[Congressional Record (Bound Edition), Volume 155 (2009), Part 23]
[Senate]
[Pages 31638-31648]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           HEALTH CARE REFORM

  Mr. CORKER. Mr. President, I rise today to speak about the health 
care bill that is before us. One of the major points of contention over 
the last 2 weeks has been the fact that Medicare savings are being 
utilized to leverage an entirely different entitlement and not even 
taking care of the SGR issue that is so important to physicians around 
our country.
  The other important stat is the fact that half of the expansion in 
health care benefits that is occurring under this bill is under 
Medicaid, probably the worst health care program in America. After a 
year of discussions among many folks on a bipartisan basis, and ending 
up with a very partisan bill, the fact that half of the expansion is 
occurring in one of the worst programs that exist in our country, 
locking people at 133 percent of poverty into Medicaid, with no other 
choice, does not seem to me to be true health care reform.
  I know the Senator from New Hampshire, who has spoken eloquently on 
this issue, has something to say about that.
  Mr. GREGG. I thank the Senator from Tennessee for opening this 
discussion on the issue of Medicaid. But I did want to ask a couple 
questions relative to what the Senate leader just said about the bill 
that is before us.
  We have to remember the bill that is before us--all 2,074 pages, as I 
understand it--is not the bill we are going to actually consider. There 
is somewhere in this building a hidden bill, known as a managers' 
amendment, which is being drafted by one or two or three people on the 
other side of the aisle, and which is going to appear deus ex machina 
on our desks fairly soon. We do not know what is in it. A lot of the 
people on the other side do not know what is in it. The press does not 
know what is in it. The American people do not know what is in it.
  Mr. CORKER. The President does not know what is in it.
  Mr. GREGG. The President does not know what is in it. Nobody knows 
what is in it. But they are designing this bill, which is going to be 
represented to expand Medicaid even further and to also offer the 
ability to people age 55 and over to buy into Medicare, which is going 
to have a huge impact.
  But what the Senator from Nevada said, which I want to ask the 
Senator from Tennessee about, is, he said this bill before us--this 
2,074-page bill, which we know is what we are working off of--is going 
to reduce health care costs.
  Is it not true that the President's Actuary--the Actuary for CMS, who 
is the President's Actuary--sent us a letter last week which said that 
health care costs in the first 10 years would go up by $235 billion?
  The majority leader also said people will be able to keep their 
insurance. Is it not true that the President's Actuary said millions of 
people will lose their own insurance under this bill?
  Further, is it not true, in the area of Medicare, that the 
President's Actuary actually said that the expansion in Medicare and 
the Medicare cuts in this bill that are before us in the Democratic 
bill would actually lead to a massive reduction in the number of 
providers for Medicare; that up to 20 percent of the providers in 
Medicare would become unprofitable and therefore they would have to 
leave Medicare, making Medicare unavailable to people because there 
would be no recipient?
  Didn't the Actuary also say, in the area of Medicaid--and I am 
quoting--``it is reasonable to expect that a significant portion of the 
increased demand for Medicaid would'' be difficult to meet, 
particularly in the first few years, and that is because providers 
would no longer be profitable and would have to leave the business of 
providing--doctors groups, hospitals, small clinics?
  Are not all those three points true relative to what the President's 
Actuary has told us--not us, not the Republican side but what the 
President's Actuary said? And don't all three points contradict the 
representations of the majority leader?
  Mr. CORKER. Not just his representations, but the representations of 
the President of the United States. As a matter of fact, it is hard to 
understand any goal that is being achieved other than making sure our 
country has a huge indebtedness.
  But the senior Senator from Tennessee has talked about this very 
subject the Senator is talking about--about Medicaid, in essence, 
giving people a bus ticket, where there is no bus because of the fact 
that if we add these people to a system where 40 percent of physicians 
do not take it, 50 percent of specialists do not take it, in essence, 
you have people accessing a system where there are not providers to 
care for them.
  I do not know if the senior Senator from Tennessee wants to expand on 
that.
  Mr. ALEXANDER. I thank Senator Corker from Tennessee.
  We have our usual situation on the Republican side--a lot of Senators 
who wish to speak on the subject of Medicaid--so I am going to keep my 
remarks brief. But looking around I see one, two, three, four of us who 
have been Governors of a State. The Acting President pro tempore was 
the Governor of the State of Virginia. Senator Corker, himself, was 
mayor of Chattanooga and the chief operating officer of the Tennessee 
State government.
  Why do I bring that up? Because the Medicaid Program we are 
discussing--I know to many people listening to this debate, it gets 
confusing. Medicare is the program for seniors on which 40 million to 
45 million people depend. We have talked about that a lot, and how the 
cuts to Medicare are going to be used to pay for this bill. But we have 
not talked as much about Medicaid, which is an even larger government 
program. Sixty million people depend on Medicaid, and they must be low-
income people in order to qualify for the program. This bill would add 
15 million more Americans to the Medicaid Program which, as Senator 
Corker said, is like giving someone a bus ticket to a bus line that 
only operates half the time, because about 50 percent of the time, 
doctors will not see new Medicaid patients.
  But there is another problem with the Medicaid proposal, which all of 
the Governors here--I know if they are like me, nothing made me any 
angrier than to see a bunch of Washington politicians come up with a 
big idea, announce it, take credit for it, and then send me the bill 
when I was Governor. Usually we would find them back at the Lincoln Day 
Dinner or the Jackson Day Dinner the next spring making a big speech 
about local control. Well, what happens here is a huge bill for this 
Medicaid expansion that is going to be sent to the States.
  I would say to Senator Corker, hasn't our Governor, a Democratic 
Governor, Governor Bredesen--who like all of us has struggled with 
paying for Medicaid--has he not said this will cause about $750 million 
in added expense? I would ask the Senator from Tennessee, wouldn't that 
require either big cuts to higher education or big tax increases to pay 
for it?
  Mr. CORKER. As you pointed out, in California there was almost an 
insurrection among students there because of the high cost of tuition, 
because of the fact that other programs in the State were eating up 
money. It is the same kind of thing that is going to happen in States 
across this country. Our Governor, who is a Democrat and who probably 
knows as much about health care as anybody in the country,

[[Page 31639]]

is very concerned about what this is going to do--hoping, by the way, 
that revenues in our State reach 2008 levels by the year 2013. So he is 
very concerned.
  I know Senator Johanns from Nebraska has been a Governor. I am sure 
he has some things to add to this debate.
  Mr. JOHANNS. I do have some things I wish to add to this debate. I 
have gone across the State. I have talked to hospital administrators 
and I always ask them the same question: If you had to keep your 
hospital open on Medicaid reimbursement, could you do that? With no 
exceptions whatsoever, from the largest to the smallest hospitals, they 
say, Mike, we would go broke because the Medicaid reimbursement is so 
bad. No question about it, that is bad news for the hospitals.
  But ask any Governor. It doesn't matter if they are a Democrat or a 
Republican--and the senior Senator from Tennessee is so right, nothing 
would irritate Governors more, nothing would get us in a more 
bipartisan furor than the politicians in Washington passing something, 
taking all the credit for it, and then sending the bill to the State 
taxpayers. I will give a speech on this to nail this down in the next 
couple of days.
  The States have very limited options. They can raise taxes or they 
can cut very valuable programs such as education, K-12 education, 
higher education, and already States are struggling. In Nebraska we had 
a special session where our Governor and our legislature stood up and 
said, We have to cut spending, and they cut over $300 million. Can you 
imagine if I were to call up later on in a couple of weeks from now and 
say, I know you did your very best at that special session, but we sent 
you another bill for millions and millions of dollars over the next 10 
years that you have to deal with?
  The final point I wish to make is, do my colleagues realize what we 
are doing to the people we will be putting on Medicaid? Already 35 to 
40 percent of the physicians won't take Medicaid. Why? Because the 
reimbursement rates are so incredibly pitiful. So if you are at 133 
percent of poverty, we basically lock you into Medicaid. It is like 
giving somebody a driver's license but then saying, there is no way you 
can ever get a car to drive, because, look, here is the problem: They 
can't get medical care no matter if they have that Medicaid card. What 
it will do to our health care system is literally bring it to its 
knees, because we are going to have this massive rush of people who 
have the Medicaid card in hand and we don't have the capacity to deal 
with that. The doctors, the hospitals are all going to be in trouble 
because of this. It is the wrong policy for a whole host of reasons.
  Mr. CORKER. Mr. President, I read a story this weekend in the New 
York Times where Medicaid recipients, especially young Medicaid 
recipients, have huge prescriptions taken out on them for antipsychotic 
drugs because basically the physicians don't want to take the time to 
deal with them, and so they are huge users of them.
  When we speak about physicians, I think it is always important to 
talk to one. Fortunately, we have one on our side, Senator Barrasso, 
who I know has treated many Medicaid recipients. I know he has a lot to 
say on this topic.
  Mr. BARRASSO. I have a couple of points I wish to add because I think 
you made a point, as does Senator Johanns. The concern is are there 
going to be enough doctors to take care of these patients. We are 
talking about 18 million more people placed on the Medicaid rolls, 
which is a huge unfunded mandate to the States. Having practiced in 
Wyoming for 25 years, in Casper, taking care of families, taking care 
of lots of patients on Medicaid, it becomes harder and harder for 
doctors to take new patients.
  There is an article in this week's Wyoming Tribune Eagle: Doctor 
Shortage Will Worsen. As many as a third of today's practicing 
physicians will retire by the time all of these additional 18 million 
get on to Medicaid.
  There is an article in the Wall Street Journal and it talks about a 
report from a research group, nonprofit, based in Washington, the 
Center for Studying Health System Change, and it says, as the Senator 
has previously stated:

