[Congressional Record Volume 153, Number 109 (Tuesday, July 10, 2007)]
[House]
[Pages H7471-H7479]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
REVISIONS TO ALLOCATION FOR HOUSE COMMITTEES
The SPEAKER pro tempore. Under a previous order of the House, the
gentleman from South Carolina (Mr. Spratt) is recognized for 5 minutes.
Mr. SPRATT. Madam Speaker, under sections 211 and 320(c) of S. Con.
Res. 21, the Concurrent Resolution on the Budget for fiscal year 2008,
I hereby submit for printing in the Congressional Record a revision to
the budget allocations and aggregates for the House Committees on
Energy and Commerce, Ways and Means, and Education and Labor for fiscal
years 2007, 2008, and the period of 2008 through 2012. This revision
represents an adjustment to the Committees' budget allocations and
aggregates for the purposes of section 302 of the Congressional Budget
Act of 1974, as amended, and in response to the bill S. 1701--to
provide for the extension of transitional medical assistance, TMA, and
the abstinence education program through the end of fiscal year 2007,
and for other purposes. Corresponding tables are attached.
Under section 211 of S. Con. Res. 21, this adjustment to the budget
allocations and aggregates of the Committees on Energy and Commerce,
Ways and Means, and Education and Labor applies while the measure--S.
1701--is under consideration. The adjustments will take effect upon
enactment of the measure--S. 1701. For purposes of the Congressional
Budget Act of 1974, as amended, a revised allocation made under section
211 of S. Con. Res. 21 is to be considered as an allocation included in
the resolution.
[[Page H7472]]
DIRECT SPENDING LEGISLATION--AUTHORIZING COMMITTEE 302(a) ALLOCATIONS FOR RESOLUTION CHANGES
[Fiscal years, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
2007 2008 2008-2012 Total
House committee -----------------------------------------------------------------------
BA Outlays BA Outlays BA Outlays
----------------------------------------------------------------------------------------------------------------
Current allocation:
Education and Labor................. $0 $0 $-150 $-150 $-750 $-750
Energy and Commerce................. 0 0 0 0 0 0
Ways and Means...................... 0 0 0 0 0 0
Change in TMA extension bill (S. 1701):
Education and Labor................. 13 4 0 5 0 8
Energy and Commerce................. -1 -1 134 132 89 87
Ways and Means...................... 0 0 -38 -38 -98 -98
Total........................... 12 3 96 99 -9 -3
Revised allocation:
Education and Labor................. 13 4 -150 -145 -750 -742
Energy and Commerce................. -1 -1 134 132 89 87
Ways and Means...................... 0 0 -38 -38 -98 -98
----------------------------------------------------------------------------------------------------------------
BUDGET AGGREGATES
[On-budget amounts, in millions of dollars]
----------------------------------------------------------------------------------------------------------------
Fiscal year 2008 Fiscal years
Fiscal year 2007 \1\ 2008-2012
----------------------------------------------------------------------------------------------------------------
Current Aggregates: \2\
Budget Authority...................................... $2,255,558 $2,350,261 n.a.
Outlays............................................... 2,268,646 2,353,893 n.a.
Revenues.............................................. 1,900,340 2,015,841 $11,137,671
Change in TMA extension bill (S. 1701):
Budget Authority...................................... 12 96 n.a.
Outlays............................................... 3 99 n.a.
Revenues.............................................. 0 0 0
Revised Aggregates:
Budget Authority...................................... 2,255,570 2,350,357 n.a.
Outlays............................................... 2,268,649 2,353,992 n.a.
Revenues.............................................. 1,900,340 2,015,841 11,137,671
----------------------------------------------------------------------------------------------------------------
\1\ Pending action by the House Appropriations Committee on spending covered by section 207(d)(1)(E) (overseas
deployments and related activities), resolution assumptions are not included in the current aggregates.
\2\ Excludes emergency amounts exempt from enforcement in the budget resolution.
Note.--n.a. = Not applicable because annual appropriations Acts for fiscal years 2009 through 2012 will not be
considered until future sessions of Congress.
HEALTH CARE IN AMERICA
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 18, 2007, the gentleman from Texas (Mr. Burgess) is recognized
for 60 minutes as the designee of the minority leader.
Mr. BURGESS. Mr. Speaker, this evening, I wanted to come to the floor
of the House to talk once again a little bit about health care. Health
care in this country is going to be something that is on the front
pages during the next 18 months until the next Presidential election, I
suspect, and something we're going to devote a great deal of time and
energy to on the floor of this House, perhaps even this month.
As we debate the future of medical care in this country over the next
18 months and through the Presidential election that will follow in
2008 and the Congress that convenes in 2009, we've got to decide on the
avenues through which our health care system will be based. And
essentially, Mr. Speaker, right now we have a system that is based part
on the government, part on the public sector, and partly on the private
sector.
The issue before us is, do we expand the public sector? Do we expand
the government's involvement in health care? Do we expand the
government's involvement in the delivery of health services, as
popularly referred to as universal health care, and back in the 1990s,
it was termed ``Hillary care,'' or do we encourage and continue the
private sector involvement in the delivery of health care? The two
options bring about a significant number of questions and a significant
number of concerns addressed on both sides of the aisle. But I'm
hopeful that as we continue to study this problem and debate this
problem in this body, we will shed some light on the direction that we
should be taking.
And Mr. Speaker, I don't think there is any question that the United
States has developed one of the best health care systems in the world.
Access can be an issue, but the quality of health care practiced in
this country is second to none. You have people coming from all over
the world. When I was a medical student at the Texas Medical Center
down in Houston, Texas, you would have people coming from all over the
word to avail themselves of the medical care that was available at
Texas Medical Center. And close to my district in north Texas, you have
Southwestern Medical School in Dallas, a number of Nobel Laureates on
the clinical faculty there. Unbelievable sources of talent and
knowledge that are available to training the young physicians of
tomorrow. So these are the types of things we've got to be certain that
we preserve, protect and defend as we do things that will perhaps alter
the way medicine is practiced in this country.
