Commerce, Justice, Science, And Related Agencies Appropriations Act, 2010--Continued

Floor Speech

COMMERCE, JUSTICE, SCIENCE, AND RELATED AGENCIES APPROPRIATIONS ACT, 2010--Continued -- (Senate - October 08, 2009)

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Mr. BURR. Mr. President, I thank the doctor from Oklahoma, my colleague, my friend. Let me say from the start, 3 1/2 years ago, TOM COBURN and I sat down and realized health care was unsustainable at its current level of investment.

The American people have complained because they have seen a process that has gone too quickly. Well, in the Patients' Choice Act you find 3 1/2 years worth of work--a bill that was designed to take 4 years before we thought we had the right information we needed to do health care reform adequately.

With the change in the administrations, the new President and his timeframe, we accelerated it. But let me say, right from the start, it is unsustainable at its current level of investment. It is 17 percent of our gross domestic product. Health care has to be reformed.

I personally believed the debate we were going to have in Washington was over what type of reform. Dr. Coburn raises a good point: cost. Where are we from the standpoint of our Nation?

I happened to gaze, as I was waiting for the last speakers to finish, on the page of this publication. It says: Baucus Bill Projected at $829 billion. In the small box down at the bottom of the page--CBO: Deficit Hits Record $1.4 trillion for Fiscal Year 2009.

Common sense would tell you that when you are in the type of financial shape the United States of America is in, not only do you stop spending, you begin to look for ways to curb spending and a way to invest to reduce the deficit. Because the deficit is what our children and our grandchildren will inherit. If you believe it is unsustainable at its current level of investment, then you sort of understand where Dr. Coburn and I are coming from.

The worst place we can start is: How much more money do we need to spend to do health care reform? But the truth is, the Baucus plan is not health care reform. It is health care expansion. The debate in Washington is not about how to reform health care. It is about how to expand health care. And once you determine the pool you are going to expand it to, the $64 million question is: How do we pay for it so the CBO says we have paid for it?

What I would like to do is spend a little bit of time exploring how the Baucus plan pays for it with the caveat up front of saying--as it relates to Dr. Coburn and myself--we don't believe we have to spend more to reform health care. I think from what he said about the Patients' Choice Act, we have made the point. We were the first two people in the Congress--House or Senate--to introduce comprehensive legislation. We cover the same amount of additional Americans that the Baucus plan covers. We do it without making additional taxpayer investments in the expansion of coverage. Why? Because in addition to expanding coverage, we reform health care. We actually bend the cost curve. We change the tax application to where it is fair and equal for all people.

What we have to realize is, the Baucus plan is a 10-year plan. We collect revenues for 10 years and we pay out for the expansion in 6 1/2 years. Let me say it again. We are collecting tax revenues for 10 years, but we are only paying benefit expansions for 6 1/2 years. We have to look at years 10 through 20 if you want to see 10 years' worth of revenue collection and 10 years' worth of expenses. As a matter of fact, if you took the first 10 years and you applied what is done in the bill and said: Well, if they started making payments in the first year, this bill would actually cost $1.8 trillion, not $829 billion but $1.8 trillion.

Incorporated in the Baucus bill are cuts to Medicare, cuts that equal $449 billion. Dr. Coburn talked about the imminent reduction to physician reimbursements: 21 percent projected. We all agree we are never going to make that. One of the attractions for health care professionals was the Baucus bill said in year one, we are not going to make those cuts. Well, they are going to cut Medicare over 10 years by $449 billion. This is giving with one hand and taking away with the other hand. Health care professionals around this country have realized that, even though their association that represents them doesn't.

The Baucus bill cuts $117.4 billion in Medicare Advantage. My colleagues are probably saying: What is Medicare Advantage? Well, it is the preferred plan of 20 percent of America's seniors. Twenty percent of our seniors on Medicare have chosen Medicare Advantage, a private sector option to traditional Medicare, where they have looked at the two and they said: I would rather have Medicare Advantage, because when I go in the hospital, Medicare is going to charge me a $750 deductible right off the bat. Medicare Advantage? Zero. For traditional Medicare, you are going to have to have Part A, Part B, Part D. Medicare Advantage, you get it all as one lump sum. You don't have to make separate selections. They provide you the doctor coverage, the hospital coverage, the drug coverage all in one plan.

