[Congressional Record Volume 140, Number 121 (Monday, August 22, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 22, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
                      THE HEALTH CARE LEGISLATION

  The PRESIDING OFFICER. The Senator from Minnesota is recognized for 
10 minutes in morning business.
  Mr. WELLSTONE. Thank you, Mr. President.
  Mr. President, I have today worked on what I think is a careful 
analysis of the mainstream proposal, a critique of Senator Chafee's and 
other Senators' work. I am going to be sending a letter out to 
colleagues, and I think this letter reflects a very thoughtful 
critique. I hope it will be helpful to everyone in how they evaluate 
this set of proposals that Senator Chafee and others are now 
presenting.
  I made the appeal on Friday, and I make the appeal again, especially 
to the media, that I just wish that all of us, all of us here, would 
forget all of the labels, left, right, center, and for that matter sort 
of forget the kind of horse-race mentality of what is ahead, what is 
in, what is out, and just analyze these proposals as to whether or not 
they would represent a step forward for the people we represent.
  I think ultimately that is a decision that you, Mr. President, as a 
Senator from North Dakota, will have to make and that I will have to 
make, and that all of our colleagues will have to make.
  I would like to summarize what I had to say Friday, and this will be 
part of this letter. And then I will want to add to that critique today 
because we now know more about Senator Chafee's proposal as Senator 
Chafee and others have been gracious enough to provide briefings for 
our staffs. I will summarize Friday's analysis, and then I will build 
on that with today's analysis and concerns.
  First of all, by eliminating the employer mandate in the Mitchell 
trigger--remember, this Mitchell bill had this trigger--the proposal 
would take us a step even further away from ensuring affordable 
coverage for working families and individuals.
  What I am simply saying is that I think this is one of the 
difficulties which Senator Chafee and others have run into with this 
proposal. Without employers contributing their fair share, it is 
difficult to figure out how to finance coverage. If you are going to 
have subsidies to enable individuals up to 200 percent of poverty to 
purchase health care, that is fine. But then once you get into $30,000, 
$35,000, $40,000 middle-income working families, you have a plan that 
does not deal with the question of how to make that coverage affordable 
to them.
  So that is the first problem. That is a fundamental problem.
  Second, the subsidies and tax deductions for individuals with no 
employer contribution required could result in employers reducing 
coverage while enjoying a Government-subsidized bailout. And then, 
because the subsidy pool is limited, the proposal could fail to 
increase the number of insured.
  This is extremely important. If you are not going to require 
employers to provide coverage, and if you are going to provide 
individuals with tax deductions to purchase coverage, and are going to 
provide subsidies for those individuals, then there is every incentive 
in the world for employers just to drop people. The employers would 
say, ``If the Government is going to do it, let the Government cover 
people''. This could become, by the way, a huge problem, a huge 
problem. The Congressional Budget Office pointed to this kind of 
problem once we started planning to give subsidies and tax deductions 
to people working for companies so they could individually purchase 
their coverage.

  The real issue here is whether or not, again, we end up spending a 
lot of money to subsidize employers. And if we only have a limited 
amount of money anyway, then we could have a real squeeze on people, 
both the low- and moderate-income people who we are trying to give 
coverage to and a new group of citizens who could be very well dropped. 
I have to say that this is a fundamental flaw with this plan.
  Third, the proposal would reduce the size of insurance pools which 
would raise community-rated premiums for small businesses and 
individuals. I do not think I did a good job explaining this on Friday, 
Mr. President. The problem is, if you reduce the employer threshold 
from 500 to 100 or below, in terms of those businesses that would be 
within these insurance pools, then you do not have much of a base to 
spread risk over. We started out saying we wanted to help the small 
business people. But if you move to such a narrow base, then it is fine 
for companies with more employees than that, but if small businesses 
are in community rating with Medicaid recipients and others--I think it 
is clear they are going to pay higher premiums. So the whole issue of 
community rating is fine, but it depends on what community you are in 
as to whether or not you are going to be able to afford the premium. 
This proposal puts small businesses, I think, at a very severe 
disadvantage compared to the Mitchell bill.
  Finally, I talked about the proposed malpractice reforms. I think the 
problem--at least the present course with this--is that the direction 
of what has been proposed by the mainstream group protects insurance 
companies and doctors, but not consumers. There has to be balance here.
  Today--and this will be a part of the letter I sent out to colleagues 
today--I want to make some additional points on the mainstream group's 
proposals. First of all, it appears there are going to be deductions 
that will be available for high-deductible catastrophic plans as well 
as for the two basic plans, the standard and the less than standard. 
