[Congressional Record Volume 158, Number 154 (Tuesday, December 4, 2012)]
[House]
[Pages H6609-H6614]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
{time} 1440
ADDRESSING THE FISCAL CLIFF
The SPEAKER pro tempore. Under the Speaker's announced policy of
January 5, 2011, the gentleman from California (Mr. Garamendi) is
recognized for 60 minutes as the designee of the minority leader.
Mr. GARAMENDI. Mr. Speaker and colleagues and the general public,
there has been a lot of discussion in the last several days about what
to do with the fiscal cliff. Is it a cliff? Is it not a cliff? Is it a
slope? Is it the end of America as we know it, or whatever. But in this
debate, there are a few things that are absolutely critical--tax
policy, the President has laid it out very, very clearly, as did the
election. We're going to do tax reform, yes. And it's time for those at
the upper end of this wealthy country to pay their fair share. So the
President has made it very clear: we're going to raise the rates on
those making over $250,000 a year. And by the way, we ought to be very
clear understanding what that means. That means 100 percent of
Americans get a tax break on the first $250,000 of income. Over that,
yes, they'll pay a higher rate, marginal rate, for that over the top.
Hey, but what I really want to talk about today with my colleagues
who will be joining me in the next few minutes is another part of this
debate, and that is on the reductions in Federal expenditures. What's
the best way to do it? How are we going to reduce Federal expenditures?
There are those that say take on the entitlements. Make the seniors pay
more. End Medicare as we know it. Turn it into a voucher program. Or
maybe turn it into a premium support program which, as a former
insurance commissioner, I know exactly what that means. That means if
you're over 65, hey, you're going to get to go buy insurance from the
rapacious health insurance companies. Good luck. Premium support, just
another way to end Medicare as we know it. Voucher programs, another
way to end Medicare as we know it.
In the last election, this was a central part of the debate here in
America. And it was clear: no way, no how are we going that way. There
are others who proposed, well, why don't we just raise the age to 67?
Interesting, very interesting proposal. Well, it will save Medicare a
little bit of money, but what does it do to those people who are 65 to
67 years of age? It denies them the opportunity to get affordable
health insurance in the Medicare program and simply throws those people
off to the wolves, again, to the rapacious health insurance companies.
And by the way, those are exactly the people that the health insurance
companies don't want. They're the people who have higher expenditures.
They're the ones who are beginning to get health issues, so the health
insurance companies don't want them. How are they going to get
insurance? They're going to get insurance at a very high cost, if at
all.
And, oh, by the way, there are those that want to do away with the
Affordable Health Care Act. In the Affordable Health Care Act, there's
this thing
[[Page H6610]]
called the Patients' Bill of Rights. The Patients' Bill of Rights
guarantees that insurance companies cannot deny you based upon a
preexisting condition. However, they can charge differential rates
based upon age. So that notion of somehow saving Medicare by keeping
people from getting Medicare is the back way to go, and it is a
nonstarter, at least with me and I think many of my colleagues.
There are things that can be done in Medicare, and we're going to
talk about those things that we can do here with our colleagues today.
We also want to pick up the issue of Social Security. Let's be very
clear: the deficit situation faced by the United States is not a Social
Security problem. It is not a Social Security problem. Social Security
is stand-alone. It is not part of the American deficit. It's an issue
that over the years has come back before the American public. The
Congresses in the past have dealt with it, extended the viability of
Social Security for years and years, and this Congress does not need to
deal with this problem this year or even next year in the 113th
Congress. Down the road it must be dealt with--and there are numerous
ways it can be--but to bring Social Security into the deficit debate is
only to cloud this debate and to make it far more difficult for us to
find a solution.
Now, my Democratic colleagues and I and the President have made it
very clear we understand the necessity of solving this problem and
we're willing to compromise. The President has put on the table a very
complete, detailed program about how we can deal with the deficit both
in the short term and in the years ahead. And we need to proceed with
that. Unfortunately, it was just simply dismissed and a new--well, not
a new--actually a rebaked, redone, rehashed proposal was put on the
table by our Republican colleagues yesterday, one that really doesn't
move us toward a compromise. We need to get there. We need to get a
compromise under way. So let's see if we can figure out how to do it.
I see several of my colleagues here. I'm not sure which one was first
up, but it looks like it might be Florida.