Why is it under the target of some in Washington to cut $117 billion? They say it is because we pay 114 percent of Medicare per person allocations to Advantage, where we pay 100 percent in traditional fee for service. That is exactly right. I remember the debate we had in Washington when we did it. Because the objective then was: How do you get Medicare Advantage to offer this plan in rural America? To offer it in rural America meant you had to offer a greater reimbursement. This isn't reflective of a windfall for the insurance companies; it was an incentive to offer this choice not just to urban seniors but to seniors everywhere in America. In my State of North Carolina, 17 percent of all the Medicare beneficiaries are enrolled in Medicare Advantage. When anybody gets up and says pass this bill, the Baucus bill, and you can keep your health care if you like it, there is a caveat to that. Unless you are 17 percent of the seniors in North Carolina or you are 23 percent of the seniors nationally, you lose your plan. You are going to go back into traditional Medicare. You are going to go back to where, when you enter the hospital, they are going to say write me a check for $750 annually; where your Part B is a separate payment; where your Part D is something you have to figure out as to which plan you want versus something that is seamless and covers everything. I will assure everybody a $117 billion cut to Medicare Advantage will eliminate that product from the marketplace. Nobody will offer it. Twenty percent of America's seniors will lose the insurance they prefer, not keep it.

Medicaid expansion. It seems like a sensible way to go if you want to expand coverage, which is where the debate has been in Washington. Well, let's simply take a coverage tool that is out there today--Medicaid--and let's raise the income limit so more people qualify for it. So instead of 100 percent of poverty, we raise it to 133 percent of poverty. It costs $345 billion. There is $33 billion in direct State spending. As Dr. Coburn said, four States are sort of split out of it, and they say: Well, we are not going to charge you because you are in tough economic times. Well, North Carolina is at 10.8 percent. Why aren't we included? Our cost, when the Federal Government makes North Carolina ante up, is going to be south of $1 billion a year for a State that had a $4 billion shortfall. Where is my Governor in her outrage at the proposal to expand Medicaid to 133 percent of poverty?

The tough thing is, this plan has been sold that it is not going to cost anybody anything, and the truth is it is going to cost seniors, it is going to cost taxpayers, it is going to cost the unemployed but, more importantly, it is going to cost people who have health care insurance today. People who have the money to purchase theirs and people whose employer offers them health care, their cost is going to go up because of the restrictions and the mandates that exist within the Baucus bill.

The Baucus bill would impose an annual $6.7 billion fee on insurance companies; $6.7 billion a year; over 10 years, $67 billion. So a $67 billion new fee on the insurance companies that we are trying to make the American people believe are going to reduce premiums, reduce costs, and we are sticking them with a $67 billion pricetag. There is nobody in America when they hear this who believes that health care is going to go down for the American people. For every person who currently has a plan today, I will assure my colleagues their premium will go up. They will pay more money, not less money.

We grow the IRS. There is something we haven't talked about because of the requirements in this bill to collect fees and to collect taxes. It is estimated by the Lewin Group that the IRS would need a 25-percent increase in their budget. The IRS currently gets $12 billion annually for their administrative costs. The administration costs for implementing the exchange subsidies would add nearly $40 billion from the Baucus bill. We have additional costs at the IRS because we have to increase by 25 percent the IRS requirements to go and collect and enforce this.

We tax the chronically ill. I thought this one was one of those myths that late night TV talks about. We tax the chronically ill in the Baucus bill. Let me explain what I mean. Current law says that if your health care charges exceed 7.5 percent of your annual income, then you can deduct that off your taxes. Clearly, the lower your income, the more likely you are to utilize the 7.5 percent exclusion. So what does the Baucus bill do to raise money? It raises the exclusion to 10 percent. Instead of at 7.5 percent of your adjusted gross income being able to deduct anything that exceeds that, it says you have to exceed 10 percent of your adjusted gross income. For somebody who makes $1 million a year, this is no big deal. They probably have more than enough insurance to take care of it. For somebody who is on a limited income; for somebody who maybe doesn't have all the insurance they need; for somebody who walks in and is chronically ill, has a chronic disease and they are making payments, they are covering their copays, they occasionally go to the hospital, they have that $50 charge for walking in the door, even though they have insurance. They are making it at the end of the year, even though they make $20,000 or $25,000 a year, and all of a sudden, 2 1/2 percent of their adjusted gross income is no longer a deduction they get. What is that? That is taxing the chronically ill in this country.

