[Congressional Record (Bound Edition), Volume 157 (2011), Part 3]
[Senate]
[Pages 4251-4254]
[From the U.S. Government Publishing Office, www.gpo.gov]




                              HEALTH CARE

  Mr. ALEXANDER. Mr. President, this is St. Patrick's Day, as Reverend 
Austin mentioned, and we celebrate that. We are coming up on another 
important anniversary, and that is the anniversary of the enactment of 
the health care law, which the majority regards as a historic 
achievement and most Republicans regard as a historic mistake.
  I want to talk a little bit about that law, but there is another 
anniversary I remember very well that came a few days before enactment 
of the health care law--the so-called health care summit that was held 
at the Blair House. It was a remarkable event.

[[Page 4252]]

  The President of the United States, who is highly intelligent and 
well-versed on health care, invited a bunch of us down to discuss 
health care. He stayed and we stayed for 6 or 7 hours. During that 
discussion, it was a pretty free exchange. I especially remember one of 
them. I had been asked by Senator McConnell and Representative Boehner 
to represent Republicans in presenting our side, and the President's 
invitation gave us a platform we usually don't have. He has a better 
platform than we do most of the time.
  We made our argument that we would prefer an approach on health care 
that instead of expanding the health care delivery system, which we all 
know costs too much, we should go step by step to reduce the cost of 
health care so more people can afford to buy insurance. That was the 
basic discussion we had. We got down to some facts. I had said that, 
according to the CBO, the President's plan would raise individual 
premiums and make insurance cost more for individuals who buy insurance 
by 10 to 13 percent. The President said, after I finished:

       So, Lamar, when you mentioned earlier that you said 
     premiums go up--that's just not the case, according to the 
     Congressional Budget Office.

  I said:

       Mr. President, if you're going to contradict me, I ought to 
     have a chance to respond. The Congressional Budget Office 
     report says that premiums will rise in the individual market 
     as a result of the Senate bill.

  The President said:

       No, no, no, no--let me--and this is an example of where 
     we've got to get our facts straight.

  I said:

       That's my point.

  And it went on from there. I had to make a decision at that moment 
whether I should continue to have a public disagreement with the 
President. I thought I was right, and he thought he was right, so I 
decided it would be more appropriate for me not to do that in public, 
to let other Senators and Congressmen have their say. I exchanged a 
letter with the President that day, and I came to the floor of the 
Senate later that week to make my argument on why I believed premiums 
would go up.
  Mr. President, I ask unanimous consent to have printed in the Record 
the transcript of my exchange with the President and that of Senator 
Kyl and a couple of Members of Congress and the letter I sent to the 
President that day which made my point rather than publicly argue with 
him. My remarks I made on the floor of the Senate later that day are in 
the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                            The White House

  Discussion on Cost Containment at Bipartisan Meeting on Health Care 
                                 Reform

                      (Blair House, Feb. 25, 2010)


                           (Roughly 11 a.m.)

