[Congressional Record (Bound Edition), Volume 146 (2000), Part 17]
[Senate]
[Pages 25183-25188]
[From the U.S. Government Publishing Office, www.gpo.gov]



               THE LAST CONGRESS OF THE TWENTIETH CENTURY


                               H.R. 2614

  Mr. GRAHAM. Mr. President, I come on this early Friday evening with a 
sense of extreme disappointment, extreme disappointment that we are 
concluding the last Congress of the 20th century with so little 
commitment to provide a vision and a sense of assistance and help to 
Americans as they prepare for the 21st century. I would describe it as 
the ``lack of vision thing.'' We cannot seem to envisage the surplus as 
a once-in-a-century chance to tackle the most important issues for our 
day, issues that will affect our children and grandchildren, issues 
such as Social Security and Medicare, the two great programs in which 
the U.S. Government has a contract with its people, and how to deal 
with the national debt, which grew so explosively over the last 30 
years, and that we now have an opportunity to substantially reduce.
  Instead, we see the surplus as a giant windfall that allows us to 
dole out favors to favored constituencies, as if Halloween has already 
arrived. The result of this ``tunnel vision thing,'' is a bill that 
will absorb $320 billion of the non-Social Security surplus faster than 
the kids next Tuesday will be able to empty their Halloween bags.
  As troubling as the specifics of this legislation is the process by 
which it found its way to the Senate floor. This legislation, which 
would propose substantial tax reductions and additional provider 
funding under the Medicare program, is a major assault against our 
ability to use the budget surplus in a rational way.
  As we all remember from Abraham Lincoln's immortal Gettysburg 
address, ours is a Government ``of the people, by the people and for 
the people.''
  For such a government of, by, and for the people to function, it must 
be conducted in full view of the people.
  As several of my colleagues have already discussed earlier today, 
this program of tax cuts and paybacks to additional reimbursement to 
Medicare providers was created by a self-appointed, elite group of 
Members in the proverbial smoke-filled room of old-style machine 
politics. The irony is that the very Republicans who snuck into the 
closet, locked the door behind them, and emerged with this poor excuse 
for a fiscal plan are the same leaders who are now encouraging George 
W. Bush to be elected President of the United States on a promise to be 
a uniter, not a divider, and a builder of coalitions and bipartisan 
consensus.
  If this is what the blueprint is for bipartisanship and consensus 
building, I shudder to imagine the legislation that will ooze out from 
this closed door should Governor Bush win the Presidency and follow the 
counsel of those who have brought us to this sad end on this fall 
evening.
  Governor Bush would do well to consider that the Republican Congress 
lacks the vision thing. It is always more difficult to see the big 
picture when you are in the dark. The legislation before us is a prime 
example of what happens when you try to see the big picture in the 
dark.
  I will not claim that this bill is without some positive qualities, 
some redeeming features. Many of those features I have strongly 
advocated and, in a number of instances, have been a prime sponsor. But 
the bill has serious deficiencies. I choose this evening to focus only 
on two of those deficiencies: First, the high level of additional 
funding being given under the Medicare program to managed care 
providers at the expense of the beneficiaries; and, second, the failure 
to provide adequate incentives for small employers to offer pensions to 
their employees.
  Both of these deficiencies have a common theme, and that is that we 
are not just proposing measures as a means of adding back or increasing 
the payments to Medicare providers. We are not providing tax incentives 
just to reward certain people with additional pension or retirement 
benefits. We are trying to achieve objectives.
  In the case of Medicare, we are trying to achieve the objectives of 
changing the orientation of this program from one which focuses on 
illness, one which focuses on treating people after they have become 
sick enough to go into a hospital or have suffered a major accident, to 
one which focuses on wellness, keeping people healthy as long as 
possible, and which recognizes that a fundamental part of any wellness 
strategy is providing access to prescription drugs which are the means 
by which conditions are appropriately managed or reversed so that 
wellness can be achieved or maintained.
  We also have as a vision to provide a balanced retirement security 
for older Americans, a retirement security that is based on three 
pillars: Social Security, employer-based pensions, and private savings. 
It is to achieve this goal of a balanced, secure retirement program 
that we should be directing our attention in terms of how we fashion 
tax incentives and other measures that use public incentives and funds 
in order to achieve that objective.
  I am disappointed that this tax legislation, this Medicare 
reimbursement legislation that we have before us, fails on both of 
those accounts, and I will elaborate on the nature of that failure.
  First, by making health maintenance organizations the only Medicare-
based means by which a prescription drug benefit can be achieved, we 
are, in effect, herding seniors who need prescription drug coverage 
into private health maintenance organizations. This bill, by any 
account, gives disproportionately too much money to the health 
maintenance organizations, organizations that do not need it and do too 
little to seniors and health care providers who do. We give too much 
money to the HMOs, too little to the beneficiaries, and too little to 
other health care providers.
  While I appreciate the modest improvements for beneficiaries included 
in this bill, the fact remains that health maintenance organizations 
will receive substantially more than one-third of the overall package 
over the first 5 years and even more over 10 years. I am alarmed by the 
attempt at offering substantial increases in payments to HMOs because 
experts tell us that these payments are already too high. The General 
Accounting Office says that under current law--under current law, not 
the increases we are considering here--and I quote from the General 
Accounting Office report:

