[Congressional Record Volume 141, Number 73 (Thursday, May 4, 1995)]
[Senate]
[Pages S6162-S6163]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          MEDICARE INSOLVENCY

  Mr. DASCHLE. Mr. President, I was not in the Chamber an hour ago when 
the distinguished Senator from Utah, my colleague, Senator Bennett, 
commented on remarks that I made earlier this morning. He is a person 
for whom I have immense respect and who I believe is a great student of 
many of the issues we address on the floor. But he and I have a very 
fundamental difference of opinion with regard to Medicare, and I wish 
to respond briefly to comments that he made today on that issue. I 
invite his reaction if he is within the sound of my voice.
  He said in his remarks the Medicare trustees' report predicting 
insolvency only became available in April 1995; that it was not 
available 2 years ago when the President's deficit reduction package 
was debated.
  The fact is that the Medicare trustees' report is available every 
year for all Members of Congress to see, and every year the report has 
been predicting insolvency of the Medicare trust fund, sometime between 
1999 and the year 2003. So there should be no surprise with regard to 
the predictions of this year's trustees' report. I think the question 
is, how we will generate Medicare savings over the course of the next 
year, and how will we use those savings.
  There are some who have advocated providing a significant tax cut for 
the wealthy. I think it is fair to say that when you cut Medicare to 
the extent that some have proposed it be cut, and then you propose a 
similar decrease in taxes for the very wealthiest among us, one would 
have to conclude that the cuts in Medicare will be used to pay for the 
tax cut for the wealthy. That was the main point I was making.
  Regardless of whether people are willing to make that association, as 
valid as I believe it is, I think it is very clear everyone recognizes 
that, indeed, the Medicare trust fund is in serious trouble. In fact, 
the President's 1993 deficit reduction package addressed this issue 
through proposals designed to delay insolvency for several more years. 
Before the President's deficit reduction package was enacted, the 
trustees' report indicated the trust fund would be insolvent by 1999. 
As a result of the enactment of the 1993 reconciliation package, which 
all Democrats supported and every Republican opposed, we have been able 
to extend the viability of the trust fund for 3 more years, from the 
year 1999 to the year 2002. So we have made progress.
  What many of us are saying now is, if we are going to continue to 
make progress, then clearly we have to go beyond what the 
reconciliation package did with respect to strengthening Medicare.
  What we said last year is that we have to pass meaningful health care 
reform if we are to reduce further the rate of Medicare growth, without 
hurting beneficiaries and shifting costs onto families and businesses.
  That is what we attempted to do last year. The Senator from Utah 
indicated that the President last year argued we needed $118 billion in 
additional Medicare cuts. Well, the President proposed these reductions 
in the rate of growth of Medicare in the context of a health reform 
proposal that assured costs would not be shifted onto the private 
sector. Clearly we get cost shifting to the private sector when we cut 
Medicare without addressing private sector health care cost problems. 
That is why so many of us argued for so long--and, unfortunately, with 
so little success--last year that if we are ever going to solve 
Medicare's problems, we have to address our entire health care system's 
problems. Unfortunately, Republicans opposed that effort last year.
  So, Mr. President, my point in addressing this issue is to clarify 
again what I believe to be the real issue. The real issue is that we 
have to make meaningful reforms to Medicare without adversely affecting 
the beneficiaries and without passing whatever savings we generate on 
to the wealthiest among us in the form of another tax cut. Real reform 
is not cutting benefits to the elderly or simply shifting more costs 
onto them. Real reform must ensure more efficient functioning and 
administration of the program.
  The last issue that I wish to raise with regard to Medicare has to do 
with the chart the distinguished Senator from Utah used. My chart is 
not nearly as fancy because we didn't have time to make such an elegant 
chart, but I think it illustrates my point.
  The Senator from Utah indicated that Medicare costs were going up 
faster than costs in the private sector.
  Well, this is only true if you look at overall costs. But if you look 
at a more meaningful statistic, per capita health care costs, as this 
chart indicates--on a per enrollee basis, from 1976 to 1984, Medicare 
costs rose only slightly faster than private sector costs, 14.2 
percent, versus 14 percent for the private sector.
  But look what has happened from the years 1984 to 1993. In that 
timeframe, 1984 to 1993, about 10 years, the actual increase in private 
sector per enrollee costs was 9.8 percent. The increase in Medicare per 
enrollee costs was 7.7 percent.
  These are numbers given to us from HCFA, and I think they make the 
point I was trying to make again this morning. On a per enrollee basis, 
there is no 
[[Page S6163]] doubt that Medicare costs over the last 10 years have 
not grown as quickly as they have in the private sector. But that, in 
part, is because we are continuing to do what I just said we do not 
want to do any more. We do not want to pass Medicare costs on to the 
private sector. We do not want to say, in the name of reform, all we 
are going to do is let the private sector take on greater 
responsibility for health costs.
  We have to solve the problem of skyrocketing costs in the private 
sector, as well as those costs in Government. And that is exactly what 
I said this morning and what I hope we can continue to focus on as we 
consider the Medicare debate.

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