[Congressional Record Volume 141, Number 205 (Wednesday, December 20, 1995)]
[Senate]
[Pages S19001-S19010]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

[[Page S19001]]


          STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS

      By Mr. LAUTENBERG (for himself, Mr. Robb, Mr. Sarbanes, and Ms. 
        Mikulski)
  S. 1486. A bill to direct the Office of Personnel Management to 
establish placement programs for Federal employees affected by 
reduction in force actions, and for other purposes.


           the public servant priority placement act of 1995

  Mr. LAUTENBERG. Mr. President, I rise today with Senators Robb, 
Sarbanes, and Mikulski to introduce the Public Servant Priority 
Placement Act, a bill to assist Federal workers who lose their jobs as 
a result of downsizing. This legislation would require Government 
agencies to give priority consideration to these employees when filling 
vacancies.
  Mr. President, the Federal Government is in the process of 
significant downsizing, and that process is likely to intensify 
substantially in the coming years. Under current law, 272,000 civilian 
positions will be eliminated by fiscal year 1999. If an agreement is 
reached to balance the budget, that number probably will be much 
larger.
  Mr. President, it is easy for some to ignore the plight of these 
workers by talking derisively of so-called faceless bureaucrats. But 
all of these workers are human beings with families, bills to pay, and 
obligations to meet. For most, getting laid off is a painful and 
traumatic event. And for many, the financial implications are severe.
  Most dislocated employees are hard-working, talented, skilled, and 
dedicated individuals who have contributed much to our Nation. They did 
not lose their jobs because they were lazy, or because they did poor 
work. They were simply innocent victims of forces larger than 
themselves.
  Mr. President, in an effort to assist these employees, and to ensure 
that their talents are not lost entirely to the Government, agencies 
have developed their own placement programs for former employees. The 
most successful such program is the Department of Defense's Priority 
Placement Program, or PPP. Under the program, involuntarily separated 
workers are granted a preference when vacancies are filled. Since PPP's 
inception in 1965, over 100,000 DOD employees have been placed 
successfully elsewhere in the Department. Unfortunately, the program's 
placement rate has been reduced in recent years because fewer job 
opportunities have been available.
  In coming years, few Federal agencies are likely to excape the budget 
axe. Some agencies probably will be eliminated altogether. It is 
critically important, therefore, that Congress work to ensure that all 
displaced workers get the support they need.
  Mr. President, the Office of Personnel Management operates two 
government-wide placement programs that supplement the efforts of 
individual agencies. Yet OPM's programs are not sufficient, in part 
because agencies all too often do not grant any preference to workers 
displaced from other agencies. According to a 1992 report by the 
General Accounting Office, in fiscal year 1991, OPM's programs had 
4,433 registrants and made 110 placements. Although OPM has made 
improvements to its programs since 1992, there clearly remains a need 
for a coordinated, mandatory, Governmentwide placement program.
  The Public Servant Priority Placement Act would direct OPM to 
establish such a program for RIF'd employees. It also would require 
agencies to institute their own intra-agency placement programs for 
these workers. Unlike the current placement programs, except for DOD's, 
agencies would be required to offer positions to dislocated workers if 
they are qualified.
  Under this legislation, if an agency has a vacancy it cannot fill 
internally, such as through a promotion, it would be required to offer 
that position to a qualified RIF'd employee of that agency who meets 
certain criteria relating to classification and pay, and who is located 
within the same commuting area. If no such employee exists, then that 
agency shall offer the vacancy to a comparably-situated, well-qualified 
RIF'd employee from another Federal agency. Should no RIF'd employee 
meet these criteria, then the agency may hire a person who is outside 
of the Federal Government.
  Mr. President, I introduced a very similar bill in the last Congress, 
and I am pleased that the concept has begun to attract support. A 
bipartisan bill was introduced a week and a half ago in the House, a 
component of which is almost identical to the bill we are introducing 
today. The Clinton administration also endorses the concept of a 
mandatory placement preference system.
  Mr. President, I urge my colleagues to support the bill and ask 
unanimous consent that a copy of the legislation be included in the 
Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 1486

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. PLACEMENT PROGRAMS FOR FEDERAL EMPLOYEES AFFECTED 
                   BY REDUCTION IN FORCE ACTIONS.

       (a) Short Title.--This Act may be cited as the ``Public 
     Servant Priority Placement Act of 1995''.
       (b) In General.--Subchapter I of chapter 33 of title 5, 
     United States Code, is amended by adding at the end thereof 
     the following new section:

     ``Sec. 3329b. Placement programs for Federal employees 
       affected by reduction in force actions

       ``(a) For purposes of this section the term ``agency'' 
     means an ``Executive agency'' as 

[[Page S19002]]
     defined under section 105, except such term shall not include the 
     General Accounting Office.
       ``(b) No later than 180 days after the date of the 
     enactment of this section, the Director of the Office of 
     Personnel Management shall establish a Government-wide 
     program and each agency shall establish an agency program to 
     facilitate employment placement for Federal employees who--
       ``(1) are scheduled to be separated from service under a 
     reduction in force under--
       ``(A) regulations prescribed under section 3502; or
       ``(B) procedures established under section 3595; or
       ``(2) are separated from service under such a reduction in 
     force.
       ``(c) Each agency placement program established under 
     subsection (b) shall provide a system to require the offer of 
     a vacant position in an agency to an employee of such agency 
     affected by a reduction in force action, if--
       ``(1) the position cannot be filled within the agency;
       ``(2) the employee to whom the offer is made is qualified 
     for the offered position;
       ``(3)(A) the classification of the offered position is 
     equal to or no more than one grade below the classification 
     of the employee's present or last held position; or
       ``(B)(i) the basic rate of pay of the offered position is 
     equal to the basic rate of pay of the employee's present or 
     last held position; or
       ``(ii) sections 5362 and 5363 apply to the basic rate of 
     pay of the employee in the offered position; and
       ``(4) the geographic location of the offered position is 
     within the commuting area of--
       ``(A) the residence of the employee; or
       ``(B) the location of the employee's present or last held 
     position.
       ``(d) The Government-wide placement program established 
     under subsection (b) shall--
       ``(1) coordinate with programs established by agencies for 
     the placement of agency employees affected by a reduction in 
     force action within such agency; and
       ``(2) provide a system to require the offer of a vacant 
     position in an agency to an employee of another agency 
     affected by a reduction in force action, if--
       ``(A) the vacant position cannot be filled through the 
     placement program or otherwise be filled from within the 
     agency in which the position is located;
       ``(B) the employee to whom the offer is made is well 
     qualified for the offered position;
       ``(C)(i) the classification of the offered position is 
     equal to the classification of the employee's present or last 
     held position; or
       ``(ii) the basic rate of pay of the offered position is 
     equal to the basic rate of pay of the employee's present or 
     last held position; and
       ``(D) the geographic location of the offered position is 
     within the commuting area of--
       ``(i) the residence of the employee; or
       ``(ii) the location of the employee's present or last held 
     position.
       ``(e)(1) The agency placement program established under 
     this section shall not affect any priority placement program 
     of the Department of Defense that is in operation on the date 
     of the enactment of this section.
       ``(2) The interagency placement program established under 
     this section shall not affect the priority of placement of 
     any employee under the agency placement program of such 
     employee's employing agency.''.
       (c) Technical and Conforming Amendments.--(1) The section 
     heading for the second section 3329 (relating to Government-
     wide list of vacant positions) is amended to read as follows:

     ``Sec. 3329a. Government-wide list of vacant positions''.

