[Congressional Record Volume 143, Number 156 (Saturday, November 8, 1997)]
[Senate]
[Pages S12080-S12082]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MEDICARE BENEFICIARY FREEDOM TO CONTRACT ACT
Mr. KYL. Mr. President, I wanted to give a report to my colleagues on
the status of the Medicare Beneficiary Freedom To Contract Act, the so-
called Medicare private contracting issue, which has been before both
the Senate and House for several weeks now following the adoption of
the Balanced Budget Act, which contained in it a provision which makes
it much more difficult for physicians to serve patients who want to
contract outside of Medicare.
Let me briefly tell you what the problem is, the legislative status,
and the resolution--at least as of now--that we have been able to
accomplish.
The issue is whether or not physicians can serve both Medicare
patients and people under private contracts who are 65 years of age.
Once a person turns 65, of course, they are eligible for Medicare, and
most of the services they can obtain are paid for by Medicare. But
occasionally, either there is a service that is not covered by
Medicare, or even sometimes services that are covered by Medicare that
a patient would prefer to obtain from a physician outside of the
Medicare Program.
For example, a constituent of mine had a condition that required the
aid of a specialist in her small community. There were none available,
except one person who was no longer taking Medicare patients. By the
way, Mr. President, this is a common situation, because Medicare,
especially for specialists, does not reimburse even up to their level
of costs. So while many physicians don't want to dump their existing
Medicare patient load and they want to continue to serve those patients
they have been serving for a long time, they are not anxious to take on
new Medicare patients. In this case, she went to the physician. He said
he would be happy to take care of her, but he wasn't taking anymore
Medicare patients. Her response was, ``Well, I will just pay you
directly. You bill me, and I will pay you. That way Medicare will save
some money, and I will get the treatment I need, and you won't have to
take new Medicare patients.'' He found that the Federal Government
would have deemed that to be a violation of law and, therefore, he
would have been precluded from providing the services.
It was in response to that kind of a problem that we created a piece
of legislation that would allow patients who are 65 years of age to
have the right to go to the physician of their choice and to be treated
outside of the Medicare Program, if that is their choice. We passed
that legislation here in the Senate. It became part of the Balanced
Budget Act. And, before the act was finalized, the President indicated
his desire to veto that legislation if that provision were retained. As
a result, some changes were made, the most important of which was to
add a provision to the act which makes it virtually impossible for
patients to actually have the benefit of that freedom of choice. The
provision was that a physician providing such services had to opt out
of all Medicare treatment 2 years in advance.
In other words, patients still had the right to go to a physician.
But any physician that provided those services could not provide any
Medicare services for a period of 2 years. That meant that it was
virtually impossible then for physicians to serve these particular
patients.
[[Page S12081]]
In an effort to try to resolve that, we introduced the Medicare
Beneficiary Freedom of Contract Act. It has almost 50 cosponsors in the
Senate, well over 100 cosponsors in the House version sponsored by the
chairman of the House Ways and Means Committee, Bill Archer. We hoped
that we would have the opportunity to get that passed before the end of
this legislative session this year. It was not to be. People in the
House of Representatives did not feel that they wanted to go forward
with it under the constraints of time. There were some other issues. As
a result, we did not push it as an amendment to one of the
appropriations bills or other vehicles by which we could have done that
here in the Senate.
Instead, I sought to proceed in a way that would enable us to ensure
that we would make progress early next year on getting this issue
resolved. Yesterday, I met with the President's nominee to head HCFA,
Nancy-Ann Minn Deparle. She gave me a series of assurances of ways that
they want to continue to work on this problem. I also received a phone
call from Secretary Shalala providing the same assurances that we will
be able to sit down and work with the administration to try to resolve
this issue so that early next year we will be able to pass legislation
that will solve this problem of Medicare-private contracting.
In addition to that, I received some assurances from Nancy-Ann Minn
Deparle that the law that goes into effect on January 1 would not
affect the provision of services not covered by Medicare. It would not
affect the provision of service only partially covered by Medicare--on
Medicare, for example, a second mammography beyond the annual
mammography covered by Medicare. It would not affect the provision of
care under the Medicare Plus Choice Plan, the Medical Savings Account
option, and it would not affect the ability of other physicians in a
group practice to treat Medicare beneficiaries when a patient makes a
private contract with one of the group practitioners.
We worked on some of the other problems relating to this in addition
to try to develop legislation next year that will be approved by the
House and Senate and the administration. I will report more on the
progress of this after a while.
I would like to introduce into the Record two items that came to my
attention this morning. One, a copy of three letters that were
published.
Mr. SPECTER. Mr. President, if my colleague will yield, I inquire:
How much time does the Senator intend to use?
Mr. KYL. I am finishing right now.
I ask unanimous consent to have printed in the Record the text of
three letters carried in the New York Times on Friday, November 7, and
a copy of an editorial in the San Francisco Chronicle, and the date is
November 6, 1997.
There being no objection, the material was ordered to be printed in
the Record, as follows:
[From the New York Times, Nov. 7, 1997]
Health Care Is Too Important for Partisanship
To the Editor:
``Move Under Way to Try to Block Health Care Bills'' (front
page, Nov. 4) points up that health care reform is again
being treated as a partisan issue rather than the bipartisan
issue it should be. The health care system is in critical
condition.
Costs are rising at twice the rate of inflation and will
double in the next 10 years. The number of uninsured--
estimated to be between 41 million and 44 million--is
increasing by a million a year, and the quality of care
continues to erode.
