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Public Statements

Medicare and Prescription Drugs

Location: Washington, DC


Ms. STABENOW. Mr. President, I rise today to speak about the issue of Medicare and prescription drugs and where we are as we have been working to develop a prescription drug benefit for seniors and put in place plans that would lower prices on prescription drugs for everyone: Businesses, individuals, workers, families.

We are at a crossroads. We have been working many hours in a bipartisan way in this body, trying to come to a positive conclusion on the question of Medicare and prescription drugs. There are wide differences in philosophy and approach, particularly with our colleagues on the Republican side of the aisle in the House of Representatives. I am deeply concerned about the direction that the conference committee appears to be going as it relates to the fundamental issue of whether we will continue to have Medicare as we know it in the future.

We all know that Medicare was put into place in 1965 because at least half of our seniors could not find or could not afford prescription drug coverage and health care in the private sector. They could not find or afford health care in the private sector. So this Congress and the President at that time came together and did something I think is one of the most significant actions of modern age for the people of the country, and that is to create health care for seniors, for those over age 65, and for the disabled of this country, a guarantee that we would make a commitment together and fund a system for older Americans and the disabled to have access to health care in this country. It has made all the difference in terms of quality of life for our citizens.

We now are at a juncture where we have seen a proposal passed as part of the House package that would essentially do away with Medicare as we know it. Instead of it being a defined benefit, meaning it does not matter where a person goes, whether they are going to New Jersey, Iowa, or Michigan, or what part of Michigan they live in, whether they live in the Upper Peninsula, Detroit, Benton Harbor, or Lansing, they could count on Medicare. They know what it will cost. Their provider knows what they will be paid for the service. It is a system that is universal, and it works.

What we are hearing now is that there is a great desire, unfortunately, among, again, predominately our colleagues in the House, in the majority, who are saying that system should be radically changed. Instead of having Medicare, which is dependable, affordable, reliable—we know what it is; seniors can choose their own doctors; providers know what the payment will be—they want to change it to what is called premium support.

Now, what does that mean? Essentially, it is like a voucher. They want Medicare to essentially say a person has X amount of dollars for their health care, and if it costs more than that, they pay that. If, in fact, they want to take that and go to an HMO or PPO, that is what would be encouraged. People would be pushed more and more into an HMO or a PPO in order to save dollars, but for most of our citizens that would not be available.

The House basically wants to say that Medicare, as we know it, will no longer be available, and it will be privatized. Folks will be given a lump sum of dollars, and then they are on their own. If they are sicker, if they need more help, they would not be covered for that additional health care they need. There would only be a set amount of dollars or essentially the equivalent of a voucher. This completely undermines what we have put in place for Medicare. The idea that we would say to our seniors, You have health care; you can rely on it; you can count on it; you don't have to worry about it, that would all be taken away with this proposal to undermine Medicare and to essentially turn it back to the private sector.

This is something I find absolutely unacceptable and I will do whatever I can to stop it, and I know on our side of the aisle there is overwhelming opposition to this notion of doing anything that would undermine and weaken Medicare for our seniors.

We know, according to a study that was just done, this proposal could increase the costs for the majority of our seniors who are in traditional Medicare by as much as 25 percent or more. I should mention the majority of seniors, when given the choice between a private plan—in this case Medicare+Choice—or staying in traditional Medicare, they have overwhelmingly chosen to stay in traditional Medicare. In fact, 89 percent of our seniors already voted. If we just want to look at who is covered and who we are trying to help for the future, we should look at what they are saying.

Mr. President, 89 percent of our seniors have chosen to stay in traditional Medicare. Only 11 percent have chosen to go into the private sector. Yet we are seeing an overwhelming push to force people to go into the private sector through a scheme that would privatize Medicare, even though it will cost them more money, even though it is not dependable.

We now know, according to the Medicare actuary in Health and Human Services, that in fact there could be sharp differences in cost among individual people or individual regions, depending on the private sector plans and how this would work. The study that was done by the Medicare actuary studied the proposals calling for private plans to compete against one another and against Medicare's traditional Government-run program. It shows that those in Medicare fee-for-service—traditional Medicare—in States such as North Carolina or Oregon would pay as little as $58 a month, well below the projected national average of $107. So they would pay $58 instead of $107. But in high-cost States such as New York or Florida—my good friend from New Jersey is here, I would guess New Jersey would fall in that category as well—they would be paying more like $175 a month for the same benefit. So on one side of the country you would have people paying $58, on the other side you would have people paying $175, for the same coverage, for the same kind of care. That is not fair. That is certainly not what we have now.

They went on to indicate that we would even see parts of States where there would be one payment, one cost, versus other parts of the State. So if you live in Marquette, MI, or Ironwood, MI, in the Upper Peninsula, you could pay a very different price for your health care than if you lived in Detroit or Lansing or Grand Rapids. That is not fair. It does not make sense. Why in the world would we go back to that kind of system?

It is for these reasons I urge my colleagues not to agree to any plan that changes Medicare as we know it, that privatizes Medicare, that takes away what overwhelmingly seniors have told us they want. They want prescription drug coverage—yes. But don't take away their Medicare. That is not a good tradeoff. We need to strengthen Medicare, provide a real benefit for prescription drugs, and do it right.

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