[Congressional Record Volume 151, Number 68 (Friday, May 20, 2005)]
[Extensions of Remarks]
[Page E1046]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




              THE PRESERVING MEDICARE FOR ALL ACT OF 2005

                                 ______
                                 

                        HON. BENJAMIN L. CARDIN

                              of maryland

                    in the house of representatives

                         Thursday, May 19, 2005

  Mr. CARDIN. Mr. Speaker, I rise to introduce legislation to help 
fulfill the promise made by Congress and the President to our seniors. 
This year, Congress may consider a multifaceted approach to programs 
that affect the security of our seniors. Any discussion about ensuring 
the financial security of retired Americans must also take into account 
their ability to access meaningful prescription drug coverage.
  In November 2003, Congress passed legislation to provide limited 
coverage for prescription drugs. I opposed that legislation because it 
contained serious flaws that will result in more harm than help for 
Medicare beneficiaries. The bill that I am introducing today, the 
Preserving Medicare for All Act of 2005 corrects the legislation's 
structural defects and provides additional beneficiary protections.
  Over the past several years, I have met with thousands of seniors in 
my district about Medicare and their need for prescription drug 
coverage. They brought me their empty pill bottles and their pharmacy 
receipts. With the highest out-of-pocket costs of any age group in the 
country, they and millions of other seniors across the nation were 
looking to Congress for real prescription drug coverage that would give 
them substantial help with their drug costs. They wanted their drug 
benefit to be provided like other benefits covered by Medicare--
administered by the Centers for Medicare and Medicaid Services, CMS, 
with a guaranteed benefit, universally available regardless of where 
they live, for it not to jeopardize existing coverage, and yes, they 
wanted the choice of their own doctor and hospital and the freedom to 
choose a private health plan if they prefer that option.
  I believe that a clear majority of the House and Senate wanted to 
enact legislation that met our seniors' needs. Unfortunately, the bill 
that moved through Congress failed to provide seniors with what they 
needed or expected. The plan that became law will not be administered 
by CMS but by private insurers.
  Under the 2003 law, the government is prohibited from using the 
purchasing power of 40 million beneficiaries to lower drug prices. 
There will be no guaranteed benefit, but rather an ``actuarially 
equivalent'' benefit whose components insurance companies can 
manipulate to discourage high-cost seniors from enrolling. It will not 
be universal, because these insurers can offer different coverage in 
different areas of the country. It will jeopardize existing coverage: 
the Congressional Budget Office has estimated that 2.7 million 
retirees--half of whom have annual incomes of less than $30,000--will 
lose the drug benefits they now enjoy as a result of insufficient 
subsidies to employers. Late last year, 14 months before the drug 
coverage provisions of the law are to take effect, hundreds of seniors 
in my district began receiving notices that their employer-based drug 
coverage would be dropped as their benefits are ``coordinated'' with 
Medicare.
  Under the guise of ``choice'' and ``competition,'' this bill gives 
billions of extra dollars to managed care plans, which are already 
reimbursed at rates one-fifth higher than fee-for-service Medicare. 
This so-called ``stabilization fund'' and a premium support 
demonstration project are not designed to offer choice, but instead to 
lure younger, healthier seniors away from traditional Medicare and into 
private plans. These features of the bill do not save money, according 
to the Congressional Budget Office's estimate. Instead, scarce dollars 
that could be used to provide a better drug benefit are used to 
increase health plan profits. Those beneficiaries who remain in fee-
for-service Medicare will be isolated in an underfunded program and 
they will see their premiums skyrocket as a result of phony 
``competition.''
  Finally, the new law includes a ``cost containment'' provision that 
actually shifts rather than contains costs. By combining the Part A and 
Part B Trust Funds and creating a new definition of insolvency that 
caps Medicare's use of general revenues at 45 percent of total Medicare 
costs, this provision would force government to cut benefits or raise 
payroll taxes if this limit is exceeded. More than any other element of 
the new law, this provision would undermine the entire Medicare system 
as we know it, shifting the burden of the program onto those least able 
to afford it.
  The bill I am introducing today will modify these damaging aspects of 
the new Medicare law. First it will authorize the HHS Secretary to use 
the purchasing power of 40 million seniors and disabled Americans to 
negotiate lower drug prices. Second, it will guarantee seniors the 
choice of a nationally available, defined benefit within Medicare. The 
premium, deductible, copays and stoploss will be set by law, not by 
private insurers. Third, my bill will fully reimburse employers for the 
cost of qualified retiree drug coverage and it will permit their costs 
to count toward seniors' catastrophic limits. Fourth, it will repeal 
the premium support demonstration and help ensure that Medicare remains 
a national program with equal access for all seniors. Fifth, it will 
eliminate the ``stabilization'' fund for private health insurers and 
dedicate these funds to strengthening the traditional Medicare program 
for seniors. Finally, it will eliminate the ``cost containment'' 
provision of the bill, which will harm both working families, seniors, 
and health care providers.
  Mr. Speaker, the Medicare prescription drug provisions of this bill 
will not take effect until 2006. We have time to fix the structural 
problems that prevent this law from benefitting today's beneficiaries 
and those who will depend on Medicare in future years. If this Congress 
is serious about the financial security of older Americans, it will 
make every effort to keep the promises we have made to our seniors. I 
urge my colleagues to cosponsor this legislation.

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