[Congressional Record Volume 141, Number 124 (Friday, July 28, 1995)]
[Senate]
[Pages S10869-S10871]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                                MEDICARE

  Mr. DOMENICI. Mr. President, I am sorry I could not be on the floor 
during the remarks of Senator Kennedy with reference to health care in 
the United States, and in particular Medicare. By coincidence, 
unbeknownst that he would speak, I had prepared for myself to deliver 
today--since we are at about the 30th anniversary date of the passage 
of Medicare--a speech that I am prepared to give to the Senate. I 
believe I heard enough of the Senator's remarks that, at some point, I 
will depart from the speech and answer a few of the comments made.
  I will start right off by saying that it is unfair to the senior 
citizens of the United States to talk about what might be, or how 
things ought to be, and not tell them how things are.
  The fact of the matter is that the cornerstone of hospital health 
care for our seniors--Medicare--is in big trouble. And to make a speech 
about the seniors and scare them about the future, without telling them 
the truth, does not seem to me to be the right way to treat our 
seniors, who are filled with wisdom, understanding, and truly think 
this is a great Nation and would like very much to do their share to 
try to fix some things that are going wrong.
  So the No. 1 point is that there has been in existence a group of 
Americans who reviewed thoroughly the status, the financial status, and 
the delivery system called Medicare. Mr. President, that is not a 
Republican group. As a matter of fact, one might call it, if you seek 
to partisanize it, a Democratic group, because three Cabinet members of 
this President and the appointee of this President who heads Social 
Security were four members of the Commission--the majority. There are 
only two more. And all six of them, including the four, wrote a report 
to the people of this country, the seniors, the President, and the 
Congress, and told us in no uncertain language that the Medicare 
Program was in trouble because it was costing too much. I just want to 
read their recommendation so that we put everything into perspective. 
Their final words of real recommendation were the following:

       We strongly recommend that the crisis presented by the 
     financial condition of Medicare trust funds be urgently 
     addressed on a comprehensive basis, including a review of the 
     program's financing methods, benefit programs, and delivery 
     system.

  Now, Mr. President, you would not have gathered from the comments of 
the distinguished Senator from Massachusetts that anything like this 
had even happened. Here sits a report--I wish I had a copy of it. If I 
am going to talk about it, I should bring it around. When I saw it, it 
was a little yellow notebook with a yellow cover, properly styled. I 
repeat, the Commissioners, four of whom work for this President, said 
the time is now--and I am going to repeat what they said we ought to be 
doing.
  It is very, very simple. But Members would not have heard it from the 
speech of the Senator from Massachusetts. They said, ``It is time to 
review the program's financing methods, benefit provisions, and 
delivery mechanism.''
  Now, why did they say that? Members would not have gathered this, 
either, from the remarks. They said there will be no money in 7 years 
to pay the bills. We would not have known that, either, from the 
remarks about all the evil and bad things that will happen to seniors.
  The worst of all things is that there be no program, that they cannot 
pay their bills in 7 years. That is, really, something to call to the 
attention of the senior citizens of the United States.
  Then say, ``What is wrong with doing just what they said? Review the 
program's financing methods, benefit provisions, and delivery 
mechanisms.''
  Now, Mr. President, if we look at what was proposed in the budget 
resolution for this country, it is on all fours with the 
recommendations of the commission that reports on the financial 
condition of the system. If we take what they said and find out what we 
ought to do, we ought to save a given amount of money to the health 
care insurance over the next 7 years in order to make that system stay 
solvent and not be bankrupt.
  The budget resolution says that is what we ought to do. Now, 
everybody ought to understand that Medicare is growing at about 10 
percent a year. They mention that too, in the report. It cannot 
continue to grow at that pace and there still be money in the trust 
fund in 7 years to pay the bill.
  It falls on someone to take a look at how we might do it better, give 
the seniors options, and perhaps cost the trust fund less money.
