[Congressional Record Volume 146, Number 90 (Thursday, July 13, 2000)]
[Extensions of Remarks]
[Pages E1226-E1227]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                             LIVE A LITTLE

                                 ______
                                 

                           HON. BARNEY FRANK

                            of massachusetts

                    in the house of representatives

                        Wednesday, July 12, 2000

  Mr. FRANK of Massachusetts. Mr. Speaker, I have for some time felt 
that we have overemphasized the importance of holding down the cost of 
medical care as a general principle. The notion that if the total 
amount we spend on medical care in all of its facets as a percentage of 
the gross domestic product exceeds some arbitrary figure we will be 
damaged economically is demonstrably false. A dozen years ago or so, 
people were convinced that America's economic performance was being 
retarded because we spent too much on medical care. No one can now make 
that argument, given the strength of our economy, and the continued 
high percentage that medical care absorbs of our gross domestic product 
compared to many other countries.
  Indeed, I believe this notion that medical care costs must be held 
down despite the good that is accomplished by medical care expenditures 
has caused us serious problems in recent years. The ill-advised, ill-
named Balanced Budget Act of 1997 inflicted serious cuts on the 
Medicare program from which health care providers and patients are 
still suffering, and undoing this terrible mistake is long overdue.
  Because I feel this very strongly, I was especially pleased in a 
conversation with journalist Jonathan Cohn to learn that he had written 
on the subject, and I asked him to send me a copy of the article. 
Having read it, I am delighted to share it with my colleagues. It is a 
year old, but it is not old in any other sense. Mr. Cohn's arguments 
are cogent and supported by our experience. As Mr. Cohn notes, ``among 
all of the things a nation's wealth could buy, surely the health of its 
citizens is near the top.'' I am very pleased that Mr. Cohn has set 
forward the argument for adequately funding our medical care needs in 
so a persuasive a fashion, and because this continues to be a matter of 
some debate in the Congress, I submit his article from the June 7 New 
Republic on this topic to be reprinted here.

                 [From The New Republic, June 7, 1999]

                             Live a Little

                            (Jonathan Cohn)

       My grandfather survived three heart attacks and a stroke 
     over the course of his lifetime. And he did so thanks to some 
     of the

[[Page E1227]]

