[Congressional Record Volume 148, Number 75 (Monday, June 10, 2002)]
[Senate]
[Pages S5286-S5287]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. DASCHLE (for Mr. Harkin (for himself and Mr. Craig):
  S. 2605. A bill to amend title XVIII of the Social Security Act to 
geographically adjust the amount of the Medicare part B premium based 
on the use of health care items and services in the State in which the 
Medicare beneficiary resides, and for purposes; to the Committee on 
Finance.
  (At the request of Mr. Daschle, the following statement was ordered 
to be printed in the Record.)
 Mr. HARKIN. Madam President, there few programs that are more 
important to the health and quality of life of Americans than Medicare. 
It has been a godsend for millions of Americans. It deserves our strong 
support. We need to make sure that Medicare is strong, secure and 
improved for the future.
  The biggest gap in Medicare's coverage is it's lack of help with the 
high costs of prescription drugs. I feel strongly that we must move 
forward to provide seniors with an affordable, reliable Medicare 
prescription drug benefit this year. I call on our leadership to bring 
legislation to the floor so that we can provide seniors with much 
needed relief.
  Another area that is in urgent need of improvement is the fairness of 
the distribution of Medicare's payments and costs throughout the 
states. The Medicare program is placing seniors and health care 
providers in certain States at a severe disadvantage compared to other 
States. There are currently unjustifiable inequities in the system that 
affect the way in which both seniors and health care professionals are 
treated. Rather than rewarding States with healthy populations, that 
have efficient, high quality health care practices, and practice health 
care cost containment, the Medicare system is punishing these States.
  For example, seniors enrolled in the Medicare program pay monthly 
part B

[[Page S5287]]

premiums of $54 across the United States. Medicare part B premiums are 
set by law to cover 25 percent of total national Part B spending 
regardless of where one lives or how many services one uses. However, 
data provided by the Medicare Payment Advisory Commission, Medpac, 
shows that the amount of part B services seniors use state by state 
varies significantly, from 70 percent of the national average to 128 
percent of the national average. This is because in States like Iowa 
seniors lead healthier lifestyles and use fewer health care services 
and we have excellent health care providers who have always practiced 
efficient, conservative medicine. I believe that a health 
population, and an efficient health care system, should be rewarded 
under the Medicare program; however the system has been established to 
achieve quite the opposite.

  Not only do seniors in my State have higher Medicare part B premiums 
because of the higher number of services seniors receive in other 
states, health care providers in my State are receiving the lowest 
reimbursement levels in the country. Iowa health care providers receive 
$3,053 on average per beneficiary, while the national average is 
$5,490, and the highest state receives over $7,000 per beneficiary. 
Senator Craig and I, along with a host of our colleagues, have 
introduced a bipartisan bill called the Medicare Fairness in 
Reimbursement Act, S. 1020, that would reduce this unjustified 
disparity that serves to punish the health care providers in our states 
year after year. Under the FAIR Act, no state would be under 95 percent 
of the national average, and no state would be over 105 percent of the 
national average. A similar adjustment would be made for the part B 
geographic payment indices.
  We must work to alleviate the disparity that exists between states 
under the Medicare program, before we drive those states into a crisis. 
We can no longer ignore the direct and critical connection between 
provider reimbursement under the Medicare program, and access to high 
quality health care for our seniors.
  That is why today I am pleased to be joined by my colleague Senator 
Craig of Idaho in introducing legislation to increase fairness in 
Medicare part B premiums for seniors. Monthly Medicare premiums would 
be set at 25 percent of projected total Medicare Part B costs for each 
state, rather than nationally. For example, Minnesota seniors utilize 
the least amount of part B services, 70 percent of the national 
average. As a result, under our bill seniors in Minnesota would pay a 
monthly premium of $38, instead of the current national premium of $54. 
Seniors in my home State of Iowa use 75 percent of the national average 
of part B services, and therefore, under this bill they would pay a 
monthly premium of $41, rather than $54.
  Our legislation is budget neutral. It would simply set Medicare 
premiums based on state level costs rather than an aggregated national 
cost figure.
  It is common sense. If a person in Iowa goes out and buys car 
insurance, or health insurance for themselves, they will pay different 
premiums than someone buying insurance in New York or California. It's 
time for the Medicare program to stop punishing those States that have 
healthy seniors and efficient health care providers.
  We need to restore greater fairness in Medicare's payment among the 
50 States. However until we achieve greater equity, seniors in low cost 
States should not have to bear an unfair portion of health care costs. 
Senator Craig and I will be working to get this issue addressed as a 
part of Medicare reforms this year. I urge my colleagues to review this 
important new proposal and to join us in working to achieve its 
passage.
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