Ms. BROWN of Florida. I'm Corrine Brown from Florida, and I'm from
the home of Claude Pepper. He was a House Member and a Senator, but he
was Mr. Social Security. He was here during the time of Ronald Reagan,
and he made sure that Social Security, which was enacted under the
Democrats, and I will never forget, Newt Gingrich said that he wanted
it to ``wither on the vine.'' That's been their philosophy.
Now, I feel that Medicaid, Medicare, and Social Security is the
difference between us and many of the Third World countries. In fact,
it has been the bedrock of American politics as far as helping to raise
the standards.
You know, many of my colleagues often talk about the Bible. Well, the
Bible says--I've never heard them say let's help the rich--the Bible
always talks about the poor and what we need to do to help raise the
standards. That's what we're supposed to be doing in the people's
House. During the campaign, they constantly confused the American
people, talking about the $715 billion that was in both proposals that
was savings, that we put back into the system that helped people that
were receiving their prescription drugs. We were helping to lower the
cost. In fact, we were plugging the doughnut hole. So that argument is
over. And the fact is that it will be 434-1. I will never vote to do
anything with Social Security as we speak.
And when you talk about Medicaid and Medicare, many of those people
are in nursing homes that cannot speak for themselves. They only have
us as their voices. And as we negotiate and discuss, let's look at one
group, African American men. Most of them don't live long enough to
benefit, and everything is not equal. When we look at jobs and
professions, many of you have these nice cushiony jobs, and so we don't
even have to worry about raising the age. But when we look at people
who actually work for a living, whether we're talking about bridges or
whether we're talking about driving trains or trucks, you want to raise
the limit for them? So there are many issues that need to be discussed
as we move forward.
But when President Clinton was in office, he left this country in the
black. The people have weighed in. They've indicated that we want to
move forward, put people to work; but we want to do it through a fair
method of doing it, and that is not cutting programs that impact the
working poor in this country.
Mr. GARAMENDI. Well, you're absolutely correct about that. The
proposal to cut Medicare benefits is a nonstarter. There are things
that can be done in Medicare to reduce the cost, and much has already
been done.
I would like to ask my colleague from the great State of Michigan to
join us. Mr. Curson is a new Member of Congress, came in a special
election about a month ago. Welcome. We are delighted to have you join
us.
Mr. CURSON of Michigan. Thank you, and I agree wholeheartedly with
what's been said so far, and what I really want to say is Medicare is
run more efficiently than nearly any insurance company in the world.
{time} 1450
They devote less than 2 percent of its funding to administrative
expenses, and you compare that to a private insurance company that
costs up to 40 percent of premiums for individuals and small group
plans for administration and to pay their executives six- and seven-
figure salaries to do the same thing that's administrated by Medicare
officials.
Also, the attempt to move Medicare eligibility from 65 to 67 sounds
like an easy fix. Well, not only, as was spoken earlier, the
recipients, those people that are 64, 65, 66, going into that category
are people that possibly are already struggling, lost their jobs, they
need that health care, they have a preexisting condition, and now their
very life is threatened having to wait that much longer.
We all look to take care of small business and private insurance
funds, such as VEBAs and those types of institutions that money is
forecast to pay for various health care, and you stretch out 2 more
years of their coverage, small business now has to pay higher premiums
to cover those employees that last those 2 more years. And they either
have to make a choice: They reduce what they give in coverage or they
eliminate it altogether, or they shift those premium costs to the
worker. It's happened over and over and over again, and we need to
avoid that in this coming legislation.
Mr. GARAMENDI. Mr. Curson, thank you so very much for your thoughtful
discussion of the age issue--it's a profoundly important one--and also
bringing up the issue of what is the cost of Medicare administration
compared to the private health insurance companies. You're quite
correct. Medicare is a very efficiently run program, very efficient in
collecting the money and paying the bills, far more than you would ever
find in the private health insurance sector, perhaps by a factor of 4--
3, 4, maybe even 5 in some cases. Also, Medicare has had an
extraordinary run of keeping the costs down.
I'd like now to call upon Mr. Joe Courtney of Rhode Island--
Connecticut. I've made two mistakes today about my colleagues' locale.
Joe, it's yours.
Mr. COURTNEY. Thank you, Congressman Garamendi. And I realize there's
congressional districts in California that are probably bigger than
Rhode Island and Connecticut combined, so I won't hold it against you
too hard.
