S6474 CