[Congressional Record (Bound Edition), Volume 150 (2004), Part 4]
[House]
[Pages 4409-4414]
[From the U.S. Government Publishing Office, www.gpo.gov]




              THE TRAGEDY IN SPAIN AND HEALTH CARE REFORM

  The SPEAKER pro tempore (Mr. Kline). Under the Speaker's announced 
policy of January 7, 2003, the gentleman from Texas (Mr. Burgess) is 
recognized for 60 minutes as the designee of the majority leader.
  Mr. BURGESS. Mr. Speaker, I too want to touch on a variety of 
subjects tonight. There are so many things that are before this body 
and before the country, and I think it is important to speak out about 
a number of them.
  The first thing, Mr. Speaker, that is on my mind, of course, is the 
terrible tragedy that happened in Spain last week. And in the sad 
aftermath of the bombings in Madrid, unfortunately we see coming from 
that some sort of new strategy to deal with the war on terror and it is 
a most unwelcome strategy. This is a strategy of capitulation and of 
compromise. It is a strategy, in short, of surrender. In that 
surrender, what do we give up? We give up security, we give up our 
beliefs, and we give up our values.
  Mr. Speaker, I am here tonight to say that ``Appeasement does not 
bring peace.'' Just ask Neville Chamberlain. ``Compromise with hate 
will not work.'' Remember Joseph Stalin?
  Mr. Speaker, these terrorists are not seeking peace. They seek to 
terrorize. Their desire is to bring ruin and disruption into people's 
lives. They want control, but we must stand firm.
  The war on terrorism was brought to this country in September of 
2001. Our President, George Bush, responded to that act of war in an 
address to this House with these wise words: ``The pictures of 
airplanes flying into buildings, fires burning, huge structures 
collapsing, have filled us with disbelief, terrible sadness, and a 
quiet unyielding anger. These acts of mass murder were intended to 
frighten our Nation into chaos and retreat, but they have failed. Our 
country is strong. A great people has been moved to defend a great 
Nation. Terrorist attacks can shake the foundation of our largest 
buildings, but they cannot touch the foundation of America. These acts 
shattered steel, but they cannot dent the steel of American resolve. 
America was targeted for attack because we are the brightest beacon for 
freedom and opportunity in the world, and no one will keep that light 
from shining.'' President George Bush, September 2001.
  Mr. Speaker, I, like everyone else in this House, was greatly 
saddened by the attacks in Spain. It is a mournful time for the people 
of Spain and for all of Europe as they bury their dead. But in the 
midst of this sorrow a more menacing problem is evolving. People are 
blaming the war on terrorism for causing the attack, and using this as 
a reason to vote out a strong ally in this war. In fact, I would remind 
the Speaker that Prime Minister Aznar was in this House and spoke to 
the House and Senate just a scant 5 weeks ago and received standing 
ovation after standing ovation in this House at the time he delivered 
his address.
  In voting out the strong ally in the war on terror, the people of 
Spain have actually handed over their government that will now shrink 
in the face of terrorism. The Spanish voters have handed to the 
terrorists their largest victory to date. No doubt the terrorists will 
feel emboldened. They feel victorious. They were able to cause chaos 
and disrupt an entire government. Is this the signal we wish to send 
the terrorists? Is this the type of behavior that we would seek to 
reward?
  Quoting an editorial today in The Washington Post; ``The rash 
response by Jose Rodriguez Zapatero, Prime Minister Elect, will 
probably convince the extremists that they are able to sway Spanish 
policy with mass murder, and they succeeded brilliantly.''
  Make no mistake, Mr. Speaker, we are winning this war. And, in fact, 
an article from my hometown paper, the Dallas Morning News, today 
stated, ``The Prime Minister of the Netherlands found that it was 
important in the international community that we stand shoulder to 
shoulder and show solidarity to fight against these terrible attacks. 
We share that same goal.''
  Mr. Speaker, last month, I was in Pakistan with part of a 
congressional delegation of the Committee on Government Reform and 
President Pervez Musharraf spoke to our group. Speaking to Members of 
Congress, he said, and I quote, ``The United States and this 
administration represents truly the last best chance for peace in this 
troubled region.'' Indeed, Mr. Speaker, that is correct.
  Both Iraq and Afghanistan have been freed from brutal totalitarian 
regimes. Both countries are now functioning under their interim 
constitutions, and both will soon hold free elections. America is 
winning the war on terrorism. This is no time for our resolve to 
weaken. This is no time for the leaders, or those who would be leaders 
on our national stage, to exhibit capitulation with the enemy.
  Mr. Speaker, we have heard a great deal about health care on the 
floor of the House tonight, and I feel obligated to speak to that as 
well. Some of the comments that were just offered by the gentleman from 
Michigan particularly deserve and, in fact, demand a response. His 
vision for the country being under a single-payer, government-run 
system is one that, quite frankly, causes me to shudder. I cannot 
imagine giving up that degree of control over my life or my family's 
life to the Federal Government.
  Mr. Speaker, I think back to a time last summer when I was visiting 
in Iraq and got to see their health care system. They have been under a 
single-payer, government-run system for 20 or 30 years, and the state 
of their health care system was below pitiful. So that does not seem to 
me to be a valid solution to health care in this country.
  Mr. Speaker, we passed some pretty major health care legislation back 
at the end of last year, in November, H.R. 1, the Medicare Prescription 
Drug and Modernization Act. On December 8, 2003, our President, George 
W. Bush, signed into law H.R. 1. This bill will institute sweeping new 
changes into the Medicare program, extending prescription drug coverage 
for the first time ever, and improving the program in ways that will 
make America's health care system healthier, stronger, and happier.
  The United States House of Representatives approved H.R. 1 November 
22, 2003. The vote was 220 to 215. The United States Senate approved 
the bill by a vote of 54-44 on November 25, 2003. When the bill came 
before the United States House of Representatives for a vote, I, along 
with 220 Members of the House, voted in favor of this measure.
  Mr. Speaker, we all know no bill is perfect, but there were several 
important provisions included in the bill that will dramatically 
improve the Medicare program and seniors' health. And just as 
importantly, as we have also heard tonight from the gentleman from New 
Hampshire, there were other provisions in this bill that will improve 
health care in general for generations to come.
  In regards to immediate assistance. Starting this summer, seniors 
will have access to a Medicare drug discount card that will provide 
discounts of up to 25 percent of their drug costs. Low-income seniors 
will have additional assistance through the discount card program, 
having an additional $600 annual supplemental along with their discount 
cards.
  The Medicare prescription drug coverage. For the first time since the 
creation of the Medicare program, prescription drug coverage will be 
available to all seniors covered by the program. Under the program, 
which will go into effect in the year 2006, a majority of seniors will 
see dramatic reductions in their drug spending. For a $35 monthly 
premium and a $250 annual deduction, Medicare will pay 75 percent of 
the prescription drug costs up to $2,250. Seniors are responsible for 
costs between $2,251 up to $3,600. When annual drug spending reaches 
$3,600 a year, Medicare pays 95 percent of all drug costs after that 
point. Low-income seniors will be covered by an even more extensive 
drug benefit with little or no cost-sharing on the part of the