Thank you for taking time on the floor today to spend some time
talking about Social Security, Medicare, and Medicaid. This really is
the moment of truth right now.
Yesterday, the Republican leadership came out with their package in
terms of trying to deal with the so-called fiscal cliff, and even
though, for months, they have not really fleshed out with great detail
where they wanted to see savings, yesterday they did. They came out
with a proposal which talked about raising the eligibility age for
Medicare from 65 to 67.
They talked about recalculating the cost-of-living-adjustment for
seniors who are on Social Security. It's the so-called chained CPI,
which would lower the year-in and year-out increase for people on
Social Security in terms of keeping up with the cost of living.
These proposals really need a full, vigorous debate before the
American
[[Page H6611]]
people before we move in that direction, which I would argue, and
certainly you and others here this afternoon, would be the wrong
direction for middle class and working family Americans.
You know, in terms of Medicare, I think it's really important,
historically, to review how Medicare came into existence.
In 1965, when it was signed into law by President Lyndon Johnson on
the porch of Harry Truman's house in Independence, Missouri, only half
of America's seniors had any insurance whatsoever. Because of age,
because of preexisting condition, because the insurance company,
frankly, just viewed them as too high a risk, and because of cost, only
half of America's seniors had any insurance whatsoever. Life expectancy
in America in 1965 was 70 years old.
With that stroke of a pen by Lyndon Johnson, the genius of Medicare
was created, which created a pool for people above the age of 65 and
people on disability, a pool which could spread risk out and make the
challenge of covering people at that age much more manageable. And for
the following 47, 48 years, we have had a system which now has brought
life expectancy for Americans up to age 78. In other words, having
people in a situation where they can access needed medical care, in
fact, lengthened people's lives and, in some instances, actually added
to the economy because some people even continued to work, to a degree,
who are on Medicare.
It has really accomplished its mission which was visualized the day
that President Johnson signed it into law. It does face challenges.
There's no question that demographics, with the baby boom coming on the
horizon, is going to increase the number of people in the program, but
the way you solve that problem is just make it smarter and more
efficient.
When President Obama signed the Affordable Care Act in March of 2010,
last year there were some really solid, smart changes that were made to
the Medicare system to make sure that the cost per patient would be
moderated, but not that it would cut benefits or kick people off the
program, which is what the Republicans are proposing to do, saying
people who are 65 and 66 would no longer be eligible under their
proposal.
This chart which I brought along with me this afternoon is based on
Standard & Poor's Dow Jones Index, which tracks the Medicare program
every single month in terms of per capita spending, and it shows,
again, back as recently as 2005, 2006, per capita expenditure for
Medicare was actually quite high. It was over 7 percent per patient,
and that, obviously, is an unsustainable level under almost really any
circumstance, but over time it moderated.
And then this red line shows the day that President Obama signed the
Affordable Care Act, which put a number of really intelligent changes
into Medicare, promoting preventive care services, prescription drug
coverage, making sure people will get their colonoscopies and their
cancer screenings, and also saying to hospitals, hey, if people show up
at your emergency room 30 days after you just treated them, we're going
to penalize you. You've got to do a better job of monitoring care in
the community. And that change, by itself, is already promoting a lot
more collaboration on a much more cost-effective, better way for
people.
Who wants to be in an emergency room? You want to be home with your
care being provided, not sitting, again, in a hospital room waiting for
life-or-death treatment.
So since that date, when President Obama signed it into law, the per
capita growth rate under Medicare is now down to its lowest level in
the history of program--2 percent per capita growth. And the fact of
the matter is we can do more. We can actually build on that success of
the Affordable Care Act.
Anybody watch ``60 Minutes'' on Sunday? They had a story about a
hospital system which basically was threatening to fire doctors if they
didn't admit patients according to certain quotas because they're,
again, chasing that fee-for-service incentive that is in old Medicare.
I mean, those are the kinds of, in that case, fraud, but in other
instances, you know, changing that fee-for-service incentive can
actually bring this number down even much more dramatically, and we
don't have to touch a hair on the head of any Medicare-eligible senior
in America for decades to come if we make those smart changes.
So the fact of the matter is we're seeing great progress just, again,
in the last 2 years, 2\1/2\ years. And the fact is that there are very
good ideas about ways of making the system much more efficient.