  Now, that is what all of this is about. No matter how we talk about 
it, the truth of the matter is that many people in the U.S. Congress 
felt it was time to look at this and fix it. In fixing it, we just 
might give the senior citizens a pretty good hospital program that will 
cost very little more to them, but will cost less, because it will be 
more efficient.
  We will take the fraud and waste out of the program and cause the 
delivery system to be restructured so you still have choice of your own 
doctor, but there is choice of plans, and perhaps over time we would 
save substantial amounts of money.
  Now, Mr. President, before I read my anniversary speech on Medicare, 
I want to make one other comment. Those who oppose fixing the Medicare 
Program now cannot miss a beat without saying the Republicans are going 
to cut the taxes for the rich, and that is why they are fixing 
Medicare.
  Now, Mr. President, and anyone listening, that is not true. First of 
all, if we take the so-called tax cuts that are proposed off the 
table--just do not do them--and the Medicare system will be bankrupt in 
7 years. Let me repeat: The so-called tax cuts--and we will talk about 
them in a minute--if we take them off the table, we would not have 
gathered from the remarks of the distinguished Senator from 
Massachusetts that the Medicare system will still be broke. They are 
completely different issues.
  If we do not fix the Medicare system, it will be short of funds, and 
cutting people's taxes has nothing to do with that unless Members would 
like to raise taxes to pay for Medicare. I have not heard anybody say 
that. But if we want to raise taxes, then we could talk about the 
program not having to be reduced in terms of cost. Mr. President, that 
is the fact.
  In addition, in the U.S. Senate, the sense of this Senate has been 
that if we ever get tax cuts, and when we do, that 90 percent of the 
tax cuts will go to people with income under $100,000. Now, there is a 
difference of opinion in this body on how that tax package will look 
when it comes out, if it comes out.
  Essentially, to continue to try to say, ``Let's don't fix Medicare so 
it will be available 7 years from now,'' instead of dying on its 37th 
anniversary, go beyond the 37th, perhaps to 40 and beyond, instead of 
addressing that issue to talk about tax cuts for the rich does not help 
the senior citizens one single bit.
  What it does help, it helps to make a political issue out of a 
situation that 

[[Page S 10870]]
need not be politicized, for we actually ought to be joining hands 
across this aisle and with the President in fixing Medicare. I repeat, 
the tax cuts that are referred to in the Republican budget--take them 
out, and we still have to fix Medicare, because the money will not be 
there in 7 years. That is for certain.
  Having said that, Mr. President, let me repeat, there are some who 
would insist that we are making changes to Medicare for other reasons. 
They may say we are changing it to balance the budget, or changing 
Medicare to lessen the tax burden on families.
  Both of these claims are false. We are making changes in Medicare to 
save the program, to strengthen it so it can survive into the next 
century, and so Senators will be here well into the next century, able 
to congratulate the program and its founders on its anniversaries.
  Any attempt to link that with cutting taxes is to no avail for the 
seniors of this country. Any attempt to link the two is, plain and 
simple, smoke and mirrors, from the opponents of reform. For there are 
still some--and I do not know, perhaps my friend from Massachusetts is 
one--who would stand and say the status quo for Medicare is good enough 
for seniors.
  Do not worry about it, leave it alone. Now, the President said that 
in his first budget--``Leave it alone.'' However, the President of the 
United States even came around, and in a 10-year proposal for a 
balanced budget, although it did not get there, even the President 
suggested that dramatic reform had to occur in the Medicare Program in 
an effort to keep it solvent.
  This was in June when the new budget was submitted, our new budget 
proposal. The President claimed that would save Medicare; that budget 
made a good start. His budget would save $127 billion from Medicare 
over the next 7 years--the same length of time as our budget.
  Now, some are comparing the $127 billion in his budget, and saying we 
do not need the $270 billion to fix the program in our budget. I submit 
that the facts are our way. The experts on budget come down on our 
side.