     best medicine that insurance could buy: a heart bypass 
     operation, extensive hospitalization, plus literally 
     thousands of hours of one-on-one nursing care after the 
     stroke left him partially paralyzed. I remember when the 
     stroke hit: the doctors predicted he'd live maybe nine more 
     months. That was in 1986. He passed away last year.
       It would be near impossible to add up my grandfather's 
     medical bills, but I'm sure they totaled hundreds of 
     thousands of dollars. He benefited from a wide range of 
     pharmaceutical products, the most advanced medical technology 
     in the world, and care from highly trained specialists. Above 
     all, he benefited from a health care financing system willing 
     to subsidize such extravagance at every level--from the 
     training of the surgeons to the research that invented blood-
     thinners to the salary of the worker who lifted him in and 
     out of his wheelchair every day.
       I thought about that last week when I read an article on 
     rising health insurance premiums. It was merely the latest 
     confirmation of a trend many economists have long predicted: 
     that, after years of stability, the real price of health care 
     in America is about to start climbing again. According to a 
     study published last fall in the journal Health Affairs, the 
     nation's total health care bill will likely go up by 3.4 
     percent annually over the next four years--compared with a 
     rate of just 1.5 percent in the period from 1993 to 1996. By 
     2007, the study predicted, health care will soak up 16 
     percent of the gross domestic product. That would be quite a 
     lot of money, particularly when you consider that we already 
     sink more than 13 percent of GDP into health care--more than 
     any other nation and well more than we spent in 1970, when 
     health care was just seven percent of GDP.
       The predictions are probably right. Today, about 85 percent 
     of Americans who hold private insurance are enrolled in 
     health maintenance organizations or other forms of managed 
     care, which hold down costs by emphasizing preventive 
     medicine; controlling access to tests treatments, and 
     specialists; and simply bidding down the services of doctors 
     and hospitals. Most of the people in these plans shifted over 
     from costly fee-for-service insurance only in the past few 
     years, and that transformation is the primary reason health 
     care spending has remained stable during that time. But the 
     cost containment from HMOs seems to have been a onetime 
     phenomenon. Now expenditures on health care are going back 
     up, if at a somewhat reduced clip, in part because people are 
     starting to demand some of the things HMOs have been denying 
     them, in part because the population is living longer, and in 
     part because researchers continue to come up with expensive 
     new technological innovations that patients want, from Viagra 
     to the protease inhibitors that keep HIV in check.
       Once the bill for all of this spending comes due, in the 
     form of higher insurance premiums and more government 
     spending, you can bet that a chorus of experts and high-
     minded officials will start insisting that we're spending too 
     much. Some will do what former Colorado Governor Richard Lamm 
     did back in 1992: they'll come right out and say we need to 
     stop coddling the elderly with the kind of ``long-shot 
     medicine'' that sustained my grandfather and made him more 
     comfortable in his final years. Others will strike more 
     cautious tones, preaching the need to be more efficient in 
     our outlays, but the end result will be much the same: less 
     generous care particularly at the margins. In a sense, we're 
     already hearing early versions of this argument in the 
     ongoing debate over Social Security and Medicare--two 
     programs in which the current level of expenditures is widely 
     believed to be unsustainable over the long run.
       But this may be a case where the average citizen, who 
     intuitively wants to keep spending that money, knows more 
     than the average expert, who insists it's not possible. After 
     all, we spend far more on computers than we did 20 years ago, 
     but nobody makes a fuss about that. The reason is that 
     computers have made economy stronger and our lives 
     discernibly easier. Well, the same logic ought to apply to 
     health care. Among all of the things a nation's wealth could 
     buy, surely the health of its citizens is near the top. And, 
     while some critics might carp about inefficiency in the 
     system, that inefficiency keeps a good chunk of our country 
     employed--while enabling the population as a whole to work 
     longer and harder.
       To be sure, many critics question whether our robust health 
     care spending really translates into robust health. They 
     argue that, even though European nations spend less on health 
     care, the differences in health care ``outcomes'' and life 
     expectancy are minimal. But it is notoriously difficult to 
     measure the impact of health care spending. For one thing, 
     those comparatively frugal counties benefit from the 
     pharmaceuticals and treatments largely subsidized by big 
     spending in the United States. What's more, the benefit of 
     more health care spending may be simply to provide a few more 
     weeks here and there, or to make life just a little more 
     comfortable for some of the nation's sickest people. This is 
     not the kind of thing that makes a big difference 
     statistically, but it is the kind of thing a society might 
     rightly deem important. After all, this is what usually 
     happens in societies as they progress economically: the 
     percentage of labor time spent on producing bare 
     necessities--food, shelter, and clothing--shrinks, freeing up 
     greater resources for making life more pleasant.
       This isn't to say we parcel out all of our health care 
     dollars wisely. Among other things, we currently subsidize 
     emergency care for the uninsured, which is at once very 
     expensive and not terribly efficient at keeping people 
     healthy, while denying them the basic care most other nations 
     offer as a privilege of citizenship. But the solution to this 
     problem is not to worry excessively about how big the bill 
     has gotten; if anything, we should be making the case for 
     spending even more money and them making sure it's meted out 
     on a more egalitarian basis. (Sound crazy? No less a sober 
     mind than MIT economist Paul Krugman once made a similar 
     argument, speculating that spending as much as 30 percent of 
     GDP on health care might not be unreasonable.)
       Yes, there is one catch. If you want to spend that much 
     money on health care, you have to find the money to spend. 
     But that's not a problem--or, at least, it shouldn't be. We 
     have enjoyed enormous gains in productivity over the past few 
     years, which means as a nation we are creating more wealth--
     wealth that can easily be directed to health care rather than 
     to, say, sport utility vehicles, either in the form of higher 
     insurance premiums or (heaven forbid!) higher taxes. ``The 
     alternatives uses of our resources are not necessarily more 
     noble,'' Mickey Kaus once wrote in this space. He's right. 
     There are a lot of things we could have bought my grandfather 
     in his final months. But none was as valuable as the time 
     itself.

     

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