[Congressional Record (Bound Edition), Volume 146 (2000), Part 17]
[House]
[Pages 25269-25276]
[From the U.S. Government Publishing Office, www.gpo.gov]



                   HEALTH CARE: THE UNFINISHED AGENDA

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
January 6, 1999, the gentleman from New Jersey (Mr. Pallone) is 
recognized for 60 minutes.
  Mr. PALLONE. Mr. Speaker, this evening I would like to take to the 
well again and talk about health care issues, because I do believe that 
when we talk about health care issues, that this is really the 
unfinished agenda that this Republican Congress has not addressed.
  Of course, there is still time. We are still here. We are here over 
the weekend, are probably going to be here a good part of next week. 
There was an effort yesterday when the tax bill was brought up by the 
Republican leadership, to suggest that somehow some of the health care 
issues were being addressed in some minor way.
  Mr. Speaker, what I wanted to begin tonight was talk about how that 
bill really does not accomplish anything significant to help the 
average American with the health care problems that they face and with 
the hospitals and the nursing homes and the home health agencies that 
are trying to provide quality health care.
  Then after that, I would like to get into the three major issues that 
most of my constituents and most Americans talk to Members of Congress 
about, and that is trying to reform HMOs, trying to provide a 
prescription drug benefit for seniors, and trying to deal with the 42 
million Americans who now have no health insurance.
  Let me start with this tax bill that was voted on and that the 
Republican leadership brought up, because they suggested, I think 
inaccurately, that what they were trying to accomplish was to deal with 
some of the problems that occurred with the Balanced Budget Act which 
was passed a few years ago which cut back significantly on the money 
that was going to hospitals, to home health care agencies, to nursing 
homes, and to HMOs, and that the reimbursement rate from the Federal 
Government, from Medicare, Medicaid, and some of the other Federal 
programs that provide funding to these facilities or to these programs 
that provide health care services, needed to be readdressed. That there 
was too little of a reimbursement rate under Medicare and Medicaid and 
that more money needed to go back to these programs or facilities if 
they were going to provide a quality health care.
  The problem, though, was that in making these adjustments in this tax 
bill, the Republican leadership essentially gave most of the money to 
HMOs in a fashion that I find totally objectionable, because the HMOs 
were not only getting huge amounts of money back from the Federal 
Government, but were really not caused to do anything for the average 
American in order to receive those funds.
  I said today in a press conference that we had outside on the lawn of 
the Capitol with some of my Democratic colleagues that the reason this 
was happening, the reason why the tax bill was so favorable to the 
HMOs, is because basically the Republican leadership has bought into 
the HMOs and the special interests that are associated with the HMOs 
and supports them because of the special interest funding that is made 
available.

                              {time}  1800

  What we see the HMOs doing is that the HMOs are leading the battle 
against the Medicare prescription drug benefit and leading the battle 
against HMO reform.
  The Democrats and some Republicans have tried to pass a bill called 
the Patients' Bill of Rights. We know it as the Norwood-Dingell bill. 
It is bipartisan, but it is opposed by the Republican leadership. The 
Norwood-Dingell bill would make significant reforms to address the 
abuses of the HMOs. But the HMOs are fighting that tooth and nail as 
well as the prescription drug benefit.
  So I think that basically what happened here is the Republican 
leadership sides with the HMOs because they are basically against the 
Medicare prescription drug benefit and against the Patients' Bill of 
Rights.
  We also see that the HMOs are spending a lot of money funding 
negative ads against those individuals, Democrats and against some 
Republicans who support the Patients' Bill of Rights, who support HMO 
reform, who support having a prescription drug benefit under Medicare. 
So this is the sort of unholy alliance here that manifested itself 
yesterday with this tax bill to give more money back to the HMOs.
  Now, let me talk a little bit about this bill because I just want to 
show how unfair it was and how little it would accomplish in terms of 
addressing the health care needs that Americans face today.

[[Page 25270]]

  First of all, and just to give my colleagues some figures about the 
amount of money that was going to the HMOs, the Republican plan, this 
tax bill, increases payments to Medicare HMOs by over $10 billion over 
5 years and over $30 billion over 10 years, despite the fact that only 
16 percent of Medicare beneficiaries are enrolled in HMOs right now.
  We know that what the HMOs have been doing is they have been dropping 
senior citizens left and right. As of July 1, I think there are over 
700,000 seniors across the country that have been dropped by HMOs to 
provide their Medicare benefits over the last few years. So a lot of 
these HMOs got into the Medicare program, and then they dropped the 
seniors.
  Yet, over one-third of the allocation in this tax bill, over one-
third of the allocation for health care, that goes back to health care 
providers, goes to HMOs. Only 16 percent of Medicare beneficiaries are 
enrolled in HMOs. My colleagues get some idea there of the inequity 
here.
  Now, in addition to that, we know that a lot of these HMOs have 
dropped out of Medicare, so one might say to oneself, well, if they are 
making an argument they need more money to stay in Medicare, then why, 
when we give them this windfall, these billions of dollars, this 30 
percent of this overall budget, then why do we not require that they 
come back into Medicare and provide certain benefits?
  Well, that makes sense. But that is not what the Republican 
leadership did. There was no guarantee that these HMO plans will not 
drop out of communities or Medicare altogether when it is no longer in 
their interest to remain, as many of them have. There is no guarantee 
that they will put new money towards maintaining benefits rather than 
shoring up their bottom line.
  So we could have said, okay, we will give HMOs all this money in the 
tax bill, but they have to sign a contract saying they are going to 
stay in Medicare for 2 years or 3 years or even 1 year.
  We could have said, okay, we will give them this money, but they have 
to make sure that they provide at least a level of benefits and 
prescription drugs for these 16 percent of seniors that are on Medicare 
that they are providing now.
  But we do not have that in the bill, nothing like that. Just give 
them the money, and that is fine. They can continue to drop out of the 
program if they want to. It is blatantly unfair. It is just basically 
pandering to special interests.
  Now, let me go beyond that to the next issue. Why is it that so much 
of this money is going to HMOs again when so few seniors are in HMOs 
that are in Medicare? We know that we have greater needs in a lot of 
other areas.
  The hospitals do not get that much. Hospitals, many have closed. I 
had one in my district in South Amboy that closed within the last year 
or so. Nursing homes. Many nursing homes are bankrupt. I visited with 
some. I went to a nursing home last week, one of the days, and talked 
to some of the residents. I found out from the operators that there 
are, I do not know what the percentage is, but a significant percentage 
of the nursing homes in the State of New Jersey are now bankrupt, and 
some of them are closing. Home health care agencies, very little money 
under this tax bill. These are the providers.
  Remember, the HMO is an insurance company. They are getting this 
money now from this windfall from this Republican tax bill, and they 
are going to go out and they are going to pay the hospitals or they are 
going to pay the nursing homes or they are going to pay the providers 
of health care services. They are not providing the services.
  But, yet, we shortchange the providers. We do not give the money to 
the hospitals, some of which are closing. We do not give the money to 
the nursing homes, some of which are closing. We do not give the money 
to the home health care providers who are directly providing services.
  It makes no sense. It makes no sense at all unless one looks at it 
from the point of view that the HMOs are special interests that are 
doing the Republican leadership a favor and that are railing against 
HMO reform and a Medicare prescription drug benefit.
  Now, let me go to the last thing, then I am going to get off the 
issue of this tax bill, but I do think it is important; and that is 
that the Republican leadership said, well, one of the things we are 
going to do in this tax bill is we are going to try to address the 
problems of the uninsured by giving what we call an above-line 
deduction for health insurance, a tax deduction.
  Okay. Well, we know that there are 42 million or so Americans now 
that do not have health insurance. Now, these are working people 
because, if one is really poor and one is not working, one is eligible 
for Medicaid, and the Federal Government pays for one's health 
insurance.
  But if one is in a low-income bracket but one is working, or even 
middle-income bracket, it depends, and one is working, a lot of times 
one's employer will not provide one with health insurance because maybe 
it is costing him too much, or whatever the reason, and one has to go 
and try to buy one's health insurance on the private market, or maybe 
the employer has some kind of a plan, but it is very expensive. 
Whatever the reasons, these 42 million people are pretty much working 
people that do not have health insurance on the job or cannot afford to 
buy it in the private market.
  So what the Democrats have been saying, what Vice President Gore and 
President Clinton have been saying, let us gradually try to address 
some of the groups that make up this uninsured. We know the largest 
group is the children. We know the second largest group is near elderly 
people, between 55 and 65, that are not eligible for Medicare yet. 
These are some of the groups.
  What the Democrats have been doing, and we actually did get the 
support of the Republicans eventually, we had to drag them along on 
this, but we eventually did get the support of the Republicans to pass 
a kids health initiative a couple years ago that gradually has been 
getting to the point where we think about half of the children that are 
uninsured will have some sort of insurance with money paid for by the 
Federal Government.
  Well, what Vice President Gore has been saying is that he wants to 
increase the income eligibility so that, right now, if one is, say, 200 
percent of poverty and one is eligible for this kids care program, we 
will raise it to 250 percent of poverty or 300 percent of poverty and 
try to get more of these lower middle class people who are working and 
their kids into this CHIP or kids care program.
  Well, we found, of course, that the Republican leadership does not 
want to do that. That would have been the logical thing to do in this 
tax bill would be to expand eligibility for the kid care program.
  Or another thing that we could have done, and this is another thing 
that Vice President Gore has proposed and the Democrats here in the 
House, is to enroll the parents of those kids in the health insurance 
program, because we know that those parents, if they cannot get health 
insurance for the kids other than through the Federal Government, they 
are not able to get it for themselves.
  In this tax bill, we could have put a provision there for the near 
elderly. What the Democrats have been saying is they would like to see 
the people between 55 and 65 be able to buy into Medicare. At their own 
expense, they would buy into Medicare.
  But, no, the Republican leadership does not want to do any of those 
things. This is what they said. They said, we are going to give you an 
above-line tax deduction.
  I am not going to get into all the details of that, but basically 
that has two problems. First of all, very few of the people who are now 
without health insurance, who are sort of lower middle class category, 
very few of them will be able to take advantage of this deduction and 
go out and buy health insurance, first of all, because most of them do 
not have incomes where that deduction is significant enough to be able 
to use it to buy a health insurance policy which in the private market 
may be $3,000 to $4,000 a year.

[[Page 25271]]

  Secondly, what we find with this above-line deduction is that it 
creates a disincentive for employers to provide health insurance. As a 
consequence, a lot more employers may decide not to provide health 
insurance and, instead, actually increase the ranks of the uninsured.
  The only people that really are able to take advantage of this are 
people that already have health insurance that are making a decent 
income and can take advantage of the deduction.
  But if one is trying to increase the number of insured people and 
take the uninsured off the rolls, this accomplishes virtually nothing. 
It just helps people who are in a higher income bracket and who already 
have health insurance.
  Again, it sounds so critical. The Republican leadership brought up 
this bill yesterday, or the day before when they brought it out here; 
and they said, we are going to try to do all these things. We want to 
address some of the health care concerns of the American public with 
this bill.
  But whether it is the question of the uninsured, it is ineffective. 
Whether it is the question of addressing the prescription drug prices, 
it is ineffective, because it does not provide any guarantees one is 
going to get prescription drugs under any kind of HMO plan. Certainly 
it does not even address the effort to reform the HMOs with the 
Patients' Bill of Rights that the Democrats have been talking about.
  So I just want to say, once again, we see the Republican leadership 
aligned with the special interests, the drug companies, the HMOs, the 
health insurance companies, not doing anything that is going to help 
the average American.
  Now, I wanted to talk a little bit, because I think it is important, 
I mentioned before earlier that there are three major health care 
issues that are not being addressed by this Congress. We only have a 
few more days. Every one of these issues could have been addressed and 
could have come to the floor. The Democrats have been pushing for them, 
for these issues, and for legislation to address these concerns to come 
to the floor. It appears in the dying days of this Congress that these 
issues are simply not going to be addressed. They should be. It is not 
fair. It does not address the concerns of the average American.
  Now, the first one I want to talk about is the Patients' Bill of 
Rights, HMO reform. We know from our own constituents, I can certainly 
say for my constituents, that one of the biggest problems people face 
is, if they are in an HMO, oftentimes they are denied access to the 
care that they need, that their physician says that they need.
  Now, that may be the individual who goes to the hospital and finds 
that the doctor says to them that they need to stay a couple extra days 
in the hospital after recuperating from a particular operation. Or it 
may be the individual who has the need for a particular operation, and 
the HMO says they are not going to pay for it, they are not going to 
cover it.
  There are so many situations. There are situations where people, 
their HMO plans say that they cannot go to the local hospital, they 
have to go to a hospital 50 miles away. They may be in a situation 
where they want to go to the local emergency room, and they have to go 
to the one 50 miles away; otherwise, it is not covered.
  These are the kinds of abuses that we see, not every day, but on a 
fairly regular basis. A lot of people come to my office and complain 
about these things.
  Now, what the Democrats said is, well, we want to address these 
abuses. Generally, the plan that the Democrats put forth, with some 
Republicans, the Patients' Bill of Rights, the Norwood-Dingell bill, 
has two major ways of correcting the abuses in sort of an overall 
sense.
  One is that it provides that, if a decision has to be made about what 
kind of care one is going to get, that that decision, rather than being 
made by the insurance company, is made by the physician and the 
patient. The definition, if you will, of what is medically necessary, 
the hospital stay, the particular operation, of what is medically 
necessary is made by the physician and the patient, and not by the 
insurance company.
  The second thing it does in a broad sense is the Patients' Bill of 
Rights says that, if one is denied care because the insurance company 
says one cannot have that operation, for example, then one has to have 
an ability to redress that grievance.
  The Patients' Bill of Rights does it in essentially two ways. One, it 
says that one can go to a board outside the jurisdiction or outside of 
the umbrella of the HMO, an independent review board that will look at 
the case and decide whether the HMO made the wrong decision in denying 
one that care. Absent that or sort of an appeal from the review board 
is that one can go to court and one can bring suit. These are really 
very simple things.
  Basically what happened here is that the Democratic leadership, the 
Vice President, the President got together, and we were able to get 
some Republicans on the other side, initiated by Republicans that were 
physicians, the gentleman from Georgia (Mr. Norwood), the gentleman 
from Iowa (Mr. Ganske) and some others, to join us and put together the 
Patients' Bill of Rights, the Norwood-Dingell bill.
  The Republican leadership opposed it. The Republican leadership did 
not want to bring it to the floor. We went out and got a discharge 
petition, which is a way of coming up to the well here and getting 
almost a majority of the Members to sign a petition saying we want it 
brought to the floor.
  The Republican leadership eventually brought it to the floor. It 
passed with almost every Democrat and maybe a third of the Republicans. 
It went over to the Senate where it was killed by the Senators who will 
not even let it come out of conference between the two Houses.
  But, again, this is an important piece of legislation, just as 
important as a prescription drug benefit under Medicare, just as 
important as trying to address the problems of the uninsured; and we 
find that the Republican leadership in this House of Representatives 
simply will not let any of these good measures move forward.

                              {time}  1815

  They have stopped them, and they are still stopping them in the 
waning hours of this Congress.
  I see I have been joined this evening by two of my colleagues who 
have been out front on all of these issues over the last 2 years, and 
even beyond that, and I am very pleased to see them here.
  I will first yield to my colleague from Texas (Mr. Turner), who has 
done so many things, but I think probably the best example I saw was 
the period of time in his district where he spoke to the different 
senior groups and had them bring in their prescription drugs and tell 
him about the problems that they faced with prescription drugs, and 
actually brought the pill bottles down here, and suggested the rest of 
us do the same, and we very dramatically showed, along with the 
gentleman from Texas, about what kind of problems the average senior 
faces in Texas and in all of our districts.
  So I yield to the gentleman from Texas at this point.
  Mr. TURNER. It is good to join my colleague here on the floor tonight 
to talk about the important issues that are still pending before this 
Congress that have not been acted upon.
  Here we are, very near the end of this session of Congress, and still 
we have been unable to see the patient's bill of rights put into law, 
which is so very essential to all Americans to ensure that they are 
able to make their medical decisions with the consultation of their 
doctors and not have that interfered with by the insurance company 
clerks that work for the HMOs. I think it is way pastime for Congress 
to act on this very, very critical issue.
  I had the opportunity when I was in the Texas legislature in 1995 to 
carry the first patient's bill of rights. It passed overwhelmingly in 
the legislature, had only 4 no votes, as I recall, out of 31 members of 
the State Senate. It passed by voice vote in the House.
  We recognized early on, as many States did, that we needed patient 
protection to be sure that doctors and not

[[Page 25272]]

insurance companies are making medical decisions affecting our lives 
and our health. Unfortunately, in 1995, our governor, Governor Bush, 
vetoed that bill. We were at the end of the session and had no 
opportunity to override, which we certainly would have done had time 
not run out on the session. But we did see the legislature in 1997 come 
back and pass similar legislation. And part of that the governor 
signed, and another part, relating to accountability, he let become law 
without putting his signature on the bill.
  In any event, we found ourselves in a position, after many States 
adopted patient protection legislation, of seeing lawsuits arise, filed 
by the big insurance companies and the HMOs, alleging they should not 
have to be bound by these State protections that many legislatures 
adopted, simply because, they said, they were multi-State plans and 
covered by Federal law, which preempted all State regulations. So that 
is why in this Congress many of us have united together to try to 
provide protection for all patients, whether they are covered under a 
State plan or whether they are covered under a multi-State plan that 
does not have any regulation or patient protection unless we in the 
Congress pass a Federal law to protect patients.
  Thus far, as the gentleman has pointed out so clearly, even though we 
have passed a good strong, bipartisan bill in this House, the Senate 
watered it down, and that bill is stuck in conference committee because 
the majority, who passed that bill in this House, were not appointed to 
that conference committee. That bill has never been moved forward. I 
think that is a great disservice to the people of this country, and I 
am hopeful that we can see action soon on a good strong patient's bill 
of rights.
  I also believe it is a failure of this Congress not to deal with the 
problem of prescription drug coverage for our seniors under Medicare. I 
was looking at a Texas paper the other day, the Dallas Morning News, 
that had a long article talking about the problems that our senior 
citizens have faced with affording prescription drugs. This article is 
entitled ``A Dose of Reality.'' It tells the stories of three seniors. 
Their stories are like the many that I have heard in my district over 
the past 2 and 3 years, since we have been working to try to get some 
action out of this Congress on this issue.
  Those stories, over and over again, tell about seniors who are taking 
six, eight, twelve prescriptions a month and are having to make the 
difficult choice of do they fill their prescription or do they buy 
their food or pay for their utilities or pay the rent. And in a country 
as prosperous as we are and as compassionate as we would like to say we 
are, one would think that we could provide a prescription drug benefit 
under Medicare to allow all of our seniors to be able to afford their 
prescription medicines.
  I am hopeful that this Congress will act on this issue before we 
adjourn, because I think it is a sign of a true failure of this 
Congress if we fail to provide our seniors some help on prescription 
drugs. The gentleman from New Jersey and the gentleman from Maine (Mr. 
Allen), who is here with us tonight, have all worked diligently on this 
problem. There is no reason in a country like ours to think that our 
citizens have to pay prescription drug prices that are twice as high as 
anyone else in the world pays.
  I think, frankly, when it comes right down to it, the inaction of 
this Congress can be traced straight to the influence of the big drug 
manufacturers over some in leadership in this Congress. Because the 
truth of the matter is, the drug companies have spent millions of 
dollars trying to defeat our efforts to put a prescription drug benefit 
under Medicare. And it is easy to understand, because they know that if 
we ever have a prescription drug benefit under Medicare, the government 
is not going to pay the same high prices that a senior is having to pay 
today when they walk in a local retail pharmacy. They will not pay 
those kind of prices. The big drug companies have it their way now and 
they do not want to give it up.
  I was very proud when the Vice President made as a part of his agenda 
a prescription drug benefit under Medicare to provide affordable 
prescription drug coverage for seniors. The truth is we cannot wait 
another 4 or 5 years to provide that kind of coverage. And this idea 
that Governor Bush has espoused of giving a little money to the States 
to just take care of the low-income seniors, that is only half a loaf. 
The truth is, whether or not an individual is low-income or not does 
not determine whether or not they are having a hard time paying for 
their prescription medicines. It is how sick an individual is as well 
as how big their pocketbook is.
  I guaranty my colleagues there are many middle-income seniors in this 
country today that have high prescription drug costs, and they cannot 
afford them. Even though they may be classified as middle income 
seniors, they simply cannot afford those six and eight and twelve 
prescriptions they are having to fill every month. Those people also 
need help.
  And if we all believe in Medicare, and everybody around here seems to 
say they believe in it, then there is certainly nothing wrong with 
bringing it up to the 21st century to be sure that it covers 
prescription drug costs. I think, frankly, when President Lyndon 
Johnson, from my State of Texas, signed Medicare into law in 1965, it 
would have had a prescription drug benefit if prescription drugs had 
been as large a portion of our health care costs as they are today.
  So these are the items that this Congress has failed to deal with, 
and I am proud to be among those on this floor tonight who have worked 
hard to try to bring this kind of prescription drug coverage and this 
kind of legislation to protect patients enrolled in managed care, 
because the American people want it. And I do not think they understand 
the influence of the insurance industry and the drug industry that is 
keeping us from being able to get a majority of this Congress to 
support this legislation.
  So we are here tonight to sound the call for action once again, and I 
am proud to join with the gentleman.
  Mr. PALLONE. Mr. Speaker, I want to thank the gentleman from Texas. I 
think that when he talks about the substance of all this, and obviously 
that is crucial and that is why we are here tonight, but more than 
anybody else the gentleman has brought home to us, with the things he 
has done in his district, about how this is really something that 
affects the average person, and that our constituents are suffering, 
that our seniors are having problems getting prescription drugs because 
of the price and because of the price discrimination.
  We are not just talking about something that is pie in the sky. This 
is something that is real for the average citizen.
  I will now yield to my other colleague, the gentleman from Maine (Mr. 
Allen), and just point out that he, probably more than anybody else, 
has brought out this whole issue of price discrimination, not only 
between different Americans but even by comparison to prices abroad. So 
I yield to the gentleman.
  Mr. ALLEN. I thank the gentleman for yielding to me and for his 
leadership on this issue, along with the gentleman from Texas (Mr. 
Turner). We have been going at this now for over 2 years.
  It is interesting to watch in the public and in the debate in this 
chamber how the issue has taken form. It now has gotten so fuzed up, so 
complicated that we cannot blame people for having a tough time 
figuring what is going on, when under the surface it is actually very 
simple.
  Seniors pay the highest prescription drug prices in the world, and 
the adversaries, the people who are trying to keep them paying the 
highest prices in the world, is the pharmaceutical industry. The 
gentleman was talking a moment ago about the special interests. Because 
of the law that this Congress passed dealing with so-called section 527 
organizations, we now have information that we did not have before. 
This group called Citizens for Better Medicare is a group that has been 
out

[[Page 25273]]

there running ads now for about a year and a half now around the 
country. It is a wonderful name, is it not, Citizens for Better 
Medicare? The trouble is they are not citizens, it is the 
pharmaceutical industry, and they are not for better Medicare because 
they do not want Medicare to provide a prescription drug benefit. They 
want insurance companies and HMOs to provide that benefit.
  But we just have a report filed with the FED from Citizens for Better 
Medicare which shows that between July 1 of this year and September 30 
of this year they spent $8.5 million running TV ads around the country. 
And if my colleagues look at what those TV ads are trying to do, they 
are trying to make black white and white black. What they are really 
doing is saying that the people who have been fighting for a Medicare 
prescription drug benefit are terrible and are not for seniors, and the 
people who have been fighting against a Medicare prescription drug 
benefit for seniors are heroes.
  If we look at the legislation that we have been working on, the bill 
that I introduced, that the gentleman from Texas (Mr. Turner) has 
worked on, that the gentleman from New Jersey (Mr. Pallone) has been an 
advocate for for a long time, it is very simple, Prescription Drug 
Fairness for Seniors Act, that bill does not have any significant cost 
to the Federal Government. No new bureaucracy. Yet we have 152 
cosponsors and not one Republican. Not one Republican will stand up and 
support giving a discount to Medicare beneficiaries so they can get the 
advantage of the best price to the Federal Government. Not one 
Republican is willing to stand up and support that approach.
  When we turn to the Medicare prescription drug benefit, which is 
where the government would help to pay for part of, not all but 50 
percent of the initial cost of prescription drug prices for seniors, my 
recollection is that we do not have one single Republican on that bill; 
am I right?
  Mr. PALLONE. That is true, we do not.
  Mr. ALLEN. Yet if we listen to the debates, George W. Bush said 
during the debates that he wanted to do a Medicare prescription drug 
benefit. Three months ago there was no plan from the Republican nominee 
George W. Bush. He did not have a plan for prescription drugs. Now he 
has one.
  He adopted it based on what the Republicans in this chamber did. And 
what was that? That was a plan that the pharmaceutical industry loves, 
and only the pharmaceutical industry could love, because it was a plan 
that provided government subsidies to insurance companies so that they 
could provide private sector health insurance to cover prescription 
drugs.
  Little detail. Small problem. The health insurance industry has said 
loudly and clearly and repeatedly, we will not provide stand-alone 
prescription drug coverage for seniors. So who is the prescription for? 
The answer: It is for Republican candidates.

                              {time}  1830

  Get them past November 7 and then we will deal with it. But by then 
it will be too late to deal with seniors to give them what they really 
need. They keep coming back. The way to do this is real simple. Follow 
the money. Follow the money. And the special interest money from the 
pharmaceutical industry through Citizens for Better Medicare, through 
the U.S. Chamber of Commerce, through other business groups is not 
reliable.
  Basically, we have been fighting for seniors to get them lower prices 
and coverage for prescription drugs for 2 years with no help from 
Republicans on the other side of the aisle. And now the effort is, of 
course, by the pharmaceutical industry, they can spend enough money on 
confusing television ads maybe. Maybe they can confuse the American 
people enough as to who is really on their side to get them through 
November 7.
  Mr. PALLONE. Mr. Speaker, I want to develop what my colleague said a 
little bit if I can maybe go back and forth a little here because I 
think it is so true and so important.
  First of all, with regard to this special interest money, I wanted to 
say and I have said many other times on the floor that I was a victim 
of this 2 years ago in 1998 when I was running for election. At the 
time, of course, I was an advocate for HMO reform and I was an advocate 
for the health care agenda that we have talked about here tonight. And 
as a consequence, a group was formed and at that point they did not 
have any disclosures, which the gentleman is pointing out now about how 
they have to disclose and he has those documents from the FEC was not 
true before.
  Basically, a group was formed to do an independent expenditure 
against me that was primarily financed by the health insurance 
industry, by the HMOs and by the pharmaceuticals. And they spent about 
$5 million in these independent ads, about $3 million on New York TV, 
which is the most expensive market in the country.
  And of course, even though they were financing it, they did not talk 
about the health care issues. I do not even remember what they talked 
about. I think it was that I was raising taxes or something unrelated, 
if you will, to the health care issues. I had to bring out the fact 
that this money was coming from the health care industry, from the 
pharmaceutical industry, and why they were doing it because I was 
supporting HMO reform and supporting a prescription drug benefit and 
supporting the things that we talked about this evening.
  No disclosure. Corporate money, what we call soft money, not the 
individual kind of contributions. If people want to contribute to us, 
they have to make an individual contribution, they have to disclose it. 
The maximum is a thousand dollars. This was all corporate. This was 
hundreds of thousands of dollars adding up to $5 million.
  This goes on all the time. I mean, I still think that even with the 
disclosure that the gentleman is talking about there is still a lot 
ways to get around this under current law.
  Mr. ALLEN. Mr. Speaker, let us turn just for a moment to another 
special interest, the HMO industry.
  This is a report done by the General Accounting Office that came out 
in August of this year, August 2000. The title is ``Medicare+Choice.'' 
That is the managed care plan. That refers to managed care plans that 
operate within the Medicare system. This was an approach to get HMOs 
into Medicare that the Republicans pushed very hard in 1997. It was 
incorporated into the Balanced Budget Act. I think a lot of us hoped 
that it might work, that it might drive down costs.
  But what this GAO study says, the title is ``Payments Exceed Cost of 
Fee-for-Service Benefits Adding Billions to Spending.''
  This report concludes that although HMOs were allowed to come into 
Medicare on the theory that it would help reduce costs and expand 
benefits, it turns out that what has happened is the costs are higher 
for Medicare+Choice, for managed care and Medicare, than they are for 
the traditional fee-for-service benefit, the way Medicare has operated. 
So at this point you have to say what is the purpose of having HMOs 
operate under Medicare.
  Now, look at what we did just yesterday. Just yesterday, the 
Republican majority brought to the floor of this House a tax relief 
bill which had attached to it a whole array of different things, but 
one of the things was what we have been calling in Medicare a BBA give-
back, a Balanced Budget Act give-back.
  Why was that brought to the floor? A lot of us had supported an 
earlier bipartisan version. Because when we go back to our districts, 
we hear from our hospitals, we hear from our home health care agencies, 
we hear from our long-term care agencies that what happened in 1997 was 
too severe, the cuts have been too great, there has got to be some 
restoration or we are going to find hospice programs, hospitals, 
nursing homes, and home health care agencies simply going out of 
business.
  So the bill that comes to the floor yesterday is a bill that gives 
$11 billion back not to hospitals and the other providers but to the 
HMOs over the first 5 years and $34 billion to the HMOs over 10 years.

[[Page 25274]]

  Now, what good does this do? Absolutely none. It does no good, 
because the money just goes to the HMOs. There is no accountability. 
There is no requirement that an HMO stay in a particular State, that it 
serve people it is serving now, that it serve people that it is not 
serving now. It is simply funneling money to an HMO industry, which 
just coincidentally gave $4.8 million to the to the Republican party 
and its candidates in 1999 through June of this year.
  Now, we have to be suspicious. When we have our providers, the 
hospitals and others saying we have to have some restoration of these 
funds, when we have a bipartisan group working on a plan and it is 
moving along well, and then at the last minute that bipartisan plan is 
yanked and we get something that puts 40 to 47 percent of the benefit 
of that give-back straight to the HMO industry, we have really got to 
wonder.
  The truth is this is again another case of whose side are they on. 
They can be on the side of seniors and can they help their providers, 
but they cannot do that and also be funneling money to the HMOs.
  Mr. TURNER. Mr. Speaker, I just want to tell the gentleman that I 
think the medical providers and the hospitals across this country have 
figured out what was wrong with that bill that the Republican majority 
passed on the floor of this House the other day.
  I have got a letter here in my hand that came in just a couple of 
days ago. This is from a hospital administrator in my district, George 
Miller. George is a real fine administrator of Christus Jasper Memorial 
Hospital down in Jasper, Texas, in my district. Here is what he writes 
me.
  He says, ``We are extremely concerned because, in the present 
language in the bill,'' referring to the one that was passed yesterday, 
``it provides one-third to one-half of the Balanced Budget Act 
relief,'' that is the money, one-half to one-third of the money, ``over 
10 years would go to HMOs, leaving less for providers and beneficiaries 
in East Texas, such as Christus Jasper Memorial Hospital.''
  Further, he writes, ``The bill does not prohibit HMOs from dropping 
benefits or leaving the community, as they have done here in Texas and 
left many of our patients without HMO coverage. We need your help.''
  This is from my hospital administrator in my district in Jasper.
  I want to tell my colleagues, I have had town meetings in my district 
during the August break and I went around to talk about the problem of 
prescription drug coverage for seniors, and what I was confronted with 
was seniors who were angry because they had just received their letter 
of cancellation from their HMO, seniors that had signed up for Medicare 
Choice HMO plans solely because the HMOs said, we will put on a little 
prescription drug coverage for you if will you go with us and get off 
traditional Medicare.
  As long as we cannot get this Congress to approve a prescription drug 
benefit under Medicare, those HMOs have a real strong leverage to 
appeal to those seniors. That is another reason we are having a hard 
time putting a prescription drug benefit under Medicare is because not 
only do the drug companies oppose it because they are afraid they 
cannot charge the same high prices to the Government as they are doing 
to our seniors, but the insurance industry knows that they are sunk if 
we put a prescription drug benefit under Medicare because they have 
been selling seniors HMO Medi-
care+Choice plans with the benefit of some prescription drug coverage 
and if they lose that advantage, our seniors are going back to regular 
Medicare.
  And why are we promoting seniors going into HMO Medicare+Choice plan, 
whether, as the gentleman from Maine (Mr. Allen) pointed outside, the 
General Accounting Office, the bipartisan agency that advises this 
Congress, tells us that Congress is already spending more money 
allowing seniors to be enrolled in HMOs than they would if we just let 
them be in regular Medicare.
  So we have got an issue before this Congress right now, and I am 
confident the President is going to veto that bill when it ever reaches 
his desk. Because the truth of the matter is I have got hospitals in my 
district that are about to close because we have not provided enough 
money to them under the Medicare reimbursement plan.
  I just do not think it is right to be lining the pockets of the 
insurance companies by increasing dramatically almost half of the money 
going into Medicare is going to these HMOs to allow them to increase 
the bottom line profit for them while I have got hospitals in rural 
East Texas that are going to close because we are not putting the money 
into the Medicare program that will reimburse them for their services.
  Instead, this Congress wants to give it to the big insurance 
companies. That is just not right. And I am proud the President has 
already spoken out saying he is not going to stand for it. And I think 
sooner or later the American people are going to figure out who is on 
their side in this Congress. And I guarantee you, it is not the 
insurance companies and the big drug companies and those who are 
dancing to their tune.
  Mr. PALLONE. Mr. Speaker, I just want to follow up on what the 
gentleman from Maine said.
  First of all, I have to say to my colleague from Texas that he is 
always so good at bringing these issues down to the average person and 
how it affects his hospitals and how it affects his seniors. I want to 
keep saying over and over again, that is why we are here talking about 
this because it directly affects our constituents.
  But I wanted to go back to the GAO report that the gentleman from 
Maine (Mr. Allen) mentioned. Because I mean, he just brought that out 
so well. I mean, the problem here with this tax bill that the President 
is going to veto, we are giving all this money to the HMOs and they are 
already costing the Federal Government more than the traditional 
Medicare fee-for-service. And I can think of at least three reasons 
why.
  First of all, what do they do with that money? They are taking it and 
they are paying for political ads against the people that do not 
support their interests. They are using the money to pay for the 
administrative costs of their CEOs' bill salaries, vacations, who knows 
what.
  The other thing that I was thinking about, too, is advertising. In my 
district I have been to some of these meetings where they do all of 
this huge advertising in the papers. I remember once there was a local 
diner and they had all the seniors come to the diner and they were 
giving them lobster dinners if they came to the diner to sign up for 
the HMO. So that is where all that money is going for all these other 
costs.
  The amazing thing is that the hospitals and the nursing homes and the 
home health care agencies that are not getting the money from this tax 
bill, or getting much less, they are more direct providers. I mean, 
that money is going almost directly to them. Medicare fee-for-service 
has very little overhead. So they are just paying the money to them to 
take care of the people's health needs as opposed to all this other 
nonsense that the HMOs are doing.
  Mr. ALLEN. Mr. Speaker, the gentleman talks about the overhead. It is 
very simple. Medicare is equitable. It covers everyone all over the 
country who qualifies for it. Medicare does not pick up and leave the 
State if it is not making money. This is a program that has continuity 
and predictability and stability. And get what? Its administrative 
costs are around three percent.
  When they go to the private sector to these HMOs and these insurance 
companies, they have got administrative costs that they do not have at 
all with Medicare. First of all, they pay their executives millions and 
millions of dollars. And there is no one in Medicare, no one at HCFA or 
anywhere else here who is being paid millions of dollars. And second, 
they have got to earn a profit. And third, they have got all sorts of 
marketing costs that Medicare would not have.
  So compared to the two to three percent administrative cost for 
Medicare, they have got 20 percent, 30 percent depending on the 
insurance company, they have got very big administrative costs.

[[Page 25275]]



                              {time}  1845

  I want to bring this back to my home state. In Maine, as of July 1, 
there was a notice. We had only 1,700 people in Maine that were signed 
up for managed care. That is 1,700 people in Medicare signed up for 
managed care. And they all got a notice shortly after July 1 from the 
carrier saying that come December 31, the carrier was pulling out of 
the state. Two of those people were my parents. That was how they got 
their prescription drug coverage. Now they have got to go out and buy 
some other kind of supplemental insurance, but it will not be any 
managed care plan.
  So the benefits of HMOs and Medicare are now gone. There are none. 
There are going to be none in the State of Maine, and they will have to 
go find some Medigap policy. But the trouble with those policies is, A, 
they are expensive, and B, they have very limited coverage. They do not 
have anything like the kind of catastrophic coverage that is part of 
the Democratic plan, what Al Gore proposed, as a way to deal with 
prescription drugs.
  So I look at this so-called tax relief bill, this Balanced Budget Act 
give-back that we passed yesterday, and I know that that $34 billion 
over the next 10 years is not going to the State of Maine, it is not 
going to east Texas, it is not going to hospitals, it is not going to 
home health care agencies, it is not going to nursing homes; it is just 
going straight into the pockets of the HMOs.
  That is fundamentally wrong, fundamentally wrong. Here we are, trying 
to make sure that seniors, for whom health care is a real worry, the 
people I talk to, are very worried that their money is going to run 
out. They are very worried they are just not going to be able to take 
the prescription drugs that the doctors tell them they have to take. 
With all the anxiety, what this Republican Congress is doing is 
catering to the special interests, the pharmaceutical industry and the 
HMOs. It is wrong and it needs to change.
  Mr. TURNER. If the gentleman will yield, it is really amazing when 
you really get down and look at the hard, cold facts of the bill that 
was passed in this House yesterday, that gave almost half of the 
additional funding for Medicare goes to the HMOs and the insurance 
companies, because, the truth is, there are only about 15 percent of 
America's seniors that even have or live in an area where they have the 
opportunity to select a Medicare+Choice HMO plan.
  In my 19 county Congressional district, today there are only two 
counties where there is even an HMO Medicare+Choice plan offered by the 
insurance companies. Now, why in the world, if only 15 percent of the 
senior population of this country even have the opportunity to buy one 
of those HMO plans and take advantage of the little add-ons they are 
able to offer, prescription drug coverage, eyeglass coverage, why would 
we give almost half of the additional money that we choose to 
appropriate this year to those HMO plans which are only available to 15 
percent of the seniors?
  It is just not right, particularly when you have got hospitals all 
across this country that are about to close their doors because the 
Medicare reimbursements are so low.
  Now, it does not take a smart person to see the fallacy in what is 
going on around here, and I think it is pretty apparent that the 
insurance industry and their lobbyists are carrying the day, not the 
American people.
  In Texas, in Texas we have 270,000 seniors who were forced to skip a 
necessary prescription in 1998 because they could not afford it. We had 
800,000 seniors in Texas who were forced to pay for their own 
prescription drug costs because they had no insurance coverage of any 
kind.
  You would think that, surely, we can do better. And I believe we must 
do better. Prescription drug coverage for seniors under Medicare, 
patient protection legislation to be sure everyone enrolled in managed 
care gets to make their medical decisions with their doctor, not having 
some insurance clerk interfere, and to think that we cannot figure out 
how to accomplish these things in this Congress is really more than 
many of us here can understand.
  So I am just hoping and praying that we will get the kind of 
legislation that the American people want and need. I was here 
yesterday, sat right up here in the gallery with a young family, 
husband and wife and a young daughter from Newton County in my 
district. The young daughter has leukemia.
  I sat there and listened to the father talk about their experience 
with managed care. He even told me about his experience of his wife, 
who needed surgery a few months back and had to fight her managed care 
company to get the surgery approved, and, after they finally got it 
approved and she had it, they had to fight with the same HMO to get the 
bill paid.
  There are people all across this country that can tell similar 
stories about dealing with their HMOs, and I think this Congress must 
act. I am proud to be here tonight with my colleagues to continue the 
battle that ultimately we will win, because we are on the right side of 
this issue for the American people.
  Yes, I think, as the vice president said, it is really a choice of 
are we for the people, or are you for the powerful, and I think we had 
better come down on the side of the American people.
  Mr. PALLONE. I appreciate the gentleman's comments. I know we do not 
have a lot of time left and I want to yield to the gentleman from 
Maine, but I wanted to say the issues of abuses by the HMO affect 
everyone, by insurance companies.
  I had a situation myself, and I have not mentioned it for a while 
because we now have the law that we passed in the previous Congress 
that says that for the drive-through deliveries, you have to allow at 
least 24 hours, I think is it is now 2 days for normal delivery, and 
maybe 4 days for a C-section, when a you have a baby. They had changed 
the rules in between my daughter being born and my son being born, when 
they were both born by C-section.
  We were actually at Columbia Hospital for Women here in D.C. between 
the two births. The law had changed, or at least the insurance company 
changed it, and when my son was born, after the second day, they said 
my wife had to come home and he had to come home from the hospital. It 
was only because there was a law in D.C., and I do not think it exists 
in a lot of states, that says before the child goes home he has to be 
examined by a pediatrician for certain things, and they found he was 
jaundiced. So they let the two of them stay, my wife and son stay, an 
extra day in the hospital. Then we passed the law to prohibit the 
drive-through deliveries. But these abuses impact everyone. It is 
across the board.
  I yield to the gentleman from Maine.
  Mr. ALLEN. I thank the gentleman for yielding. In conclusion, I 
thought I would try to simplify this about the prescription drug 
benefit. The Democrats are saying, all of us are saying, that what we 
want is a Medicare prescription drug benefit. That is, seniors would 
get their prescription drug benefit as part of the Medicare package.
  This is exactly what every Member of this House has through his or 
her own insurance, because everyone in this House has some plan through 
the Federal employees insurance, and it is a plan that you sign up for 
and other Federal employees get, and if they have prescription drug 
coverage, which I suspect almost everyone here does, they have it as 
part of the plan. If they have a Blue Cross plan, they have a Blue 
Cross prescription benefit; if they have an Aetna plan, they have an 
Aetna prescription benefit.
  All we are saying on the Democratic side of the aisle is, let us have 
a Medicare prescription drug benefit. And what the Republicans are 
saying is no, no, no, no, no, that would be wrong, because, after all, 
Medicare is a Federal health care plan. We would not want Medicare to 
provide a prescription drug benefit. That would be somehow wrong, 
because it is a government plan. That is nonsense. It is not right. It 
is absolutely not right.
  The benefit, the prescription drug coverage should come through 
Medicare. It is the health care plan for our seniors and our disabled 
people, and there is no excuse to try to create some

[[Page 25276]]

Rube Goldberg system involving private insurance companies and HMOs as 
an alternative. But that is what the folks on the other side of the 
aisle have been trying to put over on the American people.
  Mr. PALLONE. I listened to that third debate between the two 
presidential candidates, and I was very upset to hear Governor Bush say 
he was providing a Medicare prescription plan. I believe he used the 
term Medicare.
  Mr. ALLEN. He did.
  Mr. PALLONE. Yet the Republican plan and his plan is a voucher. It is 
not under Medicare. It a voucher that you get if you are below a 
certain income, not for most people, but if you are below a certain 
income, to go out and try to find an HMO or somebody to cover your 
prescription drugs. So, to even suggest that somehow this is a Medicare 
plan is not accurate. It is not under Medicare.
  I think that is a major distinction between the Democrats and the 
Republicans on this issue, that we want to use traditional Medicare for 
the prescription drug benefit, and the Republican leadership does not. 
That is a key difference here, no question about it.
  Mr. TURNER. If the gentleman will yield, you know, I think you are 
right on target. When you combine that fact with the fact that these 
Medicare+Choice plans are not even available, and you hear the proposal 
that Governor Bush makes to give the seniors a voucher so they just get 
25 percent of the premium for their insurance covered by the 
government, what we are moving toward, and I think it is wrong, it is a 
system where no longer do you have the same coverage no matter where 
you live in this country.
  Medicare, as I have always understood it, said that no matter where 
you live in this country, whether you live in the city or in the 
country, in rural America, urban America, you have the same coverage 
and the same benefit. And when you refuse to provide a prescription 
drug benefit under Medicare, and you only allow the HMOs to offer plans 
that can add on a prescription drug benefit, what you have done is 
changed in a very dramatic way what Medicare should mean to every 
senior, no matter where they live in this country.
  Mr. PALLONE. I want to thank my colleagues for joining me tonight.

                          ____________________