  We would like, very much, in the month of September, as part of a 
process up here, after hearings, meetings, input from senior groups, we 
would like to try our hand at reforming this.
  Mr. President, there are still some who leave the impression with 
senior citizens that we are truly cutting the Medicare Program. Let me 
straighten that out with some real facts. First, we are going to slow 
the rate of growth of the program. Medicare spending will grow at 6.4 
percent a year under our plan. To put it another way, and a more 
understandable way, over the next 7 years Medicare spending is going to 
increase from $4,800 per person to $6,700 per person--not down, up. 
From $4,800 to $6,700.
  I know many are very concerned about the future and what kind of 
future they are going to leave their children and grandchildren. And I 
believe, when the time comes, that when the program of reform is put 
before the American people it will be seen as an effort to deliver the 
same kind of care in different ways, to get rid of the fraud and abuse 
in the program, and ultimately to provide our senior citizens with far 
more options. They are operating under a program that is essentially 30 
years old, and it is also that old in terms of what kind of a delivery 
system it is. While all kinds of modern ways to deliver health care, 
all kinds of ways of insuring people, permitting a variety of options 
of insurance coverage now exist, Medicare is stuck in history. It is a 
30-year-old system.
  We believe reform will cause seniors to get a better deal. There will 
be incentives built in which will make it easier, rather than more 
difficult, for seniors to purchase more of what they might want and 
less of what they might not want. Yes, there will be options for them 
to keep the very system they have and their own doctors.
  So I want to just close by once again stating the caliber of the 
people who recommended that we ought to do something to fix this 
program--three of this President's Cabinet Members: then-Secretary 
Bentsen of Treasury, Secretary Shalala, and Secretary Reich. They are 
trustees of this system. And there were two public trustees, and they 
told us that we ought to fix the system. They told us it will not be 
around in 7 years. It will not have any money to pay the bills.
  In a way, they said--and I am interpreting this--it is costing too 
much. Will you not take a look and see if you cannot do it better, 
cheaper, and protect not only the seniors who are using it now but 
seniors for a long time to come?
  As I said, this Sunday, July 30, is the 30th anniversary of Medicare. 
For 30 years, Medicare has provided health protection to elderly and 
disabled citizens.
  Medicare has been a successful program. Medicare has provided an 
important source of health security and needed health benefits to 
millions of Americans since its inception 30 years ago. Today, 37 
million Americans receive the benefits and health security that 
Medicare provides.
  But Medicare has also become an expensive program, and everyone--
including the President--agrees that the system needs fundamental 
structural reform.
  Medicare is running out of money. Unless we make changes now, 
Medicare will not continue to provide this same level of health 
security in the future.
  Nevertheless, this past week, the President held a rally for 
Medicare. But all he talked about was the past. The President forgot 
the most important element of an anniversary celebration. He forgot to 
look toward the future. If the President fights the reforms necessary 
to save Medicare's future, then in just 7 years, on the 37th 
anniversary of Medicare, the program will be bankrupt.
  In the President's first budget, which he sent to us in February, 
Medicare would go bankrupt in 2002. Seven more years; that's all the 
President would give Medicare. After that, there would be no money to 
pay Medicare hospital benefits. The President would let you choose your 
doctor, but there would be no money to pay your hospital bills.
  The President's original Medicare proposal was great--for the next 7 
years. But the 37th anniversary of Medicare would be its last. Under 
the President's original plan, if you're on Medicare, you better not 
get sick 8 years from now.
  Back in January, the President did not listen to his own Cabinet 
Secretaries. Three of his Cabinet officers--Secretary Bentsen, 
Secretary Shalala, and Secretary Reich, are trustees of the Medicare 
system. Along with the two public trustees, they told the President and 
the Congress that the Medicare hospital insurance trust fund had only 
enough money to pay benefits for the next 7 years.