Now, there are a lot of people who take issue with the fact that I
maintain that the United States has the best health care system in the
world. Plenty of people here in this body would say that's an
overstatement. They would say, you've got a large number of uninsured
people in this country, or prescription drugs cost way too much. The
issues are there, but you know what, Mr. Speaker? The old saying is
that numbers don't lie, but if you torture them long enough, they'll
admit to almost anything.
We've got to dispense with a lot of the platitudes and the soundbites
and try to get to really what is causing the problems that we have
here, and how can we best go about correcting those problems? Well, how
about applying some American ingenuity to getting those problems
solved.
So, tonight, in talking about the different principles that guide the
debate about public versus private in the delivery of health care
services, it's important to concentrate a little bit on the background
on how we got to the system that we have today.
The idea that we have a problem to solve is not new. Secretary
Leavitt, I certainly agree with him when he made the remarks in a
speech not too long ago that tackling the division between the two
philosophies, public versus private, recently the Secretary said in a
speech and in an op-ed piece, he posed the question, should the
government own the system, or should the government be responsible for
some organization in the system and leave the proprietary standpoint to
someone else?
Mr. Speaker, during World War II, this country was faced with some
significant problems, and one of the problems was the specter of
inflation. So Franklin Roosevelt said, look, we're going to have wage
and price controls in this country so that inflation doesn't get out of
control. Employees found themselves highly sought after because a lot
of the workforce was overseas fighting the war. Employers wanted to
keep their employees happy. They wanted to keep them employed. They
wanted to keep them loyal to their respective companies, but they were
unable to raise wages because there was a Presidential decree that we
were under wage and price controls. So the Supreme Court rendered a
decision that benefits, things we talk about now
[[Page H7473]]
as a benefits package, health care, retirement, these things could be
available and would not violate the spirit of President Roosevelt's
wage and price controls. Thus, the era of health insurance benefits or
employer-derived health insurance was born. And Mr. Speaker, it worked
tremendously well, so well that it persisted well after the end of the
Second World War.
Now, a lot of people will look at Western Europe and say, they've got
a government-run system. Why don't we do what Europe did? How did
Europe develop a system, a single-payer, government-run system? Even
though some of the countries in Western Europe were victorious at the
end of the Second World War, the war was fought in their back yard;
their economies were devastated. It was important for their governments
to stand up a medical care system quickly to avert a humanitarian
crisis. That is what led to the institution of single-payer systems
that you see in many countries in Europe today.
But America, by contrast, came through the war with a benefits
package, if you will, that was available to employees. Employees like
it. Employers liked it because the employees were happy. The employees
stayed, to some degree, healthier and were able to work more
effectively and less time off for sick leave. So the American system
persisted and did very well for a number of years.
Now, fast forward some 20 years from the end of the war to the middle
of the administration of Lyndon Johnson, fellow Texan, fellow House
Member, albeit on the other side of the aisle, but during the tenure of
President Johnson, he signed both the Medicare and the Medicaid
programs into law. This was a large government program and represented
a fundamental shift. It was the first time that the government got
involved in a big way in running the practice of medicine. But it was
created to focus on the elderly, to focus on their hospital care and
their doctor care, and certainly make sure that persons who were then
to be covered by Medicare weren't left in poverty in old age because of
mounting medical bills.
But then fast forward another 40 years to the 108th Congress, and we
had the Medicare system that was big and expensive and was very, very
slow at change. It was like trying to turn a battleship. In 2003, in
this House of Representatives, the President came to us, in the very
first State of the Union message that I attended as a Member of
Congress in my first term, and the President said he was going to, or
this Congress was going to bring a Medicare prescription drug benefit
to Medicare, that people had waited too long for this; it was too
important to wait for another President or another Congress. And
indeed, Congress set about the work of providing what we now know as
the Part D benefit. And within the year, we voted on that package, and
within the next year, it was, indeed, starting to be run. But the
government system needed to address some of the inefficiencies that
were built into the system.
Now, the Medicare prescription drug plan has given seniors access to
medications that, quite frankly, they just didn't have available
before. And when you look at how medicine has changed from 1965 to
2005, when the Medicare drug plan took effect, the changes that had
been brought about by the advances in medical research, my dad was a
doctor as well, and I used to tease him that, back in 1965, doctors
only had two pharmaceutical choices, penicillin and cortisone, and they
were regarded as interchangeable. My dad didn't think that was very
funny. But the fact is, you come to 2005, look at the lives that have
been saved by the introduction of a medicine like statin, medicines
that are used for reduction of cholesterol. Dr. Elias Zerhouni of the
National Institutes of Health estimates that 800,000 premature deaths
have been prevented between 1965 and 2005 with the introduction of
medicines to manage cholesterol and lipid levels in patient's blood.
That's a tremendous change. In 1965, some people simply had the heart
attack and died. In 2005, 2007, that no longer happens. But they are
required, in order to maintain that state of health, to be maintained
on a medication. Well, if the medicine is too expensive for the patient
to buy, they don't take it, and they suffer the health consequences.
And as a consequence, the system becomes more expensive because people
end up utilizing the system more frequently and the outcomes for
disease management become much worse.
The Medicare Prescription Drug Program has been successful. There
have been a certain number of people who have been critical, but it has
been a great benefit for seniors. And the fact that it is up and
running now well into its second year, there is a great deal of
satisfaction, and the penetrance into the number of people who have had
prescription drug benefits who are covered by Medicare is now at an
all-time high.
Now, in this country, as I mentioned earlier, the government pays for
about half of our health care expenditures. We have a GDP of roughly
$11 trillion in this country. The U.S. Department of Health and Human
Services states that Medicare and Medicaid services alone, in fact when
we vote on our Labor-HHS appropriations bill this year, it will be
significantly north of $600 billion.
{time} 1900
So that is about a half of what we spend in health care.