       Medicare's overly generous payments rates to health 
     maintenance organizations well exceed what Medicare would 
     have paid had these individuals remained in the traditional 
     fee-for-service program.

  The General Accounting Office concluded that Medicare health 
maintenance organizations ``have never been a bargain for taxpayers.''
  Increasing HMO payments will not keep them from leaving the markets 
where they are most needed. According to the testimony from Gail 
Wilensky, chair of the Medicare Payment Advisory Commission and a 
former Administrator of the Federal Health Care Financing 
Administration, HCFA:

       Plan withdrawals have been disproportionately lower in 
     counties where payment growth has been most constrained.

  The withdrawal of HMOs from counties has actually been lower where 
the payment growth to HMOs has been most constrained.
  It comes down to priorities: Should we spend billions more on HMOs or 
should we try to help frail and low-income beneficiaries, people with 
disabilities, and children?
  The managed care industry and its advocates in Congress have thwarted

[[Page 25184]]

every effort to reform the Medicare+Choice Program so that it does what 
it is designed to do: provide services while saving the Government 
money.
  There is a complex formula by which Medicare+Choice plans are 
reimbursed. In a simplified form, it works this way. It is an 
arithmetic formula:
  A calculation is done in each county in the country as to how much 
fee-for-service medicine is costing per Medicare beneficiary. Ninety-
five percent of that number then becomes the method by which the 
HMO+Choice plans are reimbursed.
  If you happen to have a county that has a high fee-for-service 
medicine, for instance, because it has tertiary medical care or 
particularly because it has a teaching hospital, which tend to result 
in driving up the overall fee-for-service costs within that county 
because they are providing exceptional and generally exceptionally 
expensive services, then you have a high reimbursement level to HMOs. 
That is why you tend to find lots of HMOs wanting to do business in 
those high-cost, fee-for-service counties.
  Conversely, if you happen to be in a county that has no hospitals or 
only primary care hospitals and relatively low fee-for-service costs, 
then you have low HMO reimbursements, which frankly is a formula that 
makes no sense.
  For many years, there has been an effort to find a new way to 
reimburse HMOs that is more market oriented as opposed to relying on 
the accident of whether you happen to be in a high fee-for-service 
county or a low fee-for-service county.
  Several times in recent years Congress has initiated a program to do 
a demonstration project using some of the competitive bidding processes 
which are prevalent in the way in which private corporations and State 
and local governments determine how to reimburse their HMOs. They put 
their HMO contracts out for competitive bid and see what HMOs will 
offer in order to secure the business of a large corporation or a State 
or local government. I believe strongly that we should at least 
experiment with this approach to reimbursing HMOs through Medicare.
  In 1997, as an example, two demonstration projects were included in 
the Balanced Budget Act. These were to provide information on the 
competitive bidding process for Medicare+Choice contracts. What 
happened? As soon as two cities--in this case Kansas City and Phoenix--
were selected to be the sites for the demonstration projects, the HMOs 
and their allies in those communities led an assault against the 
demonstration project, and in an end-of-the-session, largely 
clandestine attack, those demonstration projects were terminated even 
before they had started. In so doing, the HMOs have been able to assure 
that they will not have to compete for Medicare's business based on 
merit and the marketplace. In fact, they would not have to compete at 
all.
  This year, the HMOs have again launched a multimillion-dollar 
lobbying effort to pressure Congress to increase their payment rates 
based on this discredited 95-percent formula. The HMOs are claiming 
their current reimbursement rates are too low. Yet these are the same 
HMOs that committed congressional homicide when they killed the 
proposal that would have allowed a more market-oriented system, which 
could have resulted in higher reimbursement rates or lower 
reimbursement rates; at least they would have been the reimbursement 
rates that were set by market competition, not by an arbitrary 
discredited formula.
  This action, of claiming that you need to have higher reimbursement 
rates after you have just killed the method by which we were going to 
determine what would be the means of setting those appropriate rates, 
is the equivalent of the child who shoots his mother and father and 
then claims to deserve the mercy of the court because he is an orphan.
  The HMO industry has shot every effort to establish a rational means 
of reimbursement.
  Then they come here late at night, late in the session, saying that 
they need to have a third or more--a third or more--of all the money 