Listen, I have to give them credit. They have left nobody out of this bill from taxes. They have left nobody out of this bill from instituting a new fee. As a matter of fact, some of it we are going to have to take for granted is going to be applied to us in an indirect way because incorporated in the Baucus bill we collect a new device tax. To the heart patient who goes in and gets a heart catheterization, to the senior who goes in and gets a hip replacement, it is a device. For any medical device that is used, there is a $40 billion device tax over 10 years.

What does that do for the innovation of new devices? Dr. Coburn can speak to it better than I can. When we were able to switch from open heart surgery to bypass surgery, we probably went from $40,000 or $60,000. When we were able to catheterize somebody and put a stent in, we reduced significantly the cost, we reduced significantly the invasion, we were able to raise the quality of life. We couldn't have done that if somebody hadn't innovated a cath and a stent. We would still be doing all bypass surgeries. You think through all the medical procedures we do in this country and you think about all the devices that have been created by companies and by doctors so they can be less invasive because they understand every time they go into somebody, every time they cut in, there is a fear of infection today; there is a consequence of recovery. It means a stay in the hospital is longer.

When you see a new device enter into the marketplace, you actually see a new efficiency come into health care. You see reduced health care costs because you are taking either somebody out of an inpatient setting and you are putting them in an outpatient setting, or you are taking an inpatient patient and you are getting them out of the hospital faster. Actually, you could make the case that innovation of medical devices is health care reform because it is driving down costs, because it is moving patients out, and the net result is the quality of life goes up. But, in this bill, we raise $40 billion over 10 years, or $4 billion a year on taxes on devices.

If you listen to the things I have talked about, you are probably sitting at home trying to figure this out: I am going to pay more in health care because they are taxing devices. I am going to pay more in health care if, in
fact, I have a chronic illness because I am not going to be able to deduct that out-of-pocket cost that is between 7 1/2 percent and 10 percent of my adjusted gross income. I am going to have to cover, as a taxpayer, a 25-percent expansion in the IRS. They are going to impose a $6.7 billion so-called fee on the insurance industry, or $67 billion over 10 years, while I have an insurance policy, so that fee is going to be passed through to me as a covered life under the insurance plan.

I am going to pick up, in the State in which I live, the increase in the limitations on Medicaid when we go from 100 percent of poverty to 133 percent of poverty. How can you make a claim that this bends the cost curve? If you tried to make the claim, it bends the cost curve up not down.

Dr. Coburn and I listened very intently as the President kicked off this debate: Create a program that provides coverage for as many Americans as we possibly could. We did that. Bend the cost curve down. Well, we make a direct investment in prevention, wellness, and chronic disease management--the only three direct areas of savings in health care. We can talk all night about tort reform and about different aspects. They are indirect and there are significant savings we can achieve by incorporating those reforms into health care.

In the Patients' Choice Act, we elected to keep it narrowly targeted, and we invest in prevention, wellness, and chronic disease management. Why? Because we went to States, businesses, and self-insured companies that went 4 years and didn't have an increase in health care costs. Why? Because they changed the lifestyle of their workers. They actually paid their workers, in some cases, to quit smoking, to lose weight, to get exercise, or to take an education program on a chronic disease they had to make sure they got the treatment they needed.

The net result? In every case, the per-enrollee savings were so significant that the companies continued to try to figure out how they could spend more to reduce health care costs. The quality of life for their employees was better. The productivity of the employees was better, and they had no annual increase in their health care costs.

We are sitting here ignoring everything that has been learned in America by private self-insured companies and by some insurers who are doing creative things, targeting chronic disease, and actually paying doctors to educate. We have ignored all of this. Why? Because we are having a debate in Washington with the Baucus bill about coverage expansion, not about health care reform.