This is another incentive to segment the insurance market and 
accelerate what actuaries call premium death spiral. I wish we did not 
have to use all this technical language. The long and short of it is 
this: If you are young and healthy, you are going to have the incentive 
to purchase the high-deductible catastrophic plans. Then you are out of 
the pool. If we go to community rating, it continues to go up for 
others who are paying for sicker people. If the healthy people drop 
out, the rate continues to go up for those that are left in the 
standard premium pool, and more drop out. It simply does not work when 
you get into this kind of segmentation.
  Second of all--and this is extremely important--the Chafee mainstream 
proposal prevents States from going further than Federal reforms. I do 
not understand that. I am a big believer in States being the 
laboratories for reform, a big believer in grassroots political 
culture. I see no reason why States cannot do better than what the 
Federal Government has done. From reading this, States like Maryland, 
Vermont--and I do not know where Hawaii fits in; that would be an 
interesting question--New York, Washington, Minnesota, and Oregon, what 
steps these States have taken that go further than the Federal 
Government could be eliminated. That progress might not be permitted. 
In addition, States which want to go single payer would not have the 
option of including large multi-State employers, which would be a major 
barrier to an effective system.
  So it strikes me that when you have a set of proposals which are 
supposed to be a step forward but which essentially prohibit States 
from doing better than the Federal reforms, with States not getting the 
chance to define what they want to do, I think that is a serious flaw, 
not a step forward.
  Third of all, the whole question of parity that Senator Domenici and 
I have worked on really for several years now for mental health and 
substance abuse services would not be secure. All other benefits would 
be determined by a board that would not be accountable to the public. 
We want some clear language, like we had in the Labor and Human 
Resources Committee bill, which makes it clear that we no longer want 
to have this discrimination where we treat mental illness as if it is 
not diagnosable and curable--and it is--and we essentially treat people 
differently with caps on how long they can stay in hospitals, and on 
what kinds of cure they can receive. We need language that makes it 
clear that there will be parity that ends that discrimination.
  Fourth, there is no protection for consumers by a public or nonprofit 
agency. This is really important. We have had some debate on the 
Mitchell bill and, before that, the bill that we reported out of Labor 
and Human Resources Committee. I know that on the floor of the Senate 
Senators came out here--and Senator Reid from Nevada was articulate. He 
said: Wait a minute, some of this attack on bureaucracy like an office 
of consumer affairs set up at the State level to represent consumers--
this is not bureaucracy with gnashing of teeth, this is, in fact, a 
role for the public sector to be there to defend and advocate for 
consumers. To eliminate the office for consumer advocacy means that 
consumers may not have a right to go to court if health plans violate 
the rules, including discrimination in enrollment. We know the power of 
the insurance industry at the State level. To set up an organization 
where consumers would have some strong advocacy and strong 
representation would be a step forward. To eliminate that is a step 
backward. I mean, consumers do have to be in the decisionmaking loop. 
They do have to be represented.
  Mr. President, I think one of the most serious flaws in the 
mainstream group's proposal is that there would be no expansion of 
public health programs. At the very time that we are trying to talk 
about how you deliver care out into the communities where people live, 
at the very time that doctors in Minnesota tell me--doctors, by the way 
who work for the prestigious Mayo Clinic, and what not--that they wish, 
in retrospect, they had more of a public health orientation in their 
training. They see public health outreach as being key to the 
foundation of preventive health care, how we save dollars by delivering 
care in the community on the front end, and we do not have any 
resources for expansion of public health.
  One of the reasons I supported the bill that came out of Labor and 
Human Resources Committee is that we put a priority on expanding public 
health. We know if you make that investment, in the shortrun, in the 
medium run, and in the long-run, you will be much better off. It is not 
a step forward to not have any real expansion for public health 
programs.
  Sixth in the list of additional weaknesses with the mainstream group 
proposal is that community-based providers in underserved communities 
could very well be eliminated by provisions that would merely require--
and I am going to use the language--health plans to contract with the 
``reasonable number of essential community providers as determined by 
the Secretary, defined strictly as rural health clinics and existing 
federally qualified health centers.''
  Mr. President, many community-based providers fall into neither 
category. As we move away from community-based providers--some of the 
most important work that we are doing with community-based clinics--we 
have language that could lead to their elimination. It is not a step 
forward; it is a step backward, especially if you are talking about 
underserved populations.
  I think this is a thoughtful critique, and this is for the 
consideration of colleagues, and I think it will be discussed and 
debated--before we get into a left, right, center, and all the rest, 
let us analyze these proposals and see if they are a step forward or 
not. Finally, I have one last point.
  The opportunity to cover long-term care would be lost once again. I 
have to repeat that. The opportunity to cover long-term care would be 
lost once again. The life-care program contained in the Clinton and the 
Labor Committee and the Mitchell bill would be eliminated. In other 
words, people would have to buy long-term care insurance on the private 
market, which has never, never worked.
