in order now for the Department of Defense bill 
to be reported for further consideration by the Senate?
  The PRESIDING OFFICER. That is the regular order. The majority leader 
also has the right to use his leader time, if he so desires.

                          ____________________