       Nearly half of all the doctors polled said that they had 
     stopped accepting or limited the number of new Medicaid 
     patients. That is because many Medicaid programs, straining 
     under surging costs, are balancing their budgets by freezing 
     or reducing payments to doctors. That, in turn, is driving 
     many doctors, particularly specialists, out of the program.

  For people in Wyoming, whether in Cokeville or Kemmerer or Casper, in 
all of these communities we are looking to try to recruit physicians. 
It is making it much more difficult when we look at this health care 
proposal the Democrats have, which is going to raise taxes, cut 
Medicare, cause premiums to go up for people who have insurance, and 
one of the reasons is because it underpays so much for things such as 
Medicaid. Yet they are talking about putting another 18 million people 
on Medicaid.
  This morning I called one of the offices of a physician group in 
Wyoming and said, What are the differences in terms of Medicaid versus 
regular insurance? For something like carpal tunnel, we know about 
overuse of the wrist and carpal tunnel surgery where the normal fee is 
about $2,000 for the surgery. Medicaid itself reimburses less than 
$500. Medicare--they are talking about putting a lot more people on 
Medicare--reimburses less than $400.
  It is very difficult if you are trying to run an office and you pay 
all of the overhead expenses and see everybody who wants to see you to 
do it on the fees alone that you get from Medicare or Medicaid. That is 
why I have great concerns. If we have all these people on Medicaid, 
will it actually help them get care?
  I think this Democratic proposal we are looking at fails. It fails in 
terms of getting costs under control. It fails in terms of increasing 
quality or increasing access, but those are the things we need in 
health care reform.
  I see my colleague from Florida is here, who has experience, having 
run a Governor's office as Chief of Staff. He may want to add to this 
discussion as well. I can't see any way this would be sustainable. As a 
matter of fact, a report that came out recently from the CMS, the group 
that oversees all of this, said it is not sustainable, that one out of 
five hospitals by the year 2020 and one out of five doctor groups will 
basically have to go out of business and close their doors.
  Mr. CORKER. Mr. President, it is pretty amazing when you think about 
it. We have a 2,074-page bill that includes the largest expansion of 
Medicaid in the history of the program. It would take about 1 page of 
that 2,074 pages to expand Medicaid and do no reform, and yet that is 
where 50 percent of the expansion is taking place. Yet, the 2,073 pages 
remaining don't meet many goals that many--any goals, really, other 
than access--any goals that Americans would stand behind.
  I know the Senator from Florida, who has spent a lot of time on this 
issue, wants to speak on this topic.
  Mr. LeMIEUX. I thank my colleague from Tennessee. I didn't have the 
honor to be a Governor but I got to sit in the office next door to be 
the Governor's Chief of Staff. We had these issues of trying to balance 
budgets because, unlike the Federal Government which is out of control, 
States actually have to balance their budgets. Receipts have to meet 
expenditures. When your Medicaid budget grows and grows and grows--and 
in Florida, $18 billion is what we pay in Medicaid. It is the largest 
expenditure in the Florida State budget. When it grows and grows and 
grows, what happens? You have to cut education. You have to cut public 
service programs that do things such as law enforcement, correctional 
facilities that hold prisoners. You hurt the other main functions of 
government if you keep adding in Medicaid.
  I wish to highlight a point my colleague from Tennessee made. It 
occurred to me when I was going through the Chief Actuary's report we 
received last Friday from the Center for Medicaid and Medicare Services 
that this plan the Democrats have put forward is the expansion of 
Medicaid. Let's be honest. This is Medicaid for the masses. Thirty-
three million people supposedly are going to be covered by

[[Page 31640]]

this plan if it is implemented. How do those numbers add up? Eighteen 
million are Medicaid, 20 million go into this new exchange, and then we 
lose 5 million because their employer drops them because they can go 
into the exchange. So what are the majority of the people who are going 
to go under this new health care reform going to get? They are going to 
get the worst health care system in America, called Medicaid, a system 
where doctors won't participate. If the doctor is not in, it is not 
health care reform.
  This is not all it is cracked up to be. I did a little back-of-the-
envelope math: $2\1/2\ trillion to put 18 million people into Medicaid. 
We could give all of those people $166,000 each, put it into an account 
and say: Here, fund your health care for the next 10 years or we could 
create this huge government program that expands a program that most 
doctors won't accept.
  My colleague Dr. Barrasso has it right. Forty percent of the doctors 
won't take Medicaid, and 50 percent of the specialists. How is this 
health care reform?
  I know my colleagues here have a lot of experience on this issue. I 
see my colleague from Mississippi and it looks as though he has a great 
chart and is going to talk about increased Medicaid spending, so I am 
sure he has something great to say to us.
  Mr. WICKER. Yes, and I appreciate so many of our colleagues being 
here today because I am glad we are getting into the Medicaid aspect of 
this bill. There has sort of been a feeling around this building the 
last couple of days that if we could only take care of the Medicare 
buy-in and the government-run option this bill would be OK. So I think 
today we are bursting that myth and pointing out the huge unfunded 
mandate the Medicaid portion would put on almost all the States.
  Every State in red as shown on this chart would be required under 
this bill to increase their Medicaid spending. Only Vermont and 
Massachusetts would not have to be mandated by us in Washington to do 
this additional spending. Of course, with the unfunded mandate, what 
the Federal Government is saying is, We think this is a great idea. We 
think people should be covered with additional Medicaid Programs and, 
by the way, you folks at the State level should come up with the funds 
to pay for it. That is the very nature of an unfunded mandate.
  I am not a Governor nor have I been a Chief of Staff of a Governor, 
but I have a letter from my Governor, Gov. Haley Barbour, who says:

       If the current bill, which would expand Medicaid up to 133 
     percent, were enacted into law, the number of Mississippians 
     on Medicaid would increase to 1,037,000, or one in three of 
     our citizens. Over 10 years this bill would cost 
     Mississippi's taxpayers $1.3 billion--

     The generosity of this Congress would be to tell the 
     legislators and taxpayers of my State of Mississippi: 
     Congratulations. We get more coverage and, by the way, you 
     have to pay an additional $1.3 billion--

     necessarily requiring Mississippi to raise taxes in order to 
     continue vital programs such as education and public safety.