The way the other half is broken down, primarily the weight is borne
by commercial insurance, by private insurance. There is a significant
number of dollars that are contributed as charity care or uncompensated
care. Certainly there are some individuals who do still simply just pay
for their medical care out of pocket, but about half are from the
Government source and half from private sources or the goodwill of
America's physicians.
The numbers are going to increase because the overall dollar
expenditure in health care is going to increase. The baby boomers are
aging. There are more and more advances discovered with every passing
month. The Federal Government is going to continue to funnel taxpayer
dollars into Medicare. We have to ask ourselves, are we getting value
for the dollar? Are we doing the best that we possibly can do with that
money? Is the government doing an excellent job of managing our health
care dollars? Do we think that the government is better suited to be
the arbiter of a person's health care needs, or are those decisions
better left up to an individual and their family? And who, at the
fundamental end of it all, who is better able, who is going to be able
to handle the growing health care needs in this country?
I would argue that if you have a public only, a government-run
system, a universal, single-payer system, that in America it is going
to be a significant problem. In fact, it will have the perverse
incentive of hampering our innovation and perhaps even hampering the
delivery of the most modern health care services available.
As an example, I would suggest that we have a model that we can
examine, and that is our neighbor to the north in Canada. Canada has a
completely government-run system. The Supreme Court in Canada in 2005,
however, said that the waiting times in Canada were unconscionable and
access to a waiting list did not equate to the same thing as access to
care.
Now, in Canada they actually have a safety valve, because if somebody
needs a medical procedure or needs a medical test done, they actually
do have an area where there is a surplus of medical care available, and
that would be on their southern border, the United States of America.
So if somebody has the ability to pay and wants to come from Canada and
cross the border to Henry Ford Hospital in Detroit, they are very
capable of doing that. I am certain that the good folks at Henry Ford
Hospital welcome their neighbors from Toronto all the time to sell
essentially excess capacity that they have, whether it be an MRI or a
CT scan or even a mammogram, heart surgery, or an artificial hip. The
things that are on the waiting list in Canada that might take months or
even years can be accessed relatively quickly simply by crossing the
border. The waiting list is significantly long for some procedures.
If we look across the ocean to the country of Great Britain, the
National Health Service, of course, has long been established in
Britain. The citizens of that country regard their health system with a
good deal of affection. But there is, in fact, a two-tier system in
England. If someone is on a list for a hip replacement and has the
[[Page H7474]]
money to pay for it, they can go outside the system to a private
orthopedic physician and have that surgery performed. Obviously,
someone who doesn't have the means to provide that for themselves will
simply have to stay on the waiting list. You get into a little trouble
with the fact that when it takes so long, if someone is of a certain
age, another year or two wait is a significant percentage of their
remaining expected life years. In many ways that is not fair either. A
sad reality that exists, but it is true.
So, in both instances, you can see that where the single-payer,
government-run system has been oversubscribed, where they have a
private system, either here in the United States for the country of
Canada or a two-tiered system in the country of Great Britain, they
have a private system to act as a backstop.
So, the question that I would ask is, if the private sector is more
nimble and more able to provide care on a timely basis, why in the
world would we do anything that would interfere with that system? It is
a complex relationship.
How Congress does its job and how we react to the situation can, in
fact, have a significant impact on making sure that we have the best
health care possible. Certainly I think it is incumbent upon Congress
to promote policies that keep the private sector involved in the
delivery of health care in this country.
Now, you almost can't talk about health care in this country without
talking about the problem of the uninsured. Regardless of the number
you use, whether it is 42, 45 or 46 million, it does become a question
of access for people without insurance.
But I would also point out that health care is rendered all the time
in this country to people who don't have insurance or don't have the
means to pay for it. It is not always rendered in the time frame that
would be most propitious for the best health outcome, and certainly it
is not always administered in the time frame where it is the least
expensive type of care, but access to care in this country is, in fact,
something that is generally available. But it can become very expensive
and the time involved can be significant.
Now, we have a program in this country. It is about to turn 10 years
old. In fact, it is a program that we have to reauthorize this year or
it will expire at the end of September. This is a program that provides
health insurance for children whose parents earn too much money for
them to qualify for Medicaid and not enough money to purchase health
insurance. So we have the SCHIP program that operates as a joint
Federal-State partnership. It does provide some flexibility to States
to determine the standards for providing health care funding for those
children, again, who are not eligible for Medicaid and whose parents
have not been able to get private insurance. The program has been very
well thought of. It has been very successful across the board.
This year, in fact, before September 30, we have to reauthorize the
State Children's Health Insurance Program. There is going to be a lot
of debate. I suspect there will be a lot of debate this month.
Certainly, in my Committee on Energy and Commerce and the Committee on
Ways and Means, there will be a lot of debate on the best way to go
forward with that.
One of the things I have had a problem with since coming to Congress
and examining the SCHIP system is the fact that it is a program that
was designed to cover children, but, in fact, we have some States that
cover adults. Pregnant women, okay, it is reasonable to have them
covered under the SCHIP system. But nonpregnant adults, it strains
credulity to have a system that is there to provide health care for
children, and in four States in this country we actually have more
adults covered under the SCHIP program than we do children.
Certainly, where you have a State where all of the uninsured children
have been covered by the SCHIP program, it may be appropriate to cover
some adults. But until that trigger point is met, until that condition
is met, to me it makes less sense to cover adults, when there are
children who would benefit from having the coverage from the State
Children's Health Insurance Program, to have them remain uncovered
while we cover a population where the money was never intended to be
used for that purpose.
A bill that I introduced, H.R. 1013, would make certain that SCHIP
funds are spent exclusively on children and pregnant women and not on
any other group. I hope to be able to have that concept considered when
we go through the reauthorization of the SCHIP program.
Last year in Congress we also debated and got through the committee
process the reauthorization for Federally Qualified Health Centers. We
did not finish the work on that legislation, so we are likely to have
to take that up again this year.
