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Public Statements

Small Business Tax Relief Act of 2007--Continued

Floor Speech

Location: Washington, DC

SMALL BUSINESS TAX RELIEF ACT OF 2007--Continued -- (Senate - July 31, 2007)


Mr. COBURN. Mr. President, I am going to spend a little bit of time first discussing health care in America. I have a little bit of experience, having practiced for 24 years. The children the majority whip talked about, I delivered 4,000 of them. I cared for well over a third of those through their infancy and into childhood.

Let's be clear about what this debate is. There is no difference. I agree with Senator Durbin. I want every person in this country to have health insurance. Actually, every problem that Senator Durbin mentioned could be solved by equalizing the tax treatment under the Tax Code so that everybody is treated the same under the Tax Code in this country.

Let's talk about where we are in health care in America today, then let's talk about what the possible solutions are.

What we have today is the best health care in the world. It is very expensive, there is no question about it. Eighty percent of all of the innovation in health care in the world comes out of our health care system. We have survival rates on prostate cancer, breast cancer, and colon cancer that far exceed anywhere else in the world. Our treatments for coronary artery disease are better than anywhere else in the world. If you have a heart attack in this country, you are more likely to live 5 years than anywhere else in the world. But we have a system that is designed to treat chronic disease instead of designed to prevent disease.

I know that the President this evening is supportive of prevention in terms of how do we change the focus in this country. You see, what we have coming to us is a storm. It is not going to be a storm that affects myself or the Senator from Ohio; it is going to affect our kids and our grandchildren. Here is what the storm is. If you are born today, born today, you are born owing $500,000 for the health care of everybody who was born before you under Medicare. Think of that. Listen to me--$500,000 is the cost we are laying on the next generation for the health care system we have under Medicare. That is not talking about Medicaid, that is not about SCHIP, that is about Medicare only. If you are born today, that is what you are going to bear over and above what our present tax rate is. That is called stealing opportunity from the next generation.

We also have a health care system under which 7 percent of the costs of health care comes about from tests that are ordered for you that you do not need. There is no reason you need them, but the tests get ordered because your doctor needs them or your hospital needs them. It is a full $170 billion a year we spend on tests that nobody needs except the doctors to protect themselves in the case of ``what if.'' And this body refuses to look at tort
changes that will make us order tests based on what you need rather than on the threat of a malpractice suit.

So we have liability costs, we have unfunded costs from Medicare, we do not have prevention. We spend tens of billions of dollars a year on disease prevention in this country, $7.1 billion at the NIH, $8.4 billion at the CDC, and then billions more that we can't quantify across many Federal agencies where you cannot measure that we did anything on prevention.

The average American does not know that at age 50, they should have a colonoscopy; they do not know that at age 35, they should have a mammogram; they do not know that if they have a family history of breast cancer, they should have that mammogram sooner; they do not know that every month, they should be doing a self breast exam; they do not know the symptoms of prostate disease in older men; they do not know what they need to know about prevention. We are totally inept in the programs we have today to communicate that to America.

So that is where we find ourselves today--the best health care system in the world, with the most innovation, but also 50 percent more expensive than anywhere else in the world.

Now, when you match up those two statistics I talked about, in terms of greater life expectancy, in terms of all of the cancers, in terms of heart disease, against the cost, what is the difference in all the countries that have universal, single-payor, government-run, bureaucratic-controlled health care? They let you die. That is the difference. If you need a knee replacement, like the Senator from North Dakota talked about, you do not get it because there is no money. Let's talk about some statistics. Average waiting time in Sweden: 25 months for heart surgery. How many people do you think live 25 months? How about an average of 10 months before the onset of chemotherapy for breast cancer in England. The reason their costs are down is because they are not caring for people at the end of life.

We can get all of that back if we emphasize prevention. Prevention. For every dollar we spend on prevention in this country, we are going to get 100 back. Yet we do not have effective prevention programs. So what is this debate really about?