  As has been pointed out, our State governments don't have a printing 
press. They have to balance the budget and make the numbers come out at 
the end of every year. We are putting a new burden, if we pass this 
legislation unamended, a tremendous burden on our Governors.
  One other comment. There has been mention of the Governor of 
Tennessee who is a two-term, respected Democrat who knows a little 
something about health care. I think the actual quote last summer from 
Gov. Phil Bredesen was that he feared ``Congress was about to bestow 
the mother of all unfunded mandates on the State of Tennessee.''
  I have here in my hand--and we don't have time because we have so 
many people who want to speak--I have 13 quotes, not from Republican 
Governors such as Gov. Haley Barbour of Mississippi, but Democratic 
Governors all across this Nation, including the newly elected 
Democratic Governor's Association chairman, Gov. Jack Markell, and 12 
others saying, we cannot afford, we cannot accept, we cannot bear at 
the State level this unfunded mandate upon this number of States.
  Mr. CORKER. I thank the Senator. That was very good. I am hearing 
some comments about there being a wink and a nod process taking place 
which is sort of what we have happening right now with the bill. We 
don't know what is in it, but I understand there may have been a tilt 
by leaders of the Democratic Party to say to Governors: If you won't 
raise much Cain here, we are going to take care of you down the road on 
this issue. I don't know if I would trust something like that to happen 
in this body but----
  Mr. WICKER. Here is the problem there. If they take care of the 
Governors down the road by saying we are going to send the money from 
Washington to cover this, then all of this talk about the program 
cutting costs at the Federal level goes out the window. Something is 
going to have to pay for it. Either we are going to have to gin up the 
printing press here, borrow some more money from China and send it to 
the States, which I guess is what the Senator was referring to, or we 
are going to pass the unfunded mandate on to the taxpayers of 48 of our 
States.
  Mr. CORKER. So many Senators, so much participation, so little time. 
I think there is about 6 minutes left. The distinguished Senator from 
Utah has not yet spoken. The distinguished Senator from Idaho--a former 
Governor--has not yet spoken. I wondered if the senior Senator from 
Utah might close us out in the remaining time, just to bring this all 
to a climactic conclusion.
  Mr. HATCH. Mr. President, I appreciate the comments of my colleagues. 
They are right-on. They know what they are talking about regarding the 
Medicaid program.
  If this bill becomes law, the CBO estimates that by the year 2019, 54 
million nonelderly, nondisabled Americans will be locked into Medicaid. 
Think about that.
  Americans with incomes below 133 percent of the Federal poverty level 
are not eligible for tax credits to purchase private coverage through 
the exchange.
  I will take a few minutes to read part of a letter I received from 
our Governor in Utah, Gary Herbert--who worked at almost every job from 
local government right up to Governor of the State--about the Medicaid 
expansion included in the Reid bill. My Governor is deeply concerned 
about the impact the proposed Medicaid expansion would have on 
individual States. Here is what he said:

       In Utah, we have a good system of public medical programs 
     that provide for our neediest population.
       The extension of Medicaid to additional populations, as 
     discussed in proposed Federal healthcare legislation, will 
     amount to an unfunded mandate that would create financial 
     havoc for our state.
       While I understand the idea that everyone must ``share in 
     the pain,'' and appreciate the Administration's commitment to 
     reforming healthcare without increasing the size of the 
     federal deficit, to force Medicaid cost increases onto states 
     will simply shift massive cost increases to the states.
       As we prepare the state's fiscal year 2011 budget, we face 
     continued cuts to agency budgets and reduced government 
     service on top of painful reductions made last year. The 
     unfunded mandate of a forced Medicaid expansion will only 
     exacerbate an already dire situation.
       If required to increase our Medicaid program as envisioned 
     in Washington, Utah and most every other state will be forced 
     to fund the money to do so through other means. This will 
     require states to either raise taxes or continue to cut 
     budgets in areas currently suffering from a lack of funding, 
     such as public and higher education. We must work together to 
     ensure that no new requirements for states to fund healthcare 
     for additional populations pass.

  In summary, I ask my colleagues, if the Reid bill is signed into law 
and the Medicaid expansions go into effect, what will the States do to 
make their budgets work? According to Utah Governor Herbert, States 
will be looking at a variety of options, such as cutting education 
programs and raising taxes. It would devastate the State, as Governor 
Barbour has said and as almost every Governor would say. I thought that 
was an important point to make.
  Mr. CORKER. Mr. President, I know the Senator has been a leader in 
making sure people throughout this country have appropriate health 
care. I thank the Senator for those comments.
  There is no one better to respond than a former Governor, the Senator 
from Idaho, Jim Risch.

[[Page 31641]]


  Mr. RISCH. Mr. President, first of all, let me say this raid on the 
States is just that. This is going to be a tax increase, and it is not 
included anywhere, it is not talked about anywhere. There is no way the 
States can deal with this except with massive tax increases or massive 
cuts in education.
  In most States, I am sure, like Idaho, about two-thirds of the budget 
is spent on education, about 10 percent of it is on public safety, and 
you have about 20 percent that is on social services. Unless you have 
been a Governor, you can't understand how difficult it is to control 
what has become an expanding black hole in Medicaid.
  The first social program this Congress came along with was Social 
Security. They decided they would do it, and they funded it. The second 
was Medicare. They decided they would do it, and they funded it. Along 
came Medicaid, and some genius here decided the Feds will only pay 70 
percent or so and we will make the States pay 30 percent. Well, 
everywhere across this country, Governors are saying: Don't do this to 
us.
  The dozen of us here who are former Governors were asked to 
participate in a conference call a couple weeks ago. I listened, but I 
didn't talk. I didn't need to because there was great bipartisan 
support for killing this bill. The most vocal people were Democrats. 
The most vocal Governors were Democrats, who were saying we cannot 
tolerate this kind of an increase. That is what is going to happen 
under this bill.
  I am sorry none of my friends from the other side of the aisle are 
here, with the exception of the Presiding Officer.
  Could the Senator from Mississippi take the top chart off. If my 
friends were here, I would tell them to pay attention to the polls 
because that is what America is going to look like on CNN next November 
2, in the evening, if you continue down this road.
  I thank the Chair.
  Mr. CORKER. I thank the Senator. I know of nobody who has spoken more 
eloquently on this topic than the Senator from New Hampshire. Before I 
hand it off to him, when I was in my 40-something-plus townhall meeting 
since this debate began, our citizens said to me they wanted the same 
choices I had as a U.S. Senator. This expansion for the American people 
is mostly being done in the area of Medicaid.
  I don't know if the Senator has any comment to that effect or a 
comment as to whether we Senators ought to be in Medicaid, if this is 
our idea of health care reform. I certainly hope he will close us out, 
and I thank him for his tremendous contribution.
  Mr. GREGG. Mr. President, I thank all of the Senators here for their 
comments. I say this--and I think the Senator from Tennessee was 
alluding to this at town meetings--this expansion of Medicaid isn't 
good for people. It is not good for people on private insurance. Their 
insurance will go up, and a lot of employers will have to drop 
insurance because it is too expensive. It is not good for people 
getting Medicaid because the number of providers willing to see them 
will go down. That is what the Actuary tells us, and that is what 
common sense also tells you. When you are only paying 60 percent of the 
cost of seeing somebody, people will stop seeing them. It is not good 
for everybody in all those red States up there on the chart because 
their taxes will go up because the States are going to get the bill for 
this. States can do nothing but raise their taxes. So it is not good 
for people and not good for health care in this country, in my opinion.
  Mr. CORKER. Mr. President, how much time remains?
  The ACTING PRESIDENT pro tempore. Thirty minutes has been consumed.
  Mr. CORKER. I am sure the Senator from Tennessee--if there is time 
remaining and if nobody is here to claim it--would like to speak. He is 
always good at explaining the deficiencies of this bill.
  Mr. ALEXANDER. Mr. President, I thank the Senator. I am impressed 
with the number of Senators here this afternoon. One thought comes to 
mind, and I wonder if some of my colleagues may want to talk about it. 
I woke up one day and saw on television a sign that said ``32 percent 
tuition increase for the students of California.'' The University of 
California could be the best public institution of higher education in 
the world.
  One of the great things the United States has--which keeps us 
competitive and gives us a chance to continue to grow and create new 
jobs--is a superior system of higher education. About half of the best 
universities--Harvard, Yale, and the private universities--half or more 
than half are public universities, where tuition is a few thousand 
dollars a year. Well, what is going to happen with this? All of us who 
have been Governors have gone through this. You have a pot of money 
left, and it either goes into higher education or Medicaid. For the 
last 30 years, we have been having to fight to fund Medicaid, and as a 
result States have not been funding public higher education properly 
and the quality has gone down and the tuition has gone up.
  What is this bill saying? It says that, after 3 years, we are going 
to dump a huge new cost on the States. I don't believe I am overstating 
it when I say that in our State of Tennessee, given the terrible fiscal 
condition our States are in today--and our State is more conservatively 
run than most--I believe our State could only fund this through a new 
State income tax and/or serious damage to higher education or both. I 
wonder if that is not the case in all of the other States represented 
here.
  Mr. CORKER. Listening to what the Senator just said, I looked on the 
other side of the aisle and realized there is no one there. This is one 
of those issues. I know that on Medicare, the other side has been able 
to argue they are extending the life of Medicare. Yet Senator Gregg so 
clearly pointed out yesterday on national television that is impossible 
because they are taking those savings to pay for a new entitlement 
program. At the end of the day, it really will not be extending the 
life in any way. We all wonder why those savings are not being utilized 
now to make Medicare more solvent.
  I wonder what my friends on the other side of the aisle would argue 
in favor of the largest expansion of Medicaid. I think that would be a 
pretty hollow argument. I think everyone knows that it was all about 
money, that this was the cheapest way to try to meet some goals--by 
passing it off to States. I would love to hear somebody on the other 
side argue how health care reform, where 50 percent of the people being 
added are being thrown into the worst program that exists in America--I 
would love to hear somebody over there argue how that is good for our 
country.
  I know Senator Gregg, myself, and others have signed on to 
legislation that would give low-income citizens choices among private 
companies and, with that, vouchers, nonrefundable tax credits, and then 
to be able to pay for that. That is health care reform. That is 
something that creates robust competition, and certainly we would not 
have these low-income individuals locked into the dungeon of the worst 
health care program that exists simply because it is cheap, making, in 
essence, the value of their health care less than the value of ours 
here in the Senate.
  I would love to hear anybody on the other side of the aisle argue for 
expanding Medicaid--how that is a good thing for the citizens it 
covers.
  I see we have someone from the other side of the aisle here. Mr. 
President, I don't know if we still have time to talk. I know Senator 
Johanns has comments to make.
  The ACTING PRESIDENT pro tempore. The time for the minority has 
expired.
  The Senator from Louisiana is recognized.
  Ms. LANDRIEU. Mr. President, I rise to speak about the ways in which 
small businesses will be helped in this bill.
  Before my colleagues leave the floor, had some of them stayed at the 
negotiating table, perhaps some of the provisions they talked about 
could have been considered. Since they pretty much packed up their bags 
months ago and left the debate and they just come to the floor to talk, 
it is very difficult

