[Congressional Record (Bound Edition), Volume 148 (2002), Part 10]
[House]
[Pages 13942-13949]
[From the U.S. Government Publishing Office, www.gpo.gov]




             IMPROVING ACCESS TO LONG-TERM CARE ACT OF 2002

  Mr. HAYWORTH. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 4946) to amend the Internal Revenue Code to provide health 
care incentives related to long-term care, as amended.
  The Clerk read as follows:

                               H.R. 4946

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

       (a) Short Title.--This Act may be cited as the ``Improving 
     Access to Long-Term Care Act of 2002''.
       (b) Amendment of 1986 Code.--Except as otherwise expressly 
     provided, whenever in this Act an amendment or repeal is 
     expressed in terms of an amendment to, or repeal of, a 
     section or other provision, the reference shall be considered 
     to be made to a section or other provision of the Internal 
     Revenue Code of 1986.

     SEC. 2. DEDUCTION FOR PREMIUMS ON QUALIFIED LONG-TERM CARE 
                   INSURANCE CONTRACTS.

       (a) In General.--Part VII of subchapter B of chapter 1 
     (relating to additional itemized deductions) is amended by 
     redesignating section 223 as section 224 and by inserting 
     after section 222 the following new subsection:

     ``SEC. 223. PREMIUMS ON QUALIFIED LONG-TERM CARE INSURANCE 
                   CONTRACTS.

       ``(a) In General.--In the case of an individual, there 
     shall be allowed as a deduction an amount equal to the 
     applicable percentage of eligible long-term care premiums (as 
     defined in section 213(d)(10)) paid during the taxable year 
     by the taxpayer for coverage for the taxpayer and the spouse 
     and dependents of the taxpayer.
       ``(b) Applicable Percentage.--For purposes of subsection 
     (a), the applicable percentage shall be determined in 
     accordance with the following table:

``For taxable years beginning in calendarThe applicable percentage is--
    2003, 2004, and 2005............................................25 
    2006 and 2007...................................................30 
    2008 and 2009...................................................35 
    2010 and 2011...................................................40 
    2012 and thereafter.............................................50.

       ``(c) Limitation Based on Modified Adjusted Gross Income.--
       ``(1) In general.--If the modified adjusted gross income of 
     the taxpayer for the taxable year exceeds $20,000 (twice the 
     preceding dollar amount, as adjusted under paragraph (2), in 
     the case of a joint return) the amount which would (but for 
     this subsection) be allowed as a deduction under subsection 
     (a) shall be reduced (but not below zero) by the amount which 
     bears the same ratio to the amount which would be so allowed 
     as such excess bears to $20,000 ($40,000 in the case of a 
     joint return).
       ``(2) Adjustments for inflation.--
       ``(A) In general.--In the case of a taxable year beginning 
     after December 31, 2003, the first $20,000 amount contained 
     in paragraph (1) shall be increased by an amount equal to--
       ``(i) such dollar amount, multiplied by
       ``(ii) the cost-of-living adjustment determined under 
     section 1(f)(3) for the calendar year in which the taxable 
     year begins, determined by substituting `calendar year 2002' 
     for `calendar year 1992' in subparagraph (B) thereof.
       ``(B) Rounding.--If any amount as adjusted under 
     subparagraph (A) is not a multiple of $1,000, such amount 
     shall be rounded to the nearest multiple of $1,000 (or if 
     such amount is a multiple of $500, such amount shall be 
     rounded to the next highest multiple of $500).
       ``(3) Modified adjusted gross income.--For purposes of 
     paragraph (1), the term `modified adjusted gross income' 
     means adjusted gross income determined--
       ``(A) without regard to this section and sections 911, 931, 
     and 933, and
       ``(B) after application of sections 86, 135, 137, 219, 221, 
     222, and 469.
       ``(d) Limitation Based on Subsidized Coverage.--
       ``(1) In general.--Subsection (a) shall not apply to 
     premiums paid for coverage of any individual for any calendar 
     month if--
       ``(A) for such month such individual is covered by any 
     insurance which is advertised, marketed, or offered as long-
     term care insurance under any health plan maintained by any 
     employer of the taxpayer or of the taxpayer's spouse, and
       ``(B) 50 percent or more of the cost of any such coverage 
     (determined under section 4980B) for such month is paid or 
     incurred by the employer.
       ``(2) Plans maintained by certain employers.--A health plan 
     which is not otherwise described in paragraph (1)(A) shall be 
     treated as described in such paragraph if such plan would be 
     so described if all health plans of persons treated as a 
     single employer under subsection (b), (c), (m), or (o) of 
     section 414 were treated as one health plan.
       ``(e) Coordination With Other Deductions.--Any amount taken 
     into account under subsection (a) shall not be taken into 
     account in computing the amount allowable as a deduction 
     under section 162(l) or 213(a).
       ``(f) Married Couples Must File Joint Return.--
       ``(1) In general.--If the taxpayer is married at the close 
     of the taxable year, the deduction shall be allowed under 
     subsection (a) only if the taxpayer and the taxpayer's spouse 
     file a joint return for the taxable year.
       ``(2) Marital status.--For purposes of paragraph (1), 
     marital status shall be determined in accordance with section 
     7703.
       ``(g) Regulations.--The Secretary shall prescribe such 
     regulations as may be appropriate to carry out this section, 
     including regulations requiring employers to report to their 
     employees and the Secretary such information as the Secretary 
     determines to be appropriate.''.
       (b) Deduction Allowed Whether or not Taxpayer Itemizes.--
     Subsection (a) of section 62 is amended by inserting after 
     paragraph (18) the following new item:
       ``(19) Premiums on qualified long-term care insurance 
     contracts.--The deduction allowed by section 223.''.
       (c) Conforming Amendments.--
       (1) Sections 86(b)(2)(A), 135(c)(4)(A), 137(b)(3)(A), 
     219(g)(3)(A)(ii), and 221(b)(2)(C)(i) are each amended by 
     inserting ``223,'' after ``222,''.
       (2) Section 222(b)(2)(C)(i) is amended by inserting 
     ``223,'' before ``911''.
       (3) Section 469(i)(3)(F)(iii) is amended by striking ``and 
     222'' and inserting ``222, and 223''.
       (d) Clerical Amendment.--The table of sections for part VII 
     of subchapter B of chapter 1 is amended by striking the last 
     item and inserting the following new items:

``Sec. 223. Premiums on qualified long-term care insurance contracts.
``Sec. 224. Cross reference.''.

       (e) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.

     SEC. 3. ADDITIONAL PERSONAL EXEMPTION FOR DEPENDENTS WITH 
                   LONG-TERM CARE NEEDS IN TAXPAYER'S HOME.

       (a) In General.--Section 151 (relating to allowance of 
     deductions for personal exemptions) is amended by 
     redesignating subsections (d) and (e) as subsections (e) and 
     (f), respectively, and by inserting after subsection (c) the 
     following new subsection:
       ``(d) Additional Exemption for Dependents With Long-Term 
     Care Needs in Taxpayer's Home.--
       ``(1) In general.--Except as provided in paragraph (2), an 
     exemption of the exemption amount for each qualified family 
     member of the taxpayer.
       ``(2) Phase-in.--In the case of taxable years beginning in 
     calendar years before 2012, the amount of the exemption 
     provided under paragraph (1) shall not exceed the applicable 
     limitation amount determined in accordance with the following 
     table:

``For taxable years beginning in cThe applicable limitation amount is--
    2003 and 2004.................................................$500 
    2005 and 2006................................................1,000 
    2007 and 2008................................................1,500 
    2009 and 2010................................................2,000 
    2011.........................................................2,500.

       ``(3) Qualified family member.--For purposes of this 
     subsection, the term `qualified family member' means, with 
     respect to any taxable year, any individual--
       ``(A) who is--
       ``(i) the spouse of the taxpayer, or
       ``(ii) a dependent of the taxpayer with respect to whom the 
     taxpayer is entitled to an exemption under subsection (c),
       ``(B) who is an individual with long-term care needs during 
     any portion of the taxable year, and
       ``(C) other than an individual described in section 
     152(a)(9), who, for more than half of such year, has as such 
     individual's principal place of abode the home of the 
     taxpayer and is a member of the taxpayer's household.
       ``(4) Individuals with long-term care needs.--For purposes 
     of this subsection, the term `individual with long-term care 
     needs' means, with respect to any taxable year, an individual 
     who has been certified, during the 39\1/2\-month period 
     ending on the due date (without extensions) for filing the 
     return of tax for the taxable year (or such other period as 
     the Secretary prescribes), by a physician (as defined in 
     section 1861(r)(1) of the Social Security Act) as being, for 
     a period which is at least 180 consecutive days--
       ``(A) an individual who is unable to perform (without 
     substantial assistance from another individual) at least 2 
     activities of daily living (as defined in section

[[Page 13943]]

     7702B(c)(2)(B)) due to a loss of functional capacity, or
       ``(B) an individual who requires substantial supervision to 
     protect such individual from threats to health and safety due 
     to severe cognitive impairment and is unable to perform, 
     without reminding or cuing assistance, at least 1 activity of 
     daily living (as so defined) or to the extent provided in 
     regulations prescribed by the Secretary (in consultation with 
     the Secretary of Health and Human Services), is unable to 
     engage in age appropriate activities.
       ``(5) Identification requirement.--No exemption shall be 
     allowed under this subsection to a taxpayer with respect to 
     any qualified family member unless the taxpayer includes, on 
     the return of tax for the taxable year, the name and taxpayer 
     identification of the physician certifying such member. In 
     the case of a failure to provide the information required 
     under the preceding sentence, the preceding sentence shall 
     not apply if it is shown that the taxpayer exercised due 
     diligence in attempting to provide the information so 
     required.
       ``(6) Special rules.--Rules similar to the rules of 
     paragraphs (2), (3), and (4) of section 21(e) shall apply for 
     purposes of this subsection.''.
       (b) Conforming Amendments.--
       (1) Section 1(f)(6)(A) is amended by striking ``151(d)(4)'' 
     and inserting ``151(e)(4)''.
       (2) Section 1(f)(6)(B) is amended by striking 
     ``151(d)(4)(A)'' and inserting ``151(e)(4)(A)''.
       (3) Section 3402(f)(1)(A) is amended by striking 
     ``151(d)(2)'' and inserting ``151(e)(2)''.
       (4) Section 3402(r)(2)(B) is amended by striking ``151(d)'' 
     and inserting ``151(e)''.
       (5) Section 6012(a)(1)(D)(ii) is amended--
       (A) by striking ``151(d)'' and inserting ``151(e)'', and
       (B) by striking ``151(d)(2)'' and inserting ``151(e)(2)''.
       (6) Section 6013(b)(3)(A) is amended by striking ``151(d)'' 
     and inserting ``151(e)''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.

     SEC. 4. ADDITIONAL CONSUMER PROTECTIONS FOR LONG-TERM CARE 
                   INSURANCE.

       (a) Additional Protections Applicable to Long-Term Care 
     Insurance.--Subparagraphs (A) and (B) of section 7702B(g)(2) 
     of the Internal Revenue Code of 1986 (relating to 
     requirements of model regulation and Act) are amended to read 
     as follows:
       ``(A) In general.--The requirements of this paragraph are 
     met with respect to any contract if such contract meets--
       ``(i) Model regulation.--The following requirements of the 
     model regulation:

       ``(I) Section 6A (relating to guaranteed renewal or 
     noncancellability), and the requirements of section 6B of the 
     model Act relating to such section 6A.
       ``(II) Section 6B (relating to prohibitions on limitations 
     and exclusions).
       ``(III) Section 6C (relating to extension of benefits).
       ``(IV) Section 6D (relating to continuation or conversion 
     of coverage).
       ``(V) Section 6E (relating to discontinuance and 
     replacement of policies).
       ``(VI) Section 7 (relating to unintentional lapse).
       ``(VII) Section 8 (relating to disclosure), other than 
     section 8F thereof.
       ``(VIII) Section 11 (relating to prohibitions against post-
     claims underwriting).
       ``(IX) Section 12 (relating to minimum standards).
       ``(X) Section 13 (relating to requirement to offer 
     inflation protection), except that any requirement for a 
     signature on a rejection of inflation protection shall permit 
     the signature to be on an application or on a separate form.
       ``(XI) Section 25 (relating to prohibition against 
     preexisting conditions and probationary periods in 
     replacement policies or certificates).
       ``(XII) The provisions of section 26 relating to contingent 
     nonforfeiture benefits, if the policyholder declines the 
     offer of a nonforfeiture provision described in paragraph 
     (4).

       ``(ii) Model act.--The following requirements of the model 
     Act:

       ``(I) Section 6C (relating to preexisting conditions).
       ``(II) Section 6D (relating to prior hospitalization).
       ``(III) The provisions of section 8 relating to contingent 
     nonforfeiture benefits, if the policyholder declines the 
     offer of a nonforfeiture provision described in paragraph 
     (4).

       ``(B) Definitions.--For purposes of this paragraph--
       ``(i) Model provisions.--The terms `model regulation' and 
     `model Act' means the long-term care insurance model 
     regulation, and the long-term care insurance model Act, 
     respectively, promulgated by the National Association of 
     Insurance Commissioners (as adopted as of October 2000).
       ``(ii) Coordination.--Any provision of the model regulation 
     or model Act listed under clause (i) or (ii) of subparagraph 
     (A) shall be treated as including any other provision of such 
     regulation or Act necessary to implement the provision.
       ``(iii) Determination.--For purposes of this section and 
     section 4980C, the determination of whether any requirement 
     of a model regulation or the model Act has been met shall be 
     made by the Secretary.''.
       (b) Excise Tax.--Paragraph (1) of section 4980C(c) of the 
     Internal Revenue Code of 1986 (relating to requirements of 
     model provisions) is amended to read as follows:
       ``(1) Requirements of model provisions.--
       ``(A) Model regulation.--The following requirements of the 
     model regulation must be met:
       ``(i) Section 9 (relating to required disclosure of rating 
     practices to consumer).
       ``(ii) Section 14 (relating to application forms and 
     replacement coverage).
       ``(iii) Section 15 (relating to reporting requirements), 
     except that the issuer shall also report at least annually 
     the number of claims denied during the reporting period for 
     each class of business (expressed as a percentage of claims 
     denied), other than claims denied for failure to meet the 
     waiting period or because of any applicable preexisting 
     condition.
       ``(iv) Section 22 (relating to filing requirements for 
     advertising).
       ``(v) Section 23 (relating to standards for marketing), 
     including inaccurate completion of medical histories, other 
     than paragraphs (1), (6), and (9) of section 23C, except 
     that--

       ``(I) in addition to such requirements, no person shall, in 
     selling or offering to sell a qualified long-term care 
     insurance contract, misrepresent a material fact; and
       ``(II) no such requirements shall include a requirement to 
     inquire or identify whether a prospective applicant or 
     enrollee for long-term care insurance has accident and 
     sickness insurance.

       ``(vi) Section 24 (relating to suitability).
       ``(vii) Section 29 (relating to standard format outline of 
     coverage).
       ``(viii) Section 30 (relating to requirement to deliver 
     shopper's guide).
     The requirements referred to in clause (vi) shall not include 
     those portions of the personal worksheet described in 
     Appendix B of the model regulation relating to consumer 
     protection requirements not imposed by section 4980C or 
     7702B.
       ``(B) Model act.--The following requirements of the model 
     Act must be met:
       ``(i) Section 6F (relating to right to return), except that 
     such section shall also apply to denials of applications and 
     any refund shall be made within 30 days of the return or 
     denial.
       ``(ii) Section 6G (relating to outline of coverage).
       ``(iii) Section 6H (relating to requirements for 
     certificates under group plans).
       ``(iv) Section 6J (relating to policy summary).
       ``(v) Section 6K (relating to monthly reports on 
     accelerated death benefits).
       ``(vi) Section 7 (relating to incontestability period).
       ``(C) Definitions.--For purposes of this paragraph, the 
     terms `model regulation' and `model Act' have the meanings 
     given such term by section 7702B(g)(2)(B).''.
       (c) Effective Date.--The amendments made by this section 
     shall apply to policies issued after December 31, 2002.

     SEC. 5. EXPANSION OF HUMAN CLINICAL TRIALS QUALIFYING FOR 
                   ORPHAN DRUG CREDIT.

       (a) In General.--Paragraph (2) of section 45C(b) of the 
     Internal Revenue Code of 1986 is amended by adding at the end 
     the following new subparagraph:
       ``(C) Treatment of certain expenses incurred before 
     designation.--For purposes of subparagraph (A)(ii)(I), if a 
     drug is designated under section 526 of the Federal Food, 
     Drug, and Cosmetic Act not later than the due date (including 
     extensions) for filing the return of tax under this subtitle 
     for the taxable year in which the application for such 
     designation of such drug was filed, such drug shall be 
     treated as having been designated on the date that such 
     application was filed.''.
       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to expenses incurred after the date of the 
     enactment of this Act.

     SEC. 6. VACCINE TAX TO APPLY TO HEPATITIS A VACCINE.

       (a) In General.--Paragraph (1) of section 4132(a) (defining 
     taxable vaccine) is amended by redesignating subparagraphs 
     (I), (J), (K), and (L) as subparagraphs (J), (K), (L), and 
     (M), respectively, and by inserting after subparagraph (H) 
     the following new subparagraph:
       ``(I) Any vaccine against hepatitis A.''
       (b) Effective Date.--
       (1) Sales, etc.--The amendments made by subsection (a) 
     shall apply to sales and uses on or after the first day of 
     the first month which begins more than 4 weeks after the date 
     of the enactment of this Act.
       (2) Deliveries.--For purposes of paragraph (1) and section 
     4131 of the Internal Revenue Code of 1986, in the case of 
     sales on or before the effective date described in such 
     paragraph for which delivery is made after such date, the 
     delivery date shall be considered the sale date.

     SEC. 7. ELIGIBILITY FOR ARCHER MSA'S EXTENDED TO ACCOUNT 
                   HOLDERS OF MEDICARE+CHOICE MSA'S.

       (a) In General.--Subparagraph (B) of section 220(c)(2) of 
     the Internal Revenue Code of 1986 is amended by adding at the 
     end the following new clause:
       ``(iii) Medicare+choice msa's.--In the case of an 
     individual who is covered under an MSA plan (as defined in 
     section 1859(b)(3) of

[[Page 13944]]

     the Social Security Act) which such individual elected under 
     section 1851(a)(2)(B) of such Act--

       ``(I) such plan shall be treated as a high deductible 
     health plan for purposes of this section,
       ``(II) subsection (b)(2)(A) shall be applied by 
     substituting `100 percent' for `65 percent' with respect to 
     such individual,
       ``(III) with respect to such individual, the limitation 
     under subsection (d)(1)(A)(ii) shall be 100 percent of the 
     highest annual deductible limitation under section 
     1859(b)(3)(B) of the Social Security Act,
       ``(IV) paragraphs (4), (5), and (7) of subsection (b) and 
     paragraph (1)(A)(iii) of this subsection shall not apply with 
     respect to such individual, and
       ``(V) the limitation which would (but for this subclause) 
     apply under subsection (b)(1) with respect to such individual 
     for any taxable year shall be reduced (but not below zero) by 
     the amount which would (but for subsection 106(b)) be 
     includible in such individual's gross income for the taxable 
     year.''.

       (b) Effective Date.--The amendment made by subsection (a) 
     shall apply to taxable years beginning after December 31, 
     2002.
  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Arizona (Mr. Hayworth) and the gentleman from California (Mr. Stark) 
each will control 20 minutes.
  The Chair recognizes the gentleman from Arizona (Mr. Hayworth).

                              {time}  1200

  Mr. HAYWORTH. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support this morning of this very important 
measure, H.R. 4946, the Improving Access to Long-Term Care Act. The 
need for long-term care is expected to grow substantially in the 
future, straining both public and private resources.
  Total spending on long-term care services for people of all ages 
approached $138 billion in fiscal year 2000, nearly $86 billion of 
which was for public programs. As 77 million baby-boomers approach 
retirement age, the need to address long-term care becomes ever-more 
important.
  Soaring costs and rising demand for long-term care services could 
deplete personal savings and exhaust government entitlement programs. 
It is essential that people are encouraged to plan and take some 
personal responsibility for their future needs. Therefore, it is my 
privilege to bring forward this legislation, the Improving Access to 
Long-Term Care Act of 2002 as a critical first step toward helping in 
the emerging long-term care crisis.
  First of all, this legislation provides immediate tax relief to 
assist individuals in acquiring and maintaining long-term care for 
themselves, especially health care, which is so vital, for themselves, 
their spouses and their dependents.
  H.R. 4946 would provide an above-the-line deduction for eligible 
long-term care insurance premiums. Under current law, individuals may 
claim an itemized deduction for the cost of eligible qualified long-
term care insurance premiums, but only to the extent that such 
premiums, combined with the taxpayer's additional medical expenses, 
exceed 7.5 percent of adjusted gross income.
  This bill provides an above-the-line deduction for a percentage of 
eligible long-term care premiums for which the taxpayer pays at least 
50 percent of the cost of coverage. The deduction is available for 
eligible long-term care insurance that covers the taxpayer, the 
taxpayer's spouse or the taxpayer's dependents.
  The deduction is available to individuals with adjusted gross income 
between $20,000 and $40,000, and twice that amount for married couples 
filing a joint return. This amount will be adjusted annually for 
inflation. This bill, Mr. Speaker, provides targeted relief for those 
taxpayers who really need it.
  Although financing is the cornerstone of the long-term care issue, we 
must also look at supporting family caregivers. H.R. 4946 would add an 
additional personal exemption for home caregivers of family members. 
This bill provides immediate tax relief to those taxpayers who assume 
the responsibility of providing for the care and support of individuals 
with long-term care needs.
  Under current law, individuals are entitled to a personal exemption 
deduction of $3,000 in 2002 for the taxpayer, the taxpayer's spouse and 
each dependent. This bill provides the taxpayer with an additional 
personal exemption for each qualified family member with long-term 
needs.
  This legislation, Mr. Speaker, has been updated to include additional 
consumer protections for long-term care insurance policies. A qualified 
long-term care insurance contract is one that meets certain consumer 
protection requirements promulgated by the National Association of 
Insurance Commissioners, or NAIC. This bill updates the consumer 
protection provisions to reflect changes made to the Long-Term Care 
Insurance Model Act by the NAIC. Groups that support the addition of 
the additional consumer protection provisions include AARP, the 
American Council of Life Insurers and the Health Insurance Association 
of America.
  Mr. Speaker, this legislation also includes other various tax 
provisions concerning health and health care. First, this legislation 
includes an orphan drug tax credit that would prevent drug 
manufacturers from delaying the important process of human clinical 
testing of orphan drugs until the time of Food and Drug Administration 
approval. This legislation would add any vaccine administered to 
prevent hepatitis A to the list of taxable vaccines. Finally, this 
legislation will provide retirees with additional flexibility in 
obtaining health care for the retirees and their families by permitting 
those individuals who have a Medicare+Choice Medical Savings Account to 
also have an Archer Medical Savings Account and allowing employees to 
make contributions to an Archer MSA on behalf of a Medicare eligible 
individual.
  Mr. Speaker, our Nation is in dire need of comprehensive long-term 
care reform. By 2040, the number of Americans 64 and older will more 
than double. Without long-term care reform, these changing demographics 
will drive spending for Social Security, Medicare and Medicaid to 
consume nearly 75 percent of all Federal revenue by the year 2030.
  The Improving Access to Long-Term Care Act is a first critical step 
to focus immediate attention on long-term care before the crisis 
occurs.
  Mr. Speaker, I reserve the balance of my time.
  Mr. STARK. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I hardly know where to begin. This bill is, at best, 
unnecessary, and, at worst, it is a wasteful expenditure of $5.5 
billion, which will accomplish very little except add to the repeated 
Republican program of giving huge benefits to the wealthy and doing 
very little for the average American.
  This bill is designed to turn a bunch of sow's ears into silk purses. 
The goal of expanding the purchase of long-term care insurance sounds 
like a positive one, if people really believe that long-term care 
insurance was any good as offered by the insurance industry today. Very 
few people are purchasing it. It is a dud in the market.
  We are, in this bill, attempting to help or bail out the long-term 
care insurance industry. But I wonder if that is a wise expenditure of 
the public's money? We are having trouble finding the money to pay, 
say, for prescription drugs. Why are we trying to get people to 
purchase something they do not need?
  Mr. Speaker, I believe firmly that we need to do something about the 
long-term care issue, but we have had precious little debate as to 
whether private insurance is the right approach. Even if you think it 
is a good idea to promote the purchase of private long-term care 
insurance, the real question is whether or not this bill before us 
today will do any good.
  There are, as the distinguished gentleman from Arizona pointed out, 
three major components to this bill. There is the long-term care tax 
deduction. It allows individuals with incomes below $40,000, and 
actually the full benefit is available for individuals up to $20,000, 
and then phases out by $40,000, it will give them very slowly over 10 
years a deduction, and the most value it will provide these people is 
7.5 cents on every dollar of long-term care premium they pay.

[[Page 13945]]

  Now, mind you, you are talking about individuals with $20,000 worth 
of income. It is questionable whether those people are even buying life 
insurance. The average amount of life insurance in this country is less 
than $8,000. Why my colleagues on the other side of the aisle think 
that people who already are under-insured and are young enough to 
afford this would begin to buy long-term care insurance escapes me.
  But let us suppose that the bill works as the Joint Tax Committee has 
informed us they think it might. In the year 2003, what would happen? 
Six thousand people would newly purchase long-term care insurance, and, 
of course, we would spend $19 million to get them to do that. That is 
approximately $3,200 per insured person of your hard-earned taxpayer 
money to just get these 6,000 people to buy policies, and I am not sure 
we would all agree that the policies are any good.
  It gets better. Why, in 2004, you would get 12,000 people, and it 
would cost them only $1,000 that year. But in 2005, you get 18,000 
people, and it costs $7,780 a person. That is more than the premiums.
  Now, why are we wasting the taxpayer's money? This is some insurance 
salesman run amuck and writing a bill, which even the insurance 
salesmen, if you triple their commissions, they would not get that much 
money. It is a terribly inefficient way.
  The net result is let us get all the way out to 2012, when this 
turkey is full grown and ready for the table. In 2012, the Joint Tax 
Committee estimates that 100,000 people will become new purchasers of 
long-term care insurance at a modest cost of $561 million. That is 
$5,600 a person.
  Now, you guys are going to bribe people with $5,600 to buy long-term 
care insurance, which most of the people supporting this, I wish they 
would raise their hands, I do not buy long-term care insurance and I 
bet none of my Republican colleagues have purchased the long-term care 
insurance, which is now available through the House of Representatives. 
That is another turkey. If we are not buying it, why should we be 
spending the taxpayer's money to encourage the public to buy in?
  Now, the bill gets better, of course. We have an additional personal 
exemption for caregivers. This sounds nice. It allows the taxpayer 
caring for a chronically ill loved one to get an additional personal 
exemption to defray some of the cost. It phases in very slowly, 
starting with a $500 exemption in 2003 and eventually going to $2,500. 
But it mostly benefits wealthy people anyway, because if you do not 
have any tax liability, this personal exemption does little or nothing 
for you.
  Of course, the third one is the grandfather gobbler of all turkeys, 
and that is Medicare MSAs, which were written into law right after we 
wrote in Medicare+Choice. This one is so successful that not one, not 
one company offers them, not one person has ever asked to buy one. They 
just do not exist. They are zip, zero, nada. This is the turkey of all 
turkeys.
  Then what they are going to do is allow Medicare beneficiaries, 
people my age, Mr. Speaker, to take $6,000 a year and deduct it, which 
nobody else can do, and pop it into an IRA, and save it there and let 
the income accumulate tax free, and when it is all done, I can spend it 
on anything I want with no penalties. I do not have to spend it on 
health care.
  It is a new $6,000 IRA only for us old fogies. Now, if you are trying 
to encourage my children to save for long-term care, maybe we could do 
something like that for them. But why give it to me? Long-term care is 
far too expensive. I should have already saved by now.
  So what you have here is a grand campaign scheme which throws away 
$5.5 billion of the taxpayer's money on something that is next to 
worthless, that only benefits insurance companies who have a bankrupt 
product that they cannot sell.
  So here we go again, the Republicans subsidizing large corporations 
to the disadvantage of the poor and the disadvantage of the taxpayers 
to accomplish precious little.
  The bill will go nowhere. You will see it on campaign statements if 
it passes muster today. But I hope it does not. It is useless, it is 
worthless, and it is a tremendous waste of the taxpayer's money.
  Mr. Speaker, I reserve the balance of my time.
  Mr. HAYWORTH. Mr. Speaker, I yield myself 30 seconds.
  The question comes from the gentleman from California in a very 
interesting fashion in terms of public policy, why do this? Well, I 
think it is worth noting that in fiscal year 2000 Medicare and Medicaid 
provided $82.1 billion, 60 percent of the money spent, of the $123 
billion, spent on long-term care services.

                              {time}  1215

  We have a basic question here. If we do not put incentives in for 
individuals, our public resources will be depleted. It is in that 
spirit that we offer the legislation.
  Mr. HAYWORTH. Mr. Speaker, I yield 2 minutes to the gentleman from 
Illinois (Mr. Weller).
  Mr. WELLER. Mr. Speaker, I stand here in strong support of 
legislation that is pro-family and pro-senior, legislation that will 
help families struggling to find long-term care needs.
  Mr. Speaker, if we look at the statistics, only 10 percent of 
Americans today have long-term care insurance, what some of us would 
call nursing home insurance. Many would suggest, well, do not worry 
about it right now; just, when the time comes if you need nursing home 
care, somebody else will pick up the tab. Well, we have learned how 
expensive nursing home care is for an average family. When we think 
about it, one could be a 16-year-old in a motorcycle accident and 
require long-term care if that tragedy were to occur.
  This is good legislation. I commend the gentleman from Arizona (Mr. 
Hayworth) for stepping forward to offer a solution that will help 
families and provide an incentive to purchase long-term care insurance.
  It is an above-the-line deduction for eligible, long-term care 
insurance premiums. When we think about it, this legislation is 
targeted to moderate and middle income families, individuals between 
the income levels, adjusted gross income level of $20,000 to $40,000, 
or if you are married, twice that. There is no marriage penalty here; 
all will be eligible for this above-the-line deduction. It helps the 
middle class, those who struggle the most. Because if you are poor, 
Medicaid picks up the tab; if you are rich, you can afford it. It is 
the middle class that struggles the most with nursing home care costs.
  I also want to commend the gentleman from Arizona (Mr. Hayworth) for 
including in this legislation help for those families who take care of 
mom or dad or a loved one at home. We receive a $3,000 personal 
exemption for our dependents and spouses under our Tax Code today. 
Well, this legislation creates a new one. If you have a parent living 
at home or someone, a loved one that is at home who requires long-term 
care needs and you are taking care of that family member at home, you 
get a personal exemption which, once phased in, will equal $2,500. That 
is leadership, and that is helping families, particularly middle and 
moderate-income families who some day will be seniors.
  Mr. STARK. Mr. Speaker, I am pleased to yield 4 minutes to the 
gentlewoman from Florida (Mrs. Thurman).
  Mrs. THURMAN. Mr. Speaker, I thank the gentleman from California for 
yielding me this time.
  I want to talk, first of all, a little bit about long-term care and 
what it means to folks in and around. One reason was mentioned just 
about nursing home care, but there are other reasons for long-term 
care. We are talking about home health care, we are talking about 
people that might want assisted living, areas that many of our seniors 
are moving in those directions today. We always want to think that we 
give them the best quality.
  So over the years, the Congress has talked about this issue. We also, 
in the last year or so, were able to pass on to retirees from the 
Federal Government,

[[Page 13946]]

as well as Federal employees that are now serving, the ability to buy 
long-term care. It just seems to me that in some ways, we need to be 
starting to work with those folks that are 44, 50 years old, so they 
can start looking at ways to plan for their retirement, and so that 
they are not dependent on their families for the cost of this. Because 
that has a negative effect on the families that they are trying to put 
through college or that they are trying to help to buy their first 
home, or to do the things that all of us want to be able to do for our 
families without burdening them with us, who might end up needing some 
long-term care.
  In saying all of that, I also want to say that I am a little 
concerned that we did not look at a bill that the gentlewoman from 
Connecticut (Mrs. Johnson) and the gentleman from North Dakota (Mr. 
Pomeroy) and myself have worked on, which was H.R. 831 which, quite 
frankly, I think does a little bit more and would improve the Hayworth 
bill.
  First of all, it would, in fact, look at instead of the deduction by 
2012, we could have actually looked at maybe a possibility of bringing 
to a 100 percent tax deductible, and particularly for those people at 
50 years old, because we need to be encouraging them to buy this. That 
would have been an excellent place, I think, for us to begin.
  The other area, for those that have chosen to keep a loved one at 
home and that have to take off from work or need to provide somebody to 
come in to give them the tax credit, I think ours was a little bit more 
generous with that.
  But I would say that I would like to thank the gentleman from Arizona 
(Mr. Hayworth) and others for taking our suggestions during the markup, 
because we had worked so hard on this piece of legislation that we also 
knew that there needed to be consumer protections, which in my 
understanding now has been added to this particular piece of 
legislation. These consumer protection provisions would apply to all 
people purchasing long-term care insurance policies, which is good and, 
among other things, these protections help to keep people from losing 
their policies. That is big, because we have seen over the course of 
the last couple of years that we have out-priced policies, that there 
were no consumer protections. So by adding in this protection, we hope 
that it will help them from losing their policies and being out-priced 
in the market or, just at the time that folks might need this, all of a 
sudden their premiums jump so high that they have the inability to pay 
for it, so all of the time they have been purchasing this, they no 
longer have use of it because they cannot pay the premium.
  I think that the gentleman from North Dakota (Mr. Pomeroy), because 
of his background, will talk more about, I hope I am right, on some of 
the issues that he has dealt with on suitability standards that he has 
so much knowledge about and has worked with for so many years in his 
own State of North Dakota.
  While I would say that I do not think the Hayworth bill is perfect, I 
do think it gives us a first step to bringing down the cost of long-
term care insurance for people, but I hope that we can look at the 
other bills that are out there.
  Mr. HAYWORTH. Mr. Speaker, I yield myself 30 seconds to thank the 
gentlewoman for her well-intentioned critique and also the work that 
she has done on a bipartisan basis with the gentlewoman from 
Connecticut (Mrs. Johnson).
  A couple of points I would make, first of all, based on some of the 
work we did in committee. Just to amplify again, we included in this 
legislation the consumer protections. The language is directly from the 
bipartisan bill H.R. 831, just to amplify that fact, so we tried to 
work in a constructive way, and we will continue to work in that 
constructive fashion. Given the budget parameters that we face, the 
bill advocated by the gentlewoman from Florida is six times the cost of 
this bill, so while this bill is a first step, it fits into some 
budgetary parameters and realities in which we had to deal.
  Mr. HAYWORTH. Mr. Speaker, I yield 2 minutes to the gentleman from 
Texas (Mr. Brady) to discuss another important provision of this 
legislation.
  Mr. BRADY of Texas. Mr. Speaker, I rise today in support of H.R. 
4946. I want to commend the gentleman from Arizona (Mr. Hayworth) from 
the Committee on Ways and Means for introducing this very important 
legislation.
  This will provide immediate tax relief to assist individuals in 
getting, and in keeping, long-term health care for themselves, for 
their parents, and for their dependents. I am pleased, too, that this 
bill incorporates legislation that I introduced, the Orphan Drug Tax 
Credit Act of 2001.
  Orphan drugs are drugs that address rare diseases, those which do not 
have large populations, but that are very serious. The act has really 
worked well getting these new drugs to the marketplace, but a glitch 
has developed that we want to correct. Delays in the designation 
process unfortunately stop drugs for about 6 months to a year from 
coming to the market, and that means we are not able to help the 
approximately 20 million Americans who suffer from more than 5,000 
different rare diseases such as Lou Gehrig's, cerebral palsy, cystic 
fibrosis, pulmonary hypertension, and Huntington's disease, for 
example. This legislation merely removes that timing problem, and 
allows the tax credit to be taken from the time they apply.
  Our goal here is to get more of these drugs and therapies into the 
hands of patients in a safe and quick and more affordable manner. We do 
that by eliminating unnecessary delays and costs, encouraging 
biotechnology and pharmaceutical companies to research, to develop, and 
to manufacture these drugs, even though the market for them may be 
relatively small. Without continued research into orphan drugs, people 
with rare diseases will not see the medical breakthroughs the patients 
with more common diseases may enjoy.
  Mr. Speaker, I support this legislation. It is endorsed by the 
Biotechnology Institute and a number of patient groups with the rare 
diseases. I appreciate the leadership of the gentleman from Arizona 
(Mr. Hayworth) and the Committee on Ways and Means in bringing this 
legislation forward.
  Mr. STARK. Mr. Speaker, I am pleased to yield 5 minutes to the 
gentleman from North Dakota (Mr. Pomeroy).
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding me this 
time. I applaud the gentleman from Arizona (Mr. Hayworth) for his 
attention to the issue of long-term care. There is no doubt we need to 
do something about this issue.
  Currently, some 5.2 million Americans over the age of 65 and 4.6 
million Americans under the age of 65 need assistance with daily 
activities. The increased life expectancy of the baby boomer generation 
will increase this need for long-term care. A man aged 65 today can 
expect to live another 15 years, and a woman aged 65 can expect to live 
another 19 years.
  But the cost of long-term care insurance can be prohibitive. The cost 
of long-term care insurance varies dramatically, according to the age 
of the consumer. On average, a basic plan premium can cost a 50-year-
old $385 annually; $1,007 annually for a 65-year old; $4,100 for a 79-
year old, if they can find the coverage.
  Now, some of us worked to begin this approach at trying to tax and 
encourage long-term care insurance and, under HIPAA, individuals can 
deduct long-term care premiums, but only if the taxpayer itemizes 
deductions and that medical cost that exceeds 7.5 percent of adjusted 
gross income.
  We had sought in a bipartisan way to expand upon this with H.R. 831, 
creating an above-the-line deduction for long-term care. I joined the 
gentlewoman from Connecticut (Mrs. Johnson), the gentleman from 
Louisiana (Mr. McCrery), and the gentlewoman from Florida (Mrs. 
Thurman) in sponsoring that legislation. I am very disappointed that 
budget constraints do not allow us to move on that legislation, because 
I believe that would have been much more significant in providing 
relief to those that accept the

[[Page 13947]]

responsibility to insure themselves against the cost of long-term care.
  The bill before us does not do a lot. I do not mean in any way to 
impugn the dedication of the sponsor to this topic. It is a feature of 
budget. But I used to prosecute insurance agents as insurance 
commissioner that overstated what they had in the policy, and to make 
it absolutely clear that we are not overstating on this legislation, I 
want to spell out what the bill does and does not do.
  Well, it gradually phases in a personal exemption for caregivers and 
for long-term care insurance, but it is phased in very slowly and, when 
fully phased in, does not produce a lot of benefit. The Center on 
Budget and Policy Priorities estimates that at full implementation in 
the year 2012, most eligible taxpayers will defray no more than 5 to 
7.5 cents of each dollar spent out of pocket for coverage. While it is 
phasing into the years 2003 and 2005, you have 2.5 cents per dollar to 
3.75 cents per dollar incentive. We are not going to achieve much in 
terms of generating new interest in the market for long-term care 
insurance with this very de minimis new incentive.
  Now, I am pleased that the sponsor of the legislation did incorporate 
the consumer protection standards that have been developed by State 
insurance regulators. I chaired the first National Association of 
Insurance Commissioners Committee to develop these minimum standards, 
and they have been enhanced over the years. I am particularly concerned 
about suitability and that these policies not be sold to people that 
may have very modest amounts of income and are actually relatively near 
Medicaid eligibility. These individuals historically have been shown 
not to be able to keep their coverage in force, lapse their coverage, 
and basically end up poorer than when they started with nothing held by 
way of protection for long-term care expenses.
  I also take some criticism of the way the personal exemption for at-
home care has been provided. In our initial legislation, we had sought 
a tax credit for long-term care for at-home cost of providing care. The 
tax exemption as figured in this legislation means the more you have by 
way of resources, the more you have by way of taxable income, the more 
you get back by way of benefit.

                              {time}  1230

  Well, the costs of providing care actually hit harder on those that 
do not have the income. It is more manageable by those that do have the 
income. So it is not sound policy to construct a benefit that gives a 
lot more benefit to those with income and a lot less benefit to those 
without. Those without income, those without resources yet struggling 
to provide the care to a loved one in their home need more help, and 
this is exactly the wrong approach.
  I have struggled with whether to support this bill or not. I do not 
know whether it is a baby step forward, in which case I would vote for 
it, or a side track, basically diverting the political pressure for 
doing more on incenting long-term care insurance or a side track down 
the road to nowhere. In the end I decided to say, very marginally 
worthwhile baby step, and I will vote for it without much enthusiasm.
  Mr. HAYWORTH. Mr. Speaker, I yield myself 2 minutes.
  Mr. Speaker, talk about faint praise. It is interesting to hear my 
colleague from North Dakota. Let me address, amidst all the rhetoric, a 
couple of concerns because it bears amplification in a bipartisan way, 
mindful of the gentleman's experience in the insurance industry. 
Precisely because of the concerns he shared with this body on 
suitability, precisely because of some of the challenges confronted, we 
specifically added the consumer protections offered in the Johnson 
bill. Specifically, section 24 of model regulation that deals precisely 
with the question of suitability.
  Now, undergirding all of this is the notion, Mr. Speaker, that the 
House has already put in place an incremental approach to long-term 
health care policy and insurance. One of the challenges we confront in 
a legislative body in a very real way is how to capture the ideal and 
move something that is real. With carte blanche, with a blank check 
certainly we could have embraced a bill six times more costly; and I 
champion the provisions, but the challenge we face is fitting this in 
to budget parameters. Again, the question comes up, who will this 
benefit?
  I would point out that a married couple filing jointly would find the 
economics of this to be between $40,000 and $80,000 a year. Not an 
inconsiderable sum.
  Mr. Speaker, we all know of families who fit within those parameters. 
I shared in committee my aunt and uncle, my cousin with Down syndrome. 
They fit precisely into this frame work. So I do not think we get 
anywhere by characterizing side steps, small steps. The fact is, Mr. 
Speaker, we will take a positive step forward with approval of this 
legislation.
  Mr. STARK. Mr. Speaker, how much time remains?
  The SPEAKER pro tempore (Mr. Isakson). The gentleman from California 
(Mr. Stark) has 2\1/2\ minutes remaining. The gentleman from Arizona 
(Mr. Hayworth) has 7 minutes remaining.
  Mr. STARK. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Wisconsin (Mr. Kleczka).
  Mr. KLECZKA. Mr. Speaker, let me thank the gentleman from California 
(Mr. Stark) for recognizing me for a short time.
  This bill was before the Committee on Ways and Means a short time 
ago. And after listening to the debate, I come down on the same side as 
my colleague from Florida (Mrs. Thurman), who indicates that the long-
term care insurance is something that I think we should not only 
consider but also encourage. We find that the population in the country 
is living longer. We also find that long-term care is something that 
many people are going to be in need of, and so to encourage people 
today where they can get a premium rate that is somewhat reasonable 
versus waiting until you are 55 or 60 years old is something this 
Congress should be involved in.
  The other provision of the bill deals with the personal exemption to 
those who provide home care to dependents. Again, we should thank and 
encourage these people to stay home. The option is to put your relative 
in a nursing home or assisted living which will cost much more.
  The thing I think is not a fatal flaw in the bill, but one is kind of 
like a turkey as referred to by the gentleman from California (Mr. 
Stark), that is the MSAs for Medicare+Choice. We tried this failed 
policy before with the general population. We found that the only 
people buying MSAs were doctors and attorneys; and to now subject the 
Medicare+Choice elderly to an MSA is ridiculous. They are the ones who 
need not only the Medicare program, a supplemental, but also a drug 
benefit.
  It is not fatal. I will be supporting the bill, but it is bad policy.
  Mr. STARK. Mr. Speaker, I yield myself the balance of my time.
  Mr. Speaker, I continue to suggest that this is a waste of money. 
Three and a half million or more people have long-term care, they will 
get no benefit from this. In its final year we will spend $561 million 
to get 100,000 people more in. That is a marginal benefit.
  If we really wanted to have long-term care, we might redesign a 
Federal program much like Social Security that people would like, they 
could afford. It is a social insurance program; and as it is with MSAs 
and with Medicare+Choice, these are failed programs. They are not 
working. Companies that issue them are going broke. People are not 
signing up. Why we continue to beat these dead horses and waste good 
taxpayers' money year after year escapes me.
  I would hope we could come back. We recognize that there is a 
problem. Let us solve it in a way that is more than campaign rhetoric. 
Let us solve it with a program that does the job for all Americans 
regardless of their income, and then we can be proud of our work.
  Mr. Speaker, I yield back the balance of my time.
  Mr. HAYWORTH. Mr. Speaker, I yield myself such time as I may consume.

[[Page 13948]]

  Mr. Speaker, I thank you for this debate; and it does point up some 
basic differences that exist between the gentleman from California (Mr. 
Stark) and many of us on the majority side. It is interesting to hear 
the call for nationalized insurance, and certainly that is one 
philosophical point of view that one can offer here.
  I think it is important not to lose sight of our goal. Indeed, this 
House has acted in incremental fashion before to put in place long-term 
care insurance. Indeed, already close to 5.5 million Americans have 
these policies. We expect them to grow in short time to 11.5 million 
Americans. That is a significant portion of our population. And we need 
to offer an opportunity for this to grow even larger because the 
question comes, who will be responsible as our society continues to 
age? Will we see up to 75 percent of funds coming into the government 
dealing with questions of health and old age for the American populace? 
Or commensurate with our national heritage and our primary philosophy 
in this country, does it not make sense to provide for self-
sufficiency? The challenge has been noted. Budgetary restraints have 
kept us from the ideal, but we deal with the real here today.
  While we thank those who, on a bipartisan basis, have offered a long-
term care model, this legislation is substantially less in cost, but 
can have a pronounced impact for working Americans in need of relief of 
long-term care and the ability to take advantage of these policies. 
Mindful of the critiques offered in committee, we reached out in this 
legislation incorporating the consumer protection language offered in a 
previous bill, in H.R. 831, and so we have been mindful of that and we 
will continue to work where we have the ability to expand this further 
as we deal with what may be contemplated in the other body. But, again, 
this is an important step. This House dare not ignore this or spurn 
this because we will send the wrong message to the American people if 
we choose to do this.
  So, Mr. Speaker, I invite you to join me in bipartisan support of 
H.R. 4946; and with this long-term care bill, we can take another 
important step forward.
  Mr. BENTSEN. Mr. Speaker, I rise today in strong support of H.R. 
4946, Improving Access to Long Term Care Act. As an original cosponsor 
of similar legislation, I am pleased that the House of Representatives 
is today considering legislation to improve the lives of long term care 
patients and their families.
  Under this bill, individuals would be permitted to deduct a 
percentage of their long term care expenses depending on their income. 
This income tax deduction would be available for both individuals and 
married couples. Under this bill, individuals and married couples could 
deduct an above-the-line deduction of 25 percent beginning in 2003. 
This deduction would increase to 50 percent of the cost of these plans 
by 2011. In order to protect taxpayers, this tax deduction is limited 
to moderate and low income families. The deduction would be available 
for those individual taxpayers whose adjusted gross income is between 
$20,000 and $40,000 and the deduction would be available for married 
couples whose adjusted gross income is between $40,000 and $80,000 
annually. The value of the deduction would be indexed for inflation so 
that as the cost of these premiums increase, the deduction would also 
increase. The Joint Committee on Taxation has estimated that this 
provision will cost $648 million over five years.
  I strongly believe that we must provide incentives to encourage all 
Americans to purchase long term care insurance plans. Under current 
law, both individuals and married couples can deduct the cost of these 
premiums from their adjusted gross income if these expenses exceed 7.5 
percent of adjusted gross income. As a result of this limitation, many 
Americans do not currently purchase these insurance plans. With the 
average cost of at least $50,000 per year for long term care services, 
many Americans are not financially prepared to pay for the cost of the 
long term care services. As the number of Americans who are reaching 
retirement age climbs, there will be more need to provide such 
coverage. In addition, it is better to encourage Americans to purchase 
long term care plans when they are healthy and younger. Because long 
term insurance plan premiums are risk-based, it is better to encourage 
individuals and families to purchase such insurance when their premiums 
are more affordable.
  Another important provision in this measure would provide a new 
personal tax exemption for home care givers of long term care patients. 
In a time when many families make personal sacrifices in order to keep 
their loved ones at home, we should be helping these families to cope 
with the financial burden for such home-based care. Under the bill, a 
taxpayer who is a care giver for a loved one would be eligible for a 
personal tax exemption of $500 beginning in 2003 and increasing by $500 
every two years until it reaches $2000 in 2010. This tax exemption 
would be available for individuals whose adjusted gross income is less 
than $137,300 and would be available for married couples whose adjusted 
gross income is less than $206,000 annually. In order to encourage all 
Americans to use these exemptions, the cap of these exemptions would be 
repealed in 2010. The Joint Tax Committee estimates that this provision 
will save families $787 million over five years. It is my hope that 
this exemption will help many caregivers who choose to care for their 
families in their own homes, rather than the more expensive 
institution-based care of nursing homes and long term facilities.
  I believe we must encourage families to purchase long term care 
insurance. Without such incentives, the federal government will face a 
crisis in the future as more Americans need long term care services. 
This bill is an important first step in our effort to making long term 
care insurance plans more affordable and accessible.
  Mr. SPRATT. Mr. Speaker, few would question the goals of H.R. 4946. 
Most of us see the need to provide assistance to those burdened by the 
costs of long-term care. However, once again we are approaching an 
issue with fiscal impact in a vacuum, without a plan to guide us.
  Republicans claim that this bill is consistent with their budget 
resolution, because the resolution provided for some tax relief. But 
the House has already adopted tax bills totaling $43.145 billion 
through fiscal year 2007. The 2003 budget resolution provided for only 
$27.853 billion over five years. Attached is a table compiled by the 
House Budget Committee Democratic staff that documents these figures.
  There is no room for these tax cuts under the fiscal plan that is 
supposed to be our guide. Either these tax cuts are not real, and we 
are passing tax bills that will never become law; or the 2003 House 
Republican budget is not real, and we are about to tax cut our way even 
deeper into deficit, and spend even more of the Social Security Trust 
Fund surplus.
  We continue to consider legislation without any coherent Republican 
budget plan. The Republicans claim that their budget provides tight 
fiscal management. But then the Republican leadership again and again 
schedules legislation that violates their own budget.
  Mr. Speaker, as we speak, we are sliding deep into deficit. It is 
time for all of us to sit down together and hammer out a real budget 
that saves Social Security, pays down the debt, and protects national 
priorities.

                                 COSTS OF TAX BILLS PASSED BY THE HOUSE THUS FAR
----------------------------------------------------------------------------------------------------------------
                Title                   2002-2007   2002-2012          Bill No.                   Status
----------------------------------------------------------------------------------------------------------------
Clergy Housing Clarification Act.....      -0.007      -0.033  H.R. 4156...............  Enacted into Law.
Energy Tax Policy Act................      22.759      33.521  H.R. 4..................  Passed the House.
Encouraging Work and Supporting             0.907       0.908  H.R. 4626...............  Passed the House.
 Marriage Act.
Expansion of Adoption Benefits.......       0.000       0.401  H.R. 4800...............  Passed the House.
Holocaust Restitution Tax Fairness          0.000       0.003  H.R. 4823...............  Passed the House.
 Act.
Marriage Penalty Tax Bill............       0.000      42.000  H.R. 4019...............  Passed the House.
Retirement Savings Security Act......       0.000       6.105  H.R. 4931...............  Passed the House.
Armed Forces Tax Fairness Act........       0.069       0.156  H.R. 5063...............  Passed the House.
Pension Security Act.................      10.440      24.615  H.R. 3762...............  Passed the House.
Tax Relief Guarantee Act.............       8.977     373.712  H.R. 586................  Passed the House.
    Grand total......................      43.145     481.388
Concurrent Resolution on the Budget..      27.853        N.A.  H. Con. Res. 353........  .......................
Available............................     -15.292    -481.388
Improving Access to Long-Term Care          1.501       5.487  H.R. 4946...............  On the Floor.
 Act.
----------------------------------------------------------------------------------------------------------------


[[Page 13949]]

  Mr. SHAYS. Mr. Speaker, I rise in strong support of H.R. 4946, the 
Improving Access to Long-Term Care Act.
  H.R. 4946 phases in tax deductions for individuals who pay 50 percent 
of their long-term care costs. The deduction can be used for the 
taxpayer, a spouse or a dependent. The challenge of caring for a loved 
one over years and, in some cases, decades can literally break families 
apart and exhaust a lifetime of savings. Many families do not use 
private long-term care insurance to help protect against financial and 
emotional strain. I am a strong advocate for making private long-term 
care more affordable and support providing incentives--including tax 
deductions--for the purchase of private long-term care insurance.
  Under the current system Medicare doesn't pay for long term care and 
seniors are forced to ``spend down'' their assets to qualify for 
Medicaid, which provides $33 billion in long term care services each 
year. This has serious financial repercussions for retirees and 
taxpayers who pay for long term care assistance through public 
programs.
  As the Baby Boom generation retires, the financial burden will 
consume more of the public resources. In the coming decade, people over 
age 65 will represent up to 20 percent or more of the population, and 
the proportion of the population composed of individuals who are over 
age 85, who are most likely to be in need of long-term care, may double 
or triple.
  I urge my colleagues to vote for this crucial legislation.
  Mr. HAYWORTH. Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Arizona (Mr. Hayworth) that the House suspend the rules 
and pass the bill, H.R. 4946, as amended.
  The question was taken.
  The SPEAKER pro tempore. In the opinion of the Chair, two-thirds of 
those present have voted in the affirmative.
  Mr. HAYWORTH. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX and the 
Chair's prior announcement, further proceedings on this motion will be 
postponed.

                          ____________________