And I will tell you, and I know my Members that are here on the floor
will agree with this. When you go and visit a hospital or when you go
and visit medical groups, the changes in electronic records, the
changes in terms of incentivizing preventive care have been embraced by
the medical community. They actually understand how wasteful the high
volume fee-for-service system is in terms of just not only taxpayers,
but also the resources that are precious and should be really allocated
to all Americans, not just those who have good insurance that can
reimburse for those procedures.
So the fact of the matter is we can do far better than kicking 65-
and 66-year-olds out of the system as a way of protecting Medicare
solvency, and that should be the direction that we go with these
discussions over the financial future of the public finances of this
government.
Again, I want to thank Mr. Garamendi for organizing this discussion
here today because it's important to get these facts out.
Mr. GARAMENDI. Mr. Courtney of the great State of Connecticut, thank
you very much for bringing this information to us.
Your chart is a dramatic one, when you consider the period of time
and the extraordinary reduction in the inflation rate in Medicare. If
you had another line on that showing the general inflation in health
care for the general population, it would actually be above Medicare,
that entire slope all the way down.
{time} 1500
And it's significantly above it. So what's happened--in part, I
think, you're correct; there may be other forces involved here, but
certainly you can see the effect of the Affordable Health Care Act. And
you identified very well some of the critical cost savings that are in
that. And it's well worth repeating it, which I will do with you. And
we ought to go back so the public comes to understand what was in the
Affordable Health Care Act.
For those over 65 that are in Medicare, those changes are critically
important. First of all, stay healthy. If you want to save money on
hospitals and doctors, stay healthy. And so you have an annual wellness
visit. I think something like 50, 60 million Americans have been able
to take advantage of that free annual visit. You've got high blood
pressure? Well, let's take some blood pressure medicine. You're headed
for diabetes? Here's a dietary program or exercise program. We can deal
with those. You keep people out of the hospitals. The hospital
infection rate, the other one you talked about, very powerful. I hear
from hospitals in my district, and I'm sure my colleagues do also. They
don't want that readmission because that comes right out of the
hospital's pocket. And also there's a penalty.
So there are many, many issues here that are involved in the
Affordable Health Care Act that have caused that slope downward to
continue. Enormous savings to Medicare. Because when you look at the
Medicare issue, it's a projection for 10 years. And the projected rate
2 years ago was 5, 6 percent. And where are you, down in the 2 percent
range now? Those are multibillion dollars a year the American public
will not have to pay in taxes and increases in expenditures. So these
things begin to add up. But there are many, many more savings.
I don't want to dominate all this time. I see that other of our
colleagues have come and joined us.
Peter Welch from Vermont.
Mr. WELCH. Thank you. This is such an important issue about the
future. We can get a deficit deal. The President is committed to doing
it. It's got to be balanced. Balanced means there's got to be revenues.
Our taxes, especially from the high-income, are at historic lows. We
have to have health care
[[Page H6612]]
reform, and that can get the cost of health care down, bring that rate
of growth of spending down.
In Vermont, that's what we're trying to do. We're a single-payer
State. We're trying to move towards a single-payer. And the reason is
that it's the best way to get our arms around health care so you can
continue the access. And we know that there are reforms that we can
make in Medicare. Just for example, if we purchase drugs wholesale, why
do we pay retail? In the VA and in Medicaid, the government is a big
purchaser and it negotiates price discounts with the pharmaceutical
companies that are quite eager to sell their prescription drugs to
Medicare.
Mr. GARAMENDI. If I might interrupt you for a moment. Under the
current law, the U.S. Government Medicare program, it is prevented by
law.
Mr. WELCH. It's illegal to be a smart shopper. That's exactly right.
You can't make that up. It's illegal. It would be like telling you, if
you went into CVS to buy some aspirin, and you knew you were going to
use them for a year--you had a family, if you wanted to buy the bottle
that had 100 and the per unit price is one-third of what it is if
you're going to buy the bottle of 20, it would be illegal for CVS to be
able to sell it to you at a lower price per unit. That's what we have
in Medicare.
Everybody understands you've got to pay for what you're going to get.
But the fundamental debate here--and this is what was reflected in the
Ryan budget with the voucher plan--is: are we going to try to address
what are obvious failures in the system of the delivery of health care,
like not allowing for prescription drug price negotiation? That would
save $165 billion, and it wouldn't cut a single benefit. Or, are we
going to go allow that system that makes no sense continue and instead
take $165 billion worth of benefits out of Medicare so that if you go
to the doctor, they may treat you for a broken wrist but not a broken
forearm. It doesn't make sense. And it certainly doesn't make sense to
start talking about benefit cuts before you have the system reform and
can get savings that are literally right on the table in front of you.