[[Page 31642]]

to put any of their provisions in the legislation. There were some 
amendments that were accepted in the Finance Committee and in the HELP 
Committee.
  The fact is, there is a lot of choice in this bill. There are a lot 
of choices for individuals and for small businesses. There is help for 
Americans and for businesses not only in the State of Louisiana, which 
I represent, but all the States in the Union.
  As you can see on this chart, without reform, the cost for small 
businesses will rise from--or the jobs lost because of the lack of 
reform will rise from 39,000, to 70,000, to 103,000, to 137,000, and 
then to 178,000. These are jobs lost because small businesses are 
having a very difficult time affording premiums and because of a lack 
of reform in the private insurance market, which this bill also 
provides. This trendline will continue unless we do something. That is 
why many of us are here working early in the morning, through the 
middle of the day, and until late at night trying to figure out the way 
to reform this system.
  I respect my colleagues. I know them all very well. They made their 
statements for the record this morning. But the fact is, we have been 
at this since Harry Truman was the President. We can't throw this bill 
away and start over again. There is choice and there is expansion of 
Medicaid and reform in the Medicaid system. There will be strengthening 
and reform of the Medicare system. In the middle, there is great 
strength and reform of the private insurance market.
  I am a very strong supporter of choice and competition. I came to the 
floor to speak about a segment of our population--27 million, to be 
exact. That is the number of small businesses that are depending on us 
to do our very best work on the Patient Protection and Affordable Care 
Act pending before the Senate as we speak.
  Our economic prosperity as a nation, as you know, Mr. President, as a 
former Governor of Virginia who helped bring millions of jobs to your 
State and now as a leader on small business yourself, the economic 
prosperity of our Nation relies, in large measure, on how we can help 
our small businesses become the economic engines we know they can be to 
help lift us out of this recession.
  Entrepreneurs roll up their sleeves and go to work each and every 
day. They go early to work; they stay late. They create jobs. They push 
the envelope on technical advances, and they assume the risk necessary 
to succeed in the private marketplace. Small businesses created 64 
percent of American jobs in the last 15 years, according to the Small 
Business Administration and others.
  Yet as chair of the Senate Committee on Small Business and 
Entrepreneurship, I have heard time and time again from these same 
business owners that they cannot afford to operate in the current 
broken health care system, and they desperately need us to fix it. That 
is what this effort underway is.
  Small businesses have been hard hit by premiums that are regularly 
increasing at 15 percent, 25 percent and, in many cases, 45 percent. 
This is the cumulative cost of health benefits: You will see, in 2009, 
$156 billion. Without reform, it is going to go to $717 billion. Then, 
in 2015, it will exceed the $1 trillion mark. This is what happens if 
we do what my colleagues are urging us to do and do nothing or to start 
again.
  We have been, as I said, since Harry Truman was President, trying to 
figure out a way to provide each and every American with affordable 
health insurance, either through the public or the private sector or 
some combination of the above. That is why this bill is so important 
because, without reform, this is the price our small businesses will 
have to pay, and it is too steep, it is too high of a mountain for them 
to climb.
  Without these reforms, as I said, costs are expected to more than 
double over the next 10 years. But this debate is not about numbers, it 
is about people--people such as Mike Brey, who owns Hobby Works in 
Laurel, MD, and who was here just last week in the Capitol to speak at 
a press conference. I have had hundreds of business owners from all 
over the country to come. Mike was one of the last ones to come and 
speak at a press conference last week. He said to us that his plan not 
too long ago cost only $100 a person, most of which he was happy to 
cover as a company. Over the years, however, his premiums have tripled 
and his employees have seen their costs go five times higher as they 
pay more of their premiums, up to almost a $1,200 deductible.
  Mike said--and his words are echoed by business owners in my State 
and business owners around the country:

       Those of us who do provide coverage are slowly being 
     dragged down by these costs. Something that we once 
     considered a benefit, a benefit I was proud to provide, has 
     now come to be seen as a burden--a burden to be feared 
     because you don't know what is coming next.

  He went on to say:

       After years of astonishing rate hikes and declining 
     competition among providers, many small businesses, like 
     mine, may be only one or two years away from having to cut 
     their health care programs entirely. I'm not going to let 
     [these premiums] put me out of business. I'm just going to 
     say we can't do it anymore.

  This is what is happening all across America. Only 15 years ago, 65 
percent of small businesses in our country offered affordable health 
insurance, something they were proud to provide--full and comprehensive 
coverage, many of them picking up a majority of the costs. Today that 
has dropped to 39 percent and dropping every week that we fail to act.
  Small business owners, such as Mike from Maryland, hundreds in my 
State, need meaningful health care reform. The Senate health care bill 
contains measures that responsibly put in place both intermediate and 
long-term insurance reforms that are very important.
  Let me start with the immediate benefits. I understand there are 
some, including myself, who would like to see more immediate benefits, 
but these are some that are important, substantial, and real.
  Temporary reinsurance for early retirees will be available under this 
bill. This will help many in a very tough stage in their life.
  States may establish exchanges to get a jump on, of course, the 
mandatory date that is in the bill.
  No annual limits and restricted lifetime limits. This will be a very 
important benefit to small business.
  Reporting medical loss ratios. For the first time, insurance 
companies will have to report information that will help keep the costs 
lower over time and bring more transparency and accountability to the 
system.
  The bridge credit for small businesses will go into effect almost 
immediately. It will help businesses that have 10 employees or 25 
employees provide health coverage for their workers.
  Then, in the intermediate timeframe, there are some additional ones. 
The exchanges will be set up by 2014. When people on the other side 
talk about choice, there is going to be plenty of choice in this bill 
for uninsured individuals, for those who are in small businesses up to 
100 employees. They will be able to access these exchanges and look for 
affordable options. That is going to be a major improvement over the 
current system.
  There is a bridge credit--a credit I call a bridge credit--a bridge 
to the exchanges for small businesses. Once the exchanges are up and 
running, businesses with 10 and 25 employees or less will be able to 
get almost 35 percent credit for the insurance they provide. That is in 
addition to the deductibility they have in current law.
  I ask unanimous consent to speak for another 5 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Ms. LANDRIEU. Mr. President, one of the major criticisms of this bill 
has been the costs. The bill does show fiscal responsibility, cutting 
budget deficits by $127 billion in the first decade and $650 billion in 
the second decade. Anything we do is going to cost money upfront to fix 
the system, but the way this bill is being designed is that for every 
dollar that is spent, there is a dollar raised to pay for that change. 
That is a refreshing change of method,

[[Page 31643]]

considering the last 8 years, where bill after bill was put on this 
floor, whether for domestic or international priorities, and not paid 
for at all.
  We can be criticized for trying to push major reform forward, but at 
least we are finding ways within the system to pay for these important 
changes that will hopefully drive down costs for everyone.
  As Mike reminded me, the gentleman who spoke at our press conference:

       It is even more important not to let one problem prevent 
     you from solving another problem.