that is going to be used to provide reimbursement to Medicare providers 
because their rates are too low. They are providing services to 
approximately one out of six Medicare beneficiaries. Yet they want to 
have a third or more of all of the money that goes for additional 
reimbursement.
  I was pleased to learn that within this bill one positive thing that 
was being considered was additional preventative benefits for Medicare 
beneficiaries. This is a cause I have long advocated as part of the 
fundamental conversion of Medicare from a sickness system to a wellness 
system.
  I strongly believe that Medicare must be reformed from a system which 
is based on treating illness to one that is based on maintaining 
wellness.
  I have introduced many bills to this effect, some of which are now 
the law of the land. The benefits that I have included have been based 
on recommendations made by experts in the field. We have used the 
medical expertise to determine which preventive modalities have been 
proven to be efficacious and cost-effective. Therefore, I was 
disappointed to find that this bill fails to provide Medicare coverage 
for those areas of prevention which have been identified by the U.S. 
Preventive Services Task Force as being the most efficacious and cost-
effective.
  What were these areas of prevention? Hypertension screening and 
smoking cessation counseling. These were the highest priorities 
identified by the U.S. Preventative Services Task Force. But these 
apparently did not meet the ``political correctness'' standards of 
those who were writing this final bill.
  The bill also provides one of the other priorities: Access to 
nutrition therapy for people with renal disease and diabetes. But it 
leaves out the largest group of individuals for whom the Institute of 
Medicine recommends nutrition therapy--people with cardiovascular 
disease.
  This is the publication of the Institute of Medicine on ``The Role of 
Nutrition in Maintaining Health in the Nation's Elderly,'' which urges 
that access to nutrition therapy be made available to people with 
cardiovascular disease. Again, apparently they did not meet the 
standard of ``political correctness'' to be included in the prevention 
modalities that will be funded in this bill.
  I believe strongly that additions to the Medicare program must be 
based on scientific evidence and medical science, not on the power of a 
particular lobbying group or on the bias of a single Member.
  It appears that instead of taking a rational, scientific approach to 
prevention, the Members use a ``disease of the month'' philosophy, 
leaving those who need help the most without relevant new Medicare 
preventative services.
  When I asked why the authors of this bill ignored the expert 
recommendations, such as providing seniors with cardiovascular disease 
with nutritional therapy, I was told it was excluded because it was too 
expensive; we could not afford to provide nutrition therapy to seniors 
with cardiovascular disease.
  It does not take a Sherlock Holmes, or even a Dr. Watson, for that 
matter, to understand what is happening here. This bill provides $1.5 
billion over 5 years for all of the prevention programs and a whopping 
$11.1 billion for the HMOs. But it is just too expensive to provide 
adequate, rational, prioritized prevention services for our elderly.
  Clearly, the money is there. But the real goal of those who wrote 
this plan is to herd seniors into private HMOs as a means of avoiding 
the addition of a meaningful Medicare prescription drug benefit for our 
Nation's seniors.
  Whether you believe in the broad Government subsidization of the 
managed care industry or in providing benefits to seniors and children, 
we should all agree that taxpayers' money should be spent responsibly.
  Congress has the responsibility to make certain that the payment 
increases we offer are based on actual data rather than anecdotal 
evidence or speculation.
  How then can we justify that over the next 10 years the managed care 
industry is set to walk away with almost

[[Page 25185]]

the same amount of funding increases as hospitals, home health care 
centers, skilled nursing facilities, community health centers, and 
beneficiaries combined.
  Over the next 10 years, under this plan, health maintenance 
organizations will receive, in additional funding, the amount that 
hospitals, home health care centers, skilled nursing facilities, 
community health centers, and beneficiaries will receive combined.
  The most disturbing problem with this bill is that it does nothing to 
address our efforts to pass a Medicare prescription drug bill in the 
year 2000. The Republican leadership would like for you to believe that 
their bill will solve the problem of providing a prescription drug 
benefit for seniors.
  According to a story in the October 26 Washington Post:

       Unlike the rest of Medicare, this plan provides some 
     prescription drug benefits; and by pumping more money into 
     it, the GOP can defuse Democratic charges that the Republican 
     Congress has failed to act on prescription drug benefits for 
     seniors.

