[Congressional Record Volume 141, Number 63 (Wednesday, April 5, 1995)]
[Senate]
[Pages S5187-S5189]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   WORKING TOGETHER TO SAVE MEDICARE

  Mr. DOMENICI. Mr. President, I want to talk today to everyone in this 
body and every American who will listen and, in particular, senior 
citizens across this land, because something is happening that we are 
not paying attention to and we ought to be doing 
[[Page S5188]] something about. I want to share it with you.
  Again, I repeat, I hope the senior citizens, who themselves are 
concerned about the future, will pay heed to what occurred the day 
before yesterday when the trustees of the Medicare program issued their 
release with reference to the status of this fund. The trustees of 
Medicare released their 1995 annual report, Mr. President, on the 
hospital insurance trust fund. This looks like yet another boring 
Government report. But the information contained within it is 
singularly alarming. The information contained in this report affects 
the lives of all Americans, and has an immediate effect on the lives of 
senior citizens.
  I want to read from the cover letter that was sent with this report:

       The Medicare hospital insurance trust fund is expected to 
     be exhausted in the year 2002. While the status of the HI 
     trust fund has thus improved slightly since last year, it 
     still does not meet the board's test of short-range financial 
     adequacy.

  Translated, this means Medicare is going bankrupt 7 years from now. 
It will not have the money in the fund to pay the hospital bills of 
seniors then in the hospitals of America expecting their bills to be 
paid under the current Medicare program. If we do nothing, Medicare 
part A, that portion that pays for hospital benefits, will run out of 
money in the next 7 years.
  I rise today to tell my colleagues and the American people that we 
must work together to save Medicare from bankruptcy.
  This is not one part of America's problem. It is not a Republican 
problem, a Democrat problem, an independent problem. It is everyone's 
problem.
  We will look at why Medicare is going bankrupt. As we can see on this 
chart, the bottom line is flat. This line represents the money coming 
into the trust fund from payroll taxes on current workers in the United 
States.
  The amount of money we are projected to pay out for Medicare is going 
to continue growing. The top line represents money we are going to 
spend on Medicare benefits. The Congressional Budget Office, our 
official scorekeeper, tells Members that Medicare outlays are projected 
to grow more than 10 percent each year. That means if we leave programs 
like they are, if we leave the delivery system like it is, that program 
will go up 10 percent a year in cost.
  This is unsustainable. The trend is obvious. The black line is the 
trend of 10 percent a year. I do not think we can afford to let 
Medicare spending continue to grow more than 10 percent every year. If 
we do, the consequence is absolutely and unequivocally and simply that 
Medicare will go under.
  I, for one, will strive diligently not to let that happen. I hope 
many Senators from both sides of the aisle and many House Members from 
both sides of the aisle will help Members keep that from happening.
  My hope that the President would help do that is dwindling rapidly. I 
will share with the U.S. Senators why I believe that is a fair 
conclusion.
  I cannot sit by and let it happen because I have promised the people 
of my State I would protect Medicare. To do nothing and leave the 
program alone is not to protect it. If I do nothing as a Senator, and 
if we do nothing, it will go bankrupt. Therefore, my commitment and 
promise requires that we act to save this system. I am not about to let 
it go bankrupt in 7 years.
  There are some other interesting facts in the trustees' report that I 
believe should be spread out here in the Senate, and for those who are 
interested, through the networks that tell the people what we are 
saying, this report says, if we do not change our projected Medicare 
spending and if we want Medicare in long-term balance, if we want to 
put it in that position, we would have to raise payroll taxes by 3\1/2\ 
percentage points. The report says that.
  I note my distinguished friend from New York is present and I hope I 
do not misinterpret anything in the report.
  Mr. MOYNIHAN. No, sir, you do not.
  Mr. DOMENICI. In other words, if we do not change the slope of this 
top line, which represents 10 percent per year growth, we are going to 
have to raise the bottom line. That means raising the current HI 
payroll tax from 2.9 percent to 6.4 percent. That is 120 percent 
increase. Those are not my numbers, their numbers. Those charts were 
telling the status of this.
  Our other option, obviously, is to slow the growth of Medicare 
spending by changing the system or changing something within the 
system.
  What else do these trustees say? They say:

       The HI program is severely out of financial balance and the 
     trustees believe that Congress must take timely action to 
     establish long-term fiscal stability for this program. The 
     trustees believe that prompt, effective, decisive action is 
     necessary.