  While we do have budget deficit problems and we are very sensitive to 
it, we cannot allow that to stop us from doing anything else. What we 
can do, as we work on the other problems, is to do it in the most 
fiscally responsible way possible. That is why I and many Members of 
the Senate have said we are not prepared to vote on anything until we 
get a final CBO score, to make sure not only can we afford it and not 
only have we paid for it but that, over time, premium costs will go 
down, costs to the government will go down, both at the Federal and 
State level, as well as to small businesses.
  The Business Roundtable reports that these exchanges, both in the 
near term and the intermediate term, could reduce administrative costs 
for business owners by as much as 22 percent. If business owners are 
making shoes, they can get back to making shoes, not running around 
looking for insurance they cannot find and, if they can, it is too 
expensive for them anyway. If they are building high-tech equipment or 
electronic equipment, they can get back to the business of doing that, 
instead of being in the business of figuring out insurance actuarial 
tables.
  Reducing administrative costs for small businesses is important. 
Twenty-two million self-employed Americans have even more unpredictable 
costs. Their premiums have risen 74 percent since 2001. These exchanges 
will help them also reduce administrative costs.
  I am proud that one of the amendments I have pending on the Senate 
floor would give the self-employed a 50-percent tax deduction so they 
can be on a similar playing field, if you will, for the small 
businesses and large businesses that enjoy favorable tax treatment 
under the current Tax Code.
  It has been mentioned before, but insurance companies will no longer 
be allowed to arbitrarily raise rates or drop coverage. Instead, 
companies will be forced to compete on the price and quality of their 
plans, not by underwriting the least risk.
  The bill also has no employer mandate. Instead, we have a shared 
responsibility for businesses with more than 50 employees. Ninety-six 
percent of small businesses in America are exempt from the provision of 
required coverage, but we have come to terms with a system that 
requires individuals to purchase insurance, as well as small businesses 
to provide insurance with proper tax credits and subsidies that help 
them make it possible.
  To help small businesses more immediately bridge the affordability 
gap, these exchanges will not be up and running until 2014. Again, 
there is an amendment to push that up. I hope we will be able to do 
that.
  In the bill, tax credits will help about 51,000 businesses in my 
State of Louisiana alone. There are hundreds of thousands of businesses 
that will benefit--51,000 in my home State of Louisiana alone--because 
of the credits that are in the bill, and through the amendment process, 
we are hoping to enrich and expand them.
  While these provisions in the underlying bill are strong for small 
business, there is always room for improvement. That is why I, along 
with many of my colleagues, have submitted a series of amendments. Some 
have costs to them, such as the 50-percent deduction. It is a $12 
billion cost. But if we can find it in the bill, if the mark allows us 
to find $12 billion, that would be a good place to spend it because 
these individuals, whether they are realtors, attorneys, accountants, 
sole contractors, or carpenters who are working out there creating a 
job for themselves and creating economic opportunity in their 
communities, could use a tax cut and a tax credit to help them.
  There are a series of amendments that I have submitted that do not 
have any costs associated. They are just common sense and create more 
efficiency in the system. I trust the leadership will consider 
including those amendments.
  In addition, Senator Lincoln has an amendment to expand both the 
bridge credit and the tax credit. It is a $9 billion provision. We are 
hoping the mark will allow for that addition as well.
  I wish to mention a few other points in my closing. I thank the small 
business owners, organizations, and advocates who remained at the 
negotiating table. They did not pack up their bags and run away. They 
stayed here in Washington, in State capitals, on telephones, on 
conference calls, in public meetings, in the debates taking place in 
the many committee rooms to argue for this kind of reform--for choice, 
for transparency, for insurance market reform, the tax credits, more 
favorable tax treatment to help them afford the insurance they know is 
the right thing for them to do and it is the smart thing for them to 
do. Most small business owners want to provide good health insurance 
for their employees so they can compete for the best employees out 
there, which helps them keep their businesses strong.
  I thank the small business owners, particularly the small business 
majority, many of the women business owners, organizations that have 
stayed at the table to help negotiate this important bill.
  In conclusion, as we move forward, I am prepared to work with my 
colleagues in the Senate to pass meaningful and responsible health care 
reform for small businesses. We have a historic opportunity in 
Washington to fix a system that is broken, that is in desperate need of 
repair. Let us not let this chance slip away.
  In these final days of negotiation, let us come together to find a 
way forward, again, one that reforms the private insurance market, 
strengthens Medicare, and sustains its viability over a longer period 
of time, helps to improve the system of Medicaid, by hopefully 
providing poor, middle-class, and wealthy people with more choices of 
health care and by coming to terms that we are not going to have an 
all-public system and we are not going to have an all-private system. 
We are going to have to find a middle ground, where we take the best of 
both sides of the public and private system and put them together so 
every American can have insurance they can count on and, most 
important, that our small businesses can have insurance that help them 
create the jobs necessary to lead us out of this recession to start 
turning this deficit situation around and creating wealth and 
prosperity for all Americans.
  Mr. President, I see my colleague here, the Senator from Vermont, and 
so I thank the Chair and I yield my time.
  The ACTING PRESIDENT pro tempore. The Senator from Vermont.
  Mr. SANDERS. Mr. President, as an Independent, let me try to give an 
independent assessment of where we are--which ain't easy, because this 
is a 2,000-page bill and different people have expressed different 
thoughts about it. I know my Republican friends are down here on the 
floor every day telling us that the world as we know it will rapidly 
come to an end if this legislation is passed, and yet I want to say to 
them: Where were they for 8 years? Where were they during the 10 years 
of President Bush? Some 7 million Americans lost their health 
insurance, health premiums soared, and tens of thousands of people died 
every single year because they couldn't get to a doctor. Where were 
they? It is very easy to be critical, but it might have been a good 
idea if 5 or 6 or 8 years ago they were down here before the crisis 
erupted to the level it is right now.
  This bill, in my view, is far from perfect, and I am going to talk 
about some of the problems I have with it, but I also want to very 
briefly outline some of the real assets, positive provisions that are 
in this legislation. It is not insignificant that this bill provides 
insurance for 31 million Americans who have no insurance. That is a 
huge step

[[Page 31644]]