So we can deal with this debt situation that we have in this country.
It is serious. Democrats understand that. The President understands it.
It's a serious problem. It's a solvable problem. But to solve it we
have to have a significant contribution from revenues. The top 2
percent can afford have their taxes go up to the Clinton year rates.
That's number one. And number two, we can have reforms in health care
that would benefit not just Medicare sustainability but health
care expenses, whether you get your health care at work through your
employer or whether you're a private-pay person.
The nice part of this is that we are all in it together. Thank you
for doing this. We can solve this problem. And let's do it.
Mr. GARAMENDI. Mr. Welch, we will do it.
Mr. Courtney from Connecticut has some ideas about other things that
we can do.
Mr. COURTNEY. Again, I think it's important--and you touched on this,
John--when the Affordable Care Act was passed in March of 2010, the
Congressional Budget Office was projecting out some savings because of
the ACA. But they were figuring about 4 percent per capita growth.
Again, as you pointed out, this chart now shows we're down to 2
percent. So they have actually been revising their estimates over the
last 2 years. And the net savings, the recalculation just in the last 2
years has been hundreds of billions of dollars of lower expenditure
than they had first thought was going to be the case.
When you compare that magnitude of savings with, for example, raising
the eligibility age to 67, they're dwarfed. It is really just a small
portion of what efficiencies in the system are capable of producing.
And the fact of the matter is that raising the eligibility age, there's
no free lunch. The fact is that even though these are people that will
be challenged in the private insurance market, 65 and 66 are still the
healthiest population within the Medicare pool. So the ones who remain
in Medicare, their part B premiums are going to go up. And that's not
just me saying it. It's the Kaiser Family Foundation, which analyzed
the impact of raising the age to 67. You're going to raise premiums.
You're going to, obviously, leave people in a horrible situation in
terms of trying to find any insurance. In the private market, which you
regulated, you know that is the roughest area of older working-age
individuals. And the net effect in terms of overall health care costs
in terms of the system is zero. In fact, there's some that would argue
that it would actually add cost to the system.
Mr. GARAMENDI. I think it really would add cost. We discussed earlier
that the Affordable Health Care Act has a very powerful cost-saving
mechanism called Staying Healthy. And that is the prevention programs.
If you move that age from 65 to 67, you're going to have a significant
population of seniors who will not have access to that preventative
medicine program. It's not going to be there for them. So the potential
for them to develop long-term, debilitating diseases increases. And
when they get to Medicare, they will be much more expensive, to say
nothing of what happens to them during that 2-year period when they
can't get to Medicare.
You said something earlier on and I'm going to go back to this. You
talked about what happened before Medicare--the 50 percent of the
population of seniors without medical insurance, the poverty rate. When
you said that, my mind flashed back to when I was a young man in the
1950s--actually, not even a teenager--my dad took me to the county
hospital. We were ranchers out in the boondocks of California, and
nobody had insurance who was in their senior years. The county hospital
sticks in my mind as the reason for Medicare. It was beyond horrible.
There was just a row of beds, the most horrible odor in that ward--
people dying. It was so compelling.
And today, there are issues out there. But we have seen the
population of seniors healthy, living longer--20 years longer than they
were just 45 years ago--50 years ago now. This is so important to
seniors. And it is the Democratic Party that has stood for Medicare all
of these decades. And we're not going to let it go. We're not going to
let Medicare go. It is a foundation of our humanity and our compassion
as Americans for all because all of us want to live long enough to get
into Medicare.
Reforms are possible. We've talked about several of them here today.
I know that our colleague from Michigan spoke earlier. If you'd like to
come back in and talk about this, we'd welcome you. We'll go back here
for a little longer.
Mr. Curson.
{time} 1510
Mr. CURSON of Michigan. Well, again, as we talked earlier, it seems
to so many in the public that moving that age--particularly young
Americans--that just going from 65 to 67 doesn't mean a lot; but if you
look at the statistics of age in this country, that's the baby boomer
generation. That's the greatest population this country has ever had is
right in that area. I'm part of that, I'm 64. So many of my friends
cannot wait 2 more years for health care. They can't afford the out-of-
pocket. Some have preexisting conditions. Without question, if we move
this, it will be a sentence of death for many, many Americans who won't
be able to get the health care that they need.