  What we have here is the attempt to use this exorbitant amount of 
money, more money than is going into hospitals, home health care 
centers, skilled nursing facilities, community health centers, and 
beneficiaries combined, pumping all that money into HMOs in order to 
create the facade that we are providing a prescription medication 
benefit and therefore don't have to provide a prescription medication 
benefit to the rest of the Medicare beneficiaries, the five out of six 
Medicare beneficiaries who get their health care through the 
traditional fee-for-service program as opposed to an HMO.
  The Republican leadership and George W. Bush criticize our 
prescription drug plan by claiming that we are forcing seniors into a 
Government-run HMO. By that so-called HMO, they mean Medicare, 
traditional Medicare, Medicare on which nearly 85 percent of the 
beneficiaries rely today.
  In reality, the Republican plan to strengthen Medicare is to force 
seniors into private HMOs in order to get their prescription drugs.
  Here is what seniors can count on in this plan of forcing seniors 
into private HMOs as the means of securing their prescription drugs.
  First, the plan will cover less than one in six Medicare 
beneficiaries. Very few seniors have elected or in many cases even have 
the opportunity to participate in Medicare+Choice. Only 16 percent of 
the 39 million Medicare beneficiaries have joined a Medicare HMO plan.
  Second, Medicare beneficiaries can look forward to plans that are 
here today and gone tomorrow. Nearly 1 million seniors will be 
abandoned by their HMOs in this year of 2000 alone. More than 87,000 of 
those are in my State of Florida. Seniors in 33 counties of the 67 
counties in Florida either never had a Medicare+Choice plan or had one 
only briefly before it packed up and left town.
  Third, seniors will have no guarantee of their prescription drug 
benefits. What is unlimited coverage today may be a capped benefit 
tomorrow.
  Listen to these numbers. This is what the prescription drug benefit 
is for some of the most significant HMOs in the country operating in 
communities with very large Medicare beneficiary populations.
  In Hernando County, FL, north of Tampa, there are two Medicare+Choice 
plans, Wellcare and United. Both offer a prescription drug benefit, the 
type of benefit we are hoping to expand by pumping more money through 
this Medicare additional reimbursement into HMOs. Both of those plans 
cap their benefits for prescription drugs, in the one case at $748 a 
year and in the other at $500 a year. There are many Medicare 
beneficiaries who spend more than that in 1 month. Yet that is the 
annual cap on prescription drugs for those two HMOs which claim they 
are providing effective prescription drug coverage for their 
beneficiaries.
  Another example is the HIP Health Plan of Florida which offers 
seniors in Miami-Dade and Broward Counties a drug plan that covers up 
to $700 annually for brand name drugs. Seniors in the same plan in Palm 
Beach County, which is immediately north of Broward County, have an 
annual limit of $250 for brand name drugs.
  What kind of prescription drug benefit is that? For many seniors, 
such as a constituent to whom I have referred frequently, Elaine Kett 
of Vero Beach, these annual capped amounts represent less than 30 days' 
worth of their prescription drug needs.
  The HMOs' tendency toward denying choice and rationing of health care 
will not benefit our Nation's seniors and people with disabilities. 
Talk about denying people choice; talk about rationing of health care; 
This is it.
  Fourth, seniors can expect no guaranteed choice of a doctor. HMOs 
have networks of doctors that are constantly changing. If Mrs. Smith's 
doctor is not in her HMO network, Mrs. Smith can't see the doctor. She 
can't see the doctor who knows her the best. She can't see the doctor 
she trusts to treat her and prescribe the medications she needs.
  Even if Mrs. Smith's doctor writes a prescription drug, her HMO may 
have a restrictive formulary and substitute her doctor's wisdom for 
theirs by filling her prescription drug with something else. Even if 
Mrs. Smith's doctor writes her a prescription drug, her HMO may have a 
restrictive formulary which will deny her the medicine that her doctor 
believed was medically necessary.
  To continue looking at the facts, let's look at the materials that 
Humana, one of the largest Medicare+Choice providers, HMOs, in the 
country, provides to seniors as it explains their prescription drug 
benefit.
  Here is what Humana says:

       For medications with dispensing limits and age limits, 
     additional information may be required for approval. These 
     requests can only be made by your physician to be considered. 
     Please have your physician contact the Humana clinical 
     hotline at the number below.

