[Congressional Record Volume 140, Number 141 (Monday, October 3, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




         SENATOR COHEN'S HEALTH CARE FRAUD AND ABUSE AMENDMENT

 Mr. DURENBERGER. Mr. President, I rise today in support of the 
amendment offered last week by the Senator from Maine to combat fraud 
and abuse in our health care system.
  Mr. President, the scope of health care fraud and abuse and its cost 
to our economy is staggering.
  In July of this year, Senator Cohen released a report detailing the 
findings of a yearlong study undertaken by his minority staff on the 
Special Committee on Aging.
  In his report, Senator Cohen pointed out that health care fraud and 
abuse accounts for as much as 10 percent of all health care spending. 
That means that, in 1994 alone, health care fraud and abuse will cost 
the citizens of this country over $100 billion. That's roughly $280 
million in losses each day, $11.5 million each hour.
  Mr. President, those figures are so overwhelming, they defy 
comprehension. By way of comparison, over the last 5 years, estimated 
losses from these fraudulent activities totaled roughly $418 billion--
almost four times as much as the cost of the entire savings and loan 
crisis to date.
  We should act--now--to stop this financial hemorrhage. We cannot 
afford, and must not tolerate, such larceny on a massive scale.
  Mr. President, Senator Cohen has for years lead the fight within this 
body against health care fraud and abuse. He has worked extremely hard 
both to expose the fraud rampant throughout our health care system and 
to craft the legislative means to attach that fraud.
  Characteristically, Senator Cohen has approached this issue in a 
deliberate and thoughtful manner. His recent report on health care 
fraud, which I strongly urge my colleagues to read, presents a detailed 
analysis of the factors which permit health care fraud to fester, and, 
based on that analysis, proposes a specific set of recommendations to 
reduce the pervasive fraud and abuse.
  The amendment before us builds on those recommendations, together 
with the insights and comments offered by a broad range of parties 
engaged in the debate over how best to fight health care fraud and 
abuse. Indeed, I am gratified to note that, throughout the drafting 
process, Senator Cohen has solicited and--to the extent he could 
responsibly do so--incorporated comments from all interested parties, 
be they in Congress, the executive branch, or the private sector.
  Mr. President, as Senator Cohen explained in detail in his recent 
report on health care fraud and abuse, current law is flawed in two 
fundamental ways.
  First, and most importantly, current law fails to provide sufficient 
means to root out health care fraud.
  Senator Cohen's amendment addresses this failing by establishing a 
new health care fraud statute in title 18 of the United States Code and 
expanding the capacity of the Secretary of Health and Human Services, 
and the Attorney General to fight fraud and abuse through the creation 
of an all-payer national health care fraud program. Law enforcement 
efforts would be further aided by more thorough data collection, a 
wider range of penalties, and additional funding through the health 
care fraud and abuse control account.
  Second, current law fails to provide honest citizens who seek to 
abide by the law with sufficient guidance to delineate the scope of 
permitted conduct.
  Senator Cohen's amendment remedies this by establishing procedures 
for regulators to solicit and adopt modifications to the current safe 
harbors to the antifraud statutes which are proposed by the public. 
Furthermore, the Inspector General, in consultation with the Attorney 
General, would be directed to issue appropriate interpretive rulings 
regarding the application of the antifraud laws.
  Mr. President, that additional guidance is a key reform. Ironically, 
though current law does not effectively curtail billions of dollars 
worth of fraudulent activity, its uncertain application does impeded 
certain transactions among law-abiding parties which may be entirely 
proper. In particular, the current safe harbors are of little use to 
even the most conscientious parties. Senator Cohen's amendment would 
provide a means for persons acting in good faith who want to ensure 
that their conduct is entirely legal to seek specific guidance from the 
persons responsible for enforcing the law.
  In closing, Mr. President, I once again wish to point out that the 
amendment presented by Senator Cohen is the culmination of many years 
of effort. I commend Senator Cohen for that effort. I was proud to 
support this amendment when it was incorporated in the mainstream 
coalition's health care reform proposal, and I am proud to support it. 
I regret the fact that Senator Cohen withdrew his amendment and hope 
this will be a priority for the 104th Congress as it continues health 
care reform debate.

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