       THE PRESIDENT: For folks who even with those lower costs 
     still can't afford coverage, we'd provide some subsidies. But 
     here's what I want to emphasize is that even without the 
     subsidies it's estimated by the Congressional Budget Office 
     that the plan we put forward would lower the costs in the 
     individual market for the average person who's just trying to 
     buy health insurance and they don't--they're not lucky enough 
     to work for a big company, would lower their costs by between 
     14 and 20 percent.
       So, Lamar, when you mentioned earlier that you said 
     premiums go up--that's just not the case, according to the 
     Congressional Budget Office.
       SENATOR ALEXANDER: Mr. President, if you're going to 
     contradict me, I ought to have a chance to--the Congressional 
     Budget Office report says that premiums will rise in the 
     individual market as a result of the Senate bill.
       THE PRESIDENT: No, no, no, no--let me--and this is an 
     example of where we've got to get our facts straight.
       SENATOR ALEXANDER: That's my point.
       THE PRESIDENT: Well, exactly. So let me respond to what you 
     just said, Lamar, because it's not factually accurate. Here's 
     what the Congressional Budget Office says. The costs for 
     families for the same type of coverage as they're currently 
     receiving would go down 14 to 20 percent. What the 
     Congressional Budget Office says is, is that because now 
     they've got a better deal because policies are cheaper, they 
     may choose to buy better coverage than they have right now 
     and that might be 10 to 13 percent more expensive than the 
     bad insurance that they had previously. But they didn't say 
     that the actual premiums would be going up. What they said 
     was they'd be going down by 14 to 20 percent. And I promise 
     you, I've gone through this carefully with the Congressional 
     Budget Office. And I'll be happy to present this to the press 
     and whoever is listening, because this is an important issue.
       SENATOR ALEXANDER: Well, may I--may I--
       THE PRESIDENT: Let me just finish, Lamar. Now, the--what 
     we've done is we've tried to take every single cost 
     containment idea that's out there. Every proposal that health 
     care economists say will reduce health care costs, we've 
     tried to adopt in the various proposals. There are some 
     additional ideas that Republicans have presented that we 
     think are interesting and we also tried to include. So, let 
     me give you an example.
       You mentioned the idea of buying across state lines, 
     insurance. That's something that I've put in my proposal 
     that's actually in the Senate proposal. I think that it shows 
     some promise. You mentioned that as--that Mike Enzi has 
     previously said, that he's interested in small businesses 
     being able to pool in the equivalent of some sort of 
     exchange. So that's where there's some overlap.
       But I just think it's very important to understand that 
     what we've done is to try to take every single cost 
     containment idea that's out there and try to adopt it in this 
     bill. What I'd like to do is to see if we can proceed and 
     have a very concrete conversation about what are the ideas 
     that you guys have that you don't think are in our bill to 
     contain costs. And what I want to do is to see if maybe we 
     can adopt some of those or refine what we've already done in 
     order to further reduce costs.
       SENATOR ALEXANDER: Mr. President, I've had my time--
       THE PRESIDENT: And what I'd like to do also is to make sure 
     that you maybe suggest some of the ideas that are currently 
     in the bill that you think are good, because, Lamar, in your 
     opening introduction, what I saw was sort of a--the usual 
     critique of why you thought it was bad. But as I said, we've 
     adopted a lot of the ideas that we've heard from your side of 
     the aisle. So I hope maybe you could say, well, those are the 
     ones that we think are good ideas; here are the things that 
     we think are bad ideas, as opposed to just painting in broad 
     brush. Go ahead.
       SENATOR ALEXANDER: Mr. President, let me--let me show some 
     respect for my colleagues here. They're all here eager to 
     speak, all sure they could do a better job than I could on 
     any of these points. And what I would like to do is get back 
     directly to you with why I believe--with respect--you're 
     wrong about the bill. Your bill would increase premiums, I 
     believe; you say it wouldn't. So rather than argue with you 
     in public about it, I'd like to put my facts down, give them 
     to you. Maybe other colleagues will say that. As far as Mike 
     Enzi's proposal, he is ready to talk about it; others are.
       THE PRESIDENT: Good.
       SENATOR ALEXANDER: So I appreciate the opportunity that 
     Mitch and John gave me to talk. You've made some interesting 
     points, and why not let other members of Congress have a 
     chance to talk.
       THE PRESIDENT: I think it's a great idea. I'd like to get 
     this issue settled about whether premiums are reduced before 
     we leave today, because I'm pretty certain I'm not wrong. And 
     you give us the information--and we're going to be here all 
     afternoon. I promise you we'll get this settled before the 
     day is out. All right.
       Mitch, who would you like to talk about cost?


         (REMARKS FROM CONGRESSMAN CAMP--LATER IN THE MEETING)

       CONGRESSMAN CAMP: I'm almost done. I do want to say on this 
     issue on premiums, CBO, in their letter, on page four, does 
     say that the estimated average premium per person for non-
     group policies would increase by 10 to 13 percent.
       THE PRESIDENT: This is the discussion that I just had to--
     about Lamar. And--
       CONGRESSMAN CAMP: Yes, they do say that. And they do say 
     that the value of the benefit is higher, and that is why it 
     goes up.
       THE PRESIDENT: Right.
       CONGRESSMAN CAMP: But the reason the value of the benefit 
     is higher is because of the mandates contained in the 
     legislation. And this is one of our big concerns with a lot 
     of the issues that have been raised. Yes, we have 
     similarities. But when all of this is structured around a 
     government-centered exchange that sets the standard for these 
     policies, states can't get out of these requirements unless 
     they seek a waiver from the Secretary. That kind of approach 
     raises costs. And so both of your comments were correct that 
     costs do go up and it's because they have a richer benefit, 
     but the reason it's richer is because of the mandates 
     contained in these very large bills.