But about someone who is not a child, not a pregnant woman, who
doesn't have access to health insurance, there are many places in the
country where Federally Qualified Health Centers exist that give the
patients access to health care without insurance; gives them a medical
home, gives them continuity of care, a place they can go and see the
same health care providers, whether it be a physician or nurse
practioner, can see that person over and over again; provides primary
health, oral and mental health and substance abuse services to persons
at all stages in the life cycle.
Federally Qualified Health Centers take care of 15 million people in
this country every year, typically someone who does not have insurance
and so would be counted as one of the uninsured, but the reality is
that they do have access to the continuity of care, just as someone who
has insurance. Both the SCHIP program and the Federal Qualified Health
Centers are designed to help the poorest, youngest and neediest in our
communities.
But what about for individuals who can afford to pay some for their
health services but just choose not to? We need to get past that point,
and certainly there are two things that would improve the access to
health insurance for people who do have the ability to pay something
for their health care, health savings accounts and health association
plans.
Health savings accounts are a tax-advantaged medical savings account
available to taxpayers who are enrolled in a high-deductible health
plan, a health insurance plan with lower premiums and a higher
deductible than a traditional health plan. In the old days we used to
refer to this as a catastrophic health plan.
Now, about 1996 or 1997, long before I ever thought about running for
Congress, I was a physician in practice back in Texas. The Kennedy-
Kassebaum bill was passed by the House and Senate and signed into law.
It had in it what was called a demonstration project that would allow
750,000 people in the United States to sign up for at that time what
were called medical savings accounts.
I subscribed to one of those. I purchased one of those for my family.
The primary reason I did it was not even so much cost considerations
but because it kept me in control of making health-care decisions.
Those were the days when HMOs and 1-800 numbers were the order of the
day, and I wanted to be certain that the health care decisions made in
my family were made by my family and not by a bureaucrat or an
insurance executive at the end of a 1-800 number.
The medical savings account proved to have a lot of restrictions on
them. For that reason, a lot of people shied away from them. So I don't
know that they ever got to their full enrollment of 750,000, but to me
it was another very viable form of insurance.
Again, the premiums were lower because the deductible was higher, and
you were able to put money into an account like an IRA, called a
medical IRA, that would grow tax-free. The interest in it would grow
tax-free year over year. This money could be used only for legitimate
medical expenses, but if you found yourself in a situation where you
needed to pay for medical care, yes, you had a high deductible, but now
you have saved some money that can offset the high deductible.
When the Medicare Modernization Act passed in 2003, we also did away
with a lot of the regulations and restrictions on medical savings
accounts, and the follow-on for that are what are called health savings
accounts or HSAs.
For an HSA, the funds contributed to the account are not subject to
the income tax and can only be used to pay
[[Page H7475]]
for medical expenses. But one of the best parts about having an HSA is
that all deposits stay the property of the policyholder. They don't go
to the insurance company. They don't go to the government. They stay
under the control and ownership of the person who has put those funds,
regardless of the source of the deposit. So even if an employer makes a
contribution to that, the funds belong to the person who owns the
insurance policy. Additionally, any funds deposited that are not used
that year will stay in the fund and grow year over year, different from
the old use-it-or-lose-it programs that were so prevalent and popular
during the 1990s.
The popularity of health savings accounts has grown considerably
since its inception. The latest numbers I have are, unfortunately, a
couple of years old. They are from 2005. But by December of that year,
3.5 million people had insurance coverage through an HSA. Of that
number, 42 percent of the individuals are families who had income
levels below $50,000 a year and were purchasing an HSA type of
insurance. Additionally, about another 40 percent were individuals who
previously had not been insured. So this allowed a way for people who
were previously uninsured to access insurance. A good number of those
folks were between the ages of 50 and 60, taking away some credence to
the myth that HSAs are only for the healthy and wealthy.
These programs have been well-subscribed. Again, the numbers that I
have are from 2005. I suspect they are much more robust at this point.
Well, when you consider a young person just getting out of college,
roundabout age 25, if they don't want to go to work for a major
corporation and therefore have employer-derived insurance, what are
their options? I will tell you, 10 years ago, you didn't have many
options. In fact, I tried to purchase a health insurance policy for an
adult child just in that situation. You almost couldn't get an
insurance policy for a single individual, regardless of the price you
were willing to pay.
Fast forward to 2005 or 2007. You can go on the Internet, type
``health savings account'' into the search engine of your choice, and
very quickly you will be given a plethora of choices from a variety of
different health plans. In my home State of Texas, a male age 25
looking for health insurance can find a high-deductible PPO plan from a
reputable insurance provider for between $60 and $70 a month. So that
is eminently affordable.
Sure, there is a high deductible involved with that. That means every
fall, if you go get a flu shot, you are probably going to pay for that
flu shot out-of-pocket, or if you have money in your health savings
account, you can make a draw on that.
{time} 1915
So that type of expense is not going to be covered, but if that
individual is in an accident and ends up spending 3 or 4 hours in the
emergency room and a day in the intensive care unit, they will be
covered because those expenses will rapidly exceed their deductible.
That individual will be covered with health insurance. That is a
concept that we need to make people aware of, that there are options.
Even though you may work for a company that doesn't provide insurance
or you are self-employed and are a small group and otherwise would not
have access to employer-derived health insurance, the concept of a
health savings account is available and marketed over the Internet, and
there is a lot of competition for those products. As a consequence of
that competition, the price on those has come down in the years since
they were introduced.
Mr. Speaker, another concept that we have debated in this House at
least every year I have been here is the concept of association health
plans. Association health plans allow small employers to band together
to get the purchasing power of a larger corporation when they go out
and price insurance on the open market.
To date, we have passed that legislation four times that I can recall
in the House of Representatives. It never passed in the Senate. I would
like to see us take up and at least discuss that as a possibility this
year. I don't know in fact if that will happen. But association health
plans may not bring down the number of uninsured directly, but it
certainly would help bend the growth curve that is going upward of the
number of people not covered by insurance because it allows for small
employers to get access to much more economic leverage in the market
for buying insurance policies and allows them to be able to offer that
insurance policy to their employees in the small group market.