  So it is not the patient relying on the best medical advice of the 
doctor and then taking that medical advice in the form of a drug 
prescription to a pharmacist in whom they have confidence to be filled. 
It is the patient relying on the goodwill of the HMO to allow the best 
judgment of the doctor to be fulfilled.
  Reading further in the Humana preferred drug list publication:

       All of the above is not a complete list and is subject to 
     change.

  So what you think may be your relationship with your doctor and your 
pharmacist today may be different tomorrow, if your HMO decides it 
wants to make it different tomorrow.
  If Mrs. Smith's doctor prescribes a medication that is not on 
Humana's formulary, she can only get it filled with prior authorization 
from Humana. That means upon learning that her medication is not on 
Humana's formulary, probably when she is standing at the pharmacist's 
counter trying to get her drug prescription filled, Mrs. Smith will 
have to call her doctor and ask her doctor to call a 1-800 number on 
her behalf.
  Once the doctor gets through, Mrs. Smith's doctor will have to 
consult with an HMO bureaucrat and provide additional information 
regarding Mrs. Smith's health so the bureaucrat can determine whether 
Mrs. Smith is eligible to receive the medication her own doctor 
prescribed. After all of this, the request to have Humana cover the 
drug may still be denied. To add to the difficulty of having a drug 
prescription filled, Humana states in its materials that the list of 
covered drugs is subject to change. A drug that is covered for Mrs. 
Smith today may be excluded on her next visit to the pharmacy.
  Fifth, there are few, often no, options to participate in 
Medicare+Choice in rural areas. Because of this perverse formula that 
relates the fee-for-service costs within that county to the amount of 
reimbursement that HMOs will receive, while seniors in urban centers 
may have access to Medicare+Choice plans, many of our seniors do not 
have that option. In over 20 counties in Florida and in the entire 
States of North Dakota, Utah, and West Virginia, there are no managed 
care programs for Medicare beneficiaries.
  I wonder, do those who would advocate that this managed care approach

[[Page 25186]]