       (2) The table of sections for chapter 33 of title 5, United 
     States Code, is amended by striking out the item relating to 
     the second section 3329 (relating to Government-wide list of 
     vacant positions) and inserting in lieu thereof the 
     following:

``3329a. Government-wide list of vacant positions.
``3329b. Placement programs for Federal employees affected by reduction 
              in force actions.''.
                                 ______

      By Mr. McCAIN (for Mr. Gramm (for himself, Mr. Inouye, Mr. 
        McCain, Mrs. Hutchison, and Mr. Inhofe)):
  S. 1487. A bill to establish a demonstration project to provide that 
the Department of Defense may receive Medicare reimbursement for health 
care services provided to certain Medicare-eligible covered military 
beneficiaries; to the Committee on Finance.


  the uniformed services medicare subvention demonstration act of 1995

 Mr. GRAMM. Mr. President, when we ask men and women to serve 
in our Nation's Armed Forces, we make them certain promises. One of the 
most important is the promise that, upon the retirement of those who 
serve 20 years or more, a graceful nation will make health care 
available to them for the rest of their lives. Unfortunately, for many 
65-and-over military retirees, promises are being broken.
  When the military's Civilian Health and Medical Program of the U.S. 
[CHAMPUS] was established in 1966, just 1 year after Medicare, 65-and-
over military retires were excluded from CHAMPUS because it was felt 
they could receive care on a space-available basis from local military 
hospitals and they would not require health care services from the 
private medical community. For many years, there were few problems and 
plenty of available space, but as military bases and their hospitals 
have closed, more and more retirees are finding it increasingly 
difficult to receive the care they have been promised.
  For many, being denied access to the local base hospital means they 
are completely reliant on Medicare. While Medicare is a valuable 
program that serves millions of Americans well, it was not designed as 
compensation for service to our country. Our military retirees, how-
ever, have all served our Nation for a minimum of 20 years, and many 
for 30 years or more. With all the sacrifices they have made during 
their careers, I believe military retirees clearly have earned the 
benefits that they were promised.
  While many health care options have been discussed that would 
appropriately reward the contributions of our military retirees, at a 
minimum they ought to be able to use their Medicare reimbursement 
eligibility wherever they choose, including the military health system. 
Our military treatment facilities also ought to be able to accept 
Medicare reimbursement and serve as Medicare providers for people who 
are eligible for both Medicare and for care in the military treatment 
system.
  For this reason, today I am joined by Senators Inouye, McCain, 
Hutchison, and Inhofe in introducing a bill to establish a 2-year 
demonstration project that will allow Medicare to reimburse the Defense 
Department for health care services provided to Medicare-eligible 
beneficiaries who are also eligible to receive care in military 
treatment facilities. Called subvention. Medicare reimbursement to 
military treatment facilities has long been a priority of military 
retirees, and I believe passing this bill and getting this project 
under way should be a top priority for the Congress.

  I am aware that some of my colleagues have also wrestled with this 
problem and have tried many different ways to establish a subvention 
program. As I introduce this bill, the Senate Armed Services Committee 
is working with the Pentagon and the Health Care Financing 
Administration [HCFA] to outline a demonstration project. In the House 
of Representatives, Congressman Joel Hefley has introduced a bill to 
begin a subvention effort. While my subvention project is different 
than these, I believe it complements their efforts.
  This program will not increase the cost to the taxpayer because it 
will ensure that DOD cannot shift costs to HCFA, and that the total 
Medicare cost to HCFA will not increase. In fact, I believe subvention 
could actually save money. The Retired Officers Association, in their 
letter to me of December 15, 1995, reports that:

       Using 1995 as a baseline, the eligible Medicare population 
     will grow by 1.6 million beneficiaries by 2000. This will 
     increase Medicare's cost by $7.7 billion if new beneficiaries 
     rely on Medicare as their sole source of care. But, with 
     subvention and DOD's 7 percent discount to the Health Care 
     Financing Administration (HCFA), the aggregate cost increase 
     can be reduced by $361 million over that same time frame. 
     Because health care will be managed, further savings could be 
     realized which could be passed on by DOD to Medicare through 
     reduced discounts.

  This legislation is strongly supported by many military and veterans 
organizations. I would ask unanimous consent to include in the Record 
18 statements of support from the following groups: The Retired 
Officers Association, National Association for Uniformed Services, Air 
Force Association, National Military Families Association, Veterans of 
Foreign Wars of the United States, The American Legion, The Retired 
Enlisted Association, Reserve Officers Association of the United 
States, Military Service Coalition of Austin (Texas), Association of 
the United States Army, Air Force Sergeants Association, Non 
Commissioned Officers Association of the United States of America, 
United States Army Warrant Officers Association, Chief Warrant and 
Warrant Officers Association United States Coast Guard, Naval 

[[Page S19003]]
Reserve Association, Naval Enlisted Reserve Association, Association of 
Military Surgeons of the United States, and Jewish War Veterans of the 
United States of America.
  There being no objection, the materials were ordered to be printed in 
the Record, as follows:


                                               Alexandria, VA,

                                                December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate,
     Washington, DC.
       Dear Senator Gramm: The Retired Officers Association (TROA) 
     with its 400,000 members (including 68,000 auxiliary 
     members), strongly endorses your bill to authorize the 
     Department of Defense (DoD) to test an innovative concept 
     called Medicare subvention, which would allow Medicare to 
     reimburse DoD for care provided to Medicare-eligible 
     uniformed services beneficiaries through the Military Health 
     Services System. Uniformed services retirees and their 
     families are entitled to medical treatment in military 
     treatment facilities (MTFs) on a ``space available'' basis. 
     However, DoD can't afford to enroll authorized Medicare-
     eligible retirees in its new Tricare program and will not 
     make available ``space available'' care for older retirees 
     unless Congress changes the law to allow reimbursement from 
     Medicare.
       Using 1995 as a baseline, the eligible Medicare population 
     will grow by 1.6 million beneficiaries by 2000. This will 
     increase Medicare's cost by $7.7 billion if new beneficiaries 
     rely on Medicare as their sole source of care. But, with 
     subvention and DoD's 7 percent discount to the Health Care 
     Financing Administration (HCFA), the aggregate cost increase 
     can be reduced by $361 million over that same time frame. 
     Because health care will be managed, further savings could be 
     realized which could be passed on by DoD to Medicare through 
     reduced discounts. In addition to saving money for Medicare, 
     taxpayers and beneficiaries, subvention will:
       Promote military medical readiness,
       Give older retirees the freedom to choose where they would 
     like to get their health care services, i.e., either from 
     civilian or military sources,
       Prevent retirees from being ``shoved out'' of Tricare Prime 
     (DoD's HMO-like program) when they turn age 65,
       Enable those 65 and older to choose the military managed 
     care approach for their comprehensive, cost-effective health 
     care, and
       Allow Congress and the government to keep the life-time 
     health care promises made to those who served.
       In closing, we applaud your efforts to introduce 
     legislation that will test the viability of subvention and 
     its potential cost savings to the government. The potential 
     benefits of subvention are detailed in the enclosed fact 
     sheet.
           Sincerely,
                                                Michael A. Nelson,
     President.
                                                                    ____

                                              National Association


                                        for Uniformed Services

                               Springfield, VA, December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate,
     Washington, DC.
       Dear Senator Gramm: I am writing to express strong support 
     for your legislation directing the conduct of a demonstration 
     project to authorize Medicare reimbursement to the Department 
     of Defense and its medical facilities for care provided in 
     military treatment facilities (MTFs) and in DoD managed care 
     networks.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DoD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care through years of 
     arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce Medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for everyone--Medicare, taxpayers, beneficiaries 
     and military medicine.
       I very much appreciate your leadership on this issue and 
     you have our full support. We are confident that this 
     demonstration will prove the need for a permanent 
     reimbursement program.
            Sincerely,

                                              J.C. Pennington,

                                     Major General, USA (retired),
      President.
                                                                    ____



                                        Air Force Association,

                                 Arlington, VA, December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate,
     Washington, DC.
       Dear Senator Gramm: The members of the Air Force 
     Association strongly support your legislative initiative to 
     develop a demonstration project to authorize Medicare 
     subvention. Medicare Subvention would provide military 
     retirees with seamless health care coverage regardless of 
     age.
       Most military members believe they were promised, through 
     tradition and practice, ``health care for life,'' when 
     deciding to choose a career in the military. In the past, 
     Medicare eligible retirees have received health care in the 
     military treatment facilities (MTFs) on a ``space available'' 
     basis. However, cutbacks in health care funding and medical 
     personnel, and base hospital closures resulting from base 
     realignment and closure, is likely to force many Medicare 
     eligible retirees out of the military medical system.
       Military retirees are the only group of retired government 
     employees who lose their health benefit upon reaching age 65. 
     At age 65, retirees must enroll in Medicare or continue to 
     take the risk of receiving health care on a space available 
     basis in the MTFs or if eligible Veterans Administration 
     facilities. Under current law, Medicare eligible retirees 
     cannot enroll in TRICARE unless changes are made to the 
     Social Security Act allowing Medicare subvention.
       You have the Air Force Association's full support for the 
     Medicare subvention demonstration program.
           Sincerely,
                                                       R.E. Smith,
      President.
                                                                    ____