It means that a group of perhaps Chambers of Commerce or a group of
realtors could band together and offer health insurance to their
employees where otherwise it might not have been available. All of
these things are important.
Another factor to consider, and we have to be careful here, about a
year and a half ago, Alan Greenspan was talking to us just before he
left his position at the Federal Reserve. Someone brought up the topic
of Medicare, and where is the funding going to come from? Mr. Greenspan
said he was confident at some point in the future Congress will come to
grips with this problem and will solve this problem.
But he went on to say what concerns me more is, will there be anyone
there to provide the service when you require it? Those words really
struck me. What he is talking about, are there going to be doctors
there in the future? Are there going to be nurses in the future to
provide for us when we are the ones who are relying on Medicare for our
health services?
Back in my home State of Texas, the Texas Medical Association puts
out a journal called Texas Medicine, and last March they had a special
issue called, ``Running Out of Doctors.''
Our country faces a potential crisis with a health care provider
shortage or a physician shortage in the future. So when we work on
health care issues in this body and on both sides of the aisle, this is
going to be important; when we work on health care issues in Congress,
we have to be is certain that we retain the doctors of today, that we
encourage the doctors who are in training today, and that we encourage
those young people who might consider a career in health care, that we
encourage them to pursue that dream and realize that dream.
Certainly the doctors of today, those at the peak of their clinical
abilities, it is incumbent upon us to make certain that they remain in
practice and they continue to provide services, services to our
Medicare patients and services to patients who typically have one, two,
three or more medical problems. Some of the most complex medical issues
that can face a practitioner today will occur in the Medicare
population.
Well, what steps do we need to take to make certain that we have
doctors in practice, that we have people there able to deliver those
services that Alan Greenspan was talking about a year and a half ago?
Well, Mr. Speaker, you almost can't have this discussion without
talking a little bit about medical liability. Now, in the 4 years prior
to this Congress, every year, again, we passed some type of medical
liability reform bill in the House of Representatives. It never got
enough votes in the Senate to cut off debate and come to a vote. I feel
certain it would have passed had it come to an up-or-down vote, but
they were never to muster the 60 votes.
We need commonsense medical liability reform to protect patients, to
protect patients' access to physicians, to stop the continuous
escalation of costs associated with medical liability in this country.
And in turn, this makes health care more affordable and more accessible
for more Americans because we keep the services available in the
communities as they are needed, when they are needed.
Mr. Speaker, I believe we need a national solution. Our State-to-
State responses to this problem, some areas, like my State of Texas,
have gone a long ways towards solving the problem, but there are many
areas in the country where the problem persists, and it does remain a
national problem.
We have an example, I think a good example, in my home State of Texas
of exactly the type of legislation that we should be considering in the
House of Representatives. Texas, in 2003, brought together the major
stakeholders in the discussion, included the doctors, patients,
hospitals, nursing homes, and crafted legislation that was modeled
after the Medical Injury Compensation Reform Act of 1975 that was
passed in California in 1975. There were
[[Page H7476]]
some differences with the California law, but basically it is a cap on
noneconomic damages. In Texas, we had a significant problem as far as
medical liability was concerned. We had medical liability insurers that
were leaving the State. They were simply not going to write any more
policies. They closed up shop and left town because they couldn't see a
future in providing medical liability coverage in Texas. We went from
17 insurers down to two at the end of 2002, the year I first ran for
Congress. The rates were increasing year over year. Running my own
practice in 2002, my rates were increasing by 30 to 50 percent a year.
In 2003, the State legislature passed medical liability reform, again
based on the California law of 1975. The California law in 1975 was
also a cap on noneconomic damages. They had a single cap of $250,000 on
all noneconomic damages.
In Texas, the cap was trifurcated. There was a $250,000 cap on
noneconomic damages as it pertains to a physician, a $250,000 cap on
noneconomic damages as it pertains to the hospital and a $250,000 cap
on noneconomic damages as it pertains to a nursing home or a second
hospital; so an aggregate cap of $750,000 on noneconomic damages.
How has the Texas plan fared? Remember, we had gone from 17 insurers
down to two because of the medical liability crisis in the State. Now
we are back up to 14 or 15 carriers. And most importantly, those
carriers have returned to the State without a premium increase.
In 2006, 3 years after the passage of the medical liability reform,
an insurance company called Medical Protective, I had a policy with
them for years and years, Medical Protective company cut their rates 10
percent, which was the fourth reduction since April of 2005.
Texas Medical Liability Trust, my last insurer of record when I left
practice in Texas, has had an aggregate cut of 22 percent since the law
was passed.
Advocate MD, another insurance company, has filed a 19.9 percent rate
decrease. Another company called Doctor's Company has announced a 13
percent rate cut. These are real numbers, and they affect real people
in real practice situations in Texas. It is a significant reversal.
The year when I first came to Congress, we lost one-half of the
neurosurgeons in the metroplex because of the medical liability expense
problem. The doctor looked at the renewal bill and said, I cannot work
enough to pay for this and pay for my practice and support my family,
so I will go elsewhere. The net effect is it put the whole trauma
system in north Texas at risk because one neurosurgeon was going to
have to do the work of two, and you cannot physically work 24 hours a
day, 7 days a week, delivering that type of care. So the whole trauma
system was put at risk before this law went into effect in Texas.
A young perinatologist whom I met during my first year in office, had
gone on and gotten specialized training to care for those high-risk
pregnancies, well, you can imagine what his medical liability premiums
were. Mine were high as an obstetrician. His were even higher as a
perinatologist who specialized only in high-risk cases. And, in fact,
at a lecture in Texas, he came to me and said, you know, I am going to
have to leave the practice of medicine altogether because I simply
cannot get insurance.