As I went through and campaigned--I come from a district that was 60
percent Republican--it didn't matter what forum I was in, what group I
talked to. There was no great calling to change Medicare, to take
benefits away, to raise the age. There was a lot of calling to take the
corruption out of Medicare, to take the phony doctors and the phony
bills and other systems. This is what we talked about: not having the
ability to negotiate prescription drugs; millions and millions and
millions and millions of dollars just to make that part of the system
competitive. We can't do that by law; that's ridiculous. Those are
things that easily we could go in, we could do, and we could make the
system much better without touching a single benefit for any American.
Mr. COURTNEY. You're mentioning the fact that there may be some young
folks out there who might be of the belief that this is really not a
big deal to bump that age up 2 years. The fact of the matter is that
some of the folks who, again, analyze the impact of raising the
eligibility age say that it would
[[Page H6613]]
spill over to young Americans, and here's how:
There are a lot of private employers that have health insurance plans
that when people hit retirement age, 65--or their hoped-for retirement
age--they are able to, again, move into Medicare. They come off their
employment-based plan, maybe get some supplemental coverage as part of
their retirement package. But the fact of the matter is that helps move
people out of the workforce at an appropriate age of 65 and opens up
jobs for younger Americans. To the extent that you now are going to say
that Medicare won't be there until age 67, it, frankly, is going to
force a lot more people to stay in the workforce longer than I think
really most people believe would be the case today. So, in fact, it
would create that job lock that would prevent, again, the workforce to
continue to refresh itself with young Americans.
So the fact is that having a solid retirement health insurance plan
like Medicare helps young Americans because it, again, allows the
workforce to continue to circulate people, older Americans out and
younger Americans in. That's why, again, the folks who had the genius
to have the strength to pass Medicare in 1965, they solved a lot of
problems in the U.S. economy, in the U.S. society that really extended
far beyond just the patients who that program covers.
Mr. GARAMENDI. Well, there are certainly a series of things that we
know we can do to reduce the cost of Medicare. Some of those are
already in place. They've been brought forward by the Affordable Care
Act. Others are yet to be done. The prescription drug issue is out
there, enormous savings, $160 billion or $150 billion right there over
a 10-year period.
The fraud in the system, some of that was dealt with with the
Affordable Care Act, but there's much more that can be done. There are
fraudulent billings for durable medical equipment as well as other
kinds of services that are provided. Those need to be addressed. The
systems that are being put in place, that is, moving away from fee-for-
service, will significantly address that.
In the area of hospitalization, again, there are programs that are
viable, that are not yet implemented, that are not part of the savings
that have already been calculated, for example, programs on the dual
eligibles. The dual eligibles are those people that do not have
sufficient income, but are already quite ill that may be 20 years of
age, and they're getting Medicaid as well as Medicare. There are
savings that can be found in the way in which we organize that.
For those seniors that are on Medicare, an organized health care
system that keeps them healthy, that is, taking the prevention program
a step further, or two or three steps further, so that there is a
continuity of care and there is a follow-up, maybe a social worker or
simply somebody on the phone saying how are you doing; are you taking
your medicine; are you able to get the food that you need so that
people can stay healthy. A healthy population significantly reduces
cost.
The use of the Affordable Care Act--not just for Medicare, but for
the total cost of the system--has a very, very powerful cost reduction
in it; and it's called ``insurance.'' Forty million Americans are going
to be insured. That means that those people are less likely, far less
likely to go to the emergency room to get their care.
The Affordable Care Act also provides for clinics. Where a private
doctor may not be available, a clinic would be available. So all of
these things provide more care to people and, in doing so, reduce the
cost of the extraordinarily expensive care that comes from when people
don't get continuing services of health care.
So Medicare is a huge issue before all of us. On the Democratic side,
we're saying, yes, there are savings available in Medicare, we should
take advantage of those, but we're not going to cut benefits. And we're
not going to privatize Medicare or end Medicare as we know it. There
are other things that we can do, we're willing to do it; let's
compromise on those things that make sense without destroying the
Medicare program.
Not on our watch are we going to see the benefit package reduced in
such a way as to harm seniors--no way. And no way are we going to end
Medicare as we know it. We'll draw a line in the sand; we'll save the
money; we'll put that cost curve even on a better trajectory, and that
is a very, very formidable and positive trajectory there.