Coverage expansion costs a lot of money--$829 billion. We are having that debate and telling the American people this is about reform. If you read the fine print, the bottom of the page, and if you read the part they don't want you to remember, it says this year alone there is a $1.4 trillion deficit. That is $1.4 trillion we didn't have that we had to borrow.

The last thing we need is more money in health care. It is 16 percent of our GDP, and we cannot maintain that level of investment. The challenge is on us to come up with the reforms that continue to invest and promote innovation, that expand coverage and, more important, reduce costs.

What do the American people want? They want health care costs to go down, and they want quality to go up. We don't accomplish that in the Baucus bill, but you do in the Coburn-Burr bill. It is not perfect, but it heads in the right direction.

I yield to my good friend from Oklahoma.

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Mr. BURR. Mr. President, I thank Senator Coburn for yielding. Let me just say the reason he is gray is because he cares. This is a Member of the Senate who typically on Monday morning delivers babies, and all weekend long. Before he comes back to Washington, he practices medicine.

This institution looked at what he did and said: You can't charge for what you do even though it costs you $200,000 a year to keep your practice open, your license in place, to buy your liability insurance. They said that is illegal under Senate rules.

So Tom Coburn is a unique individual. He sees women who are pregnant. He delivers babies. But he doesn't take any payment for it. He keeps his license up to date. To some degree, it is charity care because he believes it is the right thing to do. More important, he understands that what we do here affects what our children and our grandchildren get in inheritance from us--not financial inheritance, in opportunity.

Why are we passionate about the debt? Why are we passionate about trampling on the Constitution? Because every time we do it, we take an opportunity away from the next generation. We reduce their ability to be successful, whatever their definition is.

Tom Coburn covered it very well. We are somewhat impassioned about our criticism toward the bills that passed out of the HELP Committee, the Finance Committee soon, and the three bills in the House. Why? Because we introduced our bill first. We laid our cards on the table. We offered to work in a bipartisan way with anybody, and we had no takers.

I believe when you lay it out there and you come up with a successful plan, you have every right to be critical. I do question the ones who do not offer an alternative. But we have offered a solution, and that solution was based on three fundamental principles:

One, it had to cover everybody. The way our bill is structured, every American receives the same financial stipend regardless of whether they work or whether they don't, regardless of where they live. We treat everybody the same.

Two, if you are going to get cost savings, then you have to make direct investments in prevention, wellness, and chronic disease management. The Patients' Choice Act makes direct investments in prevention, wellness, and chronic disease management.

Three, is it financially sustainable into the future? We probably should have started with this one versus save it for last. Why in the world would we create a health care system in America if it is not sustainable? If it is not financially sustainable, why would we even consider that legislation in the Congress of the United States? If it did not pass the test of time, why would it even be worthy of debate?

Unless we expect people outside of America to continue to finance our urge to spend, then I have to tell you, we are not going to have any money--either that or we are going to have to tax the American people to a point where they are not going to want to be successful, they are not going to want to work overtime, they are not going to want to switch jobs because the benefit to them of being successful is to be punished by taxes.

This bill is filled with new fees, new taxes. True reform that expands coverage would pay for itself. Think about that. If you truly reformed health care, would the reforms through savings not pay for the expansion? Shouldn't this be a net sum game?

We have left out of the bill shopping across State lines for insurance. It saves money. The American people are sitting there: Why aren't you doing this? Tort reform saves money. The American people are sitting there: Why aren't you doing this?

Let me end on one that I think the American people are really plugged into. Congress, which plan are you putting yourself under? You designed this plan for everybody in America. Is it the plan you are going to have? You know what, in the Finance Committee, in the HELP Committee, in the House committees, there have been amendments that said Congress has to take the plan they create for the American people. That government option, that is what Congress has to be under. It has been rejected every time it has been offered.

But you see, Dr. Coburn and I took a different approach because in the Patients' Choice Act, we had to set what the basic minimum plan was going to be. Do you know what we put? The Federal Employees Health Benefits
Program. We didn't put them into the FEHBP, but we said it had to be equivalent to what Members of Congress had. How could we ask the American people on a plan we create to have less than we have? The American people expect us to look after them, they don't expect us to give them less than we have.