[[Page 4410]]

beneficiary and total coverage for all yearly drug costs.
  The bill itself has several provisions that will speed market entry 
of cheaper generic drugs. Key reforms to the Hatch-Waxman Act, the 
Federal law governing generic drug introduction, will provide brand 
name manufacturers only one 30-day stay for generic production once the 
patent expires.
  Another way the bill establishes for realistic market controls to 
drug pricing is by reforming the average wholesale price structure. 
This price structure is reported by drug manufacturers and rarely has 
any relation to what physicians actually pay for drugs. Without reform, 
overpayment, due to the average wholesale price, could reach into 
millions of dollars.
  Protecting retiree health benefit plans. A major concern of mine as 
Congress considered this bill is how it would treat retiree health 
plans. Several of my constituents expressed their deep concerns that 
with the creation of a new Medicare benefit that their company would 
drop their retiree health plan. I shared their concern, and I worked 
with the conference committee members to ensure that the bill did 
protect retiree health plans.
  The bill will support 28 percent of a retiree's drug costs between 
$250 and $5,000. That is equal to nearly two-thirds of the actuarial 
value of the standard benefit. The subsidy is also excludable from tax 
indication, raising its total value in the bill by $18 billion.
  Mr. Speaker, we heard a little earlier about health savings accounts. 
H.R. 1 creates new accounts that allows individuals and families to 
accumulate tax-free assets devoted to their health needs. The accounts 
will allow workers under the age of 65 to accumulate tax-free savings 
for lifetime health care needs if they have a qualified health plan. 
Health savings accounts require qualified plans that have a minimum 
deductible of $1,000, with a $5,000 cap on yearly out-of-pocket 
expenses.
  These amounts are doubled for family policies. Individuals can make 
pretax contributions of up to 100 percent of the health plan 
deductible. The maximum annual contribution is $2,600 for individuals 
and $5,150 for families, indexed annually for inflation.

                              {time}  2045

  Pretax contributions can be made by individuals, their employers and 
family members. Individuals ages 55 to 65 can make additional pretax 
catch-up contributions not covered by the insurance policy. Tax-free 
distributions can be made for continuation coverage periods by Federal 
law such as COBRA payments, health care insurance for the unemployed, 
and long-term care insurance.
  Health savings accounts will change the face of health care coverage 
in the United States. The individual owns the account. The savings 
follow the individual from job to job into retirement. The flexibility 
and asset accumulation characteristics of these accounts will help 
millions of Americans save for their health needs. Health savings 
accounts will also encourage individuals to buy health plans that 
better suit their needs so insurance kicks in only when it is truly 
needed. Moreover, individuals will make cost-conscious decisions if 
they are spending their own money rather than someone else's money.
  One of the major problems facing the Medicare program is the low rate 
at which it reimburses doctors for their services. As the Medicare 
program has cut rates, some physicians have stopped providing 
treatments to Medicare patients. This reduction in access to a wide 
range of physicians could have a detrimental impact on many seniors. In 
order to maintain adequate physician participation in the Medicare 
program, H.R. 1 rescinds a cut in physician payments and increases 
payments over the next 2 years. All physicians and providers, such as 
physician assistants, nurse practitioners, occupational therapists and 
other providers paid under the Medicare physician fee schedule will see 
a 1.5 percent payment rate increase under the House bill instead of the 
4.5 percent payment cut in 2004. This produces a net increase of nearly 
6 percent in payment rates in the year 2004.
  An additional 1.5 percent increase will replace another projected cut 
in 2005. To address the volatility in physician payment updates over 
time, the bill changes the formula used to calculate payments by using 
a 10-year rolling average measure instead of the current single year 
measure. H.R. 1 addresses the scarcity of physicians in rural areas of 
the country. To help rural and other areas with few physicians with 
recruitment and retention, Medicare will pay a 5 percent bonus to 
physicians providing care in scarcity areas in 2005 through 2007. Both 
primary care doctors and specialists would be eligible for this bonus 
if they provide care in scarcity areas.
  Mr. Speaker, a question that I am often asked about the Medicare bill 
is, why? Why did you undertake such a big, sweeping change to Medicare?
  One of the first things I need to say is all of the changes that were 
implemented in H.R. 1 are entirely voluntary, that is, if someone in 
the system likes what they have in the Medicare system, they do not 
have to change. They do not need to purchase a prescription drug 
benefit; they certainly do not need to avail themselves of any other of 
the other benefits, such as health savings accounts, that are available 
in the Medicare bill.
  But, Mr. Speaker, from 1965 when Medicare was first enacted in this 
country, there was something missing from the program and what was 
missing was prescription drug coverage. In 1965, it may not have 
mattered as much. The major expenses that a senior faced back then from 
the medical system was either undergoing an operation or prolonged 
hospitalization for, say, treatment of pneumonia. Prescription drugs 
were few and far between. There was only penicillin and cortisone, and 
those were interchangeable back then. But a lot has changed since 1965. 
In the 21st century, we have an enormous pharmaceutical capability that 
was really unimagined 38 years ago when Medicare was brought into 
being.
  Mr. Speaker, it was crucial that this gap be addressed. We are 
spending $287 billion a year on the Medicare program this year without 
considering prescription drugs. We are spending a tremendous amount of 
money and are scheduled to spend a tremendous amount of money year in 
and year out on Medicare, and we are not getting value for our dollar.
  As my colleague from New Hampshire pointed out earlier, earlier 
treatment of disease can reduce the overall cost for treating an 
episode of disease.
  Finally, we have heard a lot in regards to the cost of the Medicare 
bill and the cost of the prescription drug benefit. Over 10 years' 
time, $395 billion was the estimate from the Congressional Budget 
Office, and more recently the White House Office of Management and 
Budget came out with a figure of $535 billion over 10 years, or numbers 
to that effect.
  Mr. Speaker, I would like to point out there are some areas for cost 
savings within Medicare. We had before this House about a year ago this 
week a bill H.R. 5, which would have reformed the medical liability 
system in this country. The House passed it. Unfortunately, the 
legislation has stalled on the other side of the Capitol. I have great 
hopes that someday it will move, but it is not on the horizon right 
now.
  By reforming the medical liability system in this country and undoing 
some of the effects of the cost of defensive medicine, not just the 
cost people pay for insurance premiums, but the cost of defensive 
medicine, could reap enormous benefits. There was a study done in 
Stanford, California, in 1996 that showed within the Medicare system, 
just in the Medicare system, the cost of defensive medicine added $50 
billion a year to the cost of Medicare in this country.
  There is our prescription drug benefit. No matter whose figures we 
use, the Congressional Budget Office or the OMB, it is $50 billion in 
1996 dollars each year savings from removing the cost of defensive 
medicine.
  Mr. Speaker, I would like to yield to the gentleman from New Mexico 
(Mr. Pearce).
  Mr. PEARCE. Mr. Speaker, I appreciate the gentleman yielding me this

[[Page 4411]]

time. This subject of exactly why we did take up the Medicare and 
prescription drug bill comes up frequently, and it is a question that 
people really do concern themselves with.
  For me as a business owner, when I came to this body and looked at 
the budget and realized that almost all economists agreed that within 4 
to 10 years Medicare would put such deep stress on the budget, we may 
not have solutions to it.
  As a business owner, if I see that kind of problem 5 to 10 years down 
the road, I know I must do something today to begin to defuse the 
demand, defuse the problem well before it arrives.
  As we began to develop the program, the Medicare prescription drug 
bill, I began to ask questions and to make requests of my own. One of 
the things that several Members did was sign a letter saying if you do 
not give equal reimbursement to the rural areas, we will not vote for 
any bill.
  Mr. Speaker, I campaigned saying we should treat the rural areas of 
America fairly, that they needed to be compensated the same way because 
that is not the case in the past. We got 100 percent equality for rural 
hospitals in this bill, and it is one thing that affects my district 
tremendously. It was not just affordability of care that was at stake 
in my district; it was the access to care, even having hospitals that 
would operate and be in the district, and so this one component of 
equalizing the reimbursement rate in our rural hospitals was key.
  Another element that caused me to think there were good elements of 
the bill and it deserved support was the way border hospitals are 
treated. Border hospitals have a mandate by the immigration service 
that if an immigrant comes to a hospital with a medical problem, that 
hospital at its own expense or the expense of the county in which it is 
located, will transfer the person to the nearest facility where 
treatment can be given. Hospitals in my district are severely burdened. 
My district is on the border of Mexico, and the hospitals complain 
about the unfunded mandates to transport and to treat many medical 
conditions. Then the immigrants are taken back to the border and 
deposited there to return to their homes.
  Mr. Speaker, that was another element that I campaigned on saying 
that we should get reimbursement for those costs mandated by the 
Federal Government. In this bill there is $1 billion to begin to help 
border hospitals pay for the costs that they face through an unfunded 
mandate by the Federal Government in the immigration department.
  Those two things really began to convince me that for rural New 
Mexico, the Medicare bill had a good beginning, but it did not stop 
there. The disproportionate share hospitals also received an increase 
in funding level. Again, that affects most of the hospitals in my 
district. We also dealt with the reimbursement for rural physicians in 
this bill. Again, a win for New Mexico. So it began to look to me like 
we had the elements to build a successful bill on, that we had some 
long-term cures that were a long time in coming, and I was proud to be 
a part of those.
  As we got into the philosophy of the bill, I think that is where we 
really began to see the need for change, the need for systemic change. 
One example of how we do things upside down in Medicare and in 
providing government coverage for Medicare is that we cause incentives 
to go to the most high-priced objective. We all know that for a small 
copay you can get any pharmaceutical that you would like to have. Once 
you reach the copay, you might as well get the expensive as the generic 
because there is no difference.
  If we turned the incentive upside down and were to provide coverage 
for the generic, and if you want then the expensive version of the same 
drug, you would have to provide the difference, that was a compelling 
way to me that we could change behavior and change buying patterns 
throughout the country.
  One of the things that we did in this bill was we began to limit the 
powers of the drug companies. I appreciate what the pharmaceutical 
companies have done in this country. They have created pharmaceuticals 
that are extending lives beyond belief. The fastest population group in 
America is over 100 years old. The second fastest growing age group is 
85 to 100. These extensions of life and the quality of life that is 
experienced is because of the good work that the pharmaceutical 
companies do; but the pharmaceutical companies are just like the rest 
of us. They will take advantage when advantage given.
  There was a practice of extending patents indefinitely. At the end of 
the patent period, they would change a few words and change the patent 
again. It was legal, but it was something which many felt was not 
right. In this bill, we limited the extensions to one. You get your 
original patent period, and then one extension. That will bring generic 
drugs to the market sooner. Just to make sure that the generic drugs 
come to the market sooner and we get competition sooner, we went ahead 
and put provisions in that would encourage the generics to be brought 
to market sooner.
  We just wanted the drug companies to know that we appreciate what 
they do, but we also wanted to give them a small wake-up call that 
there were practices that we felt like were not in the best interest of 
all Americans. And so those changes were made here. Again, a very 
positive component that I felt began to justify this particular bill to 
be voted for.
  Another thing that we did were health savings accounts. My colleagues 
have talked about that tonight, but I will give my brief summary. 
Health savings accounts are really medical IRAs. Americans can put in 
money tax free at any age, and at any age you can take money out tax 
free. That makes the health dollar worth 30 to 40 percent more, 
depending where you are in the income spectrum.
  So you have a medical IRA that you put money into tax free at any 
age, about $5,000 a year, and you can take money out at any age if you 
use it to pay for medical benefits. You can pay for your premiums out 
of this health savings account; you can pay for your deductibles out of 
the health savings accounts, as well as prescription drugs or any other 
medical expense.
  The nice thing about health savings accounts are they are a part of 
your estate. If you do not use it for your medical needs, you are able 
to pass it on to the next generation and to the next generation so that 
your children and grandchildren have a head start on paying for their 
medical needs.
  I will tell Members, as a small business owner, the way that I would 
have dealt with this, and my wife and I sold our business in October of 
last year so I no longer have employees that would qualify for this, 
but the way I would deal with this particular situation is I would 
begin to give pay and bonuses into that account. So instead of giving 
pay increases, I would pay the increase into the health savings 
account. I would try to put $5,000 a year for every employee into the 
account, where the money was worth 30 to 40 percent more, and also 
where they could begin to use it to pay out of an account that has been 
put into their name, and they can pay out of that account to pay for 
premiums and deductibles.
  I think as we build the size of the account, we can all see that we 
can begin to shop for higher deductible insurance. Right now most of 
the time when I shopped for health insurance, it was either a $500 or 
$1,000 deductible. But if a small business has helped pay in $5,000 to 
$20,000 into a health savings account, and knows that no one is going 
to be disadvantaged, then we begin to shop for maybe $5,000 
deductibles. It is at that point the health insurance costs begin to 
collapse tremendously and we put the health care, the health insurance 
costs back within the reach of the average wage earner.

                              {time}  2100

  Ten percent of my employees had insurance costs of more than $1,000 a 
month. With 20 and 30 percent increases, you could look at 3 years from 
now having $2,000 a month. There is a point, Mr. Speaker, at which no 
one can afford health insurance. The health savings account, this 
medical IRA, begins to change the way that we think

[[Page 4412]]

about health insurance. It begins to change buying patterns so that 
long term we begin to affect the price of medical services themselves. 
One of the most important things that we did in this bill is began to 
understand that if we will catch problems at the front, at their 
initiation, they are far easier and cheaper to take care of.
  One of the reasons that Medicare has been so expensive, one of the 
reasons it stands to break the budget of the United States, is that we 
have no preventive medicine. At least we did not until we passed this 
bill. In other words, we would not do screenings but Medicare would pay 
for the full cost of operations, heart surgeries, cancer treatments 
after they were full-blown.
  In this bill with screenings, physical exams and preventive medicines 
guaranteed, I think that we are going to begin to collapse the cost of 
this Medicare bill overall down below what it has been, rather than the 
astronomical increases that we are seeing projected; because I think, 
as the good doctor has pointed out, that there are applications in this 
bill which will save us money, not cost us money.
  The gentleman from Texas explained adequately that the benefit 
programs were one of the main questions that he faces in his district. 
Benefit programs are a concern to all of us. Many companies have 
employees who have retired and are using that company benefit for their 
health insurance. I have experienced the same concerns in my district 
that the gentleman from Texas has experienced, of people wondering, 
well, if you put this in place, then my company is going to drop it, 
they are going to drop the coverage that I currently have. That 
disappointed them. It concerned them.
  I will tell you that we did something in this bill that to me made 
sense. We have our opponents, those people who want to criticize the 
bill, saying that we are giving corporate welfare. Mr. Speaker, what 
they are talking about is that we are giving an incentive, we are 
helping these companies that pay retirees' health benefits, we are 
giving those companies incentives to keep the benefits in place. We are 
saying that if the Federal Government can pay 20 or 25 percent and 
cause them to keep that health benefit in place for the retirees, that 
that is going to be far preferable to having the company drop the 
coverage and having Medicare pick up 100 percent of the coverage. And 
so those opponents of this bill who claim that it is corporate welfare 
can do so; but when they do so, they have to not be telling the full 
truth that we did it in order to encourage companies to keep those 
benefit plans open for retirees who really think they have got good 
plans.
  One of the most important parts of this bill, Mr. Speaker, was the 
concept of choice, the ability to choose whether you like the current 
plan you are under, the traditional Medicare, or whether you want to 
opt out and move into the new plans that will be offered as competing 
plans for this program.
  Mr. Speaker, I do not see anyone complaining about the right to 
choose. I see a lot of people complaining about the potential of being 
mandated to move into a complete private sector but not one person has 
said, don't give me a choice. I will tell you that the right to choose 
is one of the most fundamental parts of our American society and I am 
proud that in this bill we have given our seniors the right to stay 
where they are, to use Medicare completely as it is without any 
changes, but we have also given them a right to choose a different kind 
of coverage that meets their needs more.
  Mr. Speaker, there are many reasons that I voted for this bill but 
the main ones were I believe that systemically it began to address the 
long-term changes that are necessary to make Medicare viable for the 
rest of this generation, for the next generation and the generations 
beyond. Access to affordable health care in rural parts of the country 
just cemented my belief that we have done very good work in this 
particular bill.
  Mr. Speaker, I have more things to say but I would like to yield back 
to the gentleman from Texas and let him continue and I will wait for 
the next coverage that he gives to me.
  Mr. BURGESS. I thank the gentleman from New Mexico. We heard earlier 
this evening the gentleman from Michigan stand up and talk about paying 
for health care. Mr. Speaker, an op-ed piece by Ronald Brownstein out 
in Los Angeles, California in December talked about that he thought 
there were only two ways to pay for health care in this country: One 
was an employer-given indemnity insurance plan and the other is a 
government-paid system. As a longtime participant in the health care 
field, there is a certain segment of health care that is delivered free 
of charge. It is uncompensated because someone either cannot pay or 
will not pay, and the bill therefore is uncompensated and the hospital 
or physician or provider simply eats that charge, and that goes on 
every day of the week.
  But there is a fourth source and that is, of course, the individual 
who is going to write a check themselves, going to pay for their care 
themselves out of pocket. One of the problems in the world nowadays is 
that medical care has become so expensive so many people find that 
daunting, but that is why the health savings accounts not just for 
seniors but started at an early age and really making them available to 
all Americans, that is why that is such a crucial part of the overall 
reform encompassed within the Medicare bill.
  Mr. Speaker, the gentleman from Michigan also referenced the 
newspaper Roll Call. We are all familiar with Roll Call up here on the 
Hill. Certainly the writers in Roll Call are no particular friend of 
the President of the United States. In fact, sometimes they are quite 
critical of him. On one of those occasions where the gentleman that 
writes the column Pennsylvania Avenue was very critical of the 
President was right after the State of the Union address, I believe it 
was the Monday following the President's State of the Union address, 
where in this House he addressed both Houses of Congress and said that 
he appreciated what we had done with health savings accounts, he wanted 
now to extend that, he wanted there to be full deductibility for a so-
called catastrophic medical insurance policy, that a person would be 
able to deduct the cost of that from their income taxes.
  Mr. Speaker, combining the power of the HSA with full deductibility 
of catastrophic coverage pretty much removes from consideration, that 
is, anyone who pays insurance in this country would no longer have an 
excuse for not having health insurance. We would have given them every 
reason to spend those tax-deferred dollars on the insurance coverage 
that they need.
  One of the other programs that the President talked about that night, 
and I think the gentleman from Michigan also referenced this, was 
association health plans. Association health plans are a critical tool 
that allows small businesses of a similar business model to band 
together across State lines if necessary and get the purchasing power 
of a larger corporation, an idea that has a lot of common sense to it. 
An organization such as a collection of chambers of commerce, for 
example, or a collection of realtors, for example, these would be 
businesses of a similar business model, they could group together; a 
group of realtors could go in together and get more purchasing power 
with the money they use to buy health insurance policies and extend 
coverage and keep people from dropping out of providing insurance 
coverage to their employees, one of the problems that the gentleman 
from Michigan referenced.
  Association health plans were again passed in this House in June of 
last year and again that is an example of some legislation that sort of 
stalled on the other side of the Capitol Building. I hope that it will 
get taken up at some point.
  There is another measure, Mr. Speaker. The gentlewoman from Texas 
(Ms. Granger), my next door neighbor in Fort Worth, has a bill to 
provide tax credits for the uninsured. You may say, gosh, that is 
great. Somebody who pays income taxes can now afford health insurance. 
But what about someone who does not make enough money to pay

[[Page 4413]]

income taxes? What are they going to do for insurance? This would be a 
pre-fundable tax credit, available to someone at the beginning of the 
year to use for the purchase of a health insurance policy.
  Mr. Speaker, the combination of these three things, the health 
savings accounts with the inclusion of the catastrophic policy, with 
full deductibility of a catastrophic policy, association health plans 
and tax credits for the uninsured, comprise a fairly significant number 
of the uninsured who can be taken off the rolls of the uninsured.
  Mr. Kondracke was kind of critical of the President after those three 
proposals were sort of wrapped together in the State of the Union 
address. Mr. Kondracke said, gosh, that will only cover a quarter of 
the people who are uninsured in this country. Mr. Speaker, that is 10 
million people, in excess of 10 million people. I submit if we have the 
power in our hands, without any heavy lifting, to provide coverage to 
10 million uninsured by the end of this year without increasing the 
deficit, for heaven's sake that is something we should do. There should 
be a moral imperative for us to take up and pass that legislation.
  I urge other Members of this body to look favorably on tax credits 
for the uninsured when that legislation comes forward. I would 
encourage the Committee on Ways and Means to let that be reported out 
of committee and come to this House for a vote. Again, good legislation 
that has stalled at the other end of the Capitol needs to see the light 
of day.
  With that, Mr. Speaker, again my condolences to the people in Spain. 
I want to finish up tonight by yielding back the remainder of the time 
to the gentleman from New Mexico and thank him for his participation in 
this hour of debate this evening.
  Mr. PEARCE. Mr. Speaker, if I could request how much time is 
remaining.
  The SPEAKER pro tempore (Mr. Bonner). The Chair advises that there 
are 24 minutes remaining for this particular time period for the 
majority.
  Mr. PEARCE. Mr. Speaker, I would like to discuss even a broader 
concept in health care costs. One of the most urgent questions that I 
get when I am in my district, people wonder how are we going to afford 
health care costs. How can we afford health insurance? What are the 
components of that? All of us, myself included, would look for easy 
solutions. We would want a bill that we could pass that would just 
limit the cost of care. Maybe it is by fixing prices in the 
pharmaceutical industry or maybe fixing prices that the doctors are 
able to charge. Some people want to go in and limit the capability of 
insurance companies to raise their prices to pay for the costs that 
they have. Mr. Speaker, anything that we attempt is going to be 
simplistic and will be, without doubt, ineffective. The reasons that 
our health care is so expensive, is, frankly because we are demanding 
it. We have more demand than there is supply. When that is the case, 
you can either increase the supply, which is the number of doctors and 
the number of hospitals, or you can begin to affect demand.
  I would say, Mr. Speaker, that it is imperative, as long as we are 
going to try to solve the problem, we may address the supply, we may 
address the numbers of doctors, we may address the numbers of 
hospitals, but that does not completely deal with the problem that I 
see, that is, on the demand side. I think that the first step for us 
all is to begin to live healthier life-styles. There is one study which 
reports that if we lost nationwide 10 pounds per person that the 
incidence of diabetes could be cut by 25 percent nationwide. Nationwide 
diabetes is an exploding phenomenon that is going to affect the health 
care costs for every single one of us, even though we are not all 
affected by it. If we look at our young population, we are finding that 
exercise and healthy choices are so bad that youth diabetes is 
exploding in the country, also.
  I will tell the Speaker and this assembled group that these health 
problems into the future raise such tremendous concerns on costs for 
budgets, quality of life, that we need to begin to make healthier 
choices. We need to make healthier choices in our life regarding 
smoking, regarding physical exercise, regarding illegal substances that 
we place into our bodies. All of those are things which affect the 
demand, the demand which causes health care costs to increase daily.
  I think one of the things that we need to be smarter about in this 
country and which would also begin to lower that demand curve for the 
medical services and begin to affect the cost shifts upward each year 
is in regard to preventive medicines. We all need to be doing careful 
screenings, cholesterol checks. We should be doing the cancer 
screenings. I heard statistics today about the way that breast cancer 
is really spreading in this country. Breast cancer is a curable problem 
and one that is affecting, I think, 1 out of every 3 or 4 women. Mr. 
Speaker, if we will begin to do the screenings and the preventive 
medicines, we will find that long-term our costs will begin to deflate 
also.
  The health savings accounts, we have already discussed how that can 
affect long term the cost of our medical care and the cost of 
associated insurance.
  One of the things that we are wanting to institute in this particular 
bill is more competition.

                              {time}  2115

  If we look at a couple of examples right now in the medical community 
of competition, I think Lasik eye surgery is one of the examples, also 
reconstructive surgery, the plastic surgery. Both of those elements 
have had competition introduced into their sphere in the last couple of 
years; and we have seen, I think, 30 percent decreases in the cost of 
those particular services. Competition is one of the important aspects 
of not only the American way of life but also in any free market 
enterprise, and we should see that always competition is never 
forbidden but encouraged, and it should be that way in our medical 
field.
  The gentleman from Texas (Mr. Burgess) mentioned that one of the most 
important things we can do to begin to lower costs of medical treatment 
rather than to see the constantly inflating and increasing cost of 
medical treatment is medical liability. Many physicians in my district 
talk about the escalating medical liability costs. Each year we face 
the prospect that more and more doctors are going to just stop 
practicing medicine. So instead of increasing the supply, we are 
actually decreasing the supply, which is going to give more incentive 
for prices to go up higher even. Medical liability is one of the most 
serious problems in day-to-day costs of health care and needs to be 
addressed. This House has addressed it. We feel like it is a thing that 
should be pushed on through the full Congress and sent to the President 
for signature.
  I think, finally, the good doctor mentioned several times, and in 
good components, the cost of defensive medicine. Defensive medicine is 
not just in fear of lawsuits. Defensive medicine is when our doctors 
begin to prescribe more tests than should actually be done because they 
are afraid that they will be sued if they do not prescribe every single 
test that is available. Defensive medicine is when doctors begin to 
order more rather than exactly which tests they believe are the right 
ones, which procedures they believe to be right. It is in that 
defensive medicine, that overprescribing, that overtreating that we 
find, as the good doctor says, $50 billion worth of cost in this 
country alone and that one single step of changing that parameter in 
our health care costs could pay for, for instance, this Medicare 
prescription drug bill.
  Mr. Speaker, we are going to make choices in this Nation that are 
expensive. In this particular case, this particular bill, it was the 
right thing because we have seniors who are having to choose between 
food and medicine. There is an immediate impact in this Medicare 
prescription drug bill which will give to our low-income seniors right 
now this year a $600 card that is good for any purchase of prescription 
drugs throughout the rest of the year. Next year the same thing is 
going to happen. Those people at lower incomes, $18,000 and below for a 
couple, will receive another $600 card next year,

[[Page 4414]]

which will be good to help them defray the cost of the prescription 
drugs.
  As we look at the plan itself, we have a lot of critics who are 
describing the gap and being very critical of the gap in the 
pharmaceutical coverage. I will tell those people that are assembled 
here today that the single most important reason we did that was to be 
able to afford the bill. We did not want to break the next generations 
because we paid for full coverage for every single person in this 
Nation.
  I have often explained that my mom is one of the people who 
experienced the gap. Her income and her assets are high enough that she 
will be faced with seeing that coverage up to a point and then a gap 
and then the protection for catastrophic coverage. I asked her what she 
felt about it. She explained to me that she understood why we were 
doing it. She explained that she had felt blessed in her life, that she 
would gladly pay more in order to make it where it is affordable for 
the next generations.
  Mr. Speaker, those people who are being so critical of this 
particular aspect of the bill I think are being disingenuous. They talk 
about the cost of the bill on the one hand, while complaining about the 
gap on the other. I am sorry. They simply have to choose one or the 
other. They have to choose full coverage and the high price above $1 
trillion versus the $400 to $500 billion that we are facing in this 
bill as it stands. Either they choose full coverage and the higher 
price, or they give the gap in the lower price. We in this House and in 
the Senate and in the bill that was passed and signed by the President 
chose to allow those people to pay more who could pay more in order to 
make this bill more affordable for the next generations.
  Mr. Speaker, I appreciate the President's calm and patient leadership 
on this matter. The President never wavered in his commitment to 
provide coverage for those seniors who are not able to provide coverage 
for themselves. And I think that this House chose rightly in passing 
that bill, and I think that the seniors are finding that it is going to 
be one of the tremendous changes in the way that we present medical 
coverage through the Medicare program in this country.
  I appreciate, also, the President's leadership in many other issues. 
We have taken on serious issues in this House, and we have passed them. 
Not all have made it to the President, but many have made it to the 
President. We took bold steps to reinvigorate the economy. The economy, 
as we understand, had suffered from three deep shocks: the collapse of 
the dot-com industry back in the ending years of President Clinton's 
term; 9-11 was the second big shock. The third big shock were the 
corporations that were acting improperly. Global Crossing is a good 
example. Enron is also an example that has been used. When those 
companies began to act improperly, people began to suck their money out 
of the stock market and put it into interest-bearing accounts at the 
bank. Those three shocks to our economy were ones that were very 
difficult, and many economies could not have sustained them. The 
President has patiently built our economy back with a series of tax 
decreases to the American public. Many of those tax decreases fall on 
businesses which are able to maintain profitability, increase their 
employment, grow their capacity, increase the capability of competing 
with those firms overseas. I will tell the Speaker that we have done 
magnificent work in many areas; and I appreciate, myself, the calm and 
principled leadership of the President, who has decided to fight this 
war on terror, to fix Medicare as he saw the Medicare problems to be, 
to deal with the forests that were burning up throughout the West, to 
pass the Partial Birth Abortion bill and sign that, to pass the AMBER 
alert bill and to get that signed.
  Mr. Speaker, we have done magnificent work in this House. The 
President has signed much of it into law. But one of the most dramatic 
things we have done is to pass this prescription drug Medicare reform 
bill, which I think is going to make sure that Medicare is available 
throughout the rest of this generation and on into the future for my 
children and my grandchildren.

                          ____________________