[Congressional Record (Bound Edition), Volume 145 (1999), Part 9]
[Extensions of Remarks]
[Page 12936]
[From the U.S. Government Publishing Office, www.gpo.gov]



INTRODUCTION OF FRAUD AND REIMBURSEMENT REFORM PROVISIONS TO FUND FULLY 
                 THE MEDICARE EARLY ACCESS ACT OF 1999

                                 ______
                                 

                        HON. FORTNEY PETE STARK

                             of california

                    in the house of representatives

                         Tuesday, June 15, 1999

  Mr. STARK. Mr. Speaker, today, a number of House members are 
introducing the Medicare Early Access Act of 1999 to help people 
between 55 and 65 years of age obtain affordable health insurance.
  The proposal is almost fully funded over time through a requirement 
that beneficiaries pay for their own coverage. But there is an initial 
start-up cost to the program, and a temporary subsidy is necessary to 
mitigate ``adverse selection'' costs attributable to the fact that 
sicker-than-average individuals who are desperate for health insurance 
may sign up in disproportionate numbers for the program.
  To ensure that Medicare's trust funds are not hurt by this new 
program, I am introducing a package of anti-fraud and administrative 
improvement provisions that will raise more than enough money to fund 
the start-up of the Medicare Early Access Act. These provisions are 
changes that we ought to be making anyway to strengthen the program, 
and I am pleased that they fund this important new expansion of health 
insurance.
  Over the long run, enactment of these provisions will help reduce 
Medicare's long-term financial problems.
  Below is a brief description of the provisions. The bill will:
  Pay for covered Medicare drugs on the basis of actual acquisition 
cost instead of the artificially high level of average wholesale price 
minus 5%, which was established by the Balanced Budget Act of 1997;
  Lower Medicare payments for Epogen from $10 to $9 per 1,000 units. 
Epogen is now Medicare's most expensive drug, and taxpayers pay more 
than 80% of the cost;
  Reform Medicare's partial hospitalization benefit. In a recent audit, 
the HHS Inspector General found Medicare payments for partial 
hospitalization services had a 90% error rate;
  Improve the accuracy of Medicare's secondary payer provisions to 
require health plans and employers to provide insurance data on covered 
enrollees;
  Allow Medicare to get a volume discount by contracting with HHS-
designated ``Centers of Excellence'' for complex operations at 
hospitals that have better-than-average outcomes.

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