[Congressional Record Volume 141, Number 160 (Tuesday, October 17, 1995)]
[House]
[Pages H10082-H10083]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




               THE GOAL OF THE MEDICARE PRESERVATION ACT

  The SPEAKER pro tempore. Under the Speaker's announced policy of May 
12, 1995, the gentleman from Ohio [Mr. Hoke] is recognized during 
morning business for 5 minutes.
  Mr. HOKE. Mr. Speaker, on April 3, 1995, the Medicare trustees, which 
include three members of the President's Cabinet, issued the following 
warning: ``Medicare begins going bankrupt next year, and unless prompt 
and decisive action is taken, Medicare will be completely out of money 
by 2002.''
  There is no reason to doubt the accuracy of the report or its 
conclusion, and I urge every American to obtain an official summary of 
the report from their Congressman's or Congresswoman's office to judge 
for themselves. They can get that by calling 202-225-3121, that is, 
202-225-3121. Ask for an official 14 page summary of the Medicare 
trustees' report.
  This week, the House of Representatives will take a giant step 
forward toward putting Medicare back on sound fiscal footing and giving 
our seniors the same choices enjoyed by Federal employees, including 
Members of Congress and all citizens in the private sector when it 
passes the Medicare Preservation Act of 1995.
  The goal of the Medicare Preservation Act is to preserve Medicare for 
current beneficiaries, protect future beneficiaries, and strengthen it 
through reforms that have been tested and proven in the private sector. 
The bottom line is that if Medicare is not reformed, either seniors 
will be forced to accept sharply curtailed medical services or working 
Americans will be forced to pay increased payroll taxes estimated by 
the Heritage Foundation to cost my constituents in northeastern Ohio an 
average of an additional $1,200 per year.
  Under the Medicare Preservation Act, total Medicare spending will 
increase, will increase, will increase, will increase 54 percent from 
$161 billion in 1995 to $274 billion in 2002.

                              {time}  1245

  On an annual per beneficiary basis, average spending will increase, 
that was increase, from $4,800 today to more than $6,700 in 2002. 
Obviously not only is Medicare not being cut, but at an average 
increase of about 6.5 percent per year it will grow faster than the 
current 2.3 percent of private sector medical inflation and more than 
fast enough to accommodate all new entrants into the system. Only in 
the bizarre and convoluted world of Washington bookkeeping and partisan 
bickering can such an indisputable spending increase be called a cut.
  The Medicare Preservation Act will give seniors the same four choices 
that all Federal employees, including Members of Congress, have. First, 
if they want to, seniors can stay with the current Medicare system 
exactly as it is today, and, if they choose another option and decide 
later they want to return to traditional Medicare, they can do that, 
too. No senior citizen will be forced to give up his or her current 
Medicare coverage, switch doctors, or be forced into a plan that they 
do not want.
  Second, seniors can opt for managed care and join a health 
maintenance organization, or HMO, in which beneficiaries agree to 
receive their medical care from a defined pool of providers in exchange 
for lower out-of-pocket expenses and broader coverage, which might 
include prescription drugs, dental care, and eye wear. Many seniors, 
particularly those those private physicians are already associated with 
the HMO that they choose, will find this to be an attractive 
alternative.

  Third, seniors can opt for a medical savings account plan which uses 
the beneficiary's Medicare stipend to fund both catastrophic health 
insurance plus an MSA, a medical savings account, out of which seniors 
would pay for routine medical needs. Seniors choosing this plan would 
have complete control over the money they spend on medical care, and 
any money left over in the medical savings account at the end of the 
year would belong to the senior, not to the insurance company nor to 
the Government. Seniors can join provider service networks similar to 
HMO's organized by doctors and hospitals themselves.
  The Medicare Preservation Act will also aggressively attack waste, 
fraud, and abuse that has contributed so much to Medicare's rising 
costs. Incredibly, the Congressional Budget Office has estimated that 
as much as 20 percent of Medicare spending is fraudulent. The Medicare 
Preservation Act requires the Department of Health and Human Services 
to identify and eliminate these huge losses, including financially 
rewarding Medicare recipients who report abuses. It makes doctors and 
hospitals accountable for their actions, and imposes stiff new 
penalties on anyone caught defrauding Medicare.
  Another important point is that the portion of Medicare part B costs 
paid by seniors through premiums, currently 31.5 percent, will not 
change. Over the past 7 years, part B premiums have nearly doubled, 
rising from $24.80 in 1988 to $46.10 today.

[[Page H 10083]]

  Mr. Speaker, that is the plan. It is innovative, responsible, and 
cost effective, and we are going to pass it on Thursday.

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