[Congressional Record (Bound Edition), Volume 149 (2003), Part 22]
[Senate]
[Pages 30520-30526]
[From the U.S. Government Publishing Office, www.gpo.gov]




                                MEDICARE

  Mr. DODD. Mr. President, I will take a few minutes and comment on the 
upcoming debate on Medicare. Let me begin by expressing my appreciation 
and my respect for those who have worked on this issue for a great deal 
of time. I have nothing but the highest admiration for my colleagues, 
Senator Baucus, Senator Grassley, Senator Breaux, Senator Kennedy, and 
others who have spent a great deal of time over the last number of 
months trying to put together a proposal to provide Americans with a 
comprehensive prescription drug benefit while not undermining the core 
program of Medicare which has served millions of Americans so well for 
the past 38 years. Whatever other views I may have on this proposal, it 
does not diminish my respect for the efforts they have made to put this 
bill together. I begin on that note.
  Let me state the obvious. I don't know of many other programs that 
have enjoyed as widespread and as deep and profound a degree of support 
in our Nation's history as the Medicare Program. I cannot think of 
another program which has done as much for as many people as Medicare 
has over the past 38 years. When you look back at the statistics of the 
poor in America prior to 1965, without exception, the poorest group of 
Americans were older Americans, our senior citizens. That was, of 
course, because they had left the labor force and to what extent they 
had any coverage at all, it was usually lost upon their retirement. As 
happens when people age, health problems often emerge, people become 
sicker and require more help. America could only watch as parents and 
grandparents got sicker and poorer and faced great difficulty making 
ends meet.
  Through a very extensive and elaborate and lengthy debate, our 
predecessor Congress, both in this body and in the House of 
Representatives, under the leadership of Lyndon Baines Johnson, in 
1964, giants in this body, crafted the Medicare Program. In fact, 
President Johnson went to Missouri, to the home of Harry Truman, who 
had been such a great advocate of universal health care, to sign that 
historic piece of legislation into law. There have been a lot of other 
things we have done over the years, such as Title I of elementary and 
secondary education, that might come close--certainly Social Security--
I suspect if we had to pick two programs this Government has fashioned 
in the 20th century that have meant as much to such a critical part of 
our society, one would certainly have to identify Social Security and 
Medicare.
  It is with that background that I rise this afternoon to express my 
deep concern and worry over what we may be doing in the next few hours 
in a rather hasty manner. That does not mean to suggest that the 
conferees and others who have worked a long time on this have acted in 
haste; although I disagree with their product, I respect the amount of 
time and effort they have put into this. The Presiding Officer and this 
Senator are the only two Members present at this moment, and our 
ability to go through this and to understand what is about to happen in 
the coming days is rather limited.
  Sometime tomorrow, Sunday, or Monday, but certainly no later than 
that, we will be asked to vote up or down on a conference report that 
does something all Members have wanted to do for years--provide a 
prescription drug benefit for older Americans under the Medicare 
program. Knowing, as we all do, that had we been writing the Medicare 
bill in the year 2003 for the very first time, or several years ago, we 
would never have considered a Medicare proposal without the inclusion 
of a prescription drug benefit. But those who wrote the bill in 1964 
were not confronted with the terribly high cost of prescribed 
medicines. At that time, there simply were not that many pharmaceutical 
products out there, so prescription drugs were not as major a factor as 
they are today. The idea of providing basic healthcare services was 
what originally drove Congress to enact the Medicare Program.
  Obviously, the world has changed. So the need for a prescription drug 
benefit today, given the tremendous costs our elderly face every single 
day across this country, where they literally, without any exception at 
all, are forced to make choices about whether or not to take the drugs 
they have been prescribed, to have a meal, or to pare back on their 
prescriptions so as to spread them out over a longer period of time so 
they will not have to go back in and pay for the drugs which they 
cannot afford, in which case they are not getting the full benefit of 
the prescriptions because they are self-medicating themselves, and in 
many cases can do far more harm than not taking a drug at all, as any 
good doctor can tell you--that is the reality today fro millions of our 
senior citizens.
  It is my belief that if we were solely dealing with the prescription 
drug benefit piece of this package, it would pass 98 to 2, maybe 100 to 
0. There is no doubt in my mind that would be the case. If that were 
the only issue before the Senate, that would clearly be the outcome. 
Although I would quickly tell you there are parts of this prescription 
drug benefit that could be drawn far more wisely and far more fairly in 
many ways, I could not argue over the fact that a $400 billion 
appropriation over the next 10 years offered a good start.
  But also just as quickly I would say to my colleagues, if we were 
dealing with the portion of this package dealing with the structural 
reform of Medicare, and they were standing alone just as I suggested a 
moment ago if the prescription drug benefit package were standing 
alone, the parts of this package instituting structural changes to

[[Page 30521]]

Medicare would not get 10 votes. I don't know of many people who would 
support a Medicare package that had the sections this bill does that 
would so dramatically alter Medicare. The only reason it is getting any 
consideration at all is that we have lured people into this on the 
prescription drug benefit aspects of this conference agreement.
  So if you set that aside for a minute and begin to look at the 
structural side of this, and understand how many years it originally 
took to put together the Medicare program, what a difference it has 
made in people's lives--when you consider the tremendous salvation this 
has been to people--and then recognize the direction in which we are 
about to go if this conference agreement is adopted--and I suspect it 
may be--then it will not take long, in my view, when you will find what 
we saw only a few years ago, with the Congress coming back in to 
reverse itself in 2006 or shortly thereafter when the provisions of 
this bill go into place.
  The more you look at the structural side of this particular proposal, 
then the more people are going to be concerned about what they are 
doing. So I applaud those who have worked on the prescription drug side 
of this bill. But I have great concerns about what this conference 
report would do to the foundation of Medicare.
  In June of this year, when S. 1 was before this Senate, I based my 
support for that measure on the belief that it offered a strong, though 
not complete, first step towards ensuring prescription drug coverage 
for America's seniors and strengthening the overall structure of the 
Medicare Program.
  This conference report, I say with deep regret, can now be accurately 
characterized, in my view, as a misguided step down the wrong path. The 
agreement before us today will lead us down the path towards greater 
privatization of Medicare, towards a greater burden on our States 
trying to meet the needs of their own low-income senior citizens, and 
towards an overall weakening of the Medicare Program.
  A very simple way to describe this, as we look at the great success 
the Medicare program has enjoyed over the past 38 years, is to remember 
that this is a universal program. This program says to everybody who 
reaches a certain age, regardless of how healthy you are, or how 
wealthy you are, or how poor you are, or how sick you are, you can 
qualify and be a part of this Medicare Program. We are about to do 
something now that is going to say to those who are wealthier and 
healthier, you can move off into private plans, in which case the only 
ones who will be left within traditional Medicare are those who are 
less wealthy and those who are most sick.
  Now, you do not have to have a Ph.D. in mathematics to understand 
what the outcome will be if this conference report is adopted. If 
Medicare becomes a program of poor, sicker people because wealthier, 
healthier people have left, as I believe they will under this bill, 
then you have just forced either a reduction of benefits or increased 
costs for those under traditional Medicare--those who can least afford 
it.
  There is no other outcome you can draw from that which we are about 
to do. That is the eventual outcome. It fundamentally changes and 
alters the basic concept that was part of the plan passed in 1965--its 
universality.
  The underlying concept of wealthy, healthy people joining with 
poorer, sicker people--being together--has been the cornerstone of this 
tremendously successful program. When you begin to pick off those who 
are wealthier and healthier, for all the obvious reasons, into private 
plans, the sicker and poorer people will be left with either Medicare 
benefits getting cut or premium costs going up. That is the sadly 
predictable outcome of this legislation, Mr. President.
  Medicare is first and foremost a program to protect our Nation's 
seniors from the often insurmountable costs associated with securing 
quality health care services. Prior to its inception in 1965, as I 
mentioned, many seniors--the overwhelming majority, in fact--faced 
abject poverty as a result of skyrocketing health care costs. The 
creation of the Medicare Program provided a critical safety net for 
those seniors and allowed them to retain both their access to quality 
health care, as well as their financial security.
  Earlier this year, and prior to the Senate's consideration of the 
underlying legislation, I had the opportunity to convene a series of 
forums in my home State of Connecticut on health care issues in an 
attempt to frame the scope of this debate for them. At those forums, I 
heard from my constituents on many matters regarding health care. I 
heard from seniors who literally could not afford to fill 
prescriptions--and I know my colleagues have heard the same stories--
called for by their doctors. I heard from elderly Medicare 
beneficiaries forced to choose between purchasing groceries or filling 
their prescriptions. I heard from seniors who were forced to skip 
dosages of their medicines in an attempt to stretch their limited 
supplies of these needed medicines. I heard from Medicare beneficiaries 
requiring more than 10 prescribed medicines a day unable to afford even 
half of those prescriptions.
  Clearly, what I heard from hundreds of my own constituents is their 
grave concern over the present lack of a prescription drug benefit 
under the Medicare Program.
  When Medicare was first enacted, few could have envisioned the 
tremendous costs associated with prescription medicines. However, it is 
the great need for prescription drug coverage under Medicare that was 
firmly behind my initial support for S. 1. Sadly, however, the 
conference report before us simply does not go anywhere near far enough 
to provide sufficient coverage for prescription medicines for the great 
majority of Medicare beneficiaries. That said, we cannot turn our backs 
on what this bill would do for Medicare beneficiaries with severely 
limited incomes. This bill says, if you make under $13,470, 
representing 150 percent of the federal poverty level, then you will 
get real help under this bill. But if you make anything more than 
$13,470, which is what two-thirds of our seniors citizens do, then you 
are going to be offered little in the way of help under ths bill. That 
is why it is my belief the prescription drug benefit aspect of this 
bill should be greatly strengthened.
  But I believe for most seniors that it is terribly unrealistic to 
suggest that someone making more than $13,470 can somehow manage to 
afford the cost of their prescription medicines, particularly if they 
have costs that would push their spending into the bill's gap in 
coverage, or donut hole, as it is often described. But, nonetheless, 
that is the direction we are going with this conference agreement.
  The emerging bill contains a gap, as I mentioned, of more than 
$2,800, twice the size, by the way, contained in the Senate-passed 
legislation. Under this conference agreement, Medicare beneficiaries 
with costs within this so-called donut hole will be forced to pay for 
the full cost of their prescribed medicines as well as the monthly 
premium of an estimated $35--and I stress the word ``estimated''; I 
will get to that in a minute--and receive absolutely no financial 
assistance whatsoever.
  Only 4 percent of seniors in the country make over $80,000 a year. 
Two-thirds of seniors make somewhere above $13,470. The idea that 
somehow people are going to have enough money, as a senior, trying to 
pay a home mortgage or pay whatever obligations they have, not to 
mention food and other things, and also be able to pick up as much as 
$2,800 a year for prescription drugs, is, I think, terribly 
unrealistic.
  This bill would require Medicare to move dangerously toward 
privatization, which is what I want to get back to, because it is the 
side of this bill calling for structural change to the Medicare program 
that causes me the greatest concern and greatest worry, and undermines 
this incredibly fine program. I can't tell you how disappointed I am in 
the AARP for endorsing this conference agreement. I truly wish that 
AARP's affiliates across the country had been heard on this issue 
before their national leadership decided that they would support this 
bill and disregard the 38 years of

[[Page 30522]]

history when it comes to Medicare and the millions of people who have 
greatly benefitted from its coverage.
  As one who has witnessed firsthand the tumult and confusion created 
by Medicare+Choice organizations entering and then quickly withdrawing 
from communities in my home State of Connecticut, I can say assuredly 
to my colleagues here today that this would establish a dangerous 
precedent that may very well lead to the devolution of the Medicare 
Program as we know it.
  Also of great concern to me is the effect this legislation will have 
on employers that have already provided their retirees with 
prescription drug coverage. In my State of Connecticut, more than 
225,000 Medicare beneficiaries, fully one-third of my State's senior 
citizens, receive coverage for their prescribed medicines from their 
former employers. Under this bill, about 40,000 of those elderly will 
lose this coverage as a result of employers dropping their prescription 
drug plans.
  I don't know the numbers in every other State, but if 40,000 of my 
225,000 beneficiaries presently with prescription drug plans from their 
former employers are going to be dropped from their prescription drug 
programs, how many in other States are going to be? Where do the States 
of other Senators fall in this category?
  I additionally have another 74,000 people in my State--and I 
represent a small State with a little more than 3.5 million people--who 
qualify for both Medicare and Medicaid. These beneficiaries--and there 
are 6.4 million of them across the country that are eligible for both 
Medicare and Medicaid--will face increased prescription drug costs 
under the underlying bill. There will be a significant cost increase 
for those people who fall within both Medicare and Medicaid if this 
conference report is adopted. So even before we start talking about 
what will happen in the year 2010 and down the road under this bill, 
Mr. President, we are going to witness significant numbers of people 
lose their present coverage or be forced to withstand both higher costs 
and diminished benefits.
  Also very troubling to this Senator in the underlying conference 
agreement is its unqualified support for private for-profit insurers at 
the expense of traditional fee-for-service programs. Particularly 
disturbing are the provisions securing $12 billion to be solely 
reserved for these private insurers in order to entice them to enter 
the Medicare market. Twelve billion dollars is going to the private 
companies, just so they can compete against the traditional Medicare 
program. They are calling this competition. Back in the Roman Empire, 
they had a competition like that. You would go to the forum and on one 
side were the lions. Under this bill is a similar situation, private 
insurers will get $12 billion to compete, but Medicare will not get 
anything. Under this bill, we are going to cap Medicare spending and 
then say: Go out and compete against enriched private plans.
  I was born at night, Mr. President, but not last night. I know and 
most other people know, without a great deal more knowledge about this, 
that if you provide $12 billion, as this bill does, to private 
companies to go out and compete against a company that doesn't get that 
kind of help, do you know who is going to win that competition? I 
wonder. I wonder what the outcome will be there. Yet that is what this 
bill does. Twelve billion dollars reserved for private insurers in 
order to entice them to enter the Medicare market. The inclusion of 
this provision truly represents a solution in need of a problem, Mr. 
President. Traditional Medicare already serves 89 percent of all 
Medicare beneficiaries and the addition of $12 billion to entice 
private plan participation is wholly unwarranted and unnecessary.
  In fact, this bill will also prohibit the Medicare program from going 
out and forming a consortium to drive down the cost of prescription 
drugs. Under this bill, you are violating the law if you go out and do 
that. While we are going to provide $12 billion instead to others to 
allow them to compete with Medicare, we will not allow Medicare itself 
to go out and lobby or negotiate to lower the costs of prescription 
medicines. The traditional Medicare Program is a proven success and 
would be better served if this valuable funding of $12 billion were 
directed toward further strengthening its foundation.
  Lastly, the conference agreement before us today establishes the 
dangerous precedent of instituting so-called cost containment measures 
that could directly lead to severe cuts in what Medicare covers and 
just as severe increases in the costs Medicare beneficiaries will be 
forced to bear. Very specifically, the conference report calls on the 
Congress and the administration to address Medicare's costs when 
general revenue spending on Medicare reaches 45 percent of the 
program's total cost.
  Can anyone cite for me any other Federal agency where that kind of 
provision has been imposed? There is not one--not one. Yet this bill 
goes out and places this kind of a restraint on Medicare, and on no 
other part of our Government do we do it, only on Medicare. It is my 
belief that the adoption of this purely arbitrary cap, which you will 
find nowhere else, will lead to almost certain erosion of critical 
programs, scope of coverage, and affordability.
  Today, nearly 40 years after Medicare's inception, we find ourselves 
at a crossroads. I can truly say that I am somewhat stunned that we are 
about to make a decision on a program that has worked so well for so 
long within a matter of hours here, without any of us fully 
understanding--at least most don't seem to understand--the implications 
of what we are about to do. How could you take a program that has 
worked so well for so many people and, in the waning days of a session, 
with just a few hours remaining, get up and ask the Congress to do what 
we are about to do here? I don't understand how we could allow this to 
happen. We are on the cusp of fundamentally altering a program that has 
worked so well for this nation's elderly and most frail citizens.
  Again, Mr. President, we find ourselves at a crossroads. The 
opportunity is before us to move Medicare toward the future without 
threatening its proven availability to provide for the health and well-
being of our Nation's senior citizens. Sadly, however, this conference 
agreement before us represents an opportunity lost, an opportunity not 
only to add comprehensive coverage for prescribed medicines under the 
Medicare Program, which would have been a great success story, but also 
an opportunity to strengthen the Medicare Program for future 
generations.
  So it is with great sadness that I find myself, only months after 
originally supporting the underlying legislation when it was first 
considered by the Senate earlier this year, now having to oppose this 
conference agreement in its current form. Under the guise of providing 
needed prescription drug coverage under the Medicare Program, this 
conference agreement falls far short of addressing this need for the 
great majority of our Nation's nearly 41 million Medicare 
beneficiaries.
  Forty-one million Americans take note. Over the weekend, in the next 
72 hours, a program that has served you for 40 years, serving more than 
40 million people presently, is going to be fundamentally altered 
unless this body, and only this body, stands up and says: Stop. Go 
back. Let's rethink this before we go out and make the kind of changes 
that are being proposed in this legislation.
  While there have been numerous articles and commentaries written 
about this plan over the last number of days, people trying to attract 
attention, numerous editorial comments that I have found tremendously 
compelling, I come back to the basic point that this is dangerous 
policy. I put my colleagues on notice; I tell you this will happen.
  In the Senate passed bill, which, again, I supported, in order to 
receive prescription drug coverage, there had to be two drug-only 
providers available. However, this conference agreement calls for only 
one of these plans and an HMO. This is a fundamental change. Let me 
describe what this can mean in the clearest terms I have seen written 
about this.

[[Page 30523]]

  Under the conference report, we have now learned that the Medicare 
guaranteed fallback is only triggered if a senior does not have a 
choice of two private plans, one of which can be an HMO. Again, that 
was not in the Senate bill and it is in the conference report before 
us.
  In order to receive prescription drug coverage under this bill you 
have two choices: One, you can choose traditional Medicare and receive 
no prescription drug coverage. Two, you can choose to keep traditional 
Medicare and purchase a drug-only plan. The problem is that there is no 
limit on the monthly premiums these drug-only plans can charge. When 
you hear about the $35 cost of premiums for these plans, you must 
remember that this is only an estimate. If there is only one provider 
of the drug-only plan in your area--and that is all there has to be 
under this bill the monthly premium could be $100 or more. Nothing in 
this bill caps what the premium should be on a monthly basis for the 
drug coverage. That is what the offer is under this bill.
  In other words, it will be permissible for only one insurer to offer 
the new Medicare drug benefit and charge whatever premium they desire, 
as long as there is also an HMO option in the area. This type of 
arrangement strategically avoids the protection of a traditional 
Medicare fallback benefit from being made available to seniors. As a 
result, seniors in these regions, many of which will be rural areas, 
will be financially forced into HMOs just to obtain an affordable drug 
benefit. In the meantime, they will lose their choice of doctors.
  Does this sound familiar? Earlier this year, President Bush and his 
administration made clear that he wanted to reform Medicare by 
providing a prescription drug benefit, but only to those seniors who 
were willing to go into a private insurance plan and HMOs. This 
compromise has been designed to help achieve that goal.
  So that it is further understood, it is important to note that the 
Senate required that there be at least two private stand-alone options 
for Medicare beneficiaries. This would have ensured that there would at 
least be competition for premiums for the new stand-alone drug benefit. 
Some have argued that the competition between the drug-only plan and an 
HMO or PPO will force down the premium of the drug-only plan. The fact 
is, drug-only plans cannot compete on an even playing field with PPOs 
or HMOs. This is because HMOs and PPOs are provided additional 
subsidies under this bill and, by definition, offer a wide variety of 
services that give these plans a competitive advantage over the stand-
alone drug plans. Any losses on the drug side can be offset by gains on 
the medical side, in a sense.
  This is yet another example of how all financial incentives are 
designed to advantage the private HMOs and PPOs over traditional 
Medicare. People need to understand the fundamental changes in this 
bill that will greatly alter the very structure of the Medicare 
program.
  I have taken a lot of time this afternoon, Mr. President, and I 
apologize to my colleagues. But I feel very strongly about this 
critically important issue. Last week in this body we had a filibuster 
that went on for 4 days because people were upset over the nomination 
of 4 judges. I contend that perhaps there ought to be a filibuster on 
this legislation as nearly 41 million Medicare beneficiaries are going 
to be adversely affected if this legislation is adopted by this body.
  Here we are toady, Mr. President, down to the waning few hours of the 
session, and we are about to consider fundamentally altering and 
setting back Medicare for years to come. When the roll is called on 
this, I will vote no. I will seek other options between now and then to 
see if there is a way to delay consideration of this until we have more 
time to examine more fully the implications of this bill. Under the 
guise of providing needed prescription drug coverage under Medicare, 
the conference agreement before us today offers far too little coverage 
for the great majority of Medicare beneficiaries, while at the same 
time institutes structural reforms to the underlying Medicare program 
that will significantly weaken its ability to provide for the health 
and well being of our nation's senior citizens. It should be soundly 
rejected. I thank my colleagues and I yield the floor.
  The PRESIDING OFFICER (Mrs. Dole). The Senator from Iowa is 
recognized.
  Mr. GRASSLEY. Madam President, I didn't interrupt the Senator from 
Connecticut, so I hope my colleagues will let me give my remarks in 
rebuttal unhindered by any other obstacles.
  It is about time that we pass a prescription drug bill for Medicare. 
It is about time that we strengthen and improve Medicare, as we have 
been telling the voters for three elections.
  In the 2000 election, it was an issue. It was an issue on the floor 
of the Senate last summer. It didn't pass last summer because the other 
party in this body wanted an issue for the election coming up last 
fall. The leader of the other party took it away from his own chairman 
of the committee, so there could not be a bipartisan bill put together.
  In the Senate, nothing gets done that is not done in a bipartisan 
way. Maybe a lot of people don't like that about the Senate, but it has 
been that way for 214 years, and our country has functioned well. This 
is the only body in our political system where minority interests are 
protected. We are going to have broad, bipartisan support for this 
bill, and we are going to pass it because when Republicans won the last 
election, we won it because there were a lot of things buried in this 
body by the leadership of the other party because they wanted issues 
for that election and because they thought they would increase their 
strength in this body and get more of what they wanted this year than 
last year.
  But they miscalculated. The people of this country put the 
Republicans in charge of this body. But they didn't put the Republicans 
in charge of this body to do things just in a partisan way because we 
in the majority party know that nothing gets done here that doesn't 
have some bipartisanship with it.
  As chairman of the committee of jurisdiction over Medicare, taxes, 
international trade, and a lot of other social programs, I have the 
privilege of having a good working relationship with the former 
chairman of this committee, now the ranking Democrat, Senator Baucus. 
We started out on Medicare prescription drugs, like we did on some 
other issues this year, to put together a bipartisan approach so that 
we could deliver on the promises of the last several elections--not 
just the last election, but the last several elections. Both political 
parties have been saying that we are going to strengthen and improve 
Medicare, and one of those strengthenings and improvements is going to 
be a universal and comprehensive and voluntary prescription drug 
program.
  We are about to deliver on it, and people on the other side don't 
like it because they had an opportunity and they lost that opportunity 
because they wanted to do something in a partisan way. Previous 
speakers on the other side have raised this point about the AARP 
backing this plan. They are saying they are caving in to political 
pressure.
  It seems as though, as far as the other side is concerned, the only 
time the AARP is political, in the eyes of the Democratic Party, is 
when AARP agrees with the Republican Party.
  Senator Baucus and I have been working together, and we will bring to 
the Senate, after the House passes it tonight, a bipartisan, bicameral 
compromise out of conference, which will deliver on the promises of the 
last three elections. We are even going to deliver on the promise of 
the Democratic Party, where they were going to provide prescription 
drugs for seniors. The only thing I can think is that they regret it. 
They had an opportunity a year ago, when they were in the majority and 
when our President wanted to work with them, to do it, and they didn't 
take advantage of it.
  I want to speak about this product that we have before us. It was 
just yesterday, after 4 months of conferencing,

[[Page 30524]]

that the conferees agreed to a bipartisan breakthrough on a conference 
report that will make comprehensive prescription drug coverage a 
reality for our 40 million Medicare beneficiaries, both seniors and 
disabled. After 4 months of hard work, the conferees approved a 
sweeping package of new prescription drug benefits and other program 
improvements that makes good on our commitment to our seniors.
  I am urging all my colleagues to support it. Since 1965, seniors have 
had health insurance without prescription drugs. By reaching agreement 
yesterday, the conferees came one step closer to changing that. The 
Senate can make history by improving this compromise report.
  This important breakthrough came because of the tireless work of our 
committee members, both Democrats and Republicans, over the last 5 
years. Senators Frist and Breaux led the way on prescription drugs 
before any of us were listening. Senators Snowe, Hatch, and Jeffords, 
along with Senator Breaux and this Senator, carried the torch as 
members of the Finance Committee, but also because we wanted to do 
things in a bipartisan way. We even called that a ``tripartisan way'' 
because Senator Jeffords lists himself not as a Republican or Democrat 
but as an Independent. That is an effort we have exceeded in the bill, 
but it was an effort that somewhat blazed the trail to where we are 
today, and I am glad to have been a part of it.
  Finally, this breakthrough came because of the President's unyielding 
commitment to getting something done for seniors once and for all. Last 
December 10, I had an opportunity to meet with the President, as he 
knew I was going to be the new chairman of the Senate Finance Committee 
after the Republicans had won control of the Senate. We, in fact, had 
that meeting, anticipating all this time we had to work to get ready, a 
long time before Congress even convened. At that meeting, the President 
said two things that I remember. I did not take notes, but I remember 
very well that he was willing to commit political capital to this 
effort and that he was willing to put money in his budget for that 
effort.
  The President delivered on both of those statements because his 
budget put $400 billion in over 10 years for this bill. That is exactly 
what we in the Senate wanted. We approved that last March. By June, the 
Senate Finance Committee had reported out a strong bipartisan bill by a 
vote of 15 to 6, building upon the agreement with the President and the 
agreement of the Senate for $400 billion for the budget.
  The Senate, as you know, passed S. 1 on strong bipartisan grounds in 
June. The other body passed a similar bill, H.R. 1, that same night. I 
believe the committee report is measurably better than either S. 1 or 
the House bill, H.R. 1. It contains improvements, refinements, and 
changes that are better for seniors and better for the doctors and the 
hospitals that serve them.
  We have come a very long way in getting to this point, and I am proud 
of where we have ended up. I will do everything I can to ensure 
successful passage of this conference report over the next few days.
  Of course, the conference report can't and won't be all things to all 
people. Like any compromise, no one is left perfectly happy. That 
probably means that the conference committee came out just about at the 
right place. I urge all my colleagues to go beyond the perfect and to 
focus on the good that the conference agreement accomplishes.
  The greatest good at the heart of this conference report is a 
comprehensive prescription drug benefit that will give immediate 
assistance starting next year and continuing as a permanent part of 
Medicare to every senior. Not only is it comprehensive, it is 
universal, and if nobody wants to participate in it, they don't have 
to. It is voluntary as well.
  The conference report provides affordable comprehensive prescription 
drug coverage on a voluntary basis to every senior in America. The 
coverage is stable, it is predictable, and it is secure. Most 
importantly, the value of the coverage does not vary based on where you 
live and whether you have decided to join a private health plan. For 
Iowans and others in rural America who have been left behind by most 
Medicare private health plans, this is an important accomplishment that 
I insisted on way back as early as January of this year. I haven't 
budged on that commitment and that protection is in this conference 
agreement.
  Overall, the conference agreement relies on the best of the private 
sector to deliver drug coverage, supported by the best of the public 
sector to secure consumer protection and important patient rights. This 
combination of public and private resources is what stabilizes the 
benefit and helps keep costs down.
  Keeping costs down is essential not just for seniors but for the 
program as a whole. Throughout this bill, we have targeted our 
resources very carefully, giving additional help to the poorest of our 
seniors. Consistent with the policy of targeted policymaking, we have 
worked hard to keep existing sources of prescription drug coverage, 
such as employer-sponsored benefits, and to do it in a viable way.
  This conference agreement goes great distances to keep employers in 
the game providing drug coverage, as they do now, to their retirees 
under those plans that were promised to people after retiring from 
their employment.
  We all worried very much when we passed this bill in June that, as 
CBO scored our Senate bill, it might cause 37 percent of the 
corporations to drop their employees on the Government plan. The House 
bill had a 32-percent drop rate, according to the Congressional Budget 
Office. As a result of the conference activity and what we have done to 
shore up existing retiree plans, that percentage is now much less than 
20 percent due to the substantial investment made by conferees to 
ensure that employers can continue offering the good coverage they have 
for a long period of time.
  The conference report includes additional subsidies. It also includes 
regulatory flexibility that will do much more to help, rather than 
threaten, employer-sponsored coverage for those who currently receive 
it.
  Still, we all must acknowledge that decisions about scaling back 
coverage or dropping it altogether are bound to be made regardless of 
whether we pass this conference report. But I am confident that the 
balanced policies before us are a very good deal for employers and 
their retirees.
  I want to make it very clear to people listening who might be 
worrying about corporation retirees losing their health coverage 
because of something we are doing here, we are doing our darndest to 
supplement these plans and to give regulatory flexibility so these 
plans are not dropped. But Congress cannot pass a law that says 
corporation X, Y, or Z, some day, if they decide they want to dump 
them, might be dumped. That could be happening in some corporation in 
America today. This law is not even on the books. That happened in my 
State earlier this year and last year and the year before, not because 
Congress was talking but just because that was the policy of that 
corporation. It is something they felt they couldn't afford any longer, 
and they did it.
  That could happen even after we pass this legislation, but where 
would we be if we didn't pass this legislation? The 35 percent of the 
seniors today who have no coverage whatsoever, and probably never have 
had it in retirement, will still not have drug coverage. Also, the 
corporations that dump their plans might not have anything either. By 
passing this legislation, even considering all the resources--about 20 
percent of this legislation contains resources for these corporations 
to keep their plans--if they would drop them, at least these people 
have something on which to fall back.
  I would think that is a better situation than the uncertainty of, Is 
my corporation going to dump me or are they not going to dump me?
  If they are dumped, then they have zilch, unless they want to buy an 
expensive Medigap policy or something like that. So we are trying to 
have a safety net for all seniors, and we are trying to do it in a way 
that is very

[[Page 30525]]

helpful. So I want to make that very clear. We cannot force 
corporations--never could and never will be able to--to say they have 
to provide health care coverage and prescription drug coverage for 
their retirees. But we do have a plan that is very good for people who 
do not have prescription drugs or people who might have prescription 
drugs today but tomorrow might not have it. This is a safety net and a 
darn good safety net.
  Beyond just prescription drugs, the conference report is a milestone 
accomplishment for improving traditional Medicare, especially in rural 
America. The conference report includes the best rural improvement in 
the Medicare equity package that Congress has ever passed. The rural 
health care safety net is coming apart in rural areas. It is difficult 
to recruit doctors to rural areas because of low reimbursement. The 
conference report begins to mend that safety net.
  As many in this Chamber know, hospitals, home health agencies, and 
ambulance companies in rural America lose money on every Medicare 
patient they see. Rural physicians are penalized by bureaucratic 
formulas that reduce payments below those of their urban counterparts 
for the same service. The conference report takes historic steps toward 
correcting geographic disparities that penalize rural health care 
providers. Providers in rural States such as Iowa practice some of the 
lowest cost, highest quality medicine in America. This is widely 
understood by researchers, academics, and citizens of those States, but 
not by Medicare.
  Medicare instead rewards providers in high-cost, inefficient States 
with bigger payments that have the perverse effect of incentivizing 
overutilization of services and poor quality. This is very noted in my 
State.
  The Des Moines Register has been very clear in informing the people 
of my State that Iowa is 50th in reimbursement in Medicare on a per 
beneficiary basis over a year, 50th of the 50 States, but yet under 
indices we are fifth or sixth in quality of care.
  Over at the other end, there is Louisiana, No. 1 in reimbursement, 
about $7,000 per beneficiary per year compared to about $3,400 for 
Iowa, the lowest of the 50 States. More money to be spent on Medicare 
for seniors' medical care does not guarantee quality of care because 
Louisiana is listed 50th in quality of care. So we want to make sure 
that where one is getting high-quality delivery of health care, there 
is reimbursement that takes that into consideration. So the conference 
report begins to reverse that trend.
  It also includes long overdue pilot programs that will test the 
concept of paying for performance and making bonus payments for high-
quality health care. This benefits taxpayers and, most of all, 
patients.
  Beyond prescription drugs and beyond rural health care, the 
conference report goes at great length to give better benefits and more 
choices--the right to choose is very basic in this bill--available to 
our seniors. It specifically authorizes preferred provider 
organizations--we call them PPOs--to participate in Medicare, something 
the current law does not fully allow. The idea is that these kinds of 
lightly managed care plans more closely resemble the kinds of plans 
that we in the Federal Government have and close to 50 percent of 
working Americans have. Baby boomers then, when they go into 
retirement, will be able to compare fee-for-service 1965 model Medicare 
with these new PPOs. I think they are going to find new PPOs closer to 
what they had in the workplace than traditional Medicare, but they have 
the right to choose. We think they ought to have that right, too, 
because traditional Medicare has not kept up with changes in the 
practice of medicine like the private health plans employees have in 
the workplace.
  PPOs have the advantage of offering the same benefits of traditional 
Medicare, including prescription drugs, but they do that on an 
integrated, coordinated basis. So this creates new opportunities for 
chronic disease management and access to innovative new therapies. 
Unlike Medicare+Choice, we set up a regional system where plans will 
bid in a way that does not allow them to choose the most profitable 
cities and towns. They cannot do cherry-picking. Systems like this work 
well for Federal employees such as the postmaster in my hometown of New 
Hartford, IA. He has a choice of several plans. We want to give that 
same choice to his parents, who today have only Medicare and nothing 
else.
  Are PPOs right for everyone? It is the right to choose that is 
important about this bill. Let the seniors decide. Our bill sets up a 
playing field for PPOs to compete for beneficiaries. We believe PPOs 
can be competitive and offer a stronger, more enhanced benefit than 
traditional Medicare. But let me be clear, no senior has to choose 
PPOs. My policy has been to let seniors keep what they have, if they 
like it, with no change. All seniors, regardless of whether they choose 
a PPO, can still get prescription drugs. They do not have to choose 
that, but they can choose that as an add-on to traditional Medicare if 
they want.
  So I hope I have protected all of my colleagues, and maybe my 
colleagues do not need any protection, insisting on the voluntariness 
of this and the right to choose. I think it is pretty essential for 
people who are older, who do not want change in their life, not to have 
to make a change in their life.
  I fear maybe, as the Senator from Iowa, that somebody is going to 
come up to me someday and say: Grassley, just leave my Medicare alone.
  They do not follow Congress closely, but they read here and there and 
they get nervous: What Senator is taking away their Medicare? I can say 
to Mary Smith in Columbus Junction, IA: You do not have to worry about 
anything. If you are satisfied with the Medicare you have, you can keep 
it. If you want to join a prescription drug program to add to it, you 
can do that, but you do not have to worry about Medicare. If you like 
it the way it has been all your life, we are leaving it alone.
  I think that sounds like protection for Senator Grassley, but I am 
concerned about the cynicism my seniors have about Government, maybe 
because they do not study it as much as we do or understand it as much 
as we do. I want to reduce that cynicism, but I want them to have 
confidence in their Medicare as well. I think this right to choose 
gives them that confidence.
  The conference report also includes other important policies that I 
believe make a much stronger, better bill. First, we make wealthier 
people pay a slightly higher premium. Why should someone who makes 
$80,000 a year or more pay exactly the same price for coverage as 
someone who makes $30,000 a year? The conference report makes wealthy 
seniors pay slightly more, and this is a very important and rational 
step toward stabilizing Medicare's growth.
  The conference report also injects new and transparent accountancy 
rules into Medicare, making the trustees show in a comprehensive way 
what all of Medicare's assets and liabilities truly are. There are also 
expedited procedures for committee consideration of legislation that 
addresses any future Medicare funding crisis without changing the 
Senate rules.
  Finally, and in my view most importantly, the conference agreement 
authorizes health savings accounts. I have been a long-time supporter 
of medical savings accounts. Now they are going to be called health 
savings accounts. Such tax-favored accounts encourage responsible 
utilization of health care services. They offer low-cost insurance to 
farmers and other self-employed people. For too long, medical savings 
accounts have languished under regulatory inflexibility. The provisions 
in the conference report go to great length to make medical savings 
accounts a stronger, more accessible option for more Americans, and I 
think that is very appropriate because it adds to the right to choose.
  We are in a unique moment in our history as far as health insurance 
legislation is concerned. We have a limited opportunity to deliver on 
our promises to get this done once and for all.
  Let me remind everyone, there is $400 billion sitting in front of 
America's seniors. If we let partisan disagreement prevent us from 
snatching it up for them, shame on us because, what do

[[Page 30526]]

you think the chances are next March of this Senate adopting a budget 
with $400 billion set aside for Medicare? I think the chances of that 
happening are not very good.
  Let's not allow the perfect to be the enemy of the good. I urge my 
colleagues to continue in the bipartisan tradition of the Finance 
Committee and deliver a balanced bipartisan product that does right by 
our seniors.
  I yield the floor. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Ms. COLLINS. Madam President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER (Mrs. Dole). Without objection, it is so 
ordered.

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