provides meaningful prescription drug coverage for our Medicare 
beneficiaries think the people in North Dakota, Utah, and West Virginia 
do not need prescription medications?
  All of these factors beg the question: If seniors don't have access 
to or don't like Medicare managed care now, because of their own 
experience, why would they like it better just because we are about to 
decide to throw an enormous amount of money at it, without any rational 
justification, without any sense of the priorities among Medicare 
health care providers? Why, just because we are about to act in an 
irrational way, would it suddenly make these plans better in the eyes 
of the ultimate beneficiary?
  As I have said in a series of floor statements, the attack on a 
Medicare prescription drug benefit is, in reality, an attack on the 
Medicare program itself. Let me repeat that. This attack on using fee-
for-service Medicare as the fundamental means by which prescription 
drug benefits will be delivered is but a veiled attack, an assault on 
the basic principles of Medicare itself; universality, comprehensive 
service, affordability, those are principles that are under assault 
under the veil of denying prescription medication benefits through 
traditional Medicare.
  The Washington Post article of October 27 entitled ``Ad Blitz Erodes 
Democrats' Edge on Prescription Drugs'' describes how Republicans have 
used ads to achieve ``some success in muddying the waters on 
prescription drugs.''
  Mr. President, I ask unanimous consent that this article be printed 
in the Record immediately after my remarks.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  (See exhibit 1.)
  Mr. GRAHAM. In the legislation we are considering today, we have 
found yet another smoking gun to validate our suspicions that the 
Republican Party--and, I am afraid, its Presidential candidate--are 
seeking to do as Newt Gingrich was candid enough to say publicly: Let 
Medicare ``wither on the vine.''
  I believe the cynical way in which this bill purports to provide a 
prescription medication benefit by pumping enormous amounts of money 
away from beneficiaries in more effective prevention programs, and away 
from institutions such as hospitals and home care centers which have 
demonstrated a legitimate basis to receive additional compensation, and 
toward the institutions which have fought against every reform and 
which, by the General Accounting Office report, has not made a 
justifiable case for additional reimbursement. We are doing this in 
order to create the facade that by forcing seniors into private HMOs, 
that would be the means by which they would receive prescription drugs. 
That in itself is enough of a reason to vote against this proposal.
  Let me comment on a second reason. Just as the first, prescription 
drugs, is an area on which the Presiding Officer and I have worked to 
try to develop a bipartisan, rational means by which prescription drugs 
can be made available to Medicare beneficiaries, the next area is 
another on which I, along with many colleagues on both sides of the 
aisle, have worked, and that is to reform our pension laws. In my 
judgment, the primary objective of reforming our pension laws should be 
to increase the number of Americans with access to employer-based 
pensions.
  At first glance, the retirement savings section of this bill looks 
very similar to S. 741, the Pension Coverage and Portability Act, which 
I introduced with my colleague from Iowa, Senator Grassley, which has 
the support of 17 of our colleagues in the Senate. In fact, there are 
some very attractive and useful provisions that will make existing 
pensions work better. To these, I give my wholehearted support. For 
example, the bill makes it easier for employees to take their pensions 
with them as they move from job to job. This is an important 
improvement to existing law and will help workers accumulate assets for 
retirement.
  On further review, however, it becomes clear that in many ways this 
bill is a wolf in sheep's clothing. The principal goal of the Pension 
Coverage Portability Act is expanding retirement plan coverage to those 
Americans who currently do not have an employer-sponsored plan 
available to them. The measure focuses particularly on encouraging 
small employers to offer pension coverage.
  Let me use some examples and statistics from my State of Florida, 
which I think are not unrelated to the national scene. Florida has 
benefited greatly from the strong economic growth in America in the 
last 8 years. Almost 2 million new jobs have been created in our State 
during that time. Of those almost 2 million jobs, more than 70 percent 
are in firms that employ fewer than 25 people. The vast growth in 
employment in my State of Florida--and, I suggest, in America--has been 
through small entrepreneurial firms. It is these small employers who 
have the greatest difficulty offering pension coverage to their 
employees. A recent report from the General Accounting Office 
highlights this fact.
  According to the GAO report, slightly more than half--53 percent--of 
all employed Americans lack employer-based pension coverage. The good 
news is that that is 5 percentage points more than it was a decade ago. 
So more Americans than 10 years ago are now getting a pension through 
their place of employment.
  The more troubling finding in the GAO report is that workers' chances 
of having access to a pension plan are strongly influenced by the size 
of the firm that employs them. While 53 percent of Americans, in 
general, lack an employer-based pension, if you happen to work for a 
firm that employs fewer than 25 people, 82 percent lack an employer-
based pension. It is in precisely on those small firms that the Pension 
Coverage and Portability Act targeted its attention. Unfortunately, the 
bill before us today falls woefully short in encouraging those small 
firms to provide coverage to their workers.
  The Pension Coverage and Portability Act contained two important 
provisions to assist small businesses in offering retirement plans to 
their employees. One of those was an income tax credit to help small 
businesses defray the administrative costs associated with establishing 
a retirement plan. Second is an income tax credit for small employers 
who make employer contributions into pension plans for the benefit of 
their employees. So there were two critical provisions in the Pension 
Coverage and Portability Act, both targeted at encouraging, 
facilitating, and making more likely that small employers would provide 
pensions for their employees an income tax credit to help defray the 
initial establishment of the plan costs; and, second, an income tax 
credit for the employers who made contributions on behalf of their 
employees into their employees' pension plan. Both of these important 
provisions were excluded from the tax bill before us today.
  In addition, to the pension bill that was unanimously reported by the 
Senate Finance Committee included both of those provisions, and another 
important element of retirement security encouraged personal savings. 
This was achieved through a separate tax credit to help low- and 
moderate-income families save for their retirement.
  The bill was unanimously reported. Every Republican and every 
Democrat on the Senate Finance Committee supported the provisions that 
would have encouraged small businesses to set up pension plans for the 
employer to contribute to employee pension plans, and it also creates 
an incentive for increased savings for low- and moderate-income 
families.
  The bill crafted by the Republican leadership contains none of these 
important proposals.
  Finally, the bill even has the potential to actually create 
incentives for small businesses to drop their existing pension 
coverage. Approximately 18 percent of small businesses with less than 
25 employees might actually be encouraged by this bill to drop that 
pension coverage. How can this possibly be?
  Frequently, the employers in a small business set up pension coverage 
not only to benefit their employees and attempt to encourage a greater 
sense of

[[Page 25187]]

commitment to employment with a small firm, but they also do it out of 
self-interest. As long as an employer is willing to cover his 
employees, he generally can set aside more funds for his own retirement 
through an employer-based plan than is possible to be done through an 
IRA, individual retirement account.
  This bill includes a substantial increase in the maximum contribution 
allowable to an individual retirement account. That amount today is 
$2,000 a year and will be increased to $5,000 a year by the year 2003. 
By securing a separate IRA for the employer's spouse, effectively 
$10,000 can be tax sheltered for retirement.
  By making IRAs more attractive to small employers, those small 
employers might decide that it is in their self-interest to discontinue 
the employer-based plans which they now sponsor and rely on their own 
and their spouse's IRA as the means of providing for their retirement 
security.
  Thus, the unintended consequence of increasing IRA limits without 
providing incentives to encourage small businesses to provide pension 
coverage and then for the employers to contribute to their employees' 
plan may be to erode the retirement plan coverage for employees in 
small businesses. The percentage of those workers in small firms 
without coverage--82 percent already--could grow even higher.
  As disappointed as I am in this legislation as a whole, I am not in 
the least bit surprised. This legislation is the work of lobbyists--not 
statesmen.
  Instead of a strategic vision of what will be required in order to 
convert Medicare into a wellness program and what will be required to 
assure that the large and growing number of Americans who work for 
small businesses will have the benefit of a pension and retirement 
fund--instead of those strategic visions--this is the work of special 
interest tunnel vision. Instead of balancing the interests of all 
Americans, this bill goes full tilt towards the luckiest few.
  I suggest when legislation is drafted in the dark this is what we can 
expect. Behind those closed doors, the drafters seem to forget basic 
math. That basic math is that every dollar we spend--such as pumping 
excessive funds into HMOs--is $1 that we take directly out of the 
surplus.
  Every dollar spent on tax cuts is one that will not be spent on 
saving Social Security by paying down the national debt, and will not 
be spent on modernizing Medicare to make it a wellness program.
  I have used words such as ``squandering,'' ``flittering,'' and 
``wasting'' before this body more often in the last 2 weeks than I 
would have liked.
  I have watched any chance that this body had to create a 
comprehensive strategic spending plan for our future die a small and 
painful death.
  I am left with the hope that President Clinton will indeed veto this 
bill as promised, and that a few billion dollars can be spent paying 
down the national debt before the next Congress gets its hands on the 
purse strings again.
  I am not surprised that we are at this point. But I must admit I am a 
bit puzzled.
  Is it really possible that some of my colleagues don't realize that a 
slice here and a snack there will eventually leave nothing but crumbs? 
Can it be that they truly believe we can have our surplus and eat it 
too? Or are they feasting on the surplus behind closed doors fully 
aware that they are telling the system, starve for reform, that we will 
be fine, and go ahead, eat cake?
  Thank you Mr. President.

                               Exhibit 1

                       [From the Washington Post]

         Ad Blitz Erodes Democrats' Edge on Prescription Drugs

               (By Juliet Eilperin and Thomas B. Edsall)

