[Congressional Record Volume 149, Number 168 (Wednesday, November 19, 2003)]
[Senate]
[Pages S15110-S15111]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                            MEDICARE REFORM

  Mr. SANTORUM. Mr. President, I thank the Senator from Texas and thank 
colleagues for their remarks this morning. I rise to talk about the 
Medicare prescription drug bill that is still being worked out. I think 
it needs to be stated that this is still a process. We have an 
agreement in principle, but there are still issues having to do with 
how much the bill will cost and whether it is going to be within the 
$400 billion framework that has been laid out by both Houses of 
Congress and by the President. They are still working through that.
  As a result, there will be some changes, probably, over the next 24 
to 48 hours as to what this bill is going to look like in particular. 
But we do have a sense of what the broad outlines are. I have to tell 
you in all honesty, it is like any piece of legislation. There are some 
things that I really like, and there are some things that are good and 
I am in favor of. There are some things I don't like, and there are 
some things that I just darn well wish were not in the bill.
  The question is, How do you come out? That is a decision that every 
one of us is going to have to make on both sides of the aisle, because 
there are things I am sure every Member in this Chamber can look at and 
say: This is a good thing. The problem is, for about half of us who say 
it is a good thing, the other half will say it is a bad thing. But that 
is the nature of compromise. You try to come together to work out an 
overall package that is going to be beneficial to seniors, beneficial 
to taxpayers, and beneficial to the Medicare system over the long haul.
  That is what I want to talk about today. I think on balance this is a 
bill that achieves that.
  Let me lay out sort of my thoughts. No. 1, I am concerned with the 
overall Medicare system, the long-term health of that system. I think 
in part that is dependent upon the private sector system of this 
country upon which Medicare was built.
  You have to remember, Medicare was built on a 1965 Blue Cross plan. 
That was a private sector plan. The reason we are doing Medicare 
prescription drugs is because the private sector has been offering that 
for some time. So Medicare tends to follow what the private sector 
does.
  The question is, What is the private sector doing now? They are doing 
a lot of managed care, HMOs, PPOs, and other things insurance companies 
are trying to do to try to get costs under control, to increase quality 
and efficiency.
  Well, what are we trying to do with reforming the Medicare system? We 
are trying to put PPOs into Medicare. We already have some HMOs there. 
We are trying to expand that. What we are trying to do here is to 
conform Medicare to sort of a current state of play, as it was in 1965, 
and we are trying to conform it to what is working best in the private 
sector today. So that is one of the objectives we are trying to 
accomplish.
  This is my problem. I don't think, necessarily, that the current 
private sector--just as in 1965--is necessarily the most efficient way 
to run a health care system. I think there are fundamental underlying 
problems in the health care system that we are paying the costs for 
today. That is why our health care costs continue to go up. I think the 
fundamental problem is that people are not paying for their health 
care. When I say that, it is not that people are not paying for it 
through insurance. They are, and their premiums and copayments are 
going up to some degree.
  The overall cost for employers is going up, no question. One of the 
reasons the cost is going up is that utilization is going up, is that 
people's out-of-pocket expenditures don't conform to the benefit they 
are getting. In other words, they are paying $2 for $10 worth of 
service. As long as you are paying $2 out of pocket for a $10 benefit, 
you are probably going to continue to consume that benefit, 
disproportionate to other activities where you put $2 out of pocket and 
get $2 of benefit. We have to change that dynamic in health care, while 
maintaining insurance for people who need that coverage.
  The way this bill does that is just crucial. One of the reasons I am 
very excited about the bill is it puts in a provision called health 
savings accounts, which sets up a system in the private sector--it is 
not a Medicare provision but it is in the Medicare bill--it sets up a 
private sector reform to allow people to set up accounts so they can 
take more responsibility and more control over their health care 
expenditures. In a sense, by living healthier lives, by doing 
preventive care, doing all the things to maintain good health, they can 
actually save money and--this is the kicker--keep it. The insurance 
company doesn't benefit if you stay well and do the good things and you 
don't end up in hospitals or having surgeries. You benefit.
  So we are fundamentally changing the dynamic at the private sector, 
pre-Medicare level. Why is that important? If this is successful--and I 
believe it will be--it becomes a building block for future reform of 
Medicare, because once the employee population with private sector 
insurance, pre-Medicare, becomes used to and comfortable with this kind 
of program, they will be demanding it when we get to Medicare.
  It will infuse in Medicare what I believe is ultimately necessary, 
which is more individual control and responsibility for their health 
expenditures. So I argue that of all the things done, interestingly 
enough, in this Medicare bill, the most important thing I think we do, 
as a conservative, as somebody who believes in giving people more power 
and giving individuals more control, more choices, the most important 
thing we do in the Medicare bill isn't in Medicare but it is going to 
be a dramatic impact on it when the baby boomers retire and the costs 
go out of control.

  I make the argument--and we can get into the details of the Medicare 
bill--from the standpoint of a Republican conservative and to 
conservatives across this country, what we are doing with the reform in 
health savings accounts--they used to be referred to as medical savings 
accounts--is probably the most important, I argue, for the long-term 
future of Medicare because, as I said before, Medicare reform follows 
private sector reform. When the private sector changes, eventually 
Medicare will change to reflect that because that is what the public 
will want and demand.
  Within the Medicare system, we do put some reforms into place that 
are important. We have the reforms to Medicare Part B. We do put a 
Medicare drug bill in. Some people are saying: Well, as a conservative 
Republican, why do you want to put in a $400 billion new entitlement?
  The fact is, we have a health care system that doesn't cover health 
care

[[Page S15111]]

expenses. If we have a health insurance system that doesn't cover 50 
percent or, in some cases, more than 50 percent of the actual costs 
most people consume in health care expenditures, what kind of health 
care system is it, as far as insurance is concerned? It is not a very 
good one.
  Again, some Republicans are saying, well, we should be doing what the 
market is doing. Well, what the market did was cover drug costs. For us 
not to do that--I think it is a little disingenuous to make the 
argument that we should not take on this liability. I agree we need to 
have reforms and control costs, but we need to take on this 
responsibility because it is part and parcel of good quality health 
care in America today.
  The PRESIDING OFFICER. All time has expired.
  Mr. SANTORUM. I thank the Chair.

                          ____________________