[Congressional Record Volume 150, Number 38 (Wednesday, March 24, 2004)]
[Senate]
[Pages S3051-S3052]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           MEDICARE SOLVENCY

  Ms. STABENOW. Mr. President, I rise today to express tremendous 
concern about the latest news regarding the Medicare trust fund and the 
solvency of the trust fund. We are now hearing that Medicare, in fact, 
will become insolvent 7 years sooner than we had been told last year.
  During the time between last year and this year, there has been a 
Medicare bill passed by the Senate. I believe there is a direct 
correlation between what was passed, which I have deep concerns about, 
and the new number we are hearing about Medicare being jeopardized and 
becoming insolvent 7 years sooner.
  We know that in the bill that was passed last year, there were 
payments for the first time to private plans so they could compete with 
traditional Medicare. We know that, according to the Congressional 
Budget Office, it in fact has cost 13.2 percent more for the private 
sector through Medicare+Choice to provide the very same services as 
traditional Medicare. Rather than saying we should go, then, with the 
most cost-effective way to provide health care services for seniors and 
use traditional Medicare, the response, unfortunately, from the 
Congress and the President was to subsidize private insurance companies 
and HMOs so they could compete more favorably.
  Originally, it was $14 billion taken away from providing prescription 
drug coverage for seniors, helping to pay for their medicine, taking 
those dollars away from other preventive services that could be paid 
for, other direct services that could be given to our seniors, and it 
was put into providing subsidies for the private sector.
  Now we see in the new numbers how all of this has changed with the 
revelation of the tremendous increase in the cost of the Medicare bill 
which we were told after it passed. We are now told the first estimate 
of $14 billion being diverted is now really $46 billion being 
diverted--$46 billion not going to pay for our seniors receiving help 
with their medicine, to afford their medicine through Medicare, but 
being diverted to essentially privatize or help private plans be able 
to compete because it costs more to provide Medicare coverage and 
prescription drug coverage under private plans. We see greater costs 
there.
  Then right at the time we need to be doing everything possible to 
leverage and lower our costs, we know this Medicare prescription drug 
bill actually says in the middle of the bill that Medicare is not 
allowed to group purchase, to get bulk discounts, which is astounding. 
Every time I say that to a group of people at home in Michigan, they 
look at me in bewilderment: What in the world were you thinking that 
you would not try to get the best possible price through a bulk 
discount? Yet we know that one of the reasons there is increased costs 
in this bill is because they are not doing bulk purchasing.
  Why are they not doing bulk purchasing? Because the pharmaceutical 
industry does not want that to be done. They do not want us to get 
lower prices. They want us to pay the highest possible prices. So, 
unfortunately, this bill says that, which is another reason why I 
opposed the passage of the Medicare bill.
  Over and over we are seeing situations unravel that cause me great 
concern, not only about the new dollar amount, the new substance in 
this bill, but also about the process that brought us to the passage of 
the Medicare bill. I will speak now to some of what we have been 
hearing and reading in recent days and weeks.
  The Government's top expert on Medicare costs was warned he would be 
fired if he told key lawmakers about a series of Bush administration 
cost estimates that could have torpedoed congressional passage of the 
White House-backed Medicare prescription drug plan. This was written on 
March 12 of this year, just last week, in the Miami Herald. We know 
there were new estimates, new actual costs that were identified, and we 
were not told about them before the passage of this bill.
  We know that between November 20 and 24 of last year, administration 
officials repeatedly stated without qualification that the prescription 
drug bill ``will not cost more than $400 billion over 10 years.'' In 
making these representations, administration officials relied on CBO 
estimates without citing the conflicting estimates from their own 
analysts. This comes from a special report Health and Human Services

[[Page S3052]]

Secretary Tommy Thompson gave at the time, as well as other news 
reports.
  We then found out after the new year on January 29--not November, now 
we move up to January 29--the administration announced the Medicare 
drug bill would cost at least $534 billion over 10 years--$139 billion 
more, just as we find the new subsidies for private plans, insurance 
companies, and HMOs have gone up, and certainly there is no cost 
containment in this bill.

  On January 30, the President indicated he learned of the new 
estimates only 2 weeks earlier, but yet we find on February 12 
Secretary Thompson testified to the House Ways and Means Committee that 
they were given the final higher drug cost on Christmas Eve of 2003, 
which contradicts the President's earlier statements.
  Then on top of having conflicting information about the cost and when 
the administration knew about the cost, we also hear from a colleague 
of mine in Michigan, Representative Nick Smith, who said last fall 
unknown GOP colleagues had tried to bribe him into voting for the 
contentious prescription drug bill on November 22 by promising campaign 
help to his son who is running to replace his retiring father. This was 
reported in the Washington Post on March 15 of this year.
  We now know there is an ethics investigation going on in the House of 
Representatives regarding this process. We know when this bill first 
came up in the House, they did not have the votes for it and kept the 
board open an unprecedented 3 hours plus to change votes, to get the 
votes for this Medicare bill.
  Republican colleagues have said that if they had known the true cost 
at that time, they would not have voted for it. The cost was hidden. We 
did not find out what the true costs are, and then we see tremendous 
pressure on colleagues to vote for this bill, and now the Ethics 
Committee is looking into what happened in at least one circumstance.
  Then we move to another area of great concern to me, and that is the 
advertising of this particular legislation, this new Medicare bill. 
According to the New York Times on March 16:

       The administration then attempted to rally support and take 
     political credit for the prescription drug plan with 
     Government-produced TV ads masquerading as news reports. 
     Actors were hired by the Department of Health and Human 
     Services to pose as television journalists purveying facts, 
     upbeat ``news'' segments about the expanded Medicare 
     coverage.

  I also have concerns because in that particular taxpayer-funded 
advertising, we have found, as a result of a GAO report and a request 
for investigation that we asked to have done on March 10, the GAO 
concluded that the Bush administration's Medicare advertisements 
contain notable omissions and other weaknesses. While they indicate 
they are not unlawful, they have notable omissions and other 
weaknesses.
  One of my concerns about all of this is that we are seeing a lack of 
truthfulness regarding the cost of this bill. Many of us had great 
concerns about this bill in the beginning. We had colleagues being told 
one thing and then finding out another, saying if they had known, they 
would not have supported the bill; high pressure tactics going on and 
an ethics investigation now related to what was done in the House; and 
then we see taxpayers' dollars being used to put forward less than 
accurate information.
  The PRESIDENT pro tempore. The Senator's time has expired.
  Ms. STABENOW. I ask for an additional 1 minute.
  The PRESIDENT pro tempore. The Chair has no authority to allocate 
additional time. It has already been allocated.

  Ms. STABENOW. Without objection, I ask for an additional 1 minute.
  The PRESIDENT pro tempore. The Chair is compelled to object. The time 
has been allocated.
  Ms. STABENOW. I will simply indicate then I have deep concerns about 
this whole process, and now we find it affects the bottom line.
  The PRESIDENT pro tempore. The Senator's time has expired.
  Ms. STABENOW. I urge colleagues to relook at this Medicare bill and 
what is in the best interest of seniors.
  The PRESIDENT pro tempore. The Senator from New Jersey is recognized 
for 10 minutes.
  Mr. CORZINE. Will the Chair inform me when I have 1 minute remaining 
of the 10 minutes?
  The PRESIDENT pro tempore. Yes.
  Mr. CORZINE. I thank the Chair.

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