  They did not say wait until after the next election. They did not say 
wait 3 years. They did not say it is too tough, so do not do it. We 
asked them to tell Members what to do, and they are saying, ``Congress, 
change it, fix it, and fix it now.''
  These trustees are urging Congress to act. They are telling Members 
to save Medicare. They are telling Members that Medicare part A is 
going to go bankrupt in 7 years.
  I have said that five times. Before I am finished, I hope to say it 
three more times. Perhaps we should say it 10 times a day until some 
people in this Congress, besides a few, decide that we must fix this 
now.
  I want to read from another report. Last year I served on the 
Bipartisan Commission on Entitlements and Tax Reform, cochaired by 
current Senator Bob Kerrey and retired Senator Jack Danforth. Thirty of 
the 32 members of the bipartisan commission signed the interim report 
to the President. He asked for it. We sent it to him. I want to read 
finding No. 6 from that report.

       To respond to the Medicare trustees' call to action and 
     ensure Medicare's long-term viability, spending and revenues 
     available for the program must be brought into long-term 
     balance.

  Not the black line and the green line and the monstrous wedge, or 
differential, but so that the lines on the chart are one.
  Let Members make no mistake about it. If we pass the President's 
budget, the highly touted budget of the President, Medicare will go 
bankrupt in 7 years. The President's budget did nothing on Medicare. 
The President's budget proposed three tiny changes to the program. 
These changes have no effect on those lines.
  Secretary Shalala testified before the Budget Committee--I believe 
the distinguished occupant of the chair was present--2 months ago. I 
asked her what the administration intended to do about Medicare. She 
said they would wait until the new trustees' report came out before 
they made a recommendation. So the Secretary, representing the 
President, 2 months ago said, ``Let's wait until the report.''
  Now, of course, there is something slightly funny about all of this. 
I have not told Members who the trustees are. The trustees are 
Shalala--Secretary Shalala. She is one of these trustees. Treasury 
Secretary Rubin is another of these trustees. Labor Secretary Reich is 
a third member. Out of the six Medicare trustees, three are Cabinet 
Secretaries to this administration. The fourth also works for the 
administration.
  So, would we not think that the administration Cabinet Secretaries 
would recommend some specific action, Mr. President? Ultimately, they 
do not. Instead, they recommend that we create an advisory counsel that 
will provide information to help lead to the effective solutions to the 
problems of the program.
  The Cabinet Secretaries are apparently recommending that we continue 
to study the problem, that we engage in a study program instead of 
changing the program.
  Now, however, I want to tell Members the difference between citizens 
who do not represent this administration or any Members of Congress who 
are on this board who are trustees, I want to tell Members what they 
have to say, Mr. President. Citizens understand reality.
  I want to turn to trustees Nos. 5 and 6. These are public trustees, 
two citizens who do not work for the Government but have given their 
time over the past 5 years to this Nation. I understand by party 
affiliation one is a Democrat, one is a Republican. In any event, I 
thank them profusely. Their names are Stanford Ross and David Walker. 
Mr. Ross and Mr. Walker have been trustees for Medicare and the Social 
Security for the past 5 years.
 They 
[[Page S5189]] have been trustees during both the Bush and Clinton 
administrations. They are nonpolitical, private citizens charged with 
working in the best interests of senior citizens and our country. Most 
important, they do not answer to the White House.
  In the past, Mr. Ross and Mr. Walker have issued their own 
statements. Believe it or not, the trustees issued a report and the 
citizen members issue their own report in the back of the book because 
they do not agree with the public members.
  So, what do they have to say? I want to read some of these two public 
trustees' statements into the Record.

       The Medicare program is clearly unsustainable in its 
     present form.

  Further quote:

       With the results of last Congress, it is now clear that 
     Medicare reform needs to be addressed urgently as a distinct 
     legislative initiative.

  Continuing the quote:

       The idea that reductions in Medicare expenditures should be 
     available for other purposes, including even other health 
     care purposes, is mistaken.

  Why do I quote that? I will tell you a little more about that in a 
moment. Continuing on:

       The focus should be on making Medicare itself sustainable, 
     making it compatible with Social Security, and making both 
     [of them] financially sound in the long term.