  The President chose to ignore that. The Republicans in Congress did 
not. We invited the public trustees up to Capitol Hill, to tell us what 
needs to be done. We listened carefully, and now we are taking their 
advice.
  Let me read from the summary of the trustees' report. The full board 
of trustees say, ``The Hospital Insurance Trust Fund * * * will be able 
to pay benefits for only about 7 years and is severely out of financial 
balance in the long range.
  The two public trustees tell us that:

       The most critical issues relate to the Medicare Program. 
     Both the Hospital Insurance Trust Fund and the Supplementary 
     Medical Insurance Trust Fund show alarming results. . . . The 
     Medicare program is clearly unsustainable in its present 
     form. . . . We feel strongly that comprehensive Medicare 
     reforms should be undertaken to make this program financially 
     sound now and over the long term. We strongly recommend that 
     the crisis presented by the financial condition of the 
     Medicare Trust Funds be urgently addressed on a comprehensive 
     basis, including a review of the program's financing methods, 
     benefit provisions, and delivery mechanisms.

  This is what the public trustees of Medicare recommend we do to 
strengthen Medicare for the future. And this is exactly what we are 
doing now.
  There are those who claim that we are making changes to Medicare for 
other reasons. They say we are changing Medicare to balance the budget, 
or we are changing Medicare to lessen the tax burden on working 
families.
  Both of those claims are false. We are making changes to Medicare to 
save the program, to strengthen Medicare so it can survive into the 
next century. Even if we were not balancing the budget, we would need 
to save Medicare. And whether or not we cut taxes, we still need to 
save Medicare. Any attempt to link the two is nothing more 

[[Page S 10871]]
than blue smoke and mirrors from the opponents of reform.
  The Republicans in Congress have chosen to look toward Medicare's 
future. We decided this spring that we would save Medicare from 
bankruptcy, control the growth of program costs, and ensure that the 
program would survive past its 40th anniversary. We developed and 
passed a budget plan in June that guaranteed a strong Medicare into the 
next century.
  Suddenly, the President decided to join us. In June, he submitted a 
new budget proposal, one which he claimed would save Medicare.
  In June, the President made a good start. His budget would save $127 
billion from Medicare over the next 7 years. He is now comparing that 
with our budget, which will slow the program's rate of growth by $270 
billion over the next 7 years.
  If I believed that we could save Medicare by doing only what the 
President wants to do, I would do so in a second. But, after a long, 
hard look at the numbers, and after extensive discussions with the 
Congressional Budget Office, I do not think the President's plan saves 
Medicare.
  You see, the President has assumed that the costs of the program will 
not grow as fast as projected by the nonpartisan Congressional Budget 
Office.
  The President's June budget assumes that a serious Medicare problem 
does not exist. He says the problem is not as hard to solve as CBO says 
it is. The President is much more optimistic in his assumptions than 
CBO.
  I wish that were true, but I am afraid it is not. As much as the 
President wishes it would, the problem will not go away.
  The President has come a long way since his first budget in January. 
Now all he has to do is agree to use the honest, objective, and 
nonpartisan CBO numbers, and we will have an excellent starting point 
for discussions.
  All he has to do is live up to the commitment he made in his first 
State of the Union address, his promise that he would use CBO numbers.
  We in Congress use CBO numbers. The honest, responsible way to budget 
is to rely on a single source for our assumptions, and that is what we 
did both in our budget plan, and in our plan to save Medicare. We did 
not make the problem go away by wishing that it would. We asked CBO and 
the trustees what it would take to save Medicare, to keep it alive for 
its 40th anniversary.
  The Trustees have told us what we must do. Now we are going to do it.
  We are going to slow the rate of growth of the program. Medicare 
spending will grow 6.4 percent per year under our plan. Over the next 7 
years, Medicare spending is going to increase from $4,800 per person, 
to $6,700 per person.
