[Congressional Record Volume 155, Number 172 (Thursday, November 19, 2009)]
[Senate]
[Pages S11516-S11519]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           HEALTH CARE REFORM

  Mr. UDALL of New Mexico. Mr. President, for months we have gathered 
in this Chamber to talk about why we need a public option as part of 
health care reform. Almost every week the insurance companies provide 
another example of why a public option is critical to ensuring all 
Americans have access to quality, affordable health insurance. Our most 
recent examples come courtesy of two of America's largest insurance 
companies--Humana and CIGNA. Wall Street just completed its third 
quarter earnings season, and Humana and CIGNA released their reports a 
couple weeks ago. Let's just say that both companies did very well last 
quarter. Humana profits in the third quarter were up 65 percent over 
the same time last year. CIGNA profits in the third quarter were up 92 
percent.
  Senator Brown has focused on the insurance company issue and has seen 
what is happening to the American people. This is happening at a time 
when 47 million Americans are without access to affordable health care. 
I will ask him to speak a little bit about the insurance company issue 
and what is happening.
  Before doing so, the Republican leader was here on the floor, and he 
was talking about the numbers that were given by CBO. These are number 
crunchers. They are by nonpartisan folks. These are people who work 
very hard late at night. They have been

[[Page S11517]]

working to get out their numbers on the bill that we will have on the 
floor in a short while. I can't believe we are now hearing they don't 
like the CBO numbers. Both sides live by CBO numbers. That is the 
important thing for people to understand.
  I yield to Senator Brown.
  Mr. BROWN. Mr. President, we are also joined by Senator Reed of Rhode 
Island and Senator Merkley. They helped write the bill in the HELP 
Committee.
  We know Aetna's CEO last year made $24 million. Of the top 10 
insurance companies, the average CEO is paid $11 million per year. We 
know their profits have gone up 400 percent over the last 7 years. It 
is not so much that CEOs are paid so much. It is not just their profits 
and their CEO and top executive salaries, it is the business model that 
gets them there. When you think about what has happened to insurance 
companies, you are a big insurance company, you hire a bunch of 
bureaucrats to keep people from buying insurance, to invoke preexisting 
condition so somebody can't get insurance or to put limits on coverage 
so people can't get insurance. Then they hire bureaucrats on the other 
end to deny claims. Thirty percent of claims that are filed when people 
get sick--they turn their claims in to their insurance company from 
hospitals, doctors, treatments, they turn them in to the insurance 
company--30 percent are denied, initially. They are appealed sometimes 
and then they get reimbursement customers, someone who files a claim. 
But the fact that they have to fight the insurance companies while they 
are sick anyway or while they are advocating for their parents or a 
sister or husband or wife, these huge profits and huge executive 
salaries are based in denying care on preexisting conditions, on 
squeezing profits from customers.
  Think of all the small businesses in Rhode Island, Oregon, New 
Mexico, and Arkansas, all the businesses that say they can't afford 
insurance anymore. They may have had huge price spikes because 1 person 
in a company out of 30 employees gets sick.
  I don't care all that much about profits and CEO salaries. I do think 
it is immoral. But what I care about is that those profits and salaries 
are based on hurting people who have insurance or keeping people from 
having insurance.
  Mr. KAUFMAN. How can a business do this? There is a real reason why 
they can do it. It is because there is no competition. Other companies 
can't do that. They can't treat the people who are customers the way 
the insurance companies do. When you look at the list, you can see why 
they get away with it. There is no competition. In the top 39 States 
out of 50, over 53 percent of the market share is with 2 companies. 
There is no competition right now in health care. That is the big 
reason why we need the public option. The reason for the public option 
is it allows us to have competition in these States where there is no 
competition at the present time. You can have gigantic profits. You can 
have CEOs making millions of dollars. You can have all these things. 
You can treat your customers poorly. You can do all these things 
because you don't have to worry about somebody coming into the business 
and offering them a good or better deal. That is what the public option 
does.
  Mr. UDALL of New Mexico. I yield to Senator Reed. I want to get him 
involved in this discussion.