Well, how are we furthering the cause of patient care if we take a
young person who is very dedicated to taking care of the highest-risk
pregnancies in the metroplex and we say, sorry, you can't practice
because we can't get you insurance anywhere. Happily, in Texas, that
situation reversed, and that doctor, I know, is in practice.
The problem with the neurosurgeon, because of the straightening out
of the insurance in Texas, has been reversed. Our trauma system is
protected, as is the young man who is practicing high-risk obstetrics
and saving babies even as we speak.
One of the unintended beneficiaries of the legislation was the
benefit for community, small, mid-sized community not-for-profit
hospitals who were self insured as far as medical liability was
concerned. They had to put so much money in escrow to cover potential
bad outcomes that that money was just tied up, and it was not available
to them. Now they have been able to back some of that money out of
escrow because of putting stability into the system with the cap on
noneconomic damages, and now they are able to use that money for
capital expansion, nurses' salaries, exactly what you want your small
community not-for-profit hospitals to be engaged in. They can, once
again, participate in those activities because of the benefits from the
medical liability plan that was passed in Texas.
So, Mr. Speaker, I took the language of the Texas medical liability
plan, worked with legislative counsel and made it so it would conform
with all of our constructs here in the House of Representatives. And
although I didn't introduce that legislation, I offered it to the
ranking member on our Budget Committee last spring when we offered our
Republican budget here on the floor of the House.
Mr. Ryan, the ranking member, had that scored by the Congressional
Budget Office, and the Texas plan as applied by the House of
Representatives legislative counsel and applied to the entire 50 States
would yield a savings of $3.8 billion scored over a 5-year time span.
That is not a mammoth amount of money when we talk about the types of
dollars we talk about in our Federal budget, some $2.999 trillion, but
$3.8 billion over 5 years is not insignificant. And it is basically
money that we left on the table because we did not include the language
of that medical liability reform in the budget that was passed this
year.
Now, when I say the problem, although the problem in Texas is
measurably better than it was when I took office here, consider a 1996
study done at Stanford University that revealed within the Medicare
system alone the cost of defensive medicine, that is medicine that you
practice so that you tone the chart and you look good if something goes
wrong and the case is brought to trial; if you have practiced
satisfactory defensive medicine, you will be able to defend yourself in
the case of a medical liability suit. A couple of doctors and
economists at Stanford got together and said, what does this cost
Medicare? What does it cost for doctors to practice this type of
defensive medicine? And it cost about $28 billion a year back in 1996.
I would submit that the number is probably higher today if they were to
revise and redo that study.
{time} 1930
So that is a significant amount of money, and the Medicare system is
the one that pays for that. Remember, Medicare runs about $300 billion
a year. That's almost 10 percent of its budget that is being spent on
defensive medicine because of the broken medical liability system we
have here in this country. We can scarcely afford to continue on that
trajectory that we're on with the medical liability system in this
country.
Another consideration, Mr. Speaker, I talked a little bit about young
people who are perhaps considering a career in medicine or nursing, and
the current medical liability system is a deterrent for going into the
practice of health care because they look at the burden that's placed
on young doctors and nurses for the payment for medical liability
insurance, and we keep people out of the system and it's something we
have to consider because, again, remember, we're talking about
physician workforce issues and how we keep the doctors of today in
practice, but how do we encourage that young person who's in middle
school or high school today who's thinking about a career in one of the
health professions, and we want them to be able to pursue that dream.
But currently, they get to the end of college and they look at the
expense for getting medical training, they look at the money they will
have to put up front to purchase their medical liability policy when
they get out, and they say maybe it's not worth it.
And the problem, Mr. Speaker, with that is these are our children's
doctors and our children's children's doctors who perhaps are not going
to go into the healing professions because of problems within the
medical liability system. I could talk about that a great deal longer,
but let me get to three specific pieces of legislation that really get
to the core of dealing with the physician workforce issues and I think
the
[[Page H7477]]
problems that we're going to face in the future if we don't get our
arms around this problem.
A recent piece of legislation that I introduced is H.R. 2584, the so-
called Physician Workforce and Graduate Medical Education Enhancement
Act of 2007. Part of this legislation is to ensure this workforce in
the future by helping young doctors with the availability of residency
programs.
One thing about physicians is we tend to have a lot of inertia. We
tend to go into practice where we did our residency. We tend to not go
too far from home when it comes to setting up a medical practice.
So with that in mind, and in fact, that was one of the main thrusts
of the article that was included in Texas Medicine, is to develop more
residency programs in the communities where the medical need is
greatest and develop those residency programs with the type of
physician that's needed in those medical communities: primary care to
be certain; obstetrics to be certain; general surgery; again, the types
of physicians that we want to be on the front lines practicing in our
medium-sized communities. We need to get young doctors in training in
locations where they're actually needed.
This bill, the physician workforce bill, would develop a program that
would permit hospitals that do not traditionally operate a residency
training program the opportunity to start a residency training program
and build a physician workforce of the future and build it from the
ground up, start at home, start right where it's going to be needed.
On average, it costs $100,000 a year to train a resident, and that
cost for a smaller hospital obviously can be prohibitive. Because of
the cost consideration, my bill would create a loan fund available to
hospitals to create residency training programs where none has operated
in the past. The program would require full accreditation and be
generally focused in rural suburban inner community hospitals and focus
on those specialties that are in the greatest need, and that will, of
necessity, be some of the primary care specialties that I just
mentioned.
Well, what about those people who may not yet be in medical school
but may be contemplating a career in health care? Locating young
doctors where they're needed is just part of solving the impending
physician shortage crisis that I think will affect the entire health
care system nationally. Another aspect that must be considered is
training doctors for high-need specialties.
The second bill, H.R. 2583, the High Need Physician Specialty
Workforce Incentive Act of 2007, will establish a mix of scholarship,
loan repayment funds and tax incentives to entice more students to
medical school and create incentives for those students and newly
minted doctors to stay in those communities.
