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Mr. BLUMENAUER. I appreciate your leadership and your focusing on the issues that face us.
Having spent hours in the Budget Committee so far this Congress, I must admit that I was shocked and surprised with the profoundly negative approach that is being taken by my good friend, Paul Ryan, the chair of the Budget Committee and my Republican friends.
First of all, there is in essence a refusal to zero in on the three areas of greatest increase in the budget. We see repeated charts that talk about Medicare going through the roof over the next 50 years. And it is true. We need to get Medicare spending under control because the past path is not sustainable. But ironically what is ignored is that the approach that is being offered by the Republicans in their budget actually ignores the major provisions that have been placed in statute now that would actually reduce the rate of Medicare spending in the future.
We have taken every significant, independently verified promising initiative to bend that cost curve, and they have been stripped away. We watched Republicans attack Democrats because there were provisions to be able to make a difference with Medicare spending, claiming it would somehow slash Medicare for senior citizens by a half-trillion dollars. Well, Congressman Garamendi, you and I come from areas of the country that actually have been able to reduce health care costs, they are below the national average, and in both areas we actually have higher performance; better health care, less cost. If the rest of America practiced medicine the way it is practiced in our two communities, there would not be a Medicare crisis.
What we have done with the reform act was embed those notions to be able to provide incentives to reward value over volume, not just pay for procedures. To be able to have accountable care organizations, bundling of services, to actually have some financial disincentives for unnecessary hospital readmissions. All of these, the experts tell us, could save over $1.2 trillion over the next 20 years. And, in fact, if we had the courage to actually improve and accelerate and enhance, there are greater savings because the doctors, the nurses, the hospitals in our two communities have proven that it is possible. But our Republican friends have simply decided to turn their back on that. They are going to take the Medicare savings and spend it for tax cuts for people who need it the least.
I can't help but turn back to you because you have an interesting chart there on the floor that may say it all.
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Mr. BLUMENAUER. Your point is well taken in terms of what they would do terminating Medicare as we know it for everybody under 55 years of age. We are talking about over 230 million Americans. And as a result of this, it is clear, you can look at the Congressional Budget Office, other independent experts, it is not going to reduce the cost of health care. In fact, it is going to increase the cost of health care in America. But what it does is it is going to put an ever-increasing burden on elderly Americans. It is going to have a gap because ultimately they are not going to enable people to have Medicare until they are 67. They are going to have a small voucher that is given to the insurance company. Bear in mind the reason that LBJ and the Democratic Congress in 1965 enacted Medicare was because America's elderly could not get good insurance coverage that was comprehensive and affordable. Senior citizens, like it or not, are older. They are frailer. They are less healthy than younger Americans, and they are not working as much. They don't have the income. They need help. Now, our Republican friends would lead us to believe that all of a sudden there will be a private insurance market, which by the way sounds suspiciously like the exchanges that they said were bad in the health reform act, and they would force people into them, but they would have decreasing premium support.
I think it is also appropriate to just reflect for a moment about what happens to the 78 million geezer baby boomers who are 55 or older who will be under Medicare. That's going to continue for years. It's going to be increasingly inefficient. It appears as though there are some extra costs that are embedded for existing and soon-to-be future Medicare recipients that are going to continue to distort, drive up costs, and, of course, nationally we're all going to pay more for the privilege.
I would suggest this tombstone is something that people should consider carefully, because it's going to mean, I sincerely believe, not just the death of Medicare but it is going to provide profound shifts and dislocations within our health care system, hurt the providers, and provide less effective health care for our elderly citizens.
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Mr. BLUMENAUER. If we could just follow up on this for a moment, because you are talking about something that ought to concern each and every citizen. Medicaid. In your State Medi-Cal. We've had the Oregon health plan. There are other States that have variations on that. It provides health care, as you say, for our most vulnerable populations: the elderly, disabled, extremely poor people.
Mr. GARAMENDI. And the young.
Mr. BLUMENAUER. It is very cost effective. There are complaints that the benefits under Medicaid are actually very low, and it's hard for physicians and hospitals, medical providers, to deal with this. But by moving to a block grant that, as you say, it is designed to go down over time. And unlike the current system, which is sort of countercyclical, where the Federal Government has given more money in times of distress, which it's done to your State and my State in the last 2 years. If we hadn't got the extra payments from the Federal Government to help with Medicaid, I can't imagine what shape people would have been in in Sacramento and Salem, Oregon. The legislature would have just melted down. What this proposal is, is to continue this ratcheting down, no benefits when times are tough, and put States in a situation where too often they are either unable, or in the case of some States, unwilling to react. It's going to have a cascading effect.
You mentioned the problem that's very likely to emerge with people being literally tossed out of nursing homes. This is something that Americans need to step back and look at what is being designed as part of this very pessimistic road map that is going to have very serious negative consequences.
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