  Mr. REED. I thank Senator Udall. Senator Kaufman has made an 
excellent point. What we have seen over the last several years, 
actually more than a decade, is increasing costs shifted to small 
business. Just this year, a 15-percent increase in small business 
premiums is anticipated, much higher than inflation. That is because 
there is no real competition. Rhode Island is on that map, where two 
companies control 8 percent of the market. There are forces, which have 
been illuminated, that drive up this constant increase in cost. One is 
profits. That is what private companies are organized to achieve. If we 
were directors of those companies, we would be trying to do that. But 
those profits drive two things: One, shareholder return, profitability 
of stock, and also compensation for executives. Those two phenomena 
will not be in place in a public option. It will be a not-for-profit 
cooperative arrangement. So the response will not be to shareholders or 
to self-aggrandizement of executives; it will be to delivering service. 
That is going to be a check.
  What I find ironic in this discussion is the bold proponents of free 
markets who believe the free market can solve it are afraid of 
competition. They are afraid of a public option because they say: We 
can't compete with the Government. Their definition of competition is 
any competition. They are probably worried about 80 percent shared 
between two companies. This is a managed environment. Year in and year 
out, the insurance companies do great and small business does worse and 
worse.
  I thank the Senator for yielding.
  Mr. KAUFMAN. One final point. You can tell there is no competition 
when every year your premiums go up. The only other business I know 
similar to that--and I don't mean to hurt anybody's feelings--is the 
cable company and my TV bill. I know every year, no matter whether the 
inflation rate or the cost of living is down, I will get a notice in 
December--don't we all--basically saying my health care premiums are 
going up and my cable costs are going up. The reason is because both 
these are essentially operating as monopolies.
  Mr. UDALL of New Mexico. I don't think the American people realize we 
have exempted the insurance companies from the antitrust laws. Those 
are laws you can move in, when there is a lack of competition in the 
market, when there are too few players in the market, to try to inject 
additional competition in the market. With the public option, the first 
thing we are trying to accomplish is to inject competition into the 
market, to have insurance companies be competing. This public option is 
going to help drive that cost down in a dramatic way.
  Senator Merkley, who has worked on this legislation in his 
committees, joins us today. I hope he can talk a little bit about this 
issue also.
  Mr. MERKLEY. Mr. President, there was a time when our colleagues 
across the aisle were in favor of competition. Correct me if I am 
wrong, but in the past, we used to have a highly regulated, 
noncompetitive airline industry. Was it not our good friends across the 
aisle who said we need to create competition so consumers have real 
choice and this will drive the cost of airline tickets down? Am I mixed 
up on that or is that fairly accurate?
  Mr. UDALL of New Mexico. That is an absolutely accurate rendition.
  Mr. MERKLEY. We are in a very similar situation here, where we have a 
noncompetitive industry, costs going through the roof. There is a basic 
factor at work which is, if we introduce competition in health care, 
service will improve, costs will come down.
  Choice is much more important in this area than just about any other. 
If you are not satisfied with the cost of your insurance or the service 
you are receiving, then you should have multiple places to go. That is 
the underlying point of creating a health care marketplace or exchange, 
as it is called, so citizens can say: Here are all the plans competing 
against each other. What are they going to offer? A year later, if you 
are not happy, you get to switch, which says to every single insurance 
company, if we don't do well, we are going to lose our customers. That 
is the marketplace. That is competition. That is what we need in 
America. It will be helped by having a public option.
  Mr. UDALL of New Mexico. Absolutely. No doubt about that.
  Mr. MERKLEY. I can tell you a couple stories from Oregon. There was 
an article in the Bend Bulletin in October about two families.
  One individual, Dale Evans, went to his doctor because he was 
experiencing pain in his chest. His doctor recommended he have an MRI 
to find out what was going on. The request was made three times. The 
insurance company turned it down three times. Because he didn't have 
this test, there was no diagnosis made of the cancerous tumor he had. 
His tumor proceeded to damage the nerves in his spinal cord and left 
him unable to walk. Then it became too large to be operated on. Mr. 
Evans died the following year, in 2008. As a result of the choice made 
by the insurance company, a for-profit insurance company, the test was 
not conducted and the individual died.

[[Page S11518]]

  Richard Paulus of Bend, OR, has a similar case being filed right now. 