This program will have an established repayment program for students
who agree to go into family practice, internal medicine, emergency
medicine, general surgery or OB/GYN and practice in a designated
underserved area. It will be a 5-year authorization at $5 million per
year. It will provide additional educational scholarships in exchange
for a commitment, a commitment to serve in a public or private non-
profit health facility determined where there's a critical shortage of
primary care physicians.
Well, in addressing the physician workforce crisis, looking a little
bit at residency programs, looking a little bit at medical students
and, of course, medical liability but the placement of doctors in
locations of greatest need and the financial concerns of encouraging
doctors to remain in high-need specialties, the next bill, H.R. 2585,
will address perhaps what is the largest group of doctors in this
country, what I like to call the mature physician, and certainly the
largest and still growing group of patients, our baby boomers, those
who are just on Medicare and those soon to be on Medicare.
Now, before I get too far into this, I'm joined by my friend from
Pennsylvania. Did you wish to weigh in on this subject this evening?
Mr. DENT. I would very much like to.
Mr. BURGESS. I'm happy to yield to my friend from Pennsylvania for a
few minutes and give him time to talk.
Mr. DENT. Mr. Speaker, I first want to applaud you for your
leadership on this issue. As an OB/GYN physician, you know this issue
probably better than anyone in this institution.
But I just wanted to share with you a perspective from the
Commonwealth of Pennsylvania, where we were a crisis State. And you're
right on on some of these issues you just discussed, but the bad policy
on medical liability reform was far too common in the Commonwealth of
Pennsylvania for a very long time.
Our crisis actually originated back in the 1970s when no one would
write medical liability insurance. So we created a State fund, and it
was supposed to be a stopgap measure. We addressed that stopgap measure
almost 30 years later in 2002, 2003.
But the point of the whole issue is you had to buy insurance from the
State fund, we call it the MCAT fund, and it's been renamed the MCARE
fund, and then you would buy additional insurance from the private
sector.
The problem with the program was, though, you would buy your
insurance basically today, if you're a young doctor you buy into the
MCARE fund, and you're really paying for past claims, unlike a
traditional insurance product where you pay your premium today to pay
against a future claim, and so this has created an enormous retention
problem for us because over the years there are so many unsettled cases
in this MCAT fund that what would happen is these claims all collected
and we started settling these cases rather aggressively in the late
1990s and 2001 and 2002. And so today's physicians were being assessed
with an emergency surcharge to pay for previous medical liability
incidents. A major, major problem.
And also, in a city like Philadelphia, where the average jury verdict
was more than double that of anywhere else in the Commonwealth of
Pennsylvania, where jury verdicts were in excess of $1 million on
average, as reported by a jury verdict research, and the rest of the
Commonwealth, the verdicts were less than half that.
But my point again is this: we created this State fund, an unfunded
liability accumulates, today's doctors are paying for the liability
situation of their predecessors, creates an enormous physician
recruitment problem. Of course, there's always a retention problem, but
the recruitment problem was enormously pronounced because of that
policy change.
And so what ultimately happened, because the premiums became so high
through this State fund, the people who ultimately had to solve this
problem for the physicians were the taxpayers. And so cigarette taxes
were used to pay for physicians' premiums, particularly in the high-
risk areas, the OBs, the neurosurgeons and many other trauma surgeons
and orthopods.
That's what happened in Pennsylvania, and I think many of the
remedies you've discussed here, such as caps on noneconomic damages or
collateral sources, structured payments, some of the things that you've
done in Texas, I'm not as familiar with all those changes, but it
certainly had an impact.
I just wanted to applaud you for this. You know, of course, that
there's legislation pending in this Congress from some of the
legislation last session, and I just want to thank you for yielding,
but I just again want to applaud you for your leadership on this issue.
I'm glad you're bringing this issue, once again, to the attention of
the American people.
Mr. BURGESS. I thank the gentleman for his input. Certainly, the
ability to recruit doctors to Texas from Pennsylvania has been greatly
enhanced by the passage of the Texas medical liability bill, but you
point up a very real problem that the physicians in Pennsylvania face.
And, again, it points up the need for a national solution to wait and
have the process work its way through every State legislature, State by
State. It costs an enormous amount of money, costs an enormous amount
of time, and just the effort, the efficiency of those doctors affected
is going to be diminished.
So I really appreciate the gentleman taking the time to come down
here and add his thoughts about what is happening in his home State of
Pennsylvania.
[[Page H7478]]
Mr. Speaker, let me go on and talk just a little bit about H.R. 2585.
That will address some of the problems that are faced by the physicians
who are in practice now, the physicians who are the primary source of
care for our Medicare patients. As baby boomers retire, the demand for
services is going to go nowhere but up, and if the physician workforce
trends of today continue, we may not be talking about a Medicare
funding problem. We may be talking about why there is no one there to
take care of our seniors.
Year after year, there's a reduction in the reimbursement payments
from the Center of Medicare and Medicaid Services to physicians for the
services they provide for Medicare patients. It's not a question of
doctors just simply wanting to make more money. It's about a stabilized
repayment for services that have already been rendered, and it isn't
just affecting doctors. The problem also affects patients. It becomes a
real crisis of access.
Not a week goes by that I don't get a letter from a physician from
somewhere in the country or a fax that says, you know what, I've just
had it up to here, and I'm going to stop seeing Medicare patients. I'm
going to retire early. I'm no longer going to accept new Medicare
patients in my practice, or I'm going to restrict those procedures that
I offer to Medicare patients.
And, unfortunately, I know this is happening because I saw it in the
hospital environment before I left practice 5 years ago to come to
Congress, and I hear it in virtually every town hall that I have in my
district. Someone will raise their hand and say how come on Medicare,
you turn 65 and you've got to change doctors. And the answer is,
because their doctor found it no longer economically viability to
continue to see Medicare patients because they weren't able to pay for
the cost of delivering the care. They weren't able to cover the cost of
delivering the care.