  I know that older Americans are seriously concerned about the future 
they will leave to their children and their grandchildren. I have found 
that senior citizens are extremely concerned about the crushing burden 
of the debt that our current policies will place on their 
grandchildren.
  And I know they want a Medicare program that is fair, both for them, 
and for future generations. I also know that a 65-year old couple that 
starts receiving Medicare this year will, over their lifetimes, receive 
$117,000 more in Medicare benefits than they will put into the system 
in payroll taxes and premiums.
  I know that this will concern many seniors, who want Medicare to be 
there in the future for them, for their kids, and for their 
grandchildren.
  We are going to spend nearly 5 percent more per year on each Medicare 
beneficiary in this budget. So anyone who tells you that we are cutting 
Medicare is just trying to scare you.
  What honestly should scare America's senior and disabled citizens is 
the prospect that we will do nothing. For if we do nothing, seniors 
will have hospital benefits for only 7 more years.
  If we do nothing, seniors will be able to keep their doctor, but only 
for the next 7 years. After that, you will still have your doctor, but 
he will not be able to treat you in a hospital. After that, the 
hospital insurance trust fund will run out of money, and Medicare will 
not be able to pay hospital benefits.
  I want to make sure that our seniors can keep their existing 
coverage.
  I want to give them the opportunity to choose other health plans, 
just like my colleagues and I in the Senate can choose our health 
plans.
  And most important, I want to make sure that they can do all these 
things for more than just the next 7 years.
  In September, we are going to report legislation that will strengthen 
Medicare. We are going to simplify Medicare. And we are going to make 
sure that every Medicare beneficiary has the right to choose their 
health plan, just like my fellow Senators and I have.
  We need to strengthen Medicare, and that we have to do this by 
controlling the program's rate of growth. The first thing we are doing 
is attacking the waste and fraud in the system. Every senior currently 
receiving Medicare knows that the system is inefficient, complex, and 
filled with opportunities for waste and fraud. We are going after that 
money first.
  But all the experts tell us that will not be enough. We are going to 
do it, but then we are going to have to look at changes to the program, 
in both the short and the long run.
  In the short run, we are going to look at how much we pay doctors and 
hospitals, and the way we pay doctors and hospitals for the services 
you receive. We are going to try to create the right incentives so that 
doctors and hospitals are smart about how they spend your money.
  Most importantly, we are going to offer seniors more choices. As a 
U.S. Senator, I have the ability to choose my health plan once a year. 
If I want a generous program with lots of benefits and no deductible, I 
pay a bit more. In some areas of the country, Medicare already allows 
seniors these choices.
  We are going to expand this program, and gradually change the system 
so that all seniors have choices like we have in the Senate.
  Some seniors are going to have to pay a little bit more. There is no 
way we can get around that. But we are going to come to the seniors 
last, after we have attacked the waste and fraud in the system, after 
we have made changes to the way we pay doctors and hospitals, and after 
we have started to phase in changes that provide seniors with more 
choices.
  Any changes we make will be phased in gradually over time. We know 
that seniors on fixed incomes have difficulty adjusting to dramatic 
changes, and we are taking that into account.
  We also know that some seniors with higher incomes have a greater 
ability to adapt to changes than others. We may ask those seniors to 
pay a bit more, to compensate for those who have just enough income to 
get by.
  I will not let Medicare go bankrupt. Yes, I too celebrate the 30th 
anniversary of Medicare. It has been an important program, critical to 
the health of American's older and disabled citizens.
  But right now, I am thinking about how we are going to make sure 
Medicare has a 40th anniversary and beyond.
  The PRESIDING OFFICER. The Senator from Idaho.
  Mr. CRAIG. Mr. President, I inquire as to what order we are in?
  The PRESIDING OFFICER. Under unanimous consent, morning business has 
been extended until 2 p.m. Senators may speak up to 5 minutes.
  Mr. CRAIG. Mr. President, I ask unanimous consent to speak for up to 
5 minutes in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________