He, fortunately, is still alive. He was denied repeated requests for 
back surgery. His doctor argued for a second opinion. The request was 
made, turned down again. One factor is, you want to have an insurance 
company that is making decisions related to healing, not related to 
profits. The second factor is, one of the best ways to drive that, if 
Mr. Evans and Mr. Paulus were not satisfied, if they had a choice, they 
would be much more likely to create accountability with the company 
they are with right now.
  Mr. UDALL of New Mexico. I wish to ask the Senator about those 
circumstances because he knows more of the details, but when you have 
insurance companies, these for-profit insurance companies we have been 
talking about that are making incredible profits, when you have 
insurance companies denying these claims, which is what you alluded to, 
what people need to realize is, what they have done is they have 
created an entire administrative bureaucracy within the insurance 
industry. It has flowed over into our medical providers, where doctors 
now tell me what they have to do is have people calling the insurance 
company to push to reverse these denials. So they have created a whole 
system which tamps down the ability of people to get care. What we are 
talking about in the public option is, you create a nonprofit. They are 
not in the business of making a profit. They are going to be in the 
business of providing health care, of doing the very best they can to 
provide health care. Why it will make the market competitive is they 
will not have all this administrative runaround. They will not have 
this going on.
  Is that the Senator's understanding? They will look at the situation 
you have right there that you have described and they are going to say: 
It is clear this gentleman needs an MRI because we need to find out 
what is going on. So they will do the MRI, and then they will move 
quickly to the care. To me, that is the difference between what the 
Senator described, where insurance companies are trying to find a way 
to not pay out, to meet their bottom line, and to raise profits; 
whereas, a public option would be doing the opposite, focusing on the 
health care, focusing on future needs, focusing on providing what 
people need in the health care arena.
  Mr. MERKLEY. Your point is well taken. The overhead in the private 
health care industry is now 25 to 30 percent. That is a whole lot of 
folks sitting around desks operating with paper rather than nurses and 
nurse practitioners and doctors practicing the craft of medicine, the 
craft of healing. Whereas, if you look at Medicare, instead of 25 to 30 
percent overhead, it is somewhere around 3 percent--much less and, 
therefore, a lot more dollars going into actually assisting folks in 
getting well. Again, competition is going to drive down that overhead.

  Mr. UDALL of New Mexico. I say to Senator Merkley, the thing the 
American people should know about the health care plan Senator Reid was 
down here talking about earlier--that we have unveiled here in the 
Senate--is it has a public option in it. So the public option will be 
there to provide competition. It will be there to provide the very best 
care. And it will be there to make sure we keep these insurance 
companies honest. That is what we are trying to do here: to make sure 
there is competition in the market, to make sure the insurance 
companies are honest.
  Mr. MERKLEY. Yes. The reason we have lost competition is twofold. 
One, in many markets, a single company dominates the market. Second, 
even if you have multiple companies, they are exempt from the antitrust 
laws and, therefore they can communicate with each other in a way that 
reduces or even eliminates real competition. That is why this is so 
important.
  There is one feature of this public option that I think is important 
to recognize. It represents a huge compromise, and that compromise is 
that many of our Senators said: We are not sure our folks back home are 
quite sold on this idea, and we do not want to see it ``forced on 
them.'' Quite frankly, I think it would be good to have competition 
everywhere in the country, everyone have more choices. But in deference 
to that Federalist tradition in America, in deference to the laboratory 
of State experimentation, a provision has been included in Senator 
Reid's merged bill that says if a State does not want to participate, 
it can opt out.
  So there is no Senator in this Chamber who should have any concern 
about saying my folks back home do not want this, and they are going to 
be forced to have it, because no State will be put in that position. 
Any State can choose to say: We do not wish to participate. I think 
that means we will have a situation where many States--most States, I 
believe--perhaps virtually all States will say: We do want to 
participate. But those States that are not so convinced will have a 
choice to watch this unfold to decide if they wish to join this 
movement for competition and choice later on.
  Mr. UDALL of New Mexico. I say to Senator Merkley, I think that is a 
great example of how we all work here together to find a compromise 
that works for everyone. I realize there are Democratic Senators and 
Republican Senators--and the same for Governors--who may want to do 
things differently in their State. So what we have done here is give 
them the option of opting out in this public option we are providing.