                                          Veterans of Foreign Wars


                                         of the united states,

                                Washington, DC, December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate,
     Washington, DC.
       Dear Senator Gramm: Thank you for taking the initiative to 
     introduce legislation that is so important to the Veterans of 
     Foreign Wars of the United States (VFW). Specifically, we 
     have repeatedly sought legislation that would allow the 
     Secretary of Health and Human Services to reimburse the 
     Military Health Service System for care provided to Medicare-
     eligible military retirees and their spouses in the Military 
     Health Service System. This inter-departmental reimbursement 
     proposal is referred to as ``Medicare subvention''. It would 
     improve present government health care services to taxpayers 
     in a more cost-effective and service-efficient manner than is 
     presently the case.
       Today, more than half the 2.1 million members of the 
     Veterans of Foreign Wars of the United States (VFW) who are 
     eligible to receive Medicare are military retirees who fought 
     in World War II, Korea, and/or Vietnam. Hence, they now must 
     receive medical treatment in the civilian community or 
     private sector at a higher cost than could be provided in a 
     military treatment facility. To further compound this problem 
     most VFW military retirees prefer to continue to receive 
     their medical care in military facilities whenever and 
     wherever possible. To make this point, at our last national 
     convention held in August 1995 our voting delegates 
     unanimously passed VFW Resolution No. 643 titled ``Health 
     Care for Medicare Eligible Military Retirees.'' A copy is 
     attached to this letter. Our position is to have Congress 
     pass legislation that allows Medicare eligible retirees and 
     their dependents to continue to receive the high quality of 
     military medical service they are familiar with and are 
     accustomed to receiving.
       Thank you for your past and present efforts on behalf of 
     all military retired veterans. They have earned military 
     sponsored health care through past years of arduous service. 
     Today, they are the only federal employees who lose their 
     employer provided health care upon reaching age 65. Your 
     proposed legislation will correct this inequity.
           Sincerely,
                                                    Paul A. Spera,
                                               Commander in Chief.
       Attachment: as stated.

                           Resolution No. 643


          health care for medicare eligible military retirees

       Whereas, military retirees find it difficult to be treated 
     at military facilities once they become eligible for Medicare 
     since the military is not allowed to take Medicare money and 
     hospital Commanders are reluctant to provide care for which 
     they receive no reimbursement; and
       Whereas, there is presently a bill before the House of 
     Representatives, H.R. 861, by Congressmen Randy (Duke) 
     Cunningham and Duncan L. Hunter that would allow military 
     retirees and veterans to use their Medicare benefits at 
     military or VA hospitals; and
       Whereas, this would reduce the government's cost of 
     providing health care since the government hospitals can 
     treat these patient less expensively than paying Medicare to 
     civilian medical facilities; now, therefore, be it
       Resolved, by the Veterans of Foreign Wars of the United 
     States, that we urge Congress to support passage of 
     legislation that would allow military retirees and veterans 
     to use their Medicare entitlements in military or VA 
     hospitals.
                                                                    ____

                                  
[[Page S19004]]



                                          The American Legion,

                                Washington, DC, December 19, 1995.
     Sen. Phil Gramm,
     Committee on Appropriations, U.S. Senate, Washington, DC.
       Dear Senator Gramm: The American Legion commends you for 
     introducing and fully supports the ``Medicare Subvention 
     Demonstration Project Act.'' This bill, which proposes a two-
     year demonstration program at selected sites, serves to 
     implement an adopted American Legion mandate, namely medicare 
     subvention or reimbursement of Department of Defense (DOD) 
     medical facilities by the Department of Health and Human 
     Services (DHHS) for treatment of enrolled medicare-eligible 
     military retirees and their dependents.
       Recognizably, this demonstration project legislation 
     represents a significant first step in the direction of full-
     fledged medicare subvention which has been long supported by 
     The American Legion. The goal of this effort would improve 
     access to needed health care services for this dual-eligible 
     population while assuring the demonstration does not increase 
     the total federal cost of both programs. It is our aspiration 
     that this legislation become law, and that it eventually be 
     implemented at all military medical facilities throughout the 
     country.
       Most importantly, this bill would ease the tremendous 
     frustration expressed by medicare-eligible military retirees 
     and their dependents that their government has reneged in its 
     promises of free, lifetime, heath care in exchange for 
     decades of service to this nation in time of war and peace. 
     Military retirees and their dependents are the only group of 
     Federal retirees who essentially lose their health care 
     coverage when they become 65 and are no longer eligible for 
     CHAMPUS/TRICARE coverage. Aside from the Department of 
     Defense itself providing health care for this group--which it 
     states it can no longer afford--medicare subjection appears 
     to provide the only viable solution to resolve the health 
     care crisis experienced by this growing group of deserving 
     veterans who have served their country for so long. Enclosed 
     is a copy of American Legion Resolution No. 107, ``Department 
     of Defense Health Care Reform for Military Beneficiaries,'' 
     which supports the proposed legislation.
       Military retirees have seen the promise of lifetime health 
     care, and other promises, being broken which is not only a 
     demoralizing factor, but one which can and will impact on 
     recruiting and retaining a quality force if it is left 
     unresolved. The American Legion salutes your initiative.
           Sincerely,
                                                G. Michael Schlee,
     Director National Security-Foreign Relations Division.
                                                                    ____



                             The Retired Enlisted Association,

                                Alexandria, VA, December 19, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm, On behalf of The Retired Enlisted 
     Association (TREA), and its Auxiliary, I want to express our 
     collective appreciation to you for introducing legislation 
     that will require a demonstration project authorizing 
     Medicare reimbursement to the Department of Defense when 
     treating Medicare eligible military retirees seeking care 
     from the Military Health Services System (MHSS) within the 
     demonstration area.
       Medicare eligible military retirees began their service 
     during World War II or the Korean War and continued their 
     service through the Cold War and the many conflicts during 
     that era, including the Vietnam War.
       Without your Medicare reimbursement legislation, too many 
     of these dedicated American patriots would find themselves 
     disenfranchised from the Military Health Care System despite 
     decades of promises of health care for life from the 
     military.
       If TREA can be of assistance to you on this most important 
     issue, please don't hesitate to contact us.
           Sincerely,
                                                    John M. Adams,
     MCPO, USN (Ret.), Director for Government Affairs.
                                                                    ____

                                                  Military Service


                                          Coalition of Austin,

                                    Austin, TX, December 15, 1995.
     Sen. Phil Gramm,
     Washington, DC.
       Dear Senator Gramm: Our Military Service Coalition in 
     Austin, Texas is extremely pleased with your authorship of 
     such a balanced and unique approach to the Military Medicare 
     Subvention debate. It is our opinion that your proposed 
     ``Medicare Subvention Demonstration Project Act'' provides 
     for both fiscal soundness and an operationally feasible 
     method to test the theory and concept of Military Medicare 
     Subvention.
       Clearly, this legislation is a pragmatic alternative to 
     other proposals that were simply too progressive, too soon. 
     We believe that although, theoretically attractive, they were 
     simply too far reaching and were introduced without any clear 
     method to gain a better understanding of any potential 
     adverse impact on both providers and customers.
       Again, you and your staff are to be commended on the 
     introduction of such a well coordinated and reasoned approach 
     to legislative change which we believe will begin to improve 
     our existing military health care delivery systems. We 
     appreciate the opportunity you gave us to work closely with 
     your staff during the development of this fine effort.
       May God continue to bless your efforts to make health care 
     more accessible to our Nation's Veterans.
           Respectfully,
     Bruce Conover, President.
                                                                    ____