forward for our country. It is not insignificant that this legislation 
provides for major health insurance reform, finally outlawing some of 
the most outrageous behavior patterns of the private insurance 
companies--practices such as denying people coverage for preexisting 
conditions, behaviors such as not renewing health insurance because 
somebody committed the crime the preceding year of getting sick and 
running up a huge bill. It eliminates caps on the amount of money that 
people need. Well, you know what, if people need cancer surgery, it is 
expensive, and you can't tell them there is going to be a cap on what 
they receive. This bill, importantly, says to families with young 
people that young people will get coverage until they are 26 years of 
age. That is a very important provision. All of those are very 
important steps forward.
  Having said that, let me also mention that this bill is strong on 
disease prevention. The Senator from Iowa, Tom Harkin, has talked for 
years about the need to understand why we are seeing more and more 
people coming down with cancer or heart disease or diabetes or other 
chronic illnesses, which not only cause death and pain and suffering 
but huge expenditures for our health care system. It seems to me to 
make a lot more sense to get to the root of the causation of those 
problems, try to prevent them, and in the process keep people healthy, 
and save our system substantial sums of money. We have a lot of 
resources in there for disease prevention.
  Those are a few of the positive elements that are in this bill, and I 
congratulate the people who have fought to make those provisions 
possible. But let me talk about some of the weaknesses in this bill and 
some of the areas where I have real concern.
  Right now, today, we are spending almost twice as much per person on 
health care as any other major country on Earth, despite the fact our 
health care outcomes in many cases are not as good. Can I stand here 
with a straight face and say we have got strong cost-containment 
provisions in this legislation; that if you are an ordinary person who 
has employer-based health care your premiums are not going to go up in 
the next 8 years based on what is in this bill? I can't say that. It is 
not accurate. So we need to have in this bill, as we proceed on it, to 
make sure there are far stronger cost-containment provisions than 
currently exist.
  To my mind, at the very least, we must have a strong public option to 
provide competition to the private insurance companies that are raising 
their rates outrageously every single year. What is to prevent them 
from continuing to do that under this legislation? Not a whole lot, 
frankly. So the fight must continue for strong public options, not just 
to give individuals a choice about whether they have a public plan or a 
private plan but to also provide competition to the private insurance 
companies.
  Second, let me tell you another concern I have. Right now, our 
primary health care system in this country is on the verge of collapse. 
There are people all over this country who cannot get in to see a 
doctor. In fact, we have some 60 million people in medically 
underserved areas. Most of them can't get to a doctor. What they end up 
doing is going to an emergency room. They get sicker than they should 
be and end up going to a hospital, at great expense to our system, and 
adding a lot of human suffering. What I worry about, if we add 15 more 
million into Medicaid, if we add another 16 million people into private 
health insurance, where are those people going to get the primary 
health care they desperately need? The system is inadequate now. It 
certainly does not have the infrastructure to address 31 million more 
people who are getting health insurance.
  The good news is that in the House there is language put in there--
and fought for by Congressman Jim Clyburn--that would add $14 billion 
over a 5-year period in order to see a significant expansion of 
community health centers and the National Health Service Corps. 
Community health centers today are providing primary health care, 
dental care, low-cost prescription drugs, mental health counseling to 
some 20 million people. What is in the House bill is language that 
greatly expands that program and also expands the National Health 
Service Corps, which provides debt forgiveness for medical students who 
are going to practice primary health care, dental care, or nursing in 
underserved areas.
  We desperately need more primary health care physicians. Certainly we 
have to change reimbursement rates, but one way we can help is that 
when medical school students are graduating with $150,000 in debt, debt 
forgiveness will help them be involved in primary health care. So this 
is an absolutely essential provision we have got to adopt. We have to 
do what the House did and provide at least $14 billion more for primary 
health care, an expansion of community health centers and the National 
Health Service Corps.
  There is another issue. I know there are not many people in this 
institution who agree with me--although there are millions of Americans 
who do--that at the end of the day we have to understand that one of 
the reasons our current health care system is so expensive, so 
wasteful, so bureaucratic, so inefficient is that it is heavily 
dominated by private health insurance companies whose only goal in life 
is to make as much money as they can. We have 1,300 private insurance 
companies administering thousands and thousands and thousands of 
separate plans, each one designed to make a profit. The result is we 
are wasting about $400 billion a year on administrative costs, 
profiteering, high CEO compensation packages, advertising, and all the 
other stuff that goes with the goal of private insurance companies to 
make as much money as they can. So I will be offering on the floor of 
the Senate, I believe for the first time in history, a national single-
payer program, and I look forward to getting a vote on that.
  I am not naive; I know we will lose that vote. But I will tell you, 
at the end of the day--not this year, not next year, but sometime in 
the future--this country will come to understand that if we are going 
to provide comprehensive quality care to all of our people, the only 
way we will do that is through a Medicare-for-all, single-payer system, 
and I am glad to be able to start that debate by offering that 
amendment.
  But more importantly for the immediate moment, we have language in 
this legislation which must be improved which gives States--individual 
States--the right, if they so choose, to go forward with a great deal 
of flexibility in order to provide quality care to all of their people. 
Many States may look at a single payer, other States may look at other 
approaches. But I believe it is absolutely imperative--and I am working 
with Senator Ron Wyden on this issue--to give maximum flexibility to 
States to be able to take the money that otherwise would be coming in 
to their State to use for their own innovative health care programs 
designed to provide quality, universal, comprehensive health care in a 
cost-effective way. Some may choose to go single payer, some may choose 
to go in another direction. We have language in there which must be 
improved so that States can begin that process when the exchange comes 
into effect in 2014.
  I want to touch on two other issues briefly. The House has very good 
language in determining how we are going to pay the $800 billion to 
$900 billion we are spending. What the House says is there should be a 
5.4 percent surtax on adjusted gross income above $2.4 million for 
individuals and $4.8 million for couples. That means nobody in this 
country who is making less than $2.4 million or less than $4.8 million 
as a couple will pay one nickel.
  What we have here in the Senate, unfortunately, is a tax on health 
insurance programs which, in fact, will result in the middle class 
paying, over a period of time, a not so insignificant amount of money 
as part of this process.
  The ACTING PRESIDENT pro tempore. The Senator has used his time.
  Mr. SANDERS. I ask unanimous consent for 5 more minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

[[Page 31645]]


  Mr. SANDERS. Mr. President, in joining me, Senators Brown and Franken 
are supporting this amendment, as well as the AFL-CIO, the National 
Education Association, the International Brotherhood of Teamsters, the 
Communication Workers of America, the United Steelworkers of America, 
the American Postal Workers Union, and many other organizations 
representing millions of Americans.
  The bottom line here is that at a time when we are in the worst 
economic crisis since the Great Depression, do we want to ask the 
middle class to pay more in taxes as part of health care reform or 
should we ask the wealthiest people in this country to start paying 
their fair share of taxes? I think the evidence is overwhelming that we 
should do that.
  I would point out that, according to the consultant group Mercer, the 
Senate tax on health insurance plans--despite what we are hearing about 
a so-called Cadillac plan--would hit one in five health insurance plans 
in 2013. The CBO has estimated that this tax would affect 19 percent of 
workers with employer-provided health coverage in 2016. So what we have 
got to do is junk the tax on health insurance plans, move to the House 
provision, which says let us ask the wealthiest people in this country 
to pay a modest amount in order to make sure many more Americans have 
health insurance.
  The last point I want to make is that in the current bill being 
debated now there is a provision which deals with the reimportation of 
prescription drugs. This is an issue I have been involved in almost 
since I have been in the Congress. I was the first Member of the 
Congress to take Americans into Canada, across the dividing line, in 
order to purchase low-cost prescription drugs. I will never forget the 
reality that women who were with me from Franklin County, VT, ended up 
paying one-tenth the price for Tamoxifen--a widely used breast cancer 
drug--than they had been paying in the United States. They pay one-
tenth the price in Montreal, Canada, for the same exact medicine.
  We have to be bold. I know and you know that the drug companies are 
very powerful. They are delighted that the American people are paying 
by far the highest prices in the world for prescription drugs. That is 
good for them. They are making a lot of money. But it is not good for 
the average American who cannot afford to buy the prescription that his 
or her doctor is writing. So we have to pass prescription drug 
reimportation. We have to lower the cost of prescription drugs in this 
country significantly.
  The bottom line here is that this bill has a number of very important 
features which I think will make life easier for a lot of our fellow 
Americans. There are problems remaining, and I hope that in the coming 
weeks we will successfully address those problems.
  With that, I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Arizona.
  Mr. KYL. Mr. President, I ask unanimous consent that Senator Nelson 
from Florida be allowed to speak for 10 minutes; after that, that I be 
allowed to speak for 10 minutes; after that, that Senator Murkowski 
speak for 10 minutes; and after that, Senator Dodd. Following that--
Senator Murkowski for 20 minutes, I am sorry; and after that, Senator 
Dodd.
  The ACTING PRESIDENT pro tempore. Is there objection? Without 
objection, it is so ordered. The Senator from Florida is recognized.
  Mr. NELSON of Florida. Mr. President, it is a wonder this health care 
bill has survived this far with so many people shooting at it. But 
survive it must and survive it will, because it is the right thing to 
do. With a country that has 46 million people who do not have health 
insurance, when they do get health care, it costs the rest of us a lot 
of money because they get it free in the most expensive place. That is 
not a system that is operating as it should and that is what this whole 
effort is about. This whole effort is about trying to help people who 
cannot get insurance get it--those who desperately want it, who cannot 
get it, to be able to get it--and those who have it to not have it 
canceled on them in the middle of their treatments.
  It is all about people who desperately want insurance suddenly having 
an excuse from an insurance company: No, you can't get insurance 
because you have a preexisting condition. Some of those preexisting 
conditions are the flimsiest excuses. But what about those who have had 
a heart attack who definitely desperately need health insurance after 
that? This legislation is all about folks who desperately want 
insurance and they finally find an insurance company that will insure 
them and then they cannot afford it.
  Why, in America, in the year 2009 and almost 2010, aren't we at the 
point of being able to give our people the confidence, the 
satisfaction, the loss of fright that they cannot take care of their 
families if they get sick? That is what this legislation is all about.
  But everybody and his brother and sister are taking these potshots 
and every special interest that has their finger in the pie wants their 
share of the pie and to heck with anybody else. This is what we are 
trying to overcome. We are trying to overcome a system that has built 
up since World War II, over the last 60 years, that is inefficient and 
is not giving the health care to the people who desperately need it, 
unless they can afford it.
  So despite all these potshots, survive this bill, it must and survive 
it will. We are going to pass this bill, and somehow we are going to 
get 60 votes cobbled together to break this filibuster so we can get on 
to the final passage of this legislation.
  I wish to give one example. You remember that story, that famous 
novel, ``A Tale of Two Cities,'' about London and Paris? I am going to 
give you a story, a tale of two industries and what they are doing in 
this bill. One industry is the insurance industry, the other industry 
is the pharmaceutical industry--two industries that have an enormous 
interest in the outcome and high stakes in how this legislation comes 
out. On the one hand is the insurance industry. They are running TV ads 
all over this country, trying to torpedo this. If you watch those 30-
second and 60-second ads, you would think this is the worst thing that 
is going to bankrupt America, and we are not going to have anybody 
given any insurance. Why are they doing this? Because they know they 
are going to have to suddenly act responsibly. They are not going to be 
able to have the excuse of a preexisting condition, they are not going 
to be able to cancel your policy in the middle of your treatment. You 
thought they would come to the table, when suddenly we were going to 
insure an additional 46 million people, that they were going to get all 
those premiums. But because the subsidies were not enough for the poor 
people or, if they did not buy that insurance in the health insurance 
exchange that the penalty wasn't enough, the insurance industry said: 
Forget it.
  Contrast that with the pharmaceutical industry. The pharmaceutical 
industry, to their credit, is still supporting this bill. That is very 
good. They are one of the few deep-pocketed industries that can go out 
and buy TV time and support this bill. But remember when I said 
everybody has their finger in the pie? The pharmaceutical industry--I 
want them to know how much I appreciate what they have done, but they 
can do more. Let me give a case in point. They say in their so-called 
$80 billion contribution that $20 billion of that is to have a 50-
percent discount on their brand-named drugs in the doughnut hole. The 
doughnut hole is that vast amount--of about $3,000 that senior 
citizens, once Medicare helps them get up to it--it is about $2,300--
above that all the way up to about $5,300 the Medicare recipient 
doesn't get any reimbursement. It is not until that higher level that 
catastrophic Medicare coverage kicks in.
  What the pharmaceutical industry has said is they will come in and 
give a 50-percent discount. Of their $80 billion contribution, that is 
worth $20 billion. But here is what they didn't tell you. Again, I am 
speaking very favorably for them because they are supporting the 
legislation. But this is what they did not tell you. They did not tell 
you, with that 50-percent discount, that, No. 1, they are going to

