[Congressional Record Volume 141, Number 160 (Tuesday, October 17, 1995)]
[House]
[Pages H10121-H10122]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




      REPUBLICANS MEDICARE BILL WORSENS PROBLEM OF FRAUD AND ABUSE

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from New Jersey [Mr. Pallone] is recognized for 5 minutes.
  Mr. PALLONE. Mr. Speaker, I also want to address the problem of 
waste, fraud, and abuse in Medicare and say that I am very pleased to 
be a cosponsor, an original cosponsor, of the gentleman from 
Connecticut, Ms. DeLauro's, bill to deal with the problem.
  As she pointed out, she is trying to address this problem. But, 
unfortunately, the Republican leadership, in their Medicare bill, which 
we are going to vote on, I understand, this Thursday, does not. In 
fact, Speaker Gingrich's proposal, the Republican leadership proposal 
on Medicare actually makes the problem of waste, fraud, and abuse in 
the Medicare Program seriously worse.
  The reason for that is, essentially what the Republican leadership is 
doing with this Medicare bill is trying to achieve savings by cutting 
Medicare to provide money for a tax cut primarily for the well-to-do. 
So their concern about problems dealing with waste, fraud, and abuse is 
really relatively minor in the overall bill that they have and that 
they will bring before the House.
  I am concerned, Mr. Speaker, because we had a hearing, we were not 
allowed a hearing in the Committee on Commerce, which I sit on, to 
actually deal with the Republican Medicare proposal, but we decided 
that we would have our own hearing. And the day after the bill was 
first presented to us last week, we had our own Democratic hearing on 
Medicare. Interestingly enough, a number of representatives from the 
various Federal agencies that go after those who abuse the Medicare 
System, or commit fraud on the Medicare System, testified to the 
problems that exist in this bill with fraud and abuse.
  Essentially, Mr. Speaker, what they say is that the Medicare 
restructuring proposed by Speaker Gingrich and the Republican 
leadership actually weakens the Government's ability to weed out bad 
practices and Medicare scams. Over the course of 7 years, $126 billion 
could be saved by reducing fraud and abuse, but the GOP bill makes the 
existing civil monetary penalties and the antikickback laws 
considerably more lenient. According to the inspector general of the 
Department of Health and Human Services, the Medicare restructuring 
legislation by the Republicans would substantially increase the 
Government's burden of proof in cases under the Medicare-Medicaid 
antikickback statute. And although a fund would be created to direct 
money recovered from wrongdoers, this fund would not go to further law 
enforcement efforts.
  Now, just to put this in perspective, here we are, pursuant to this 
Republican proposal, squeezing every last dime or nickel out of the 
Medicare Program with these spending caps that limit how much can be 
spent on Medicare, and in the context of that, with our health care 
system and the quality of our health care system significantly 
declining because of these cuts, we are now, instead of addressing 
fraud and abuse and trying to save some more money there, actually 
making it easier for fraud and abuse to take place.
  Mr. Speaker, I think one of the speakers mentioned that the 
Congressional Budget Office actually estimated that over the 7 years of 
this Republican Medicare Program, the regulatory relief would actually 
incur an additional expense of $1.1 billion. In other words, it would 
cost us another billion dollars or more in this Medicare Program 
because of the relaxation of the laws that deal with fraud and abuse.

  Now, I just want to just give some brief statements that were made by 
June Gibbs Brown, the inspector general of the U.S. Department of 
Health and Human Services, at our Commerce alternative hearing on 
October 3, because she basically specifies why it is true that this 
Republican bill will cripple efforts of the Federal and State law 
enforcement agencies to control fraud and abuse in the Medicare system.
  She says, ``We believe that H.R. 2425 contains several provisions 
which would seriously erode our ability to address Medicare and 
Medicaid fraud and abuse.''
  Here are some of the examples she cites. ``The bill would make the 
existing civil monetary penalty and anti-kickback laws considerably 
more lenient.'' She goes on to say, ``The bill would relieve providers 
of the legal duty to use reasonable diligence for ensuring that the 
claims they submit to Medicare and Medicaid are true and accurate. This 
will have the effect of increasing the government's burden of proof in 
cases under the civil monetary penalties law. In an era where there is 
great concern about fraud and abuse in the Medicare and Medicaid 
Programs, it would not be appropriate to relieve providers of the duty 
to use reasonable diligence to ensure that their claims for payment are 
truthful and accurate.''
  She then says, ``The bill would substantially increase the 
government's burden of proof in cases under the Medicare-Medicaid 
antikickback statutes. For the vast majority of present-day kickback 
schemes, the proposed legislation would place an insurmountable burden 
of proof on the government.''
  She then says, ``The bill would create new exemptions to the 
Medicare-Medicaid antikickback statute, which could be readily 
exploited by those who wish to pay rewards or incentives to physicians 
for the referral of patients.''

[[Page H 10122]]

  But worst of all, Mr. Speaker, even though the bill creates a fund 
for directing moneys recovered from wrongdoers, the moneys do not go to 
the enforcement agencies within the Government to continue their 
efforts to try to stop fraud and abuse. It is incredible to me, Mr. 
Speaker, that in all the talk about Medicare, that this is what we have 
in this Republican bill.

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