       Buoyed by a massive advertising blitz from business groups, 
     Republicans have managed to erode some of the Democrats' 
     political advantage on the issue of prescription drugs for 
     seniors, according to polling data and independent analysts.
       Republicans have had some success neutralizing an issue the 
     Democrats had hoped to ride to victory in both the 
     presidential race and many congressional contests across the 
     country, the analysts said. In fact, in a few key races, 
     Republicans have successfully used the issue to skewer the 
     Democrats as big government spenders.
       Fueling the Republicans have been tens of millions of 
     dollars in ads from the pharmaceutical industry, the U.S. 
     Chamber of Commerce and other business groups lauding the 
     GOP's private-sector-oriented approach to providing drug 
     coverage for seniors. Republican ads for Texas Gov. George W. 
     Bush and other candidates have also portrayed Democratic 
     proposals to add a drug benefit to the Medicare program as a 
     potential bureaucratic nightmare.
       Democrats ``just assumed we would roll over and say, `You 
     know, we are against seniors and for the big drug companies, 
     so come on over and take the House and Senate back with it,' 
     '' said GOP pollster Glen Bolger. ``But Republicans decided 
     not to do what the Democrats wanted.''
       Just three months ago, Bush had no plan to provide 
     prescription drug coverage for seniors and was badly trailing 
     Vice President Gore on the issue. A Washington Post/Henry J. 
     Kaiser Family Foundation/Harvard University poll in July 
     showed Gore with a strong advantage over Bush, 49 percent to 
     38 percent, when voters were asked which candidate would do a 
     better job ``helping people 65 and over to pay for 
     prescription medicines.''
       Three months later, after an onslaught of Republican 
     National Committee advertising on the drug issue, the Gore 
     advantage had disappeared: When voters were asked whom they 
     trusted to handle ``Medicare and prescription drug 
     coverage,'' they were evenly split, 45 percent saying Gore 
     and 43 percent Bush.
       Democratic operatives acknowledge that Republicans have had 
     some success muddying the waters on prescription drugs. In 
     mid-September, the party's own internal surveys showed that 
     Gore's advantage on the issue has slipped to single digits, 
     one top pollster said.
       But a fall advertising campaign has helped put the issue 
     back into the Democratic column, this pollster said, and Gore 
     and his party now hold a 15-point advantage on the question 
     of who would better address the prescription drug problem.
       Robert Blendon, a health policy specialist involved in the 
     Post/Kaiser/Harvard poll, said surveys suggest the public, in 
     fact, prefers Gore's proposal to add a prescription drug 
     benefit to Medicare over Bush's plan to encourage insurance 
     companies to provide the coverage.
       But he added that most voters ``don't exactly understand 
     the nuances between the two policies,'' making it difficult 
     for Gore to gain an advantage.
       On the congressional level, Republicans have tried to 
     defuse the issue by approving a measure allowing the 
     reimportation of cheaper prescription drugs and, in the case 
     of the House, passing their own drug coverage bill along the 
     lines of what Bush is proposing.
       And when Republican candidates have had the money to spend, 
     they have been able to tarnish their opponents: Sen. Spencer 
     Abraham (Mich.) saw his numbers surge this summer after he 
     ran a series of unanswered attacks against the drug proposal 
     of Rep. Deborah Ann Stabenow (D-Mich); and both Sen. Conrad 
     Burns (Mont.) and Senate hopeful John Ensign of Nevada 
     improved their standing in the polls after launching similar 
     ads.
       But according to Michigan-based pollster Ed Sarpolus, older 
     voters who became confused on the drug issue are now 
     beginning to gravitate back to Gore and Stabenow.
       ``It's human nature. If you're confused, you vote for what 
     you know,'' said Sarpolus, who added that voters tend to 
     trust Democrats more on health care.
       Individual House Republicans, bolstered by their party 
     committees and business groups, have also aggressively 
     defended their records on drug coverage in recent months. 
     Rep. Heather A. Wilson (R-N.M.) saw her poll numbers rise 
     significantly among seniors once she began running ads on the 
     GOP plan. Ohio Republican Pat Tiberi--who is hoping to 
     succeed his former boss, Rep. John R. Kasich--also expanded 
     his lead in the polls after the National Republican 
     Congressional Committee funded ads attacking his opponent's 
     position on prescription drugs.
       Former representative Scotty Baesler (D-Ky.), who is hoping 
     to defeat freshman Rep. Ernie Fletcher (R-Ky.), said the 
     Republicans ``muddied the waters very well'' on the question 
     of prescription drugs, prompting him to air ads on gun 
     control instead because ``it's a definite separation between 
     myself and Fletcher.''
       Rep. E. Clay Shaw Jr. (R-Fla.) has even turned the issue 
     into a liability for his opponent Elaine Bloom, blanketing 
     his district with ads highlighting how she served on the 
     board of directors of a company that makes generic drugs and 
     that received payments from a competitor in exchange for 
     keeping a heart medicine off the market.
       The party committees are not the only groups touting the 
     GOP's drug plan in recent weeks. The U.S. Chamber of Commerce 
     has run several commercials decrying the Democrats' proposal 
     as a potential bureaucratic nightmare while Citizens for 
     Better Medicare--a group funded by the pharmaceutical

[[Page 25188]]

     industry--has spent $50 million on an ad campaign supporting 
     the position taken by House and Senate Republicans.
       Democratic Congressional Campaign Committee Chairman 
     Patrick J. Kennedy (R.I.) said, ``The $50 million in 
     independent expenditures from the major pharmaceutical 
     companies has validated the Republicans' belief that money 
     can buy anything including their inaction on a real 
     prescription drug benefit for Medicare.''
       Republican pollster Bill McInturff said that in the 
     battleground states where GOP advertising on prescription 
     drugs has been concentrated, ``these are roughly parallel 
     numbers'' concerning which party and which candidate has the 
     advantage. ``This is clearly a case where advertising has 
     affected people's opinions,'' he said.

  The PRESIDING OFFICER. The Senator from Alaska is recognized.
  Mr. MURKOWSKI. Mr. President, I ask unanimous consent that I be 
allowed to speak in morning business. I apologize for the lateness of 
the hour.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. MURKOWSKI. I thank the Chair.

                          ____________________