[Congressional Record Volume 142, Number 30 (Thursday, March 7, 1996)]
[Senate]
[Pages S1614-S1615]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         THE FUTURE OF MEDICARE

  Mr. BAUCUS. Mr. President, it is all too easy for people in 
Washington to lose sight of what really matters. What really matters is 
how decisions made here in Washington actually affect average American 
families. The Medicare Program is a good example.
  As the future of Medicare is debated, we are going to hear a lot of 
fancy words, a lot of concepts thrown around by both sides. But let us 
not forget that premiums, deductibles, copayments, and managed care 
mean nothing in and of themselves. Let us not lose sight of the bottom 
line. The bottom line is how the Medicare Program helps people, 
average, hard-working, descent people in my home State of Montana and 
across the Nation.

  Are the proposed changes in Medicare going to actually help seniors 
live in dignity and security? Will they actually help average working 
families begin to plan for a secure retirement? Will they actually give 
these same families the peace of mind of knowing that they will not be 
forced to shoulder the costs of their parents' medical expenses?
  Not long ago I was going through my mail from home and I came across 
a letter that helped drive these points home. It came from Mrs. Ethel 
Ostheller in Libby, MT. Libby, you might know, is a small town in the 
northwest corner of our State.
  Mrs. Ostheller is 85 years old. She is widowed and lives off Social 
Security. She has had some serious health problems. She had a heart 
attack. She still owes a little over $700 to the hospital, and she now 
pays about $150 each month for prescription drugs, none of which is 
covered by Medicare.
  She writes to me about these problems. Let me just read to you the 
closure of her letter which reflects her concern, but yet the optimism 
which is so typical of people across our country.

       So with all of this, I'm worried [she writes]. I wonder 
     what more can happen. But I'm not as bad off as lots of 
     others. I'm trusting in God, living one day at a time, and I 
     keep busy.

  I think that typifies and represents the decency and the goodness and 
the basic common goodness of Americans.
  How will any changes in Medicare affect people like Ethel Ostheller? 
That is what this debate is about. For her and thousands of other 
Montanans, Medicare is a health issue but also a pocketbook issue. It 
helps them plan for a secure retirement and to make ends meet. That is 
why we must work to assure that Medicare remains solvent and that the 
Medicare trust fund is not raided, not raided in order to pay for other 
programs or to pay for tax breaks for the very wealthy, as was the case 
in Speaker Gingrich's budget last year. That is also why we must work 
to assure that the Medicare Program is run as efficiently as possible. 
Unfortunately, that is not the case for either Medicare or Medicaid 
today.
  The General Accounting Office estimates that about 10 percent of 
Medicare's total costs result from waste, from fraud, from abuse. That 
is about $18 billion this year; 10 percent wasted or lost through fraud 
or abuse.
  We all know that $18 billion is a lot of money, but let me put this 
in perspective: $18 billion is enough money to run the government of 
the entire State of Montana for 6 years.
  More to the point, $18 billion is enough money to reduce the health 
care costs of every Medicare recipient by $500 each year. That is $500 
each year Medicare patients now pay because of Government waste, fraud, 
and abuse in the Medicare Program. That drives up--that fraud and 
abuse--Medicare costs. It is robbing our seniors, robbing people like 
Ethel Ostheller, of hundreds of dollars each year.
  How does this happen? Typically, it involves fraudulent billing 
practices by a Medicare or Medicaid provider; that is, a doctor or a 
hospital, one of the various providers. It occurs in every State in the 
Nation and in every segment of our health care industry. There have 
been abuses in ambulance services, clinical laboratories, medical 
equipment suppliers, home health care, nursing homes, physician and 
psychiatric services, and rehabilitation.

  Let me cite some examples. These were uncovered by the General 
Accounting Office and also by the Senate Special Committee on Aging.
  A medical equipment company in California billed Medicaid half a 
million dollars for merchandise they said they delivered to needy 
patients. What happened? It was a ruse. The patients did not need the 
equipment; the company never made delivery of the equipment, but they 
sent the taxpayers the bill anyway.
  Another example: Medicare paid $7.4 million to a company for surgical 
bandages that were never used.
  And still another case in Great Falls, MT--unfortunately, my home 
State: An ophthalmologist overbilled Medicare by $200,000. He was 
prosecuted and convicted by our U.S. attorney in Billings.
  While these incidents may be extreme, they are not isolated. Frankly, 
I am disappointed with the Federal

[[Page S1615]]

agencies that are supposed to have jurisdiction over all this. They 
have let this go unchecked for too long and have only recently begun to 
take action. I must say they are not alone.
  A tough approach to fraud and abuse is almost completely lacking in 
the Gingrich plan that Congress is considering. The $270 billion in 
cuts, which was so harsh on beneficiaries and hospitals, contained a 
pathetically low amount for fighting fraud and abuse.
  We must have zero tolerance for those who willfully cheat the 
Medicare system--zero. Ultimately, they are stealing money from 
ordinary Americans, average American families. They are stealing money 
away from seniors, people like Ethel Ostheller, who depend upon 
Medicare to help make ends meet. They are also stealing money from 
millions of Americans who are working today and deserve to know that 
Medicare will be there when it is time for all of them to retire.
  In the weeks ahead, I intend to come forward with proposals to get 
tough on Medicare fraud. I look forward to working with a number of my 
colleagues, both Democrats and Republicans, to find commonsense 
solutions to this very serious problem.
  Thank you, Mr. President.

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