105th Congress: Democratic Perspectives House Committee on Energy and Commerce Democrats Welcome Page
If the Medicare provisions of this budget reconciliation could be considered in isolation,
a number of positive statements could be made about them.
For example, the provisions expand Medicare health care choices by allowing beneficiaries to enroll in a variety of managed health care plans, and also provide significant consumer protections within most of these plans. We applaud our Republican colleagues for recognizing the wisdom of carefully defining the terms of managed care for senior citizens who choose to receive their health care this way. The success of managed care in the Medicare market ultimately hinges on whether seniors are well served by the system: whether they have quality care, access to appropriate providers, bona fide appeals and grievance mechanisms, and honest marketing. Another protection, expanded by a Democratic amendment, allowing seniors to move into the managed care market without the penalty of losing forever their right to purchase a Medigap policy. In short, the majority wisely turned its back to the last Congress' approach of leaving America's seniors to the mercy of the health insurance marketplace.
The Committee's Medicare proposal also properly acknowledges the need to make both short-term payment changes and longer term policy modifications to address escalating Medicare costs and the solvency of the Medicare Trust Funds. The provisions attempt to provide judicious balance among payment reductions affecting various providers and to allow the establishment of new payment methodologies that provide for greater control and accountability. In addition, a number of important fraud and abuse protections, as proposed by the President, are contained in the legislation. Additional components of the President's proposal should be included, and we will pursue that goal as the bill moves forward.
However, the legislation continues penny- and pound-foolish: namely, including Medical Savings Accounts in the MedicarePlus program. Although the proposal is structured as a demonstration project, we continue to question the wisdom of spending over $2 billion to toss Medicare beneficiaries into totally uncharted waters, as an experiment. We already are testing MSAs in the younger, healthier general population through a demonstration program established under the Kassebaum-Kennedy legislation. That project is due to end, and to be evaluated, in 4 years. Why not wait until that evaluation concludes to begin an expansion of the experiment to Medicare beneficiaries?
Many differences of opinion on MSAs were expressed during Subcommittee and Committee deliberations. We argued that MSAs would appeal to and thus enroll younger, healthier Medicare beneficiaries -- those who cost the Medicare program less -- leaving older, less healthy people in "traditional" Medicare and increasing Medicare costs. This is one of the reasons that the Congressional Budget Office believes MSAs will cost, not save money. But the truth is, nobody knows about risk selection in MSAs. Thus, nobody can predict with any accuracy that MSAs will not have an enormous and adverse affect on Medicare costs over the long term. The Kassebaum-Kennedy demonstration will be the first opportunity to answer that question. We believe it would be prudent to wait for the results of that program. Alternatively, and at a minimum, we believe that any MSA demonstration program in Medicare must be much more limited than 500,000 lives. We attempted to circumscribe this through amendments, and intend to pursue a reduction in scope, or the elimination of the MSAs, as the legislation proceeds.
Our additional point: medical malpractice reforms -- regardless of their substantive merits or lack thereof -- do not belong in this legislation. Congressional decisions about federal malpractice liability standards that would pre-empt state laws and prerogatives deserve to be made in the light of separate deliberations. Committee hearings have not been held on this matter. We have not have an opportunity to mark up legislation. We have not had an opportunity for Members to debate their differing perspectives on this issue. We intend to continue our objection to including malpractice provisions in budget reconciliation.
In summary, we cannot isolate the Medicare provisions of budget reconciliation and look at their positive features separately. Indeed, we must look at the changes in this critically important program in the total context of a budget agreement that places America's senior citizens in the last car of a train and pulled by an engine of "balancing" the federal budget loaded with tax cuts for the wealthy. Many agree that Medicare spending needs to be curtailed, and the program needs to be changed -- for its long-term good. And many would agree that savings of $115 billion improves upon the Republican proposal of the last Congress. However, reasonable senior citizens, and reasonable Democrats, continue to puzzle over a scheme that cuts Medicare while at the same time providing tax breaks for businesses and for higher-income individuals.
We are told that tax cuts will help the "middle class" -- those whose incomes are $100,000 per year, or more. Since the majority of Medicare beneficiaries have incomes one-quarter of that amount -- less than $25,000 per year -- we are understandably skeptical of the trade-offs. Furthermore, the budget agreement between the President and the Republican leadership -- for all of its flaws -- included a "fail-safe" for the lowest income Medicare beneficiaries. It specifically included a commitment to spend $1.5 billion on helping these seniors pay their Medicare Part B premiums. The bills reported by this Committee do not honor that commitment. That failure colors all of what otherwise might be viewed as positive aspects of the Medicare portions of this package.
John D. Dingell
Sherrod Brown
Diana DeGette
Bobby L. Rush
Rick Boucher
Thomas J. Manton
Gene Green
Tom Sawyer
Anna G. Eshoo
Elizabeth Furse
Frank Pallone, Jr.
Peter Deutsch
Ron Klink
Edward J. Markey
Bart Gordon
Henry A. Waxman
Edolphus Towns
Ted Strickland
Karen McCarthy
Bart Stupak
105th Congress: Democratic Perspectives
House Committee on Energy and Commerce Democrats Welcome Page