  I personally--looking at the facts, and looking at the situation--do 
not know why a State would want to opt out. But there is going to be 
the check and balance there of the legislature having to pass a law, 
the Governor having to sign it, and say: We do not want to have 
anything to do with the public option.
  But we realize with a public option you bring competition to the 
market, you expose these high administrative costs you talked about. 
One of the things people do not realize, on administrative costs, is, 
the Federal Government runs the Medicare Program. Here you have a 
program that when I go to town hall meetings, I say: Raise your hand if 
you are on Medicare. They will put their hand up. And I will say: Keep 
your hand up if you like Medicare. So they will raise their hand, and 
they will keep it up.
  Ninety-five percent of the people like Medicare. Well, Medicare has a 
3-percent--3-percent--administrative cost. As the Senator said earlier, 
the insurance companies we are dealing with have anywhere from 25 to 30 
percent administrative costs. So if you put a public option out there, 
you are going to make there be competition.
  Senator Merkley.
  Mr. MERKLEY. I say to the Senator, let me give you an example of how 
that competition can work in a health insurance marketplace. In Oregon, 
we have a public option in workers compensation, which is health 
insurance for injuries that occur on the job. We have had this public 
option for 80 years. It did not work that well. It was not that well 
designed, and it was not that well managed.
  About 20 years ago, a group of businesses got together, and the 
businesses said: We need a better insurance policy. We need a better 
competitive market for on-the-job health insurance. So in a deal that 
was called the Mahonia Hall deal, Mahonia Hall rewrote and improved the 
management of our public option. The result is, rates today in workers 
compensation in Oregon are half of what they were 20 years ago, because 
competition was introduced, efficiencies occurred, service improved. I 
can tell you, there is not a business in Oregon to be found campaigning 
to eliminate the State accident insurance fund, which is a public 
option in work-based health care.
  Our colleague Sheldon Whitehouse was involved in establishing a very 
similar program in Rhode Island. Their workers comp, he told me--and I 
think he has told this Chamber--introduced by Rhode Island adopting a 
work-based health care public option resulted in their rates dropping 
by half.
  Wouldn't it be great if competition could reduce health care costs in 
America rather than having 10 to 15 percent increases every single 
year?
  Mr. UDALL of New Mexico. Yes. I say to the Senator, you hit it on the 
head. I have been here on the floor with Senator Whitehouse--I know 
Senator Reid was just here--participating in a colloquy.
  The point that both of them, I think, make is when you inject a 
public option into the insurance market--

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whether it is health insurance, whether it is workers compensation--you 
inject competition. And by injecting that competition, you make the 
marketplace work a lot better. That is what we are striving for here 
today.
  Senator Merkley.
  Mr. MERKLEY. There are folks who have said: Well, now, hold on. Isn't 
this a government takeover of health care? Since that has been said so 
many times on this floor by those who oppose health care reform, I 
think we should address it directly. Introducing a competitor does not 
have the government taking over health care. It is an option citizens 
can choose--if they are not satisfied with the current performance--
competing on a level playing field. This is exactly what you need when 
you have markets that have lost their competition.
  It is important to note this phrase ``government takeover'' came out 
of a study that was contracted for by my colleagues across the aisle to 
say: How can we defeat health care? They polled folks in America and 
said: What are the scariest terms we can use--even though we do not 
know what the plan is; even though we do not know whether the plan is 
going to invest in prevention; we do not know if the plan is going to 
invest in disease management; we do not know if the plan is going to 
have healthy choice incentives that will help improve the quality of 
life of Americans and decrease health care costs; we do not know if we 
will have insurance reforms that will get rid of dumping, the practice 
of throwing people off their health care plan once they get sick; we do 
not know whether there will be reforms that say there will be 
guaranteed issue, you cannot be denied the opportunity to have health 
care because of preexisting conditions. We do not know any of that, but 
whatever it is, we are going to be against it. So let's do a study now. 
And they contracted to do the studies. Let's find out how to scare 
Americans. The result was: Let's call it a government takeover.
  I have to tell you, this is too important an issue to the citizens of 
our Nation. Health care touches every individual, touches every small 
business trying to succeed. It touches every large business trying to 
compete around the world, with much more efficient--much more 
efficient--health care systems in other countries. It is too important 
than to do studies to try to find words to scare Americans.