There is not anybody in this Chamber who does not want to see kids have great access to health care, preventative or otherwise. There is not anybody in this Chamber who wants anybody not to have available health care. What is the real debate? Well, there are actually three.

The first debate is: Do we want the Government that cannot get you a passport, that cannot control the border, that cannot take care of the problems associated with a hurricane when we have a major emergency, do you want them running your health care? A government that is failing so many fronts because the bureaucracy is so big, the oversight is so poor from this body, the oversight is so poor, we do not do our jobs. We can find lots of ways to spend new money, but we cannot spend the effort to find out if money we are spending is working. The oversight is so poor that we have ineffective programs all over the place.

There is a columnist by the name of P.J. O'Rourke. He said, if you think health care is expensive now, wait until it is free. And there is a lot of truth to that. When it becomes free, it is going to be tremendously expensive.

So the debate is not about whether we should cover children and whether children ought to have great health care. They should. We have the resources to do it. What the debate is about is whether we are going to put into the hands of an incompetent government in many other areas your health care. And this is the first step in moving it all in that direction.

Now, the Senator from Illinois talked about the young child with acute lymphoblastic leukemia. We have moved to where we have about an 80-percent cure rate with that right now. We did not do that through the Government; we did that through the private sector. But he also noted that he did get this care. He did get chemotherapy. He did get it. So the other point that needs to be made about--the system we have now is shifting a quarter of a trillion dollars a year into a system because we are absorbing costs rather than giving individuals their care based on freedom.

The second point is, if we do this expansion of SCHIP, are we getting good value for what we are paying? There is a chart I want to put up that shows--these are CBO numbers. The reference to the private care comes from data about the individual health insurance market. The $1,532 comes from average of a $500 deductible added to the average premium for a private children's policy: $1,032. One in three will pay a $1,500 deductible, two will pay no deductible. So for $1,532, you can buy private coverage, but with this bill we are talking about spending $3,950 for government care for the same thing. That expense will be charged to your children and your grandchildren. I think it is probably not a great deal, not great value, for us to do it this way.

The other thing the Senator from Illinois recognized is that he wanted everybody to have insurance. All he has to do is cosponsor the Burr-Corker bill because that gives everybody in this country, if you are an individual, a $2,160 tax credit, refundable flat tax credit. If you are a family, it gives a $5,400 refundable tax credit.

Now, what does that mean? If you are earning $61,950, a bureaucrat is going to decide what your health care is and who your doctor is going to be and whether or not you have care versus you deciding. It is about freedom to choose.

So the Senator from Illinois can have every one of the desires he listed and meet every one of the goals by us equalizing the benefit under the Tax Code for all of us. That means it does not matter if you are rich or poor; you get the same treatment under the Tax Code. In other words, we are going to guarantee 100 percent universal access for everybody in this country, and it is not going to cost a penny.

The other thing this debate is about is, Do we really want to have a debate in this country on health care? If we do, let's have a total debate.

Mr. President, so this debate is about whether we get value, this debate is about whether we really are going to fix health care, and finally, this debate is about the dishonesty in this bill about how it is paid for. And what we are doing--you saw Senator Gregg with the chart out here. We are going to assume that in year 6, the cost of this is $3.5 billion, but the new program is 12. There has never been a program that is going to go down from that. So rather than violate their own rules, they cut it down and said it does not exist at the same level for the second 5 years of this authorization. That is exactly what America has come to expect of us--being intellectually dishonest with them about the true costs of programs.

So, as Senator Gregg said, the debate really is about the starting of the debate, about what we are going to do in health care. We have good health care. We have 43.6 million Americans who do not have it. This bill purports to put 3.3 million of them on SCHIP. The only problem with that is 1.1 million of them have insurance now, so there is a double cost. So we got back to the $3,900, which is what the American taxpayer, one way or the other, is going to pay for $1,532 worth of care. How does that make sense? It makes sense only if you are moving in a direction to have the Government run it all.

So if you want the personal freedom to be able to choose what your health care should be and you want the Government to equalize the tax basis under which we all receive care so that everybody gets the same benefit--not the wealthy, one, and the poor, a different one; the difference is $2,700 if you are well off and $102 if you are not--that is how the Tax Code discriminates against you now. What we do and what we suggest is everybody gets the same treatment. And what happens is, under this bill, CBO scores that it will add maybe 3.3 million kids. Under the Burr-Corker, we add 24 million people in coverage over the first 10 years of that program, according to JCT.

So if this is about covering all of the children and about covering those who do not have health care, we ought to be addressing it in a totally different way. We ought to be saying we want a universal flat tax credit that is refundable to everyone in this country so they can all have access.

Senator Wyden has proposed that on the other side with some minor differences in what we are suggesting through the Burr-Corker bill. But the fact is, you cannot have it both ways. Which way is better? Do you want the freedom to choose or do you want an organization that right now has proven to be terribly incompetent?

Some statistics about the incompetence: the doctor shortage in this country 15 years from now is going to be 200,000 doctors. Why is that? Why are the best and brightest not going into medicine today?

Why is that? It is the same reason that you see all the European single-payer systems moving toward what we have, as we try to move toward them. We are going in exactly the opposite direction. The reason is, by the time you finish 12 years of college and graduate and postgraduate and post-postgraduate education, you can't earn enough under Medicare or Medicaid to even repay your loans. So what is happening is, our best and brightest, instead of going into medicine, are going into other areas where they can be remunerated for their investment in education. This drives us further that away.

What is the statistic behind it? Fifty percent of the doctors don't see Medicare or Medicaid patients now. If you move to a new city and you are on Medicare, good luck on finding a new Medicare doctor. Why? Because the reimbursement is about 50 percent of what they can earn seeing somebody who is not on Medicare. So we will have a shrinking number of doctors, a government-run program that is going to control cost by saying, as the Senator from North Dakota said: Here is the amount of money. Guess what. We are not paying for it. It is going to get rationed. That is exactly what is going to happen to us. Consequently, we are going to take the best health care system in the world, with all its defects, and we are going to turn it on its ear. We are going to take the system that develops 80 percent of all new innovations in health care and run it away.

Example: M.D. Anderson Clinic spends more on research in health care than all of Canada. Think about that. One private outfit in this country spends more than the whole nation of Canada on health research. Why? Because we have a system that rewards innovation. We are going to kill that system. We are going to destroy it. The question is not whether children ought to be covered. Sure, they should. But so should their parents and everybody else but not in a way that destroys the system. The system will work if we create access for everyone. The system will work without raising a tax dollar to anybody. We will give everyone free choice to have what is best for them.

The numbers don't lie. If you doubt what I am saying about this being a step toward national health care, here is what they say. Question: Is this the first step toward a government-run, bureaucratic-controlled single-payer health care system? Senate Finance Committee: Absolutely not.

Now let's hear what the chairman said:

We're the only country in the industrialized world that does not have universal coverage. I think the Children's Health Insurance Program is another step to move toward universal coverage.

AKA government-run health care in this country. So the system that gives us great innovation, that creates 80 percent of the new drugs, new techniques, new technologies, we are going to poke our finger in its eye because of what it has done.

We heard the Senator from Illinois say all the big businesses want to solve this. They have made commitments to health care. They now want to dump on the American public rather than on their shareholders. General Motors, Ford, Chrysler, they want us to pay for it. They had an obligation for it. They took plenty of bonuses when the profits were good. Now they want you as taxpayers to pay for it. That is why all the Governors want the SCHIP program, because it is going to expand their ability to solve their other budget problems. But what we are charged with is doing what is best for the country in the long run. I will promise you, a government-run, bureaucratic-controlled health care system is not the best thing for this country. And that is what we will get. What we to have do is go back and use a little common sense and look at what is happening.

In my State of Oklahoma, we have 117,000 kids on SCHIP. Oklahoma chose to make it a Medicaid expansion. The problem is, Medicaid doesn't pay enough so kids can't get access in Oklahoma under the rates which they pay. So have we given children access? We have a SCHIP program. Can they get care on a timely basis, can they get the same thing somebody through a private insurance firm can get? No. Is that the kind of care we want? I want everybody to have the same access. I don't want a Medicaid stamp on anybody's forehead. I want them to be treated equally under the Tax Code so they have exactly the same opportunity for access to care that the richest or the best union member or the best business offers. We can do that, but we can't do it by going in this direction.

We heard from the majority whip that we don't like kids. I don't care how much tobacco is taxed. The problem is their numbers are foolish, because we know as we raise the tax, the amount of volume goes down or it goes to the black market or it goes through Indian tribes who don't pay the Federal excise tax even though they owe it.

So what we know is the way we are going to fund this isn't going to work, but we are going to be on the hook anyhow. Except it is not us on the hook. It is your kids. The very kids we are going to insure, we are going to come back and say: By the way, you have to pay for your insurance through increased tax rates.

We should be very careful about what we are doing. I care dearly about children. I have four grandchildren, 10 and under. I look at them, and I see all the kids I have delivered through the last 20-some years. I see all the kids I have cared for, diagnosed major diseases on, treated broken bones, taken their appendix out. I look at all those, and not once were they ever turned down. The vast majority of physicians don't turn somebody down in need, but we are coming to a screeching halt. No longer can we continue to cut the incentive to have people going into the medical field. Take 200,000 doctors and see what would happen if, in fact, we had them there in the future.

The biggest problem facing hospitals today, they can't find a nurse. Why? Because the reimbursement rates are so low we can't incentivize enough people to go into nursing because they can't pay the costs to do it and the hours are terrible. You work four 12-hour shifts. You are off for 3 days, and you come back and work four 12-hour shifts. It is not a great life. So the people in medicine today, the vast majority, care deeply about kids, but they also care deeply about having some rest, having access to a normal life outside of that. My nurse added it up. During my 20 years, my average time in practicing medicine was over 80 hours a week. That is not uncommon in this country. It is not uncommon for doctors to spend 80 hours a week taking care of folks. But we are going to be short 200,000 because we are going to see less dedication because there is not the financial reward for people to invest that much time and their assets to get the education they need.

Let's talk about who is going to get on the system and who is not. Under the old system with this expansion, we are going to add 4.1 million kids. But we are going to take 2.1 million off private insurance. So in Oklahoma, I don't know what the exact numbers will be, but we are going to take kids off private insurance and then put them on a Medicaid system they can't get access to. We will feel good. We gave them insurance. We give them coverage, but they don't have access. Unless you are getting seen, it is not access.

Also under the new system, the newly eligible, they will add 600,000 kids, but there is a 1-for-1 trade. We will take 600,000 off private insurance. So tell me what we are doing? We are shrinking the pie so that the cost for everybody in private insurance is going to go up. That is what is going to happen. We are going to move it over to a government-run system that doesn't reimburse at a rate to give you access. Why would we do that? Why would we pay 2.5 times what it costs to get it in the private sector?

There are a lot of changes that need to happen in health care. We need to complete transparency as far as price and quality so you as a consumer can make a decision. I am for that. We need true insurance market reform so that instead of big health insurance companies taking 40 percent of the premium dollars you pay and keeping it through administration of profits, we actually put it into health care.

We need a change in the insurance industry, where a bureaucrat sitting at a computer, either at Medicaid, Medicare or an insurance firm, isn't denying your care because they have never put their hands on you to say you need this or not.

What we are talking about is giving individuals the freedom to handle their own health care, the freedom to choose, the security to know that through this tax credit, everyone will have access in this country, no matter who you are, no matter what you make. You are equal footing with everybody else.