Let's spend just a moment of time, as we come towards the end of our
time, on Social Security, which many people--well, not on the
Democratic side, but let's talk about Social Security and should it be
on the cutting table here, should it be part of the deficit reduction.
Mr. Courtney.
Mr. COURTNEY. Well, again, what's remarkable--and I know both of you
are well aware of this--is that Social Security, over the last 3 or 4
years, 2 out of those last 4 years there was no COLA; there was zero
percent increase for seniors on Social Security. Again, as we all know,
that's a formula that's tied to the Labor Department basket of goods
that they spill out every year since the 1970s when COLA was first
enacted, and where the economy at that point produced that result.
Now, the last 2 years there have been moderate increases through the
COLA formula; but, again, Republicans want to go deeper. They want to
come out with a new cost-of-living adjustment formula called the
``chained CPI,'' which would depress the existing COLA formula that
already ended up with a zero percent 2 out of the last 4 years and make
that even lower for seniors.
As I think many of you know, you go to a senior center and you talk
about, how come we didn't get a COLA this year or how come the COLA is
so small, and you explain to them how the formula works. Well, the fact
of the matter is that Labor Department formula that we use today uses a
lot of goods and services that seniors don't buy. They don't buy flat
screen TVs, they don't buy laptop computers, where prices have come
down because of competition in those areas. They concentrate their
spending on food and fuel and prescription drugs, which, if you look at
just that basket of goods, the COLA would be higher than the existing
formula, certainly not lower.
So for the Republicans to come out with a proposal that says we
should depress the COLA formula that we have today that, again, really
doesn't match up with the profile of what a senior goes out to the
supermarket and buys one week to the next, and is really going
backwards in terms of really the economic security of people over age
65.
I know the gentleman from Michigan would like to share his thoughts.
Mr. CURSON of Michigan. Well, I think the great majority of our
citizens don't understand that Social Security is not funded by tax
dollars. The confusion lies because over the years the contributions
made by workers to fund Social Security created a surplus. With that
surplus, they loaned that surplus to other government-funded projects,
and they're being paid back with government money. That government
money every year is now playing into the repayment. That's why people
think that you can cut Social Security to take the tax dollars out.
{time} 1520
Well, if that was a private insurance company that had a surplus and
loaned that surplus to another company, that first company would expect
the second company to pay it back. So that cannot be part of this
equation. Social Security and the Federal money that goes into Social
Security cannot be part of the equation in this fiscal cliff debate.
Now, certainly with the expectancy of Social Security only surviving
until 2038, before it has reduced benefits, in the very near future,
this great Hall has to discuss how to fix that; and all the great minds
in this Hall, I'm sure, can. But it does not need to be a part of this
debate. This should not be a part of whatever legislation we settle in
this last lame-duck session of this Congress.
Mr. GARAMENDI. Well, you are certainly well stating my position and I
believe the position of our colleagues and I believe of the President.
Social Security is not part of the current deficit problem. It is an
issue. We'll have to deal with it at any time between now and the next
7, 8 years. And we can. It's been done before.
At least three times in my memory, Social Security has been adjusted.
One was discussed earlier with the issue of
[[Page H6614]]
the COLA. That's been adjusted. There are things that can be done to
deal with Social Security, but that is a debate separate and apart from
the deficit and the fiscal cliff debate.
The fiscal cliff debate is a tax issue, and it's also a spending
issue. Today we focus largely on the issue of what are we going to do
about Medicare, a big part of the Federal expenditures. And our
argument is this: we're here to protect Medicare for seniors, period.
We're not here to cut the benefits for seniors. We're here to see to it
that Medicare, which has been a program for seniors since 1964-65, is
going to continue to be there for seniors as well as the benefits
package that's there. There are reforms and changes that can be made to
reduce the cost of Medicare but not to reduce the benefits. We've
talked about many of those.
So here's where we're coming. Within that area, there are very, very
significant savings that can be made. The prescription drug benefit,
$150 billion over 10 years. Other issues having to do with keeping
people healthy, to extend their health care, issues having to do with
how much we pay for certain services, fraud and abuse. All of those
things could add up to the potential savings--not the potential
savings--to the savings that the President has called for, which is
somewhere in the range of $300 billion over 10 years--additional
savings over and above what has already taken place in the Affordable
Care Act. And we've seen in this decline in the inflation rate in
health care some of the effects of the Affordable Care Act. So there
are things that can be done and will be done.