  That is the end the quotes. Now, my own conclusions from that.
  That is what public, nonpolitical trustees say we should do about 
Medicare and that is exactly what I hope we are going to do. I would be 
quick to add, as Senator Chafee has pointed out, when Congress 
increased taxes on Social Security benefits in 1993, it devoted the 
increased revenues to this HI trust fund. Therefore there should be no 
doubt, if we now repeal that increase we would be lowering the amount 
of money going into this HI fund, causing the system to go bankrupt 
even sooner.
  We must enact comprehensive Medicare reform to make Medicare 
financially sound now. And we must do that so it will be manageable and 
sound over the long term. We must make it sustainable and do that now. 
We must act to preserve the system, to ensure that our senior citizens 
receive Medicare today and will continue to receive it in 7 years from 
now. There is nothing magical about it. We have to do something. If we 
do not do anything it will be bankrupt. Current seniors for the next 5 
or 6 years will get their hospital bill paid as per the law, but 
thereafter they will not.
  What kind of public servants and leaders are we, if we do nothing 
again? So I am committing today that the U.S. Senate Budget Committee 
is going to mark up a budget resolution. After we return from this 
recess that will get done. At least from my standpoint, as chairman, I 
commit to a blueprint that not only achieves balance in terms of our 
fiscal house, but also addresses this critical problem. In order to 
make Medicare financially sound and a financially sound program once 
again, Congress will have to follow.
  I made a comment that I did not follow up on, where I said the 
nonpolitical trustees, the two who are not Members of the President's 
Cabinet, said that Medicare savings should be used--Senator Gorton--to 
make the program solvent. Not to pay for something else.
  One might say, ``Who intends to spend them for something else? What 
are you talking about?'' I suggest the President ought to let us know 
what he has in mind. He proposed a $130 billion in Medicare savings 2 
years ago. He did not help with this, not one bit. Because he spent the 
money. He spent it to cover other people with health care coverage 
problems. I submit that one of the reasons the President of the United 
States did not put Medicare reform in his budget is because he intends 
to use Medicare reform savings to pay for health care reform, not to 
put it on the deficit. I submit we ought to have that debate.
  We ought to ask the American people: Do you want to make this program 
solvent as it should be, or do you want to take savings that you can 
get from reform and decide we are so rich we can just spend it on 
another program? That is simple and that is oversimplification, but it 
is the real question. Some will say, Senator Domenici, it is not that 
simple. We need to cover all the other people who are not covered and 
it will ultimately help this program. But to tell you the truth, that 
is very, very difficult to understand. It is very difficult to figure 
we are really going to do that someday.
  So I submit in the next 6 months this body, the U.S. Senate, has a 
real chance to vote on whether they are going to make this program for 
future senior citizens and those who have been paying into this fund 
for a long time, this 2.9 percent--for those, are we going to make it 
solvent or not? I believe there is a way to do it without a huge amount 
of pain. I might just suggest it is amazing that the two programs, big 
programs in health care that are still on a hell-bent-for-bankruptcy 
growth line are the two programs the U.S. Federal Government still 
runs.
  There are no other programs that are growing at 10 percent a year. Go 
ask businesses, are they paying 10 percent more, year after year, for 
insurance coverage for their employees? They will tell you no. It was 
14 percent or 15 percent 3 years ago, but it is down to 4 and 5 in some 
cases. In fact, we got a report the other day, some of them that were 
growing at 12 or 13 percent are now down at no growth, getting the same 
coverage. Why? Because they are trying new delivery systems. They are 
trying managed care. They are trying health maintenance organizations. 
They are trying those kinds of delivery systems which everybody knows 
are inevitable.
  But we hang onto Medicare and we lead our senior citizens to believe 
that they are only going to get good health care if we keep the system 
that the rest of the public is beginning to say does not work, it is 
too expensive. So that is why we can fix this and we can fix it without 
denying our senior citizens good, solid health care. And the programs 
must continue to grow because we know health care for seniors cannot be 
a zero sum game.
  So I thought we ought to tie in, today, sort of the first 
presentation of the issue with reference to fiscal policy. If you do 
not want to fix this you probably do not want a balanced budget and, 
more important than anything else, you probably do not want to do 
anything very difficult to get to a balanced budget.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Rhode Island.
  Mr. PELL. Mr. President, I ask unanimous consent I may proceed as in 
mornings business.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  

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