Competition and managed care have been promoted as
solutions, yet the marketplace has done little to stem long-
term cost, quality and coverage problems, which show no sign
of abating.
Opponents of reform being considered in Congress contend
that the proposals would increase costs even more and drive
more people out of health coverage.
Yet without change in the way we deliver and pay for health
care, costs will rise more rapidly and the number of
uninsured will grow larger.
Partisan posturing only aggravates the problems for all
Americans.
Henry E. Simmons, M.D.,
Pres., Natl. Coalition on Health Care.
____
Kyl Proposal Isn't New
To the Editor:
``Republican Health-Care Mistakes'' (editorial, Nov. 5)
overlooks that the wording of the bill sponsored by Senator
Jon Kyl, which would allow Medicare patients to pay doctors
more than Government-set rates, would only preserve and
codify the status quo.
The Medicare law and its amendments never forbade
contracting between physicians and beneficiaries outside of
Medicare. It was the heavy hand of the Health Care Financing
Administration that articulated the draconian regulations
forbidding outside contracting. A 1992 court decision
(Stewart v. Sullivan) was moot on the subject of outside
contracting, effectively allowing it.
Consequently, we have already had Medicare outside
contracting without all of the hazards you predict: illegal
double billing of both the patient and Medicare, a two-tier
system of care and unequal bargaining between physician and
patient. You propose to fix the functional status quo with
one that decrees loss of individual freedom of choice at a
moment when life and death decisions may be crucial.
Robert L. Soley, M.D.
____
Competent at 65
To the Editor:
Re ``Republican Health-Care Mistakes'' (editorial, Nov. 5):
You miss the point of the Kyl amendment. There are 65-year-
olds more than able to negotiate on their own behalf and who
feel demeaned when the Government robs them of the right. Why
deny them the same rights that they had the year before they
turned 65?
The low regard for the integrity of physicians your
editorial expresses is offensive. In spite of all the chaos
in the health care sector, the primary reward of the
physicians I speak with comes from helping patients.
Do you really think the typical physician is bent on
defrauding people?
Herbert S. Gross, M.D.,
Clinical Professor of Psychiatry,
University of Maryland.
____
[From the San Francisco Chronicle, Nov. 6, 1997]
Freedom of Choice On Medical Care
The Balanced Budget Act of 1997 was supposed to give
elderly patients greater freedom of choice on medical care.
But it stopped short of offering genuine choice. Here's the
situation.
Under current rules, doctors are prohibited--criminally
prohibited--from charging Medicare patients more than the
amounts permitted by the government, even if the patients are
willing to pay the money out of their own pocket. These
restrictions have kept Medicare patients from being able to
use their own money to see doctors--even specialists--as they
choose.
This restriction is all the more onerous for patients
because so many doctors have become disenchanted with
Medicare, which reimburses at about 70 percent of the rate of
private insurers. As a result, some senior citizens have
trouble finding a doctor willing to take them.
Recognizing the problems with the restrictions, Congress
recently voted to allow Medicare beneficiaries the option to
privately contract with doctors for any service at any
price--with one caveat.
And that caveat, insisted upon by the Clinton
administration, is a whopper that effectively undermines the
patient's freedom of choice. The Clinton-pushed amendment to
the bill provides that any physician who enters into such a
private contract cannot receive any Medicare reimbursement
for two years. Those new rules go into effect January 1.
Senator Jon Kyl, R-Ariz., has introduced legislation (S.
1194) that would get rid of the two-year restriction on
doctors who enter into the private contracts. His plan to
open up choices for Medicare patients has encountered intense
opposition from powerful groups, notably the American
Association of Retired Persons.
Defenders of the status quo argue that Medicare patients
have no shortage of choices. ``The idea that doctors don't
take Medicare patients is fallacious,'' said Representative
Pete Stark, D-Hayward, a longtime advocate of universal
health care. Stark maintains that a private-payment option
would create a two-tiered system--``boutique health care''
for the wealthy, while Medicare would be left to tend to the
poorest and the sickest.
There is a little problem with the all-is-well premise of
those who oppose the Kyl bill. If Medicare really did offer
satisfactory choice and service for beneficiaries, then none
of them would want or need to dig any deeper into their
pockets for medical care.
This issue also involves a matter of privacy--which is why
the American Psychiatric Association strongly supports the
Kyl bill. Medicare covers 50 percent of the cost of
psychotherapy, but some patients would rather pay the full
freight in order to avoid the government's ability to review
their claims, said the APA's Jay Butler.
Medicare patients deserve a chance to decide for themselves
what kind of care they want, and whether they are willing to
pay for it.
Mr. KYL. With that, Mr. President, I will complete this at another
time since I know Senator Specter wants to move forward.
Mr. SPECTER addressed the Chair.
The PRESIDING OFFICER. The Senator from Pennsylvania is recognized.
Mr. SPECTER. Mr. President, I thank my distinguished colleague from
Arizona. I had sought a time determination because we have 90 minutes
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on the bill and are scheduled to vote at 2:30. The way our colleagues
work, people will be ready to depart for trains and planes at 2:29.
So if the clerk will report now, I know that there are other Senators
who wish to speak and there will be time to speak during the 90-minute
time. Then by unanimous consent we can go into morning business. But I
request that we proceed at this time to the consideration of the
conference report on Labor-HHS and Education.
____________________