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Mr. CORKER. Mr. President, I am here to introduce a bill that would address entitlement reforms and the debt ceiling called the Dollar for Dollar Act. I continue to hope Speaker Boehner and President Obama will negotiate a deal north of $4 trillion before year end. However, I think we should also prepare now for the possibility that they will not, especially based on recent conversations. The next opportunity we have to make the structural, transformative reforms to Social Security, Medicare, and Medicaid that will save these programs and put our country on a path to fiscal solvency will be during the debt ceiling vote which will come up after the first of the year as soon as we get back.
I am introducing the Dollar for Dollar legislation that will raise the debt ceiling by roughly $1 trillion in exchange for roughly $1 trillion in reforms to Social Security, Medicare, and Medicaid. This puts into legislative language many of the concepts laid out in a bipartisan Simpson-Bowles and Domenici-Rivlin proposal. This meets our obligations to older and younger Americans.
Young Americans expect us to solve their fiscal issues so they are not saddled with debt and robbed of opportunity for the American dream. Seniors expect us to honor the commitments we have made to them. If we act now, we will be addressing the debt ceiling more than 3 months before we reach it.
Let me walk through those changes that are well known to policymakers and Congress and the administration. I will begin with Medicare. Medicare's trust fund has $27 trillion in unfunded liabilities, and it is expected to be insolvent by the year 2024. According to an Urban Institute study, an average income of a married family will contribute about $119,000 in payroll taxes to Medicare in today's dollars over their lifetime and consume about $357,000 in today's dollars in Medicare benefits.
Obviously, this is unsustainable. Everybody in this room knows this. The pages in front of me know it. Medicare needs to be structured in a way to provide care for current and future beneficiaries in a fiscally responsible manner.
This bill would structurally transform Medicare, keeping fee-for-service Medicare in place forever, while having it compete side-by-side with a reformed Medicare Advantage program called Medicare Total Health. Seniors would maintain the option of choosing fee-for-service Medicare or a private plan as they do today. I think most of us know that about 25 percent of the people in our country who are on Medicare are in a private plan today.
The competition created by these reforms would significantly reduce Medicare costs by $290 billion--and this is very important--without a spending cap on the program. This proposal is similar to one backed by Alice Rivlin, former Budget Director for Bill Clinton.
In addition, this bill would update cost-sharing requirements to reflect 21st-century health care practices, such as capping out-of-pocket expenditures for beneficiaries and unifying deductibles and coinsurance structures. This bill also would improve solvency by requiring higher income beneficiaries to pay more for their premiums.
Finally, it would raise the eligibility age incrementally from 65 to 67 by the year 2027. Moving to Medicaid, the bill would provide increased flexibility for States to achieve Medicaid savings by establishing a waiver process for States to better manage their Medicaid programs. It also would eliminate a massive ``bed tax'' gimmick used to bilk Federal taxpayers out of $50 billion over a 10-year period.
Next, let me walk through Social Security changes. Although some have suggested we should ignore the impending crisis in Social Security funding, we should address it now because it is already beginning to cause the Federal Government to spend more than it takes in, and the Social Security trust fund is projected to be exhausted in the year 2033. It also will be much more painful to make these adjustments to achieve solvency in Social Security if we procrastinate.
In order to return the program to long-term solvency, the bill would enhance the progressivity of benefit calculations. In addition, it would adopt chained CPI in measuring inflation to calculate annual cost-of-living adjustments. Chained CPI is the Bureau of Labor Statistics most modern and most accurate measure of inflation. By the way, the bill would apply chained CPI government-wide, which would also affect revenues, and it would reflect revenues in a positive way as it relates to our budget deficits. It would slowly raise the retirement age to better reflect longevity increases.
Finally, the bill would strengthen the disability insurance program by moving beneficiaries into Social Security insurance at an earlier age. This part of Social Security will go bankrupt by the year 2017 if we do nothing.
In conclusion, I am offering a bill that would implement structural entitlement reforms and, in exchange, it would raise the debt ceiling dollar for dollar. Dealing with this now would avoid facing a crisis next year when we hit that debt ceiling in February or March, which would rattle financial markets and generate tremendous uncertainty in our country and around the world. We need to get our fiscal problems behind us so that businesses, investors, and all of the American people can have confidence about the future. If we do that, the economy will truly take off.
So if I could, if one of the pages could take this to the desk, I am introducing this bill. I hope Senator Reid will put in place a process through regular order for bills of this nature to be introduced and go through the appropriate committees. I hope when we deal with the debt ceiling in this coming year, we do so on a dollar-for-dollar basis, just as has been recently established this last year--the precedent has been set--that during this fiscal dilemma we are dealing with, when we raise the debt ceiling, we actually lower spending by a dollar. Up until this point, almost all the things we have talked about have been through discretionary spending. Thus far, we really haven't addressed entitlement reforms.
Again, let me reiterate that I hope the President and Speaker Boehner come to some accommodation over the next couple of weeks that actually deals with some maybe $4 trillion in size that would actually put this in the rearview mirror. But as the conversations continue, and not much substance is coming forward, that is looking doubtful. So I hope as we end this year and move into next year we will begin to put in place an open process whereas we move toward the debt ceiling and use the same precedent we have already used this last year, so that when we raise the debt ceiling by a dollar, we will reduce spending by a dollar.
We have all said we need revenues and we need entitlement reform. What I have done today is to lay out a way--and I know other Senators will have ideas, and I hope they will bring them to the floor--for us to raise the debt ceiling by around $1 trillion and in return have entitlement reform on a dollar-for-dollar basis, saving and reforming these programs, so that seniors in the future certainly will have the opportunity to continue these programs they depend upon so much, and the young people who are coming behind us will have the certainty that we, as mature adults, I hope, have dealt with these issues in an appropriate way.
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