It was rejected every time that was offered to move Congress to their plan. But I think it tells you a lot about the way Tom Coburn and I approached the bill we worked

on because we never thought about taking us and putting us into their plan, we thought about taking them and raising them to our plan. There is a big difference in that. There is a big difference in looking at the American people and saying, you should be here; not the American people saying, you should be where we are.

We want people to be successful in this country. TOM COBURN said this is not a bipartisan bill. He is right. But I will end with this tonight: This is also not a reform bill. If you want to talk about expanding coverage, it does an equal job to what the Coburn-Burr bill does. If you want to judge it based upon reform, it accomplishes no reform.

I encourage those who are not satisfied with the options that have been presented in the House or the Senate or that will be debated, go on TOM's Web site, go on my Web site, Google ``Patients' Choice Act.'' Read the bill. It is only 200-some pages, it is not 1,000.

The truth is, if we have a real debate--at some point, we will have one about health care reform--I could suggest to the American people one word that would drastically reform health care, that could replace all 1,000 pages of a House or Senate bill. It is called portability. It is called the ability for an individual employee to take their insurance from one employer to another, not to be construed in any way because they have a preexisting condition, but also to recognize the fact that when you do portability, you change drastically the way insurers look at covered lives.

I think the American people would be shocked to know the average person is under a health care plan for an average of 4 1/2 years right now. Ask yourself: If I am an insurer and I am going to invest in somebody's lifestyle changes and I am only going to have them 4 1/2 years--how much are you going to invest? The answer is, probably very little. By the time they lose weight or quit smoking, you haven't reaped the benefits of those savings, and all of a sudden you create portability. That means a 24-year-old covered by an insurance company--that insurance company has an opportunity to keep him until he is 64 years old, 40 years. How much are you going to invest in that insured if you are going to have them for 40 years? You are going to invest a heck of a lot because you will want to keep him well as long as you can. You are going to reimburse doctors to do the education; you are going to make sure you keep them out of the hospital; you are going to make sure that if they go into the hospital you get them the treatment they need to get them out as quickly as you can. You are not going to deny a prescription a doctor wrote for them. You are not going to question a treatment a doctor chose because all of a sudden the doctor is a partner to the insurance versus just a cost to the insurance.

You see, true reform has to change health care across the board. It has to change the relationship between patients and insurers, between doctors and insurers, between hospitals and insurers.

Ask yourself: Does the Baucus plan accomplish any of it? The simple answer is no, it does not. That is why it costs $829 billion, and that is why to pay for it you don't get it through savings, you get it through taxing and fees. You get it through the insurance costs of everybody who has it. You achieve the costs by cutting Medicare, by knocking seniors off the health care plan they prefer. You get there by increasing the income limitations on Medicaid, making States actually pay for the expansion of 11 million Americans who are going to be covered under the most inefficient health care system in the country, Medicaid, where only 60 percent of the health care professionals will even see Medicaid beneficiaries because the reimbursements are so low. But we are going to grow that population by 11 million people.

We are doing an injustice to these people to put them in a plan where only 60 percent of the health care professionals will see them. They will not get the education they need for chronic disease management. They will not make the lifestyle changes because Medicaid does not pay for prevention, wellness, or chronic disease management, nor does Medicare, nor does the VA, nor does Indian Health. Show me a government plan that pays for prevention, wellness, and chronic disease management, and I will quit coming to the floor and quit talking about the lack of reform.

The truth is, the Baucus plan tries to replicate what the Federal Government has, and it does not have prevention, wellness, and chronic disease management today. It will not have it tomorrow, and it will not have it next year.

Mr. President, I thank you for your patience. I assure you and our other colleagues that Dr. Coburn and I will be frequent visitors here as we get ready for this debate, as we have this debate, and probably after this debate is over, depending upon the outcome of it.

But let me make it perfectly clear, if any Member in this debate is looking to try to achieve a bipartisan solution to health care, you can sign TOM COBURN and RICHARD BURR up today to sit at the table with you, to forget about who is the author of legislation, to talk about real solutions to real problems that deal with health care. I am committed to doing it, but I am not committed to rolling over and just accepting another expansion of the Federal Government and Federal Government spending.

Mr. President, I yield the floor.

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