            (REMARKS FROM SENATOR KYL LATER IN THE MEETING)

       SENATOR KYL: Now, let me give you a couple of examples. 
     Dave Camp, I think, pointed out the answer to the dispute 
     that

[[Page 4253]]

     you and Lamar Alexander had a moment ago, and he was exactly 
     right. Let me quote from the Congressional Budget Office 
     letter--this is from Doug Elmendorf to Evan Bayh, November 
     30th, 2009: ``CBO and Joint Tax Committee estimate that the 
     average premium per person covered, including dependents for 
     new non-group policies, would be about 10 percent to 13 
     percent higher in 2016 than the average premium for non-group 
     coverage in the same year under current law.'' Oliver Wyman, 
     a very respected third-party group says it's even more--about 
     54 percent; in my state of Arizona, 72 percent increase. Why 
     is it so? For a variety of reasons, but one of which both you 
     and Dave Camp agreed on. It is a richer benefit. How did it 
     get that way? Because the federal government would mandate it 
     under your legislation in the insurance exchanges. And as a 
     result, there would be a higher cost. How does this happen?
       THE PRESIDENT: Okay, Jon. I'm going to go to you, Jim, but 
     I--since as has tended to happen here, we end up talking 
     about criticisms of the existing bill as opposed to where we 
     might find agreement, I feel obliged just to go through a 
     couple of the points that you raised.
       Just to go back to the original argument that Lamar and I 
     had and we've now chased around for quite some time. Look, if 
     I'm a self-employed person who right now can't get coverage 
     or can only buy the equivalent of Acme insurance that I had 
     for my car--so I have some sort of high-deductible plan. It's 
     basically not health insurance; it's house insurance. I'm 
     going to--I'm buying that to protect me from some 
     catastrophic situation; otherwise, I'm just paying out of 
     pocket. I don't go to the doctor. I don't get preventive 
     care. There are a whole bunch of things I just do without. 
     But if I get hit by a truck, maybe I don't go bankrupt. All 
     right, so that's what I'm purchasing right now.
       What the Congressional Budget Office is saying is, is that 
     if I now have the opportunity to actually buy a decent 
     package inside the exchange that costs me about 10 to 13 
     percent more but is actually real insurance, then there are 
     going to be a bunch of people who take advantage of that. So, 
     yes, I'm paying 10 to 13 percent more, because instead of 
     buying an apple, I'm getting an orange. They're two different 
     things.
       Now, you can still--you still have an option of--no, no, 
     let me finish. The way that this bill is structured uses a 
     high-cost pool, a catastrophic pool, for people who can't 
     afford to buy that better insurance, but overall for a basic 
     package--which, by the way, is a lot less generous than we 
     give ourselves in Congress. So I'm amused when people say, 
     let people have this not-so-good plan, let them have a high-
     deductible. But there would be a riot in Congress if we 
     suddenly said, let's have Congress have a high-deductible 
     plan, because we all think it's pretty important to provide 
     coverage for our families. And the federal health insurance 
     program has a minimum benefit that all of us take advantage 
     of. And I haven't seen any Republicans--or Democrats--in 
     Congress suddenly say, ``You know what, we should have more 
     choices and not have to have this minimum benefit.''
       So what we're basically saying is we're going to do the 
     same thing for these other folks that we do for ourselves--on 
     the taxpayers' dime, by the way.
       Now, there is a legitimate philosophical difference around 
     that, but I think it's just very important for us to remember 
     that saying there's a baseline of coverage that people should 
     be able to get if they're participating in this big pool is 
     not some radical idea. And it's an idea that a lot of 
     states--we were talking earlier about what states do--a lot 
     of states already do it.
                                  ____



                                                  U.S. Senate,

                                Washington, DC, February 25, 2010.
     Hon. Barack Obama,
     President, The White House,
     Washington, DC.
       Dear Mr. President: During today's discussion on health 
     care, you and I disagreed about whether the health care bill 
     that passed the Senate on a party-line vote on December 24 
     would cause health insurance premiums to rise even faster 
     than if Congress did not act. I believe premiums will rise 
     because of independent analysis of the bill:
       On November 30, the non-partisan Congressional Budget 
     Office (CBO) wrote in a letter to Senator Bayh that ``CBO and 
     JCT estimate that the average premium per person covered 
     (including dependents) for new nongroup policies would be 
     about 10 percent to 13 percent higher in 2016 than the 
     average premium for nongroup coverage in that same year under 
     current law.''
       When you asserted that CBO says premiums will decline by 14 
     to 20 percent under the Senate bill, you are leaving out an 
     important part of CBO's calculations. These reductions are 
     overwhelmed by a 27 to 30 percent increase in premiums due to 
     the mandated coverage requirements in the legislation. CBO 
     added those figures together to arrive at a net increase of 
     10 to 13 percent--as shown in their chart in that same 
     letter.
       In that same letter, CBO wrote, ``The legislation would 
     impose several new fees on firms in the health sector. New 
     fees would be imposed on providers of health insurance and on 
     manufacturers and importers of medical devices. Both of those 
     fees would be largely passed through to consumers in the form 
     of higher premiums for private coverage.''
       On December 10, the chief actuary for the Centers for 
     Medicare and Medicaid Services--who works for your 
     administration--concurred with the CBO. In his analysis, the 
     actuary said, ``We anticipate such fees would generally be 
     passed through to health consumers in the form of higher drug 
     and device prices and higher insurance premiums.'' He also 
     said, ``The additional demand for health services could be 
     difficult to meet initially with existing health provider 
     resources and could lead to price increases, cost-shifting, 
     and/or changes in providers' willingness to treat patients 
     with low-reimbursement health coverage.''
       For these reasons, the Senate-passed bill will, indeed, 
     cause Americans' insurance premium to rise, which is the 
     opposite of the goal I believe we should pursue.
           Sincerely,
                                                  Lamar Alexander.