[[Page 31646]]

have increased sales of their brand-name drugs to the tune of $5 
billion over this 10-year period in the doughnut hole because they are 
selling more drugs in the doughnut hole; and because that means more 
people get above that $5,300 level and get it into catastrophic 
coverage, that they are going to be able to sell, incremental sales, 
another $25 billion or a total of increased sales of $30 billion.
  They are going to contribute $20 billion, but they are going to get 
$30 billion additional. So they come out a net $10 billion over 10 
years to the good.
  What I would ask the pharmaceutical industry--that we appreciate--to 
do is come in and give a 100-percent discount and, by their open 
numbers, they have come up with, in a study by Morgan Stanley--by their 
own numbers, a 100-percent discount would cost them $40 billion over 10 
years, but they would reap back, by Morgan Stanley's numbers, $60 
billion. They would be, the pharmaceutical industry would be $20 
billion to the good.
  It is a tale of two industries. One is the insurance industry, which 
grabbed its bag of marbles and said you are not making the penalties 
severe enough, we are taking our bag of marbles and we are going home 
and we are going to try to defeat your bill.
  No. 2, the pharmaceutical industry, which has still hung in there but 
which can do a lot more. I hope, as we get into these negotiations, 
they will be willing to step up and set the example of health care 
reform in America.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Arizona is 
recognized.
  Mr. KYL. Mr. President, let me talk for a moment about one aspect of 
the health care legislation that has been of great concern to our 
Nation's Governors. The Presiding Officer can certainly appreciate the 
problem since, among other Governors and former Governors, the 
Presiding Officer had the responsibility of balancing a State budget 
with one of the largest obligations, being the payment for the Medicaid 
patients.
  My Governor, Jan Brewer, of Arizona, was in town last week. She 
talked to me about the problem. She sent me a letter which, in a 
moment, I will ask to be printed in the Record. But as a result of that 
conversation, I wish to point out some things to my colleagues and hope 
we can revisit the legislation that is on the floor.
  Incidentally, before we do that, let me note the fact that my 
colleague from Florida referred a moment ago to a filibuster. I wish to 
be clear. I presume he was not referring to Republicans filibustering 
the bill, since we have been asking to have votes on the pending 
amendment, which is the Crapo amendment, since 6 days ago when that 
amendment was posited. As a matter of fact, the Republican leader on 
Sunday finally had to file cloture on the Crapo amendment, which will 
ripen tomorrow morning, to end the filibuster the majority has been 
conducting.
  I understand members of the majority have not been able to decide how 
to proceed. But in the meantime, we have not been able to vote on any 
pending amendments. Republicans would like to do that, would like to 
get some more amendments up and continue on with our debate on the 
bill. For a bill this important, we should have been able to dispose of 
a lot more amendments than we have. So lest anybody believe there is a 
Republican filibuster going on, I hasten to add that, of course, is not 
true.
  Let me talk about the Medicaid features of this bill. It is against 
the backdrop of unemployment because, as you get more people on 
unemployment, you are going to have more people on the Medicaid rolls. 
Arizona's unemployment rate has risen 6 points just since June of 2007 
and more and more of our people are, therefore, eligible for our 
Medicaid Program, which is known in Arizona as the AHCCCS Program.
  Currently, one in five Arizonans is covered through AHCCCS; over 
200,000 Arizonans have enrolled in AHCCCS since December 31. That is 
nearly 20,000 new enrollees every month. So we are talking about a 
substantial burden as a result of the recession we are in on our State 
government.
  As my State and many others have had to deal with the challenges of 
the recession, declining State revenues, increasing need for certain 
State services, the last thing Washington should do is make things even 
harder for the States. Yet that is exactly what the Reid bill would do. 
The Reid bill would require States to expand Medicaid eligibility to 
all children, parents, and childless adults up to 133 percent of 
Federal poverty, beginning January 1, 2014, and there is even talk now 
of raising that to 150 percent of poverty. Moreover, the Federal 
government would only foot the bill for 3 years. In 2017, and in 
subsequent years, the States would have to help finance this expansion. 
The Congressional Budget Office estimates that $25 billion in new State 
spending would result in the Reid bill.
  The Arizona Governor's office estimates this bill would require the 
State of Arizona to increase its costs by almost $4 billion, between 
now and 2020. The State of Arizona does not have that kind of money.
  Just the so-called woodwork effect alone, meaning the number of 
currently eligible individuals who might enroll, would itself entail 
significant costs. There are about 200,000 Arizonans currently eligible 
but not all are enrolled in Medicaid. If only half those individuals 
would enroll, it would cost the State $2 billion, from 2014 to 2019.
  As I said, our State simply doesn't have the money to do that. Our 
Arizona Governor wrote to Chairman Baucus stating her strong opposition 
to the Medicaid expansion. I ask unanimous consent that her letter, 
dated October 6, to Chairman Baucus be printed in the Record at the 
conclusion of my remarks.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  (See exhibit 1.)
  Mr. KYL. Let me read a few key excerpts.
  First:

       Arizona cannot afford our current Medicaid program, despite 
     the fact that we have one of the lowest per member per year 
     costs in the country. Arizona's General Fund spending on our 
     Medicaid agency has increased by 230 percent over the past 
     ten years, rising from 8 percent of total General Fund 
     spending in fiscal year 1998-1999 to 16 percent ten years 
     later. As part of the solutions for our current year's budget 
     shortfall, we have had to reduce Medicaid provider 
     reimbursement by over $300 million and freeze institutional 
     reimbursement rates, resulting in an additional loss of more 
     than $60 million.
       Despite these reductions, we are sacrificing other state 
     programs that impact the education, health and safety of our 
     children and our seniors in order to cover the growing costs 
     of Medicaid. Considering this, it is incomprehensible that 
     Congress is contemplating an enormous unfunded entitlement 
     mandate on the states. The disconnect between policymakers in 
     Washington and the reality of State and local governments is 
     disheartening.

  Let me quote from some other colleagues of Governor Brewer's, 
Democratic and Republican Governors around the country who have made 
exactly the same point.
  The newly elected chairman of the Democratic Governors Association 
chairman is Jack Markell of Delaware. He said:

       We've got concerns . . . And we're doing our best to 
     communicate them. We understand the need to get something 
     done, and we're supportive of getting something done. But we 
     want to make sure it is done in a way that state budgets are 
     not negatively impacted. . . . But I believe all governors 
     are certainly concerned about what the potential impact is of 
     some of these bills.

  Governor Rendell of Pennsylvania, who has been on television a lot 
and makes a lot of sense when he talks about this:

       I don't think it's an accounting trick. I think it's an 
     unfunded mandate. We just don't have the wherewithal to 
     absorb that without some new revenue source.