Now, Medicare payments to physicians are modified annually under a
formula that is known as the ``sustainable growth rate.'' Because of
flaws in the process and flaws built into the formula, the SGR-mandated
physician fee cuts in recent years have only been moderately averted at
the last minute; and if long-term congressional action is not
implemented, the SGR will continue to mandate physician cuts.
Now, unlike hospital reimbursement rates which closely follow the
consumer price index that measures the cost of providing care,
physician reimbursements do not. I have a graph here, again from the
Texas Medical Association, that shows based on various calendar years
what the cuts in the SGR formula have amounted to as far as physician
reimbursement versus what the cost-of-living adjustment has been for
Medicare Advantage, the Medicare HMOs, for hospitals, for nursing
homes, for pharmaceuticals now would be the same type of formula.
Only physicians are asked to live under this formula. In fact,
ordinarily Medicare payments do not cover or only cover about 65
percent of the actual cost of providing the patient services. Can you
imagine going to any industry or company and ask them to continue in
business when you're only paying them 65 percent of what it costs them
to stay in business?
The SGR links physician payments updates to the gross domestic
product and the reality is that has no relationship to the cost of
providing patient services. But simply the repeal of the SGR has been
difficult because it costs a lot of money; but perhaps if we do it over
time, perhaps we can bring that down to a level that's manageable.
Paying physicians fairly will extend the career of practicing
physicians who would otherwise opt out of the Medicare program, seek
early retirement or severely restrict those procedures that they offer
to their Medicare patients. It also has the effect of ensuring an
adequate network of doctors available to older Americans as this
country makes a transition to the physician workforce of the future.
In the new physician payment stabilization bill, the SGR formula
would be repealed in the year 2010, 2 years from now, but would also
provide incentive payments based on quality reporting and technology
improvements. These incentive payments would be installed to protect
the practicing physician against that 5 percent cut that is estimated
to occur in 2008 and 2009.
{time} 1945
Note that this would be voluntary. No one would be required to
participate in either program that dealt with quality improvement or
technology improvement, but it would be available to doctors or
practices who wanted to offset the proposed cuts that would occur in
physician reimbursement until the 2 years time the physician repayment
formally can be repealed.
Now I know that a lot of the doctors don't like the concept of
postponing the SGR by 2 years. In fact, in the bill 2585, by resetting
the baseline of the SGR formula, a technique that we used in this
Congress back in 2003, by resetting the baseline, the amount of cuts
contemplated for 2008 and 2009 are actually modified significantly,
and, in fact, there may not be a cut at all in 2008 or 2009. This could
translate into an actual positive update for physicians in those 2
years.
But the critical thing, in my mind, is that we have to be, regardless
of what we decide to do over the next 2 years, we have got to be
working on a long-term solution to get out from under the tyranny of
the SGR formula.
Now, why do it this way? Why not just bite the bullet and get the SGR
out of the way and get it repealed once and for all? The problem is, it
costs a tremendous amount of money to do that. The problem we have in
Congress is, if we are required to submit all legislation that we
propose to the Congressional Budget Office to find out how much
something costs, we are going to be spending the taxpayers' money, we
have got to know how much we are going to spend, over what time will we
spend it.
Because of the constraints in the Congressional Budget Office, we are
not allowed to do what's called dynamic scoring. We can't look ahead
and say, you know, if we do this, we are going to save money. The
Congressional Budget Office doesn't work that way.
That's why postponing the renewal of the SGR by 2 years, take that
savings that is going to occur over those 2 years, sequester it and
aggregate that savings and put it towards paying for the repeal of the
SGR and replacing it with a cost of living index, the Medicare,
economic index that would be fundamentally much fairer.
One of the main thrusts of the bill is to require the Centers for
Medicaid and Medicare Services to do just exactly that and to look at
the 10 diagnostic codes for which most of the monetary expenditures are
rendered. You know the old bank robber, Willie Sutton, when he was
asked why he would rob the bank, he said, that's where the money is.
Let's go to where the money is. Let's go to those top 10 procedures and
diagnoses that spend the greatest amount of Medicare and look for where
the greatest amount of savings can be found within that.
The same considerations actually apply to the Medicaid program as
well, so it will be useful to go through this process in identifying
those top 10 conditions and trying to modify things so that the
delivery of care for those top 10 conditions actually ends up costing
us less.
With the time that remains, I know I have talked about a lot of stuff
tonight, a lot of it is technically very complex. I will admit it, a
lot of it is actually very boring to listen to. But it is an incredibly
important subject, and it is an incredibly important story that we have
to tell here in Congress. It's a story of how the most advanced, most
innovative and most appreciated health care system in the world
actually needs a little help itself.
The end of the story should read, ``happily ever after,'' but how are
we going to get to that conclusion? In fact, the last chapter may well
read, ``private industry leads to a healthy ending.''
At the beginning of this hour, we talked about the debate that will
forever change the face of health care in this country. Again, I think
it's important to understand, that we understand here in Congress, that
we understand what's working in our system and what is not. We can't
delay making the changes and bringing health care into the 21st
century.
I believe the only way we can make this work is if we allow the
private sector to be involved, to stay involved and, in fact, lay the
foundation for the improvements that we all want.
[[Page H7479]]
The pillars of this system are that we are going to have, be rooted
in, the bedrock of a thriving private sector, not the tenuous ground of
a public system that has proven costly and inefficient in other
countries.
I believe we need to devote our working Congress to building a
stronger system and involving the private sector within that system.
History has proven this to be a tried and true method. We can bring
down the number of insured. We can increase patient access. We can
stabilize the physician workforce, and we can modernize through
technology, and we can bring transparency into the system. Each of
these goals is within our grasp if we only have the foresight and the
determination, the political courage to achieve each goal.
Again, I referenced when I was a medical student in Houston, people
would come from around the world to come to the Texas Medical Center
for their care. There is a reason that people come from around the
world to the United States for their health care and for their
treatment. We are the best, but we must make adjustments to remain at
the top of the game.
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