[Congressional Record Volume 142, Number 98 (Friday, June 28, 1996)]
[Senate]
[Pages S7278-S7279]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                        HEALTH INSURANCE REFORM

  Mrs. KASSEBAUM. Mr. President, it has been exactly 2 full months 
since the Senate unanimously passed the Health Insurance Reform Act 100 
to nothing. However, because Republicans and Democrats have been unable 
to reach agreement on one outstanding issue--the size and scope of the 
Medical Savings Account Demonstration Program--we have not been able to 
make further progress in reaching a compromise between the House and 
Senate language on this bill.
  Many, I think, assume that this legislation which passed unanimously 
in the U.S. Senate has already become law, and that is just not the 
case. I would suggest that every day we wait the stakes grow higher. As 
the number of legislative days dwindle:
  More American families lose their health insurance coverage;
  More American families are unable to obtain insurance because of 
preexisting illnesses or outright discrimination;
  Millions of Americans hold onto jobs that they would otherwise leave 
for fear of losing their health coverage;
  Patients suffering from AIDS, and our seniors and disabled citizens, 
do not have adequate resources to pay for care;
  And self-employed men and women, and small businesses, find the cost 
of health insurance increasingly out of reach.
  The bipartisan health reform legislation that passed both the Senate 
and the House in April would help address these critical issues. The 
General Accounting Office [GAO] estimates that the reforms at the heart 
of the bill will help at least 25 million Americans each year.
  There is no disagreement between Republicans and Democrats about how 
to help these 25 million Americans. Yet each day that we quibble over 
whether to allow a tiny fraction of the insurance market to test the 
concept of medical savings accounts, the chance to enact reforms that 
will help these 25 million Americans grows dim.
  As my colleagues know, the House passed a very different bill from 
the Senate. But after weeks of discussions and sometimes tense 
negotiations between Republican leaders, we have reached agreement on 
every outstanding issue--except for MSA's. The House has agreed to drop 
altogether controversial provisions on multiple employer welfare 
arrangements and medical malpractice. While many--including myself--
strongly believe we need to help small employers gain purchasing clout 
and control the health care costs through malpractice reform, all of us 
recognized that compromise was necessary to reach a bipartisan 
consensus on the legislation.
  Mr. President, I want to assure my colleagues and the American people 
that the core of the Kassebaum-Kennedy bill is firmly in place in the 
House-Senate compromise. Those provisions will greatly enhance the 
health security of American workers. In addition, the compromise 
legislation increases the deduction for self-employed individuals from 
30 to 80 percent, provides tax deductions to help make long-term care 
more affordable for our seniors, and helps reduce health costs by 
fighting fraud and abuse and reducing the paperwork burden imposed on 
patients, doctors, and hospitals.
  In an attempt to reach agreement on the remaining outstanding issue, 
Republicans have offered three separate compromises on medical savings 
accounts. Unfortunatley, these concessions seem to have done little to 
narrow the gap between Republicans and Democrats in the House and 
Senate, and the White House.
  Last night, under the leadership of the distinguished majority 
leader, Republicans proposed an extremely generous, constructive 
compromise that will allow us to test the concept of MSA's and assess 
their impact in the small employer market. As my colleagues know, I 
have grave concerns about the potential impact of MSAs. But I believe 
this proposal is fair and limited, and contains protections sufficient 
to guard against adverse risk selection. It was offered in good faith 
and goes a long way toward meeting concerns raised by the President. In 
fact, it goes well beyond the agreement I reached earlier with many 
Republicans in the House and Senate conference.
  As part of this agreement:
  Republicans have agreed to reduce the scope of the 4-year 
demonstration program to firms with 50 employees or less, and to 
require an affirmative vote to expand MSA's to large employers and 
individuals. That is a significant concession.

  The Joint Committee on Taxation estimates that MSA's will be 
available during this 4-year demonstration to less than 1 percent of 
the total work force and slightly more than 1 percent of the work force 
with insurance.
  Equally important, reducing the size of the demonstration to firms 
with 50 workers or less will help guard against risk selection because 
the underlying bill extends guaranteed issue and renewal requirements 
to firms with 50 or fewer workers. Moreover, this is the portion of the 
insurance market where the States have worked aggressively to protect 
consumers and guard against risk selection.
  The proposal contains a fire process for assessing the impact of 
MSA's by an independent, nonpartisan organization. In addition, the 
Secretary of the Treasury is required to annually monitor the MSA's 
impact on the market and report to Congress as to whether the 
legislation is necessary to reduce costs due to excessive enrollment.
  Finally, Republicans have agreed to reduce further individuals' out-
of-pocket exposure by lowering the maximum MSA deductible and requiring 
MSA plans to cover at least 70 percent of covered services once an 
individual reaches the deductible. We also have agreed to further 
reduce the tax advantages of MSA's by limiting annual contributions.
  Moreover, high-deductible plans must meet disclosure requirements, 
and the National Association of Insurance Commissioners is directed to 
promulgate further consumer protection standards.
  Mr. President, despite significant concessions, I believe, on the 
part of Republicans, however, the White House and congressional 
Democrats continue to raise new demands and to insist that high-
deductible MSA policies meet nondiscrimination and consumer protection 
standards well beyond current

[[Page S7279]]

law requirements for other health insurance plans and even well beyond 
the reforms contained in the underlying legislation.
  The Health Insurance Reform Act will pass, Mr. President, only if we 
keep our eye on the ball.
  First, we need to recognize that success always requires compromise. 
The House has conceded on malpractice reforms, has conceded on MEWA's 
and now receded significantly on the MSA's.
  Second, we need to bear in mind that the legislation will help 25 
million Americans each year, and that the positive impact of the bill's 
core reforms will far outweigh any potential harm from the limited 
medical savings account proposal that has been offered by Republicans 
last night.
  I believe we have worked too long and too hard in a bipartisan 
fashion to let this historic opportunity to pass meaningful health 
reform pass us by. I hope we can come together in the next few days. I 
think it is absolutely essential that we not let time slip away. And I 
hope that the White House and the Democratic leadership will genuinely 
help us reach that goal.
  I yield the floor.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico.
  Mr. DOMENICI. Mr. President, I ask unanimous consent that I be 
permitted to speak for 6 minutes as if in morning business.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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