  Bill Richardson of New Mexico:

       We can't afford that, and that's not acceptable.

  Gov. Phil Bredesen of Tennessee said he feared Congress was about to 
bestow ``the mother of all underfunded mandates.''
  He was referring to this Medicaid mandate.
  Gov. Christine Gregoire of Washington State:


[[Page 31647]]

       As a governor, my concern is that if we try to cost-shift 
     to the states, we're not going be in a position to pick up 
     the tab.

  Bill Ritter, Democrat of Colorado:

       Our only point was that a significant Medicaid expansion 
     should not operate as an unfunded mandate for the states.

  Gov. Brian Schweitzer, Democrat of Montana:

       The governors are concerned about unfunded mandates, 
     another situation where the federal government says you must 
     do X and you must pay for it.

  Let me quote two more.
  Gov. Ted Strickland of Ohio:

       The states, with our financial challenges right now, are 
     not in a position to accept additional Medicaid 
     responsibilities.

  Governor Perdue of North Carolina:

       The absolute deal breaker for me a governor is a federal 
     plan that shifts costs to the States.

  There are more and more I could quote. The point is, virtually all of 
the Nation's Governors have expressed a concern about this and have 
alluded in one way or another to the disconnect between Washington and 
the States. The point is, Washington seems to bark the orders but it is 
with no regard to the difficult financial challenge many of these 
States are in.
  One final point. These new unfunded mandates generally mean higher 
taxes and significant payment cuts to safety net providers, just as 
Governor Brewer said, and ultimately the loss of jobs. This is the 
example I want to close with. Phoenix Children's Hospital was built to 
handle 20,000 emergency cases a year. It is a great hospital. It 
receives about 60,000 per year. Its capacity does not begin to match 
the need. To meet the demand--and by the way, more than half of these 
are Medicaid patients--the hospital built a new tower expected to open 
at the end of next year. Good news, right? Not exactly. The hospital 
has added up the State budget cuts Governor Brewer referred to, the 
payment cuts in the Reid bill I have referred to, and additional State 
cuts that will be needed to finance new Federal mandates, and concluded 
that the math doesn't add up. As a result, the Phoenix Children's 
Hospital informs me they will not be able to move into their new 
building. It would have generated 2,000 new jobs. What we do in 
Washington has real consequences. I submit the Reid bill spells 
disaster for States.
  As we debate more and more features of this bill, each day we focus 
on something different in this legislation that creates a huge problem. 
Today's focus is on the problem that is focused on States because of 
the visit from our Governor. She is at her wit's end because they don't 
have the fiscal means of paying for this new unfunded mandate. She 
doesn't know what they will do if Congress ends up passing this. I urge 
colleagues, we have to find a way to not expand the Medicaid 
eligibility in a way that adds this new mandate on our States. 
Incidentally, if the Federal Government were to pick it all up, it 
simply transfers it to the citizens in the form of higher taxes they 
would have to pay in order to pay for the mandate that is laid off on 
to the States themselves. One way or another, this element of the bill 
has to be rethought.
  I encourage my colleagues on the other side, figure out what you need 
to do to reach a vote so that we can actually vote on these amendments. 
Republicans are ready. We have been ready for a long time now. Whatever 
it is that is causing a problem within your conference, figure it out 
so you can reach agreement with the Republican leader and we can begin 
to take votes starting on the Crapo motion and then move on through 
other amendments we have, one of which is the amendment by Senators 
Hutchison and Thune, then an amendment by Senator Snowe, and then an 
amendment I hope we will be able to offer at some time to remove this 
unfunded mandate which the States cannot afford to pay for about which 
I have been talking.
  I yield the floor.

                               Exhibit 1

                                                 Executive Office,


                                             State of Arizona,

                                        Phoenix, AZ, Oct. 6, 2009.
     Hon. Max Baucus,
     U.S. Senate, Chairman, Senate Finance Committee, Hart Senate 
         Office Building, Washington, DC.
       Dear Chairman Baucus: I have been following the debate on 
     federal healthcare reform with interest, and I have been 
     working closely with members of Arizona's Congressional 
     delegation to make sure they are well informed about the 
     impact of the various proposals on our state. I am concerned 
     that the proposals under consideration thus far do not 
     consider the fiscal difficulties states are facing and are 
     likely to continue to face over the next few years. Like 
     many, I was particularly focused on the proposal that would 
     emerge from the Senate Finance Committee, and I hoped that 
     your plan would appropriately address state concerns. Given 
     the continued lack of attention to state issues in the 
     Chairman's Mark, I believe it is critical to provide you with 
     my perspective on the state of my state, and how your 
     proposal will impact Arizona.
       By way of background, Arizona is wrestling with one of the 
     most challenging economic downturns in state history. 
     Arizona's economy is heavily focused on construction, real 
     estate and the service sector, all of which have experienced 
     declines that have combined to create a severe and lasting 
     recession. While experts are expressing reserved optimism 
     that the national economy may be turning the corner, it is 
     likely that states--including Arizona--will not feel that 
     turnaround for some time to come
       For example, the revenue collections during the most recent 
     fiscal year for Arizona declined by 18 percent. Through the 
     first quarter of the latest fiscal period, revenues from our 
     three major tax sources have decreased an additional 10 
     percent. Our budget declines are contrasted with our rising 
     Medicaid enrollment, which has grown by 18 percent over the 
     past 12 months. At this time, one in five Arizonans is 
     covered through the Medicaid program and we expect Medicaid 
     enrollment to remain at elevated and unsustainable levels 
     through the near future.
       Arizona cannot afford our current Medicaid program, despite 
     the fact that we have one of the lowest per member per year 
     costs in the country. Arizona's General Fund spending on our 
     Medicaid agency has increased by 230 percent over the past 
     ten years, rising from 8 percent of total General Fund 
     spending in fiscal year 1998-1999 to 16 percent ten years 
     later. As part of the solutions for our current year's budget 
     shortfall, we have had to reduce Medicaid provider 
     reimbursement by over $300 million and freeze institutional 
     reimbursement rates, resulting in an additional loss of more 
     than $60 million. However, budgetary savings cannot be 
     achieved solely through provider reductions. Arizona also 
     recently made the difficult decision to eliminate coverage 
     for 9,500 parents of children enrolled in our Children's 
     Health Insurance Program. Looking forward to fiscal year 
     2010-2011, we know that further reductions will be necessary.
       Despite these reductions, we are sacrificing other state 
     programs that impact the education, health and safety of our 
     children and our seniors in order to cover the growing costs 
     of Medicaid. Considering this, it is incomprehensible that 
     Congress is contemplating an enormous unfunded entitlement 
     mandate on the states. The disconnect between policymakers in 
     Washington and the reality of state and local governments is 
     disheartening.
       These are realities that many states across the country are 
     facing. Arizona's situation, however, is compounded by the 
     fact that we have already expanded our Medicaid program to 
     all residents with incomes under 100 percent of the federal 
     poverty level (FPL). This decision means that, under your 
     proposal, our state will be unable to take advantage of the 
     higher level of federal funding that will be provided to 
     states that have not enacted similar expansions. In essence, 
     the Chairman's Mark penalizes Arizona for its early coverage 
     of non-traditional Medicaid populations, like childless 
     adults.
       I must also point out my concern that estimates developed 
     at the federal level do not accurately reflect the costs that 
     states will ultimately bear. While I have great respect for 
     the Congressional Budget Office (CBO), in this instance, its 
     estimates are substantially below Arizona's fiscal estimates 
     and I believe they understate the cost of expansion. For 
     instance, the CBO analysis estimates the State cost of the 
     Medicaid expansion and ``woodwork'' to be $454 million. 
     Arizona has an estimated 200,000 citizens below 100 percent 
     of the FPL that are currently eligible for Medicaid, but not 
     enrolled. If only half of those individuals enrolled, the 
     cost of this ``woodwork'' effect alone would be over $2.0 
     billion for FY 2014 through FY 2019, using the traditional 
     Medicaid match. That is a significant difference for just one 
     small state.
       I want to reiterate my opposition to these unfunded 
     mandates on states. I implore you to bear in mind the fiscal 
     realities states are facing as we attempt to maintain 
     responsible balanced budgets while preserving services for 
     our most vulnerable residents. I hope you find this 
     information useful as you consider the various proposals 
     before you, and please do not hesitate to contact my office 
     should you require additional information.
           Sincerely,
                                                 Janice K. Brewer,
                                                         Governor.

  The ACTING PRESIDENT pro tempore. The Senator from Alaska.

[[Page 31648]]



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