Social Security is not a part of this debate.
But I also want to point out here in the last closing minutes of this
a couple of things that I think are very, very important. The President
has put forth a very detailed program calling for $1.6 trillion in
additional revenue over 10 years; and that is money that is to come
from the expiration of the George W. Bush tax cuts for the top 2
percent.
Now I want to make this clear. I said this earlier--yes, it's worth
repeating because it's not said very often--every American taxpayer
gets a tax reduction. The superwealthy to the very minimum taxpayer in
this Nation gets a reduction in what the President is proposing. And
that is to continue at the current tax rate for those with under
$250,000 adjusted gross income. For those who have income over and
above that, they get that tax reduction. And above that, they're going
to pay an additional amount up to 3.9 percent in two different
tranches. So everyone gets a tax break.
But those superwealthy, the 2 percent, they're going to pay more, and
that will amount to a substantial amount of money over 10 years. And,
frankly, they've had 12 years of really low, low taxes--the lowest
taxes, really, ever since the 1930s.
The President has also proposed something that's very important. We
talked about this last week. I want to talk about this again the next
time we come here. And that is, how do we grow jobs? How do we put
people back to work?
The President has proposed an additional $50 billion. He did this
more than a year ago in the American Jobs Act, and he's put it back on
the table: $50 billion in infrastructure. Let's build the foundation.
That deserves a lot of discussion; and, frankly, it's something we
ought to enact here right away and put people back to work.
There are other savings that he's proposed over the course of the
next 2 years. We don't have time now. I notice my time has just about
expired, if you would like to take a final shot at this, Mr. Curson.
And by the way, this is the first opportunity I have had to spend
part of my hour with you. You are a very articulate spokesperson for
the working men and women in this Nation. You know the issues of
Medicare and Social Security so very, very well. And I know, coming
from Michigan and Detroit, you know the need to build the jobs portion
of our economy. So why don't you close, and then I will wrap this up.
Mr. CURSON of Michigan. Thank you for that, and I thank you for your
comments.
But without a doubt, we could take an hour talking about rebuilding
the infrastructure, the jobs it would create, the need in America to
fix our bridges and our roads. If you are about to drive over a bridge,
you want it safe. It doesn't matter if you are a Republican or a
Democrat, you want that bridge to hold you and your car up as you go
over it. That needs to be done.
Much of our infrastructure is crumbling. The power grid is crumbling.
If it goes out, it doesn't matter what party you are affiliated with.
You want your lights on; you want your refrigerator to work; you want
your house warm.
So all of those things that could be done and would put America back
to work and create revenue from people working, when they get that
paycheck, then they would have money to send their kid to a dance class
or to go get a haircut. All the small businesses in the area spawn off
of that money from creating jobs, rebuilding our infrastructure. That
should be on the forefront of our agenda, and I certainly hope we have
a chance to talk about that.
Mr. GARAMENDI. How about next week? We'll come back to the floor next
week, and we'll pick up the issues of infrastructure, of jobs and the
like.
This week we need to focus on what has been put on the table by the
Republicans and the Democrats on how to deal with the fiscal cliff,
dealing with the issue of Social Security and Medicare. Social
Security--no, not part of this problem. It is something we'll deal with
perhaps in the next Congress or even in the one beyond that because we
do have time to deal with Social Security.
Medicare--for those who want to privatize Medicare, end it as we know
it with a voucher or a premium support program--no. No way, no how are
we going to go there.
For those that want to work on changing the way in which Medicare
operates to get savings, such as negotiating drug prices, dealing with
fraud and abuse, the various payment systems that are in Medicare, all
of which can save money and to continue the work of the Affordable Care
Act, and the way it has already brought the inflation rate down from
the 4 percent, 5 percent range down into 2, 2.5 percent range, this is
an extraordinary savings right here. And that will be calculated in the
years ahead. And, frankly, this will add up to hundreds of billions of
dollars in the reduction and the projected cost of Medicare in the
years ahead.
So we're making progress. We've got work to do, and we're prepared to
do it. The Democrats are prepared to put together a compromise. Let's
get to work on it. The American public expects us to do that. And we
can, and we will.
With that, Mr. Speaker, I yield back the balance of my time.
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