                                                Association of the


                                           United States Army,

                                 Arlington, VA, December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: Medicare Subvention, the reimbursement 
     of the Department of Defense for the medical care it provides 
     to Medicare-eligible beneficiaries, has long been a goal of 
     the Association of the United States Army. Despite the 
     bureaucratic resistance that often meets new ideas, 
     Subvention continues to pass every test of fairness and logic 
     to which it is subjected. In an age of constrained budgets 
     and fiscal restraint, Medicare Subvention is an initiative 
     that makes too much sense to ignore and actually holds the 
     promise of saving money.
       On behalf of the more than 100,000 members of the 
     Association of the United States Army, thank you for your 
     courage in confronting the bureaucratic resistance by 
     introducing legislation to permit a demonstration of Medicare 
     Subvention. While I believe a test is unnecessary to show 
     that value of Subvention, the demonstration will remove any 
     doubt that this is an initiative in which there are no 
     losers. The Medicare-eligible military beneficiary wins. The 
     military health care system wins. The Health Care Financing 
     Administration wins and, in the final analysis, the American 
     people win because a quality product will be delivered to a 
     deserving segment of our population at a lower cost and in a 
     more practical manner.
       Medicare Subvention does not answer all the concerns we 
     have with the military medical system, but it goes a long way 
     to help one segment of the beneficiary population. It is an 
     idea whose time has come. Thank you again for your 
     willingness to sponsor a bill that will make Medicare 
     Subvention a reality.
           Sincerely,
                                                  Jack N. Merritt,
     General, USA Retired.
                                                                    ____

                                                         Air Force


                                        Sergeants Association,

                              Temple Hills, MD, December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm, On behalf of the 160,000 members of the 
     Air force Sergeants Association, thank you for your 
     introduction of Medicare subvention legislation before the 
     United States Senate. Our shared concern for health care 
     needs of our oldest military retirees will, hopefully, result 
     in legislative action on your bill during this Congress, with 
     the eventual goal of attaining subvention for all over-64 
     military retirees.
        As you are aware, current law requires that over-65, 
     Medicare-eligible military retirees be thrown out of formal 
     participation in the Military Health Services System (MHSS) 
     simply because they have attained that age and status. For 
     many, this effectively ends their care possibilities within 
     the MHSS, because ``space-available'' care in Military 
     Treatment Facilities is increasingly difficult to obtain.
       Most other federal employees keep their federal health 
     insurance upon reaching age 65. Therefore, the current 
     practice toward over-65 military retirees is discriminatory 
     and must end. The full-scale enactment of Medicare subvention 
     could result in the ability of many of our older military 
     retirees to participate in DOD's new health care program, 
     TRICARE. Your efforts to begin the process are needed and 
     appreciated. As always, feel free to ask for AFSA's support 
     of this or any other legislation of mutual concern.
           Sincerely,
                                                 James D. Station,
     Executive Director.
                                                                    ____

         Non Commissioned Officers Association of the United 
           States of America,
                                Alexandria, VA, December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: The Non Commissioned Officers 
     Association of the USA (NCOA) wishes to express strong 
     support for your efforts to introduce legislation directing 
     that a demonstration project be conducted to authorize 
     Medicare reimbursement to the Department of Defense (DoD) for 
     medical care provided in Military Treatment Facilities (MTFs) 
     and in the department's managed care networks. It is very 
     important that your bill include TRICARE and the Uniformed 
     Services Treatment Facilities in the demonstration.
       NCOA and it's members are very concerned that the efforts 
     of DoD to improve health care availability and accessibility 
     through implementation of the TRICARE program for all 
     military beneficiaries are being hampered simply because 
     Medicare will not reimburse DoD for the medical treatment 
     provided to the age-65 military retiree. NCOA cannot just 
     standby and watch a group of military retirees who earned a 
     free lifetime medical care benefit be disenfranchised from 
     that benefit.
       In this regard, NCOA applauds your efforts and supports 
     your legislation.
           Sincerely,
                                             Michael F. Ouellette,
     Sgt Maj, US Army, (Ret), Director of Legislative Affairs.
                                                                    ____

                                  
[[Page S19005]]

                                                 National Military


                                           Family Association,

                                Alexandria, VA, December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: The National Military Family 
     Association supports your legislation providing for a 
     demonstration project to authorize Medicare reimbursement to 
     the Department of Defense and its medical facilities for care 
     provided in military treatment facilities (MTFs) and in DoD 
     managed care networks. The bill includes TRICARE and the 
     Uniformed Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. DoD's TRICARE program 
     excludes them despite the fact that these retirees earned 
     military sponsored health care through years of arduous 
     service and paid for Medicare through payroll deductions.
       NMFA is aware that Medicare reimbursement to DoD will only 
     benefit those living in areas where MTFs exist and/or TRICARE 
     Prime is available and continues to support offering all non-
     active duty military beneficiaries the option of enrolling in 
     the Federal Employees Health Benefit Plan. Nonetheless, 
     Medicare reimbursement to DoD will benefit many who would 
     otherwise lose access to the military system.
           Sincerely,
                                                 Sylvia E.J. Kidd,
     President.
                                                                    ____

                                      Reserve Officers Association


                                         of the United States,

                                Washington, DC, December 18, 1995.
     Hon. Phil Gramm,
     U.S. Senate Washington, DC.
       Dear Senator Gramm: I write to you today on behalf of the 
     more than 100,000 members of the Reserve Officers 
     Association, an organization chartered by Congress to 
     ``support a military policy for the United States that will 
     provide adequate national security. . . .'' ROA strongly 
     supports your legislation directing the conduct of a 
     demonstration project to authorize Medicare reimbursement to 
     the Department of Defense and its medical facilities for care 
     provided in military treatment facilities (MTFs) and in DoD 
     managed care networks. The bill includes TRICARE and the 
     Uniformed Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although military retirees are entitled to 
     use MTFs on a space available basis, deep cutbacks in health 
     care personnel and funding as well as hospital closures 
     resulting from Base Realignment and Closure Commission 
     actions will shove hundreds of thousands of them out of 
     military medicine.
       Medicare-eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. When they were recruited and 
     reenlisted they were promised lifetime medical care. Now when 
     they need it most they are being disenfranchised. Further, 
     DoD TRICARE program excludes them despite the fact that these 
     retirees earned military sponsored health care through years 
     of arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce Medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for everyone--Medicare, taxpayers, beneficiaries 
     and military medicine.
       You have our association's full support for this important 
     legislation. I am sure that this demonstration will prove the 
     need for a permanent reimbursement program.
       Sincerely,

                                             Roger E. Sandler,

                                         Major General, AUS (Ret.)
     Executive Director.
                                                                    ____

                                        Jewish War Veterans of the


                                     United States of America,

                                                December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: I am writing to express strong support 
     for your legislation directing the conduct of a demonstration 
     project to authorize Medicare reimbursement to the Department 
     of Defense and its medical facilities for care provided in 
     military treatment facilities (MTFs) and in DOD managed care 
     networks. The bill includes TRICARE and the Uniformed 
     Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DOD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care through years of 
     arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for everyone--Medicare, taxpayers, beneficiaries 
     and military medicine.
       You have our full support for this legislation. I am sure 
     that this demonstration will prove the need for a permanent 
     reimbursement program.
           Sincerely,
                                                     Neil Goldman,
     National Commander.
                                                                    ____

                                                         U.S. Army


                                 Warrant Officers Association,

                                                December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: On behalf of the United States Army 
     Warrant Officers Association (USAWOA) I am writing to express 
     strong support for your legislation directing the conduct of 
     a demonstration project to authorize Medicare reimbursement 
     to the Department of Defense and its medical facilities for 
     care provided in military treatment facilities (MTFs) and in 
     DOD managed care networks.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have excluded 
     hundreds of thousands of retirees from military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DOD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care through years of 
     arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce medicare 
     benefits in military treatment facilities while providing the 
     necessary funds needed for their care.
       Your leadership in initiating this important legislation is 
     appreciated. We are confident that this demonstration will 
     prove the need for a permanent reimbursement program.
       Sincerely,

                                                     Don Hess,

                                                         CW4, USA,
     Executive Vice President.
                                                                    ____

                                           USCG, Chief Warrant and


                                 Warrant Officers Association,

                                Washington, DC, December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: I am writing to express strong support 
     for your legislation directing the conduct of a demonstration 
     project to authorize Medicare reimbursement to the Department 
     of Defense and its medical facilities for care provided in 
     military treatment facilities (MTFs) and in DoD managed care 
     networks. The bill includes, Tricare and the Uniformed 
     Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DoD's Tricare 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care though years of arduous 
     service and paid for Medicare through payroll deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce Medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for everyone--Medicare, taxpayers, beneficiaries 
     and military medicine.
       You have our full support for this legislation. I am sure 
     that this demonstration will prove the need for a permanent 
     reimbursement program.
           Sincerely,
                                                  Robert L. Lewis,
                                               Executive Director.
     