When the majority whip comes out and says that is what he wants, my challenge to him is, sign on to the Burr-Corker bill. That is exactly what it does. It gives equal access to everyone. Instead of an additional 130,000 kids in Illinois, he will have all the kids covered. Instead of the adults who are not covered in Illinois, he will have them all covered. He would not raise taxes on a soul. Will it shift some? Sure.

The question is, are our kids worth it? That is the question that has been raised by the Finance Committee and Senator Durbin and those who have spoken. I say they are. But if you go back to the numbers, which is $3,950, and you apply that and you take the 4.2 million children, we could cover all of the uninsured children if we did it at the cost of the private sector right now. If we said we will take the same amount of money we are going to spend under the SCHIP program and we will buy them all a private policy, we can cover every kid who is not covered today because we spend 2.5 times more doing a government program than the same thing you can do on your own in the private sector. Why wouldn't we do that?

We wouldn't do that because this is the first step in moving toward universal, government-run, bureaucratic-controlled health care.

One other point I wish to make. We have a Medicaid program today. We have a SCHIP program today. There are 680,000 kids right now who are not covered who are eligible for those programs. Tell me how effective we are at covering those 680,000 kids. They are eligible, but we don't have them? That is because of the failure of the Government bureaucracy to fully get a benefit out to those who are deserving of the benefit. So what do we do? We are going to go in the opposite direction.

The other important point is, what SCHIP does is separate you from your family. If you make $60,900 in this country--that is higher than the average family income in 21 of our States--your child is going to be eligible for SCHIP. So your child is going to go on SCHIP. They will have a different insurance plan than you. They will have different doctors. There is not going to be a family doctor who cares for the whole family. The child will have one, and the parents will have a different one. We will separate them and divide them. We are going to totally separate them. Then guess what is going to happen. Parents are saying: I could put my kid on SCHIP, and I will get a decline in my premium. But it would not decline because we would not have done any insurance market reform.

We will not have created a competitive market where they have to bid for your care. We will not have done what we need to do to fix health care.

So I welcome this debate. This is a debate we ought to have in this country. Health care is important, and it is one of the things that is limiting our competition. But the reason it is limiting competition is because we aren't investing in prevention and nearly $1 out of every $3 spent in health care does not go toward helping anybody get well. The reason it is that way is because we have the Government in the middle of the market. We are about to make that worse.

What we do know in this country is markets work. Individuals in this country figure out how to buy a car that is good for them. They figure out how to buy auto insurance. They figure out how to buy homeowners insurance. But we assume if we give everybody a level playing field, they are not capable. How arrogant of us. Markets work.

What we will see is this $250 billion--this quarter of a trillion dollars in transfer payments, cost shifting--go completely out. The $250 billion will drop everybody's insurance cost in this country by $1,000 per person. So not only will we insure everybody who is not insured, we will lower their cost of insurance by $1,000, by eliminating the cost shifting, and we are paying for that already. So we will have great benefits if, in fact, we move to a true competitive market.

The last thing I will say is, if we do a tax credit--a flat tax credit, a refundable tax credit--it keeps families together. It keeps mama and papa and brothers and sisters going to the same clinic, with the same doctors, with constancy of care, knowledge of their history, knowledge that is important in terms of giving great care.

I look forward to this debate. I plan on being on the floor. I plan on asking questions. The fact is, this is the issue this country is dealing with both in terms of how hard it is to get health care in this country and how expensive it is. There are two ways of solving it. One says the Government is going to run it and the bureaucrats are going to control it and we are going to control the costs by rationing the care. The other way says we are going to let vibrant markets create transparent information and competition that lowers the cost and increases the quality for everybody. On the way, we are not going to be inefficient in the way we spend money, spending $3,950 for $1,500 worth of product. That is what we typically do up here. There is no reason we should do that again.

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