  In fact, I think some of the discussion on the floor has not been as 
nearly as accurate as it should be. Lots of people in North Dakota and 
Minnesota when they hear long-term care is going to be covered, they 
think it is the catastrophic expenses when in a nursing home. We were 
not going to be covering nursing home expenses, although that would be 
covered in a single-payer plan. We were going to cover long-term care 
as defined as home based care.
  What we did, we essentially structured a life-care program which 
would be a public insurance program that people could purchase at a 
price they could afford. We said, at least as a backup let us have 
that.
  That is eliminated.
  I mean, Mr. President, we start out talking about health care reform. 
I cannot even count the number of Senators who came to the floor--I am 
sure it was well over a majority--who talked about their parents or 
their grandparents, someone, who, toward the end of life had all of 
their resources depleted because they had been in a nursing home, that 
that is wrong. The great Senator from Minnesota, Hubert Humphrey, 
talked about that, that that is wrong. It is not right for people at 
the end of their lives--on the backs of people who built this country--
to have to be faced with this kind of uncertainty.
  The life-care program which was contained in the Labor Committee 
bill, in the Clinton bill, and the Mitchell proposal, which I do not 
think went far enough--I think we should have covered long-term care, 
including nursing homes at the beginning--was a step forward. At least 
it would make that policy affordable for people to buy the insurance 
themselves against this.
  That is eliminated.
  So, Mr. President, I believe we are talking about a set of 
proposals--everybody wants the call themselves mainstream. Everybody 
wants to say they are in the middle. Everybody wants to say it is 
bipartisan. But it cannot be the lowest common denominator. It cannot 
be something with a fancy name and a title that does not work for 
people in our States. It cannot be something where we make a claim that 
we just simply are not going to be able to support.
  We start out talking about universal coverage, dignified affordable 
care for people out in the community where people live, and now I fear 
we have a set of proposals which I think are going to have a very 
negative effect on the people we represent.
  If people are worried that it might be worse for them than it is 
right now, they certainly have reason to worry if the employers have an 
incentive to drop them. They certainly have a reason to worry if they 
are small businesses expecting that we would be in an insurance pool 
that would give them some bargaining power. That very well might not 
happen. They have every reason to worry what is called malpractice 
reform will end up hurting them as consumers, and once again the 
insurance companies get their way. They have every reason to worry that 
the cost containment built into these plans--I think the weakness of 
the Mitchell bill is you have fail-safe automatic cut in subsidies. If 
cost exceeded revenue, the fail-safe provision was the cuts in the 
subsidy for the people, to enable people to afford it, as opposed to 
caps on insurance premiums.
  Why are we not lowering insurance premiums and having some limit on 
them? The CBO told us that is the way to have effective cost 
containment.
  That is taken off the table, a capitulation to political power.
  To conclude, I want to list again six or seven other critical points 
that I hope colleagues will look at. If I am wrong, fine. Let us have 
the debate and the discussion.
  I think the tax deductions for the high-deductible catastrophic 
plans--that is that the way it appears--is going to lead to 
segmentation of the insurance market. I think it is profoundly wrong 
and mistaken to say the States would be prevented from going farther 
than the Federal reforms. I think we have to clarify language and 
guarantee parity in mental health care. I know my colleague from New 
Mexico, Senator Domenici, agrees with me. I think we cannot move away 
from protection for consumers.
  That is exactly what the mainstream proposals do. I think it is sadly 
mistaken not to have an expansion of public health programs because 
everybody that studies health care policy in this country tells us that 
should be a priority. I think to begin to move away, or to have 
language that can very well eliminate some of our most important 
community-based providers, is a huge step backward as well.
  Finally, at the very minimum we ought to have a live-care program 
contained in this legislation which will at least enable people to have 
a chance to be able to afford some kind of insurance against the 
catastrophic expenses that come with, for example, nursing home care.
  Mr. President, as I said, this critique I present on the floor of 
Senate is a letter to colleagues. I hope they will look at this. I hope 
we will debate these points one by one. And I hope that my colleagues, 
Democrats and Republicans alike, will just put all the labels in 
parentheses, put all of this sort of political discussion about what is 
ahead and what is not ahead in parentheses, and analyze the substance 
of it--analyze the substance of it. Let us not go to something that 
becomes the lowest common denominator where we can sort of claim credit 
for having done something positive, but it might well not work with 
people we represent.
  I am all for a reform bill if it is going to work for the people we 
represent. I am for a step forward even if it is not everything I 
believe in. I am not for going backward. I believe there are serious 
questions about the mainstream proposals that have to be answered. At 
this point in time I think there are some fundamental flaws and 
weaknesses to what some of my colleagues have presented.
  I yield the floor.
  The PRESIDING OFFICER. The time of the Senator has expired.
  Mr. WELLSTONE. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. GRASSLEY. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Senator from Iowa is recognized for 10 minutes.

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