[[Page S19006]]



                           Naval Enlisted Reserve Association,

                              Falls Church, VA, December 14, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: I am writing to express NERA's strong 
     support for your legislation directing the conduct of a 
     demonstration project to authorize Medicare reimbursement to 
     the Department of Defense and its medical facilities for care 
     provided in military treatment facilities and in DoD managed 
     care networks. The bill includes TRICARE and the Uniformed 
     Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it 
     most, they are being disenfranchised. Further, DoD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care though years of arduous 
     service and paid for Medicare through payroll deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce Medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for Medicare, taxpayer, beneficiaries and 
     military medicine.
       You have our full support for this legislation. I am sure 
     that this demonstration will prove the need for a permanent 
     reimbursement program.
           Sincerely,
                                                        Eddie Oca,
     National President.
                                                                    ____



                                    Naval Reserve Association,

                                 Alexandria, VA, 15 December 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: I am writing to express strong support 
     for legislation directing the conduct of a demonstration 
     project to authorize Medicare reimbursement to the Department 
     of Defense and its medical facilities for care provided in 
     military treatment facilities (MTFs) and in DoD managed care 
     networks. The bill include TRICARE and the Uniformed Services 
     Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided health care upon 
     reaching age 65. Although eligible to use MTFs on a space 
     available basis, deep cutbacks in health care personnel and 
     funding as well as hospital closures resulting from Base 
     Realignment and Closure Commission actions have shoved 
     hundreds of thousands of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DoD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care through years of 
     arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their families to use 
     their Medicare benefits in military treatment facilities 
     which will save scarce Medicare trust funds while providing 
     the necessary funds needed for their care. Your Medicare 
     reimbursement bill is win-win legislation for everyone--
     Medicare, taxpayers, beneficiaries and military medicine.
       You have our full support for this legislation.
           Sincerely,
     James E. Forerest
                                                                    ____

                                  Association of Military Surgeons


                                         of the United States,

                                  Bethesda, MD, December 15, 1995.
     Hon. Phil Gramm,
     U.S. Senate, Washington, DC.
       Dear Senator Gramm: I am writing to express strong support 
     for your legislation directing the conduct of a demonstration 
     project to authorize Medicare reimbursement in the Department 
     of Defense and its medical facilities for care provided in 
     military treatment facilities (MTFs) and in DoD managed care 
     networks. The bill includes TRICARE and the Uniformed 
     Services Treatment Facilities in the demonstration.
       Military retirees and their families are the only federal 
     employees who lose their employer provided care upon reaching 
     age 65. Although eligible to use MTFs on a space available 
     basis, deep cutbacks in health care personnel and funding as 
     well as hospital closures resulting from Base Realignment and 
     Closure Commission actions have shoved hundreds of thousands 
     of retirees out of military medicine.
       Medicare eligible retirees served in WWII, Korea, Vietnam 
     and the long Cold War. They were recruited and reenlisted by 
     promises of lifetime medical care. Now when they need it most 
     they are being disenfranchised. Further, DoD's TRICARE 
     program excludes them despite the fact that these retirees 
     earned military sponsored health care through years of 
     arduous service and paid for Medicare through payroll 
     deductions.
       Your Medicare reimbursement legislation will allow these 
     patriots and their families to use their Medicare benefits in 
     military treatment facilities which will save scarce Medicare 
     trust funds while providing the necessary funds needed for 
     their care. Your Medicare reimbursement bill is win-win 
     legislation for everyone--Medicare, taxpayers, beneficiaries 
     and military medicine.
       You have our full support for this legislation. I am sure 
     that this demonstration will prove the need for a permanent 
     reimbursement program.
           Sincerely,

                                              MAX B. BRALLIAR,

                                         LT General, USAF, MC Ret.
                                       Executive Director.
Mr. McCain. Mr. President, today I am cosponsoring with Senator 
Phil Gramm the Uniformed Services Medicare Subvention Demonstration 
Act, this bill would allow Medicare reimbursement to the Department of 
Defense for care provided by the military system to Medicare-eligible 
uniformed services beneficiaries.
  In the case of those Medicare-eligible uniform services beneficiaries 
who enroll in the Department's managed health care plan, Tricare, this 
legislation would authorize a demonstration project that allows 
Medicare to pay DOD based on a reduced rate per enrollee of 93 percent 
from what Medicare pays eligible health maintenance organizations. In 
the case of DOD beneficiaries who do not enroll in Tricare, Medicare 
would pay military treatment facilities [MTFs] for services provided 
based on the methodology it would use in paying a discounted rate of 93 
percent of what Medicare pays a similar civilian provider.
  Under current law, DOD retirees may receive care free of charge at a 
MTF on a space available basis. There are currently about 1.2 million 
uniformed services beneficiaries age 65 and older. By 1997, this number 
is expected to grow to 1.4 million. It is estimated that 97 percent of 
these retirees are eligible for Medicare. An estimated 324,000 of these 
individuals currently use military health care facilities on a regular 
basis when space is available, at a cost of $1.4 billion per year from 
DOD's annual appropriation. Due to budgetary considerations, DOD soon 
will no longer have the resources to treat Medicare-eligible 
beneficiaries unless it is able to obtain Medicare reimbursement.
  For military retirees, the cost of care provided through civilian 
providers in the Medicare Program is significantly higher than if the 
care is provided at a military hospital. One study by DOD found that 
the cost of care at a military hospital is 10-24 percent less. Such 
savings are further supported by a GAO study of six hospitals in which 
estimated savings to the CHAMPUS Program ranged from $18 to $21 
million. With Medicare reimbursement, DOD will be able to treat more 
Medicare-eligible beneficiaries at lower cost to the Government.
  There would be substantial benefits to our military readiness 
associated with this legislation. Under this demonstraion project, the 
readiness of the military health care system would be enhanced in two 
significant ways. First, military treatment facilities would be able to 
maintain their service capacity despite DOD budgetary restrictions due 
to the infusion of Medicare funds. Second, DOD physicians and other 
military health care personnel will be able to treat the broad range of 
medicare problems presented by retired beneficiaries, thereby assisting 
them to maintain and expand their knowledge and skills.
  Even more important, this legislation is important to overall 
military personnel readiness. Particularly in times of conflict, our 
Armed Forces depend heavily on the high quality of career mid-level and 
senior management. We must therefore continue to attract such personnel 
to serve full military careers, often comprising 30 years of service 
and sacrifice. Offering an attractive retirement benefits package, 
including military health care during retirement, and keeping our 
Government's promises concerning such benefits, is essential to 
maintaining these key personnel.
  I believe that this bill is at least budget neutral and will save the 
Government money. It will seek a reduced reimbursement from Medicare 
only for 

[[Page S19007]]
new beneficiaries who otherwise obtain care through Medicare within the 
Civilian sector. DOD concludes that subvention will reduce Government 
costs. Allowing Medicare reimbursements for DOD health care has been a 
long standing proposal. This bill would allow us to demonstrate the 
initiative on a limited basis to ensure that it provides the promised 
benefits to Medicare recipients who are retired uniform service 
beneficiaries, to Department of Defense's health care system and to the 
Medicare trust fund. I hope it is a demonstration we can implement to 
increase success for broader application.
  Mr. President, this bill is important to the military, its retires 
and the Nation. The military needs to maintain its readiness and its 
ability to provide the best care possible. Retirees who have served 
their careers in our uniformed services, and who have also paid into 
the Medicare trust fund like other Medicare beneficiaries, deserve the 
full range of choice that this legislation offers. They should be able 
to use their Medicare coverage wherever they are eligible to receive 
care, including a military treatment facility or the Tricare Program.
  This legislation is supported in principal by the Department of 
Defense and fully by all the uniformed services organizations and the 
major veterans organizations, including the entire military coalition. 
Additionally, the Senate has already taken a positive position on 
Medicare subvention when it earlier this year passed a sense-of-the-
Senate resolution in the Defense authorization bill. I am proud to be 
part of an effort with Senator Phil Gramm to continue to move forward 
on this important legislation for military service members and their 
families.
  Again, this legislation should provide the catalyst to demonstrate 
that, in fact, those career uniformed service members continue to have 
options in terms of health care and allows them to continue to be able 
to choose their health care provider like most Americans. For the 
active service member and their families they will continue to enjoy 
the highest quality health care that is our duty to provide.
                                 ______

      By Mr. SARBANES:
  S. 1488. A bill to convert certain excepted service positions in the 
U.S. Fire Administration to competitive service positions, and for 
other purposes; to the Committee on Governmental Affairs.


                  U.S. Fire Administration Legislation

 Mr. SARBANES. Mr. President, today I am introducing 
legislation to convert eight remaining excepted service positions at 
the U.S. Fire Administration to competitive service status.
  During its first few years of operation, the Federal Emergency 
Management Agency used an excepted service authority provided under the 
Fire Prevention and Control Act of 1974 in order to quickly staff the 
National Fire Academy with personnel who were uniquely qualified in 
fire education.
  In the early 1980's, after the Academy's original vacancies had been 
filled and the Academy was up and running, it became FEMA's policy to 
fill openings at the NFA through a competitive civil service hiring 
system. Today, 91 of the NFA's 99 employees are under the general 
schedule with only eight employees who were hired in the 1970's and 
early eighties remaining in excepted service status. As a result, these 
remaining eight are subject to significant limitations within the USFA. 
Although they each average over 17 years of Federal service and were 
hired solely because of their strong backgrounds and unique 
qualifications in fire education, they are legally barred from 
competing for management positions within the Fire Administration. The 
remaining eight excepted service employees are not even allowed to 
serve on details to competitive service jobs--even within their own 
organization--without an official waiver from the Office of Personnel 
Management.
  Mr. President, I am proposing to remedy this situation. The 
legislation which I am introducing will enable the Director of the 
Federal Emergency Management Agency and the Director of the Office of 
Personnel Management to convert any employees appointed to the Fire 
Administration under the Federal Fire Protection and Control Act, to 
competitive service--without any break in service, diminution of 
service, reduction of cumulative years of service, or requirement to 
serve any additional probationary period with the Administration. Those 
converted under this legislation shall also remain in the Civil Service 
Retirement System and retain their seniority. This practice is 
consistent with other federally supported training academies. The 
Congressional Budget Office has indicated that there would be no cost 
for this conversion, and I urge my colleagues to join me in support of 
this legislation.
                                 ______

      By Mrs. MURRAY:
  S. 1489. A bill to amend the Wild and Scenic Rivers Act to designate 
a portion of the Columbia River as a recreational river, and for other 
purposes; to the Committee on Energy and Natural Resources.


                    COLUMBIA RIVER BASIN LEGISLATION

 Mrs. MURRAY. Mr. President, I am introducing legislation today 
to designate the 50-miles of the mid-Columbia River known as the 
Hanford Reach--the last free-flowing stretch of the river--a wild and 
scenic river and to improve fish and wildlife habitat downstream of the 
reach.
  Although I have been working for less than a year with the community 
and members of my Hanford Reach Advisory Panel to develop a broadly-
supported means of protecting the river corridor, the effort to save 
the reach has been underway for 30 years.
  The Hanford Reach is an issue whose time has come.
  While most of the Columbia River Basin was being developed during the 
middle of this century, the Hanford Reach and other buffer areas within 
the Hanford Nuclear Reservation were kept pristine, ironically, by the 
same veil of secrecy and security that lead to the notorious nuclear 
and chemical contamination of the central Hanford site. Today, these 
relatively undisturbed Hanford buffer areas are wild remnants of a 
great river and vast shrub-steppe ecosystem that have been tamed by 
dams, farms, and other economically important development.
  As the last free-flowing stretch of the Columbia between the Canadian 
border and Bonneville Dam, the significance of the Hanford Reach has 
only recently become fully appreciated. Mile for mile, it contains some 
of the most productive and important fish spawning habitat in the lower 
48 States. The cool, clear waters of the Columbia River that sweep 
through the reach have the volume and velocity to produce ideal 
conditions for spawning and migrating salmon. The reach produces 80 
percent of the Columbia Basin's fall chinook salmon, as well as 
thriving runs of steelhead trout and sturgeon. It is the only truly 
healthy segment of the mainstem of the Columbia River.
  At a time when the Pacific Northwest is struggling to restore 
declining salmon runs--and spending hundreds of millions annually on 
restoration and enhancement efforts--protecting the Hanford Reach is 
the most cost-effective step we can take. That is why the Northwest 
Power Planning Council, Trout Unlimited, conservation groups, tribes, 
and many other regional interests involved in the salmon controversy 
support designation of the reach under the National Wild and Scenic 
Rivers Act.
  The reach is also rich in other natural and cultural resources. Bald 
eagles, wintering and migrating waterfowl, deer elk, and a diversity of 
other wildlife depend on the reach. It is home to dozens of rare, 
threatened, and endangered plants and animals, some found only in the 
reach.
  This part of the Columbia Basin is also of great cultural importance. 
Native American culture thrived on the shores and islands of the reach 
for millennia, and there are over 150 archaeological sites in the 
proposed designation, some dating back more than 10,000 years. The 
reach's naturally-spawning salmon and cultural sites remain a vital 
part of the culture and religion of Native American groups in the area.
  The southern shore of the reach chronicles a different kind of 
history: the story of the Manhattan project and defense nuclear 
production during the cold war. Nowhere else in the world is there a 
higher concentration of nuclear facilities, some of which are on the 
National Register of Historic Places, than along this stretch of the 
Columbia River.
  In stark contrast to the old defense reactors is the section of the 
reach 

[[Page S19008]]
dominated by the White Bluffs, whose towering but fragile cliffs offer 
dramatic scenery and opportunities for solitude. Irrigation water 
flowing through unstable Ringold formation sediments has caused part of 
the White Bluffs to slide into the River, smothering spawning 
beds, reducing water quality, and even deflecting the course of the 
river. This constitutes one of the great threats to the reach.

  The reach offers residents and visitors recreation of many types--
from hunting, fishing, and hiking to kayaking, waterskiing, and 
birdwatching--and adds greatly to the quality of life and economy of 
the area.
  My legislation builds on a foundation begun in the 100th Congress by 
Senators Dan Evans and Brock Adams, and Congressman Sid Morrison, who 
enacted legislation which called for a moratorium on development within 
the river corridor and a detailed study of policy options. Our bill 
implements the preferred alternative of the Hanford Reach EIS, which 
recommended Congress designate the reach a recreational river under the 
National Wild and Scenic Rivers Act.
  With the guidance of my Hanford Reach Advisory Panel, the legislation 
also contains some refinements and protections. For example, the bill 
explicitly allows current activities, such as agriculture, power 
generation and transmission, and water withdrawals along the river 
corridor to continue. It excludes private property, which comprises 
only about three percent of the study area. The legislation also 
guarantees that local government and other local interests have a 
formal role in the management of the river corridor, which will come 
under the jurisdiction of the U.S. Fish and Wildlife Service.
  The legislation also includes provisions which complement the Wild 
and Scenic River designation. The Secretary of Interior and relevant 
Federal agencies are directed to work with local and State sponsors in 
developing a program of education and interpretation related to the 
Hanford Reach. The city of Richland and area tribes, among others, have 
been working with the Department of Energy on a museum and regional 
visitor center proposal and are eager to make the natural and human 
history of the reach part of the project. Federal agencies should help 
coordinate with local sponsors on this initiative.
  There is also great interest in the tri-cities, and among some 
government agencies, in improving the habitat value, access, and 
appearance of the Columbia River shoreline in the area, much of which 
is lined with high, steep levees that were put into place before the 
network of Columbia River dams controlled the flow of the River and 
reduced the need for such flood control structures. Migrating salmon 
and wildlife now face a sterile gauntlet, populated by predatory fish 
species, in this part of the River.
  This bill directs the Army Corps of Engineers, which built, owns, and 
maintains the levees, to coordinate with local sponsors on 
demonstration projects to restore the rivershore. In the short-term, 
the bill directs the corps to undertake some small levee modification 
projects under their existing Section 1135 Project Restoration Program, 
assuming the local sponsors meet program requirements for planning and 
cost-sharing. The cities of Kennewick and Pasco, and the Port of 
Kennewick, have already indicated an interest and ability to pursue 
this course of action. In the long-term, the corps is directed to 
undertake a comprehensive study of the levees and determine if 
rivershore restoration in the area is feasible and an important Federal 
priority.
  I am proud of the way this legislation was developed. It is the 
product of an open, consensus-building process that heard from 
virtually every interested group in the community and in the region. 
The bill was drafted with the assistance of a diverse panel of 
community leaders from local government, business, labor, and the 
conservation community.
  I am deeply grateful to the members of my Hanford Reach Advisory 
Panel for their public spirited commitment of their valuable time, 
energy, and creativity. Sue Frost, manager of the Port of Kennewick; 
Chris Jensen, Pacso City Council; Joe King, Richland City Manager; Rick 
Leaumont with the Lower Columbia Basin Audubon Society; John Lindsay, 
president of TRIDEC; Kris Watkins with the Tri-Cities' Visitor and 
Convention Bureau; and Jim Watts with the Oil, Chemical and Atomic 
Workers did an outstanding job tackling the tough issues associated 
with this legislation and developing a consensus proposal.
  I look forward to working with my colleagues in the Senate to enact 
this historic and balanced measure.
                                 ______

      By Mr. SIMON (for himself, Mr. Jeffords, Mr. Leahy, and Mrs. 
        Boxer):
  S. 1490. A bill to amend title I of the Employee Retirement Income 
Security Act of 1974 to improve enforcement of such title and benefit 
security for participants by adding certain provisions with respect to 
the auditing of employee benefit plans, and for other purposes; to the 
Committee on Labor and Human Resources.


               the pension audit improvement act of 1995

  Mr. SIMON. Mr. President, Senator Jeffords and I are introducing the 
Pension Audit Improvement Act of 1995 today in order to improve the 
quality of audits performed pursuant to the Employee Retirement Income 
Security Act of 1974 [ERISA]. The bill repeals the limited scope audit 
exemption, enhances ERISA auditor qualifications, and requires speedy 
reporting of serious ERISA violations discovered during plan audits.
  Over the past few years, both the Inspector General of the Department 
of Labor and the GAO have issued reports documenting the need to 
strengthen the quality of pension audits. Recent investigations by 
Secretary Reich of 401(k) plans further demonstrate the need for 
Congress to Act promptly on this measure.
  I want to commend Senator Jeffords for his interest and work in 
support of this bill. I also want to commend Secretary Reich for the 
Department's substantial work and effort in support of this bill. I am 
also pleased to report that this bill is supported by the American 
Institute of Certified Public Accountants, and I thank them for their 
efforts to move this bill forward. I ask unanimous consent to have a 
summary of the bill printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record,  as follows:

                 Pension Audit Improvement Act of 1995


                              current law

       Title I of the Employee Retirement Income Security Act of 
     1974 (ERISA), requires that pension plan administrators 
     obtain a financial audit of employee benefit pension plans. 
     ERISA's audit requirement was designed to protect employee 
     benefit plan assets and assist the Labor Department's 
     enforcement activities by insuring the integrity of financial 
     and compliance information disclosed on the annual report 
     filed with the government.
       Under  current  law,  plan  auditors  are permitted to 
     exclude plan assets invested in regulated institutions, such 
     as banks or insurance companies, from the annual audit. This 
     exclusion, referred to as a limited-scope audit, prohibits 
     auditors from rendering an opinion on the plan's financial 
     statements in accordance with professional auditing 
     standards. Consequently, there is no assurance that plan 
     assets are secure. About fifty percent of plan audit reports 
     contain a limited scope audit disclaimer, resulting in 
     approximately $950 billion dollars in pension plan assets 
     that are not subject to a full financial audit.
       Federal law enforcement agencies including, the Office of 
     the Inspector General of the Department of Labor, the General 
     Accounting Office (GAO) and the Pension and Welfare Benefits 
     Administration of the Department of Labor have found that 
     current ERISA audits do not consistently meet professional 
     standards, therefore, hundreds of millions of dollars in 
     pension funds are not being adequately audited.


     major provisions of the pension audit improvement act of 1995

       The Pension Audit Improvement Act is designed to improve 
     the integrity of private audits of employee pension plan 
     benefits to better protect retirees and active workers future 
     retirement income. In order to insure that pension funds are 
     adequately safeguarded, this bill repeals the limited scope 
     audit exception, enhances ERISA auditor qualifications, and 
     requires speedy reporting of serious ERISA violations 
     discovered during plan audits.

                   1. Repeal of limited scope audits

       The bill repeals the limited-scope audit. Limited scope 
     audits were originally designed to exempt institutions that 
     were already examined by federal or state agencies from 
     duplicative detailed audits. The Inspector General of the 
     Department of Labor, has found, however, that a significant 
     number of these financial institutions are not audited 
     annually increasing risks to plan participants of inadequate 
     retirement security. 

[[Page S19009]]
     Eliminating the limited scope audit will not require that the plan's 
     accountant duplicate the work of a bank or insurance company 
     audit. It is expected that the ERISA plan auditors will 
     rely on the reports of the financial institution, meeting 
     certain certified public accounting standards, which speak 
     to the reliability of that audit. This ``single audit'' 
     approach would fulfill the purposes of the audit 
     requirement without imposing the additional cost of 
     independently reviewing the financial institution's 
     records. At the same time, accountants will now be able to 
     issue audit reports that provide employees the assurance 
     that their retirement income is secure.

      2. Reporting and enforcement requirements for pension plans

               a. Prompt reporting of serious violations

       ERISA's current reporting rules create a time lag between 
     the detection of a reportable event and the filing of the 
     annual report which increases the risk to plan participants 
     and beneficiaries that full recoveries will not be made. This 
     audit bill requires faster reporting duties on auditors who 
     discover serious violations or whose services are terminated 
     by the employer client. This provision should substantially 
     enhance ERISA enforcement because the Department of Labor 
     will receive notices of violations from plan auditors, up to 
     eighteen months, before the Department currently receives 
     this information.
       The new reporting rules apply only to the most egregious 
     violations like theft, embezzlement, bribery or kickbacks. 
     The primary reporting obligation remains with the plan 
     administrator. Auditors report serious violations directly to 
     the Labor Department only if the administrator fails to 
     notify within a specific time frame.

                         b. Auditor termination

       The bill also requires a pension plan that terminates an 
     accountant to promptly notify the Secretary of Labor. The 
     plan's notice must specify the reasons for termination, and a 
     copy of the notice must be sent to the accountant.

                    c. Penalty for failure to report

       The bill provides a civil penalty of up to $100,000 against 
     any accountant or pension plan that violates the reporting 
     requirement. A violation could also result in criminal 
     sanctions.

           3. Enhanced qualifications for ERISA plan auditors

       The Department of Labor reports that it ``continues to 
     detect substantial auditing work'' by ERISA auditors. This 
     bill creates a peer review and continuing professional 
     education requirement for ERISA plan auditors. The bill also 
     gives the Secretary of Labor regulatory authority to insure 
     the quality of plan audits.
       The bill requires that qualified public accountants 
     participate in an external quality peer review relevant to 
     employee benefit plans within a three year period prior to 
     conducting an ERISA audit. This review must meet recognized 
     auditing standards as determined by the Comptroller General 
     of the United States. The bill also requires that qualified 
     public accountants performing ERISA plan audits satisfy 
     specific continuing education requirements.

                4. Clarification of fiduciary penalties

       The bill provides the Secretary of Labor the discretion to 
     reduce the current civil penalties (the penalty is an amount 
     equal to 20% of amount recovered pursuant to a settlement 
     agreement for breach of fiduciary duty). The Secretary has 
     determined that the automatic penalty disadvantages plan 
     participants because it serves as a ``disincentive'' for 
     parties to settle with the Department.
       The bill also clarifies that ERISA's anti-alienation rule, 
     which protects pensions from third party creditors, does not 
     protect fiduciaries who breach ERISA and cause a loss to the 
     plan. The bill clarifies that ERISA does not prohibit a plan 
     from offsetting a fiduciary's, or criminal wrongdoer's 
     pension benefits when such person causes a loss to the plan.

  Mr. JEFFORDS. Mr. President, I rise today with my good friend and 
colleague, Senator Simon, to introduce the Pension Audit Improvement 
Act of 1995. I'd also like to thank the Department of Labor and the 
American Institute of Certified Public Accountants who have worked very 
closely with us to produce this bill.
  The primary purpose of this legislation is to repeal the limited 
scope audit exception currently in the Employee Retirement Income 
Security Act [ERISA]. Similar bills have been introduced by my 
colleagues Senators Kassebaum and Hatch in previous years. The current 
bill has the added feature of putting some teeth into private auditor 
enforcement efforts and responsibilities.
  Limited scope audits are audits where independent accountants are not 
required to examine, test, or evaluate funds or assets held in trust by 
banks or other regulated financial institutions. This provision in 
ERISA has created a major loophole in the oversight of pension plans. 
While the assumption is that these institutions are adequately audited 
by federal agencies, these audits are generally done only once every 
two years. More significantly, when an independent auditor is 
restricted from examining significant information in an audit, she 
generally disclaims any opinion about whether that plan's financial 
statements are correct.
  Workers and retirees have the right to except that somebody is making 
sure that their pensions are there when they retire. The sheer numbers 
of private pension plans over 900,000, make it virtually impossible for 
the government to possibly maintain a viable enforcement effort without 
the help of private plan auditors. Also, is it realistic to expect an 
accountant, who has continuing ties with an employer, to identify and 
report to the Department of Labor questionable transactions between the 
plan and plan sponsor?
  The current enforcement system incorrectly assumes, to a large 
degree, that independent public accountants will detect serious 
violations in a timely manner. A 1987 report, by the Department of 
Labor's Office of Inspector General found that in 71% of their reviews, 
that the independent auditors had failed to discover existing ERISA 
violations. In a more recent 1989 report, the Inspector General found 
large numbers of audits didn't adequately examine or test plan assets 
and lacked timely reporting of ERISA violations.
  Furthermore, these studies indicate a number of problems with the 
detection of potential ERISA violations, including: incomplete or 
inadequate information being reported, the ability of the government to 
examine only about one percent of these plans per year, and that 
private plan audits do not consistently meet generally accepted 
professional accounting standards.
  The intent of the Pension Audit Improvement Act is to increase the 
overall integrity of private pension plan auditing enforcement 
practices. To enhance the integrity of audits this bill will subject 
qualified public accountants to external peer review. In addition, 
public accountants performing ERISA audits will be required to satisfy 
continuing education requirements emphasizing employee benefits ERISA 
rules.
  In addition, this bill will place new, expedited reporting duties on 
auditors whose services are terminated by the plan administrator before 
the audit is completed and, for those auditors who discover evidence of 
serious violations such as theft, embezzlement, bribery or kickbacks. 
Auditors will be required to report these violations directly to the 
Department of Labor only if the administrator fails to notify the 
Department within a specified time frame. The primary reporting, of any 
violation, still remains with the plan sponsor.
  I look forward to working with all interested parties in turning this 
bill into a first step toward strengthening our current pension 
enforcement system. Although, these changes to ERISA's reporting rules 
may seem minor they have the potential to create lasting reform with 
respect to the enforcement of Title I of ERISA. Giving private sector 
auditors the tools and responsibility of early detection of violations 
will prevent workers from losing hard earned pension benefits.
  We simply must do a better job of safeguarding the pension benefits 
of a growing number of workers and pensioners. The economic security of 
tens of millions of Americans depends on these benefits being 
adequately protected.
                                 ______

      By Mr. GRAMS (for himself, Mr Heflin, Mr. Pryor, Mr. McConnell, 
        Mr. Conrad, Mr. Coverdell, and Mr. Santorum):
  S. 1491. A bill to reform antimicrobial pesticide registration, and 
for other purposes; to the Committee on Agriculture, Nutrition, and 
Forestry.


                       anti-microbial legislation

  Mr. GRAMS. Mr. President, I rise today to introduce bipartisan 
legislation reforming the burdensome regulatory process for pesticide 
approvals under the Federal Insecticide, Fungicide, and Rodenticide 
Act.
  I am pleased to say that my legislation achieves that goal while 
preserving and improving upon our Nation's public health.
  This legislation is a product of compromise between the affected 
industry 

[[Page S19010]]
and the Environmental Protection Agency.
  The spirit of bipartisanship is best exemplified by the list of my 
colleagues joining me in this effort, including Senator Heflin, Senator 
Pryor, Senator McConnell, Senator Conrad, Senator Coverdell and Senator 
Santorum.
  As members of the Agriculture Committee, their support for this 
commonsense legislation is essential and appreciated.
  Mr. President, Congress has finally begun to recognize the severe 
burdens we place upon America's job creators when we impose regulatory 
legislation without respect to its cost or ultimate benefits.
  So I am pleased that we have made significant progress this year in 
reforming and reducing some of that regulatory burden, and I believe 
this legislation takes us another step forward.
  The pesticides covered by this legislation, called antimicrobial 
products, include common household disinfectant cleaners, bleaches, 
sanitizers, and disinfectants.
  Antimicrobials play an important and beneficial role in controlling 
disease and in maintaining a high public-health standard in hospitals, 
nursing homes, clinics, schools, hotels, restaurants, and even in our 
own homes.
  Because emergency workers rely on antimicrobial pesticides to 
disinfect contaminated water supplies, they are especially valuable 
during times of natural disasters, such as flooding in the Midwest, 
hurricanes in Florida, and earthquakes in California.
  Yet despite the critical role antimicrobials play in maintaining 
public health, and the efforts of our colleagues to develop a 
responsible solution, there have been significant and unintended delays 
on the EPA's part in approving these products for use.
  Unfortunately, those delays in the registration process have stifled 
the ability of the industry to market new products--products which 
could have an even more significant impact on the public health.
  I would like to share an example.
  A new product which provides extraordinary effectiveness against a 
powerful form of bacteria was developed by an international supplier of 
cleaning and sanitizing products.
  Not only was this new product found to be extremely effective, but it 
was also developed to break down rapidly once it had achieved its 
sanitizing work. In short, it effectively helped destroy bacteria while 
it reduced the likelihood of environmental damage.
  While this revolutionary product had proven merits, the company could 
not get the product approved by the EPA for over 2 years because of the 
cumbersome approval process.
  At the end of that 2-year period, the EPA granted its approval and 
agreed that this product was of great importance to public health and 
the environment. It's unfortunate that it has taken so long for the 
Government to recognize what its manufacturer had long known.
  Such examples have become commonplace. Because of this inappropriate 
backlog of anti-microbial applications pending within the EPA that have 
little or no chance of being resolved within a reasonable period of 
time, the need for legislative reform is clear.
  Our legislation will establish process for expediting the review of 
anti-microbial products.
  It incorporates predictability into the system without compromising 
public health and safety. it encourages industry and Government to work 
together to actually improve products which can better guarantee our 
public health.
  In a legislative climate that is too often partisan and 
uncompromising, this bill is an example of how Congress, the 
administration and its Federal agencies, industry, and consumers can 
pool their efforts to achieve a common end.
  Again, I thank my colleagues who have cosponsored this bill, the 
anti-microbial industry, user groups, and the EPA for coming together 
to work out the details of this bill. I urge the rest of my colleagues 
to join us in supporting this commonsense reform.

                          ____________________