  How about we try to solve problems in this Chamber? I am going to 
tell you, I think this bill put forward last night by Majority Leader 
Reid is about solving a problem absolutely critical to our economy, 
critical to our small businesses, critical to the quality of life of 
our families.
  Mr. UDALL of New Mexico. I say to Senator Merkley, you are exactly 
right. Senator Reid has put a merged proposal on the floor, and do you 
know what the response is we have seen? I like your comments on this. 
The response we have seen I find amazing, I find absolutely amazing, 
because here is what we are facing.
  The American people want health care reform, so we have announced we 
are going to put a bill on the floor to reform health care. We have 
been working on it for months. It is out of two committees. We have 
brought it together. So what do we have to do in the Senate to move 
forward? We file a motion to proceed. OK. That is just to proceed. You 
are not even on the bill.
  Do you know what is going to happen? The Republicans are going to 
step forward, their leadership is going to step forward, and they are 
going to say: No, no, we are not going to agree to that. We are not 
going to agree to even proceed to the bill.
  So we are going to have to file cloture. When we file a cloture 
motion today, it is going to take 2 days before that cloture motion 
ripens. Then we are going to have a cloture vote. Then 30 more hours 
are going to expire. They are going to require us to use all that time. 
Even though we may be in a quorum call and not doing any debate, they 
are going to require that. Then, believe it or not, they are going to 
require us--these wonderful clerks who work up here--they are going to 
require them to stand up for 50 hours and read that bill on the floor--
50 hours. The normal thing we do to get to something is we waive the 
reading. But they are going to require it.
  What does the Senator think of that approach? I cannot understand 
that.
  Mr. MERKLEY. Many Americans are familiar with the tradition of a 
filibuster, and they envision it where Senators stand up and speak and 
speak on an issue of principle. That was used very rarely in the past. 
In fact, now all that is required is for one Senator to object to 
unanimous consent, and then you need to have a 60-vote test.
  This 60-vote test is most often used at the end of a debate to say: 
Do we go to a final vote? Are we going to wrap up debate and go to a 
final vote? But in this case, as the Senator has described it, it is 
going to be used even to hold a debate on health care in this Chamber.
  All my life--I first came to this Chamber when I was an intern for 
Senator Hatfield in 1976--all my life, I have heard the Senate 
described as ``the world's greatest deliberative body.'' Well, that is 
a pretty cool thing. But are you telling me that folks are going to try 
to block this Chamber from even debating health care?
  Mr. UDALL of New Mexico. That is exactly what I am saying. We have 
worked hard. The majority has worked hard. We put together a bill. We 
have had hearings--Democrats and Republicans--in those committees. When 
we file a motion to proceed, we are not even on the bill, we cannot 
amend the bill. When we file that motion to proceed, they are going to 
require we take 2 full days, and then another 30 hours, and then demand 
we read the bill on the Senate floor.
  I see Senator Alexander in the Chamber. I know there are good friends 
of ours on the other side who do not want to see that kind of thing 
proceed. But a couple of Senators can muck up the whole works here and 
slow this thing down.
  I think the American people want us to move forward with health care. 
I think they want us to get something done that provides health care 
for people, that provides choices, that keeps people's doctors, that 
puts competition in the market--all of those kinds of things.
  Senator Merkley.
  Mr. MERKLEY. I join the Senator in saying to all my colleagues, do 
not fear debate on health care. We are here, and it is our job to come 
and debate. It is our job to come and talk about how important it is to 
have insurance reforms so people are not barred because of preexisting 
conditions, people are not dumped after a decade of being provided 
insurance because they get sick.
  It is so important we have this debate, and I look forward to having 
it, and hope all colleagues will join in saying: Yes, no matter which 
side of this issue you are on, it is time to debate, as our citizens 
have sent us here to do.
  Mr. UDALL of New Mexico. I say to Senator Merkley, thank you. Thank 
you for joining me in this colloquy today.
  I thank the Acting President pro tempore and yield back any time at 
this point.
  The ACTING PRESIDENT pro tempore. The Senator from Tennessee.
  Mr. ALEXANDER. Mr. President, I wonder if you could let me know when 
I have consumed 9 minutes.
  The ACTING PRESIDENT pro tempore. The Senator will be so notified.
  Mr. ALEXANDER. Thank you, Mr. President.

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