  Mr. ALEXANDER. We talk a lot about the law of unintended consequences 
in dealing with legislation. In this case I believe the health care law 
is a situation where we had a lot of predictable consequences. 
Republicans were saying, for example, premiums are going to rise. In 
fact, they have. We were saying specifically that individual premiums 
will rise. It was predictable they would because, in the first place, 
the health care law requires that individuals buy a better policy than 
what they buy today. So if they are going to buy a Cadillac instead of 
a Chevy, it will cost more and they will get more benefits.
  Second, there are some taxes in the health care law, such as with 
medical devices, that are passed on to the consumer and premiums will 
go up.
  Third, a lot of people who moved into Medicaid are going into a 
system of government health care where the doctors aren't properly 
reimbursed. Many of the doctors shift the costs over to the people who 
buy insurance. That is called cost shifting.
  For all those reasons, we have seen stories regularly in California, 
Nevada, Wisconsin, and Connecticut that individual premiums, over the 
last year, have gone up at least partially due to mandates included in 
the new law.
  Let's look at some of the other issues we talked about during that 
time. We said the bill would raise taxes. In fact, it does--$813 
billion. As I mentioned, the tax on medical devices is passed right 
along to people who buy insurance, and their costs go up.
  We said it would cut Medicare, and it has. Eleven million Medicare 
Advantage recipients--about one-fourth of everyone who has Medicare--
are seeing or will see their benefits reduced.
  We said there would be thousands of pages of new regulations that 
would hamper small businesses and individuals as they go about their 
daily lives. We are beginning to see them come. The most notorious is 
that form 1099 which causes 40 million businesses to file a report 
every time they buy something that costs more than $600. We hear a lot 
of talk about repealing that. We have tried to repeal it for some time, 
but it is still the law.
  Something that particularly bothered me about the debate were the 
unfunded mandates on State governments. We hear about college tuition 
going up in California 30, 40 percent. People would be surprised to 
think that the reason may be that the Federal Government is imposing 
more health care costs on California, and the money that ought to go 
for the University of California or the University of Tennessee isn't 
there. Where does the university get the money to keep its excellence? 
It raises tuition.
  Our former Democratic Governor, who just retired, said the health 
care law imposes on Tennessee more than $1.1 billion in new costs 
between 2014 and 2019. That is an unfunded mandate from Washington that 
will cost the people of Tennessee.
  Fewer jobs will be created as a result of this law. Someone might 
say: How can you say that? I will give an example. I met with a group 
of leaders of the restaurant industry in America. They are CEOs of all 
the big restaurant companies. They are the second largest employer in 
America. They hire a lot of low-income people. One of them said they 
had been operating their stores

[[Page 4254]]

with 90 employees on the average, and as a result of the health care 
law, their goal was to operate with 70 employees. That is fewer jobs. 
And there were many other examples of that around the room.
  Even the student loan takeover has created a problem because students 
are actually paying more in interest on their student loans to help pay 
for the new health care law, which I think a lot of students would not 
appreciate.
  The health care law that was passed a year ago, which some believe is 
a historic achievement, we believe is a historic mistake. We believe it 
would have been better and will be better to, instead of expanding a 
health care system that costs too much, go step by step to reduce its 
costs so more people can afford insurance. We will continue to advocate 
that position. We voted to repeal the health care law. We lost that 
vote. But we are continuing to work.
  The ACTING PRESIDENT pro tempore. The Senator's 8 minutes has 
expired.
  Mr. ALEXANDER. With Senator Johanns' leadership and others, we will 
work to repeal the 1099 provision. Senator Hatch and others are working 
to give Governors more flexibility in the Medicaid Program. And we will 
continue to advocate solutions such as allowing people to buy insurance 
across State lines.
  Next Wednesday is an important anniversary. Some believe it is a 
historic achievement. We believe it is a historic mistake and that 
there is a better solution to health care costs.
  I thank the leader for his courtesy in giving me a chance to go 
ahead.
  I yield the floor.

                          ____________________