[Congressional Record Volume 142, Number 26 (Thursday, February 29, 1996)]
[Extensions of Remarks]
[Page E260]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




REPUBLICAN MEDICARE BILL WILL COST SENIORS $6.8 BILLION IN EXTRA DOCTOR 
                                CHARGES

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                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                      Thursday, February 29, 1996

  Mr. STARK. Mr. Speaker, the Republican Medicare bill will cost the 
Nation's seniors an extra $6.8 billion per year in doctor's bills. This 
is the same rate of balance billing we had before 1985, the year that 
Congress started to encourage doctors not to charge seniors extra. A 
return to this previous level of balance billing will cost the Nation's 
seniors at least $6.8 billion extra per year.
  The Republican Medicare bill allows doctors to set up fee-for-service 
plans with no limit on how much can be charged. It allows HMO's to 
extra bill for the basic package of Medicare services. It permits 
specialists outside of a beneficiary's managed care plan to charge 
unlimited amounts. Those who elect the Medical Savings Account option 
will also lose all protection against the-sky's-the-limit billings. The 
Republican plan reduces payments for traditional Medicare programs to 
the point doctors will switch to new systems that allow unlimited fees.
  Beginning in 1985, Congress passed a series of laws designed to 
encourage doctors to accept as payment in full the amount proposed by 
Medicare. As a result, Medicare beneficiary liability for excessive 
doctors' bills fell from $2.8 billion in 1985 to $1.3 billion in 1992. 
In current 1995 dollars, that is a decline from $5.5 billion to $1.5 
billion. When you factor in the growth in Medicare and assume a return 
to the old ratio of balance billing, you get $8.3 billion in extra 
charges. Subtract the current $1.5 billion in extra billing, and you 
have an additional cost of $6.8 billion from the Republican plan.
  Seniors have been paying less out of pocket for medical bills in 
recent years, because assignment rates--the number of doctors who 
accept the Medicare fee as payment in full--has gone up, from 70 
percent in 1986 to 92 percent in 1993. Balance billing--charging 
seniors more than the Medicare fee schedule--has also declined 
dramatically. When a senior goes to a doctor, he or she doesn't have to 
pay more than 20 percent--the coinsurance--of a set fee. There are no 
extra charges.
  The Republican bill changes all that.
  The GOP returns to the rate of extra charges existing in 1985. This 
will increase costs to seniors $6.8 billion per year, or an increase of 
$187 per senior in out of pocket expenses. The Republicans will also 
charge seniors $120 more per year in part B premiums. Put the two 
together, and seniors will see an increase over the Clinton budget of 
$614 a couple.
  Managed care should be encouraged. Medicare currently offers many 
choices of managed care plans to seniors. We should not return to 
wallet biopsies and price gouging.
  Whatever Medicare changes are made, we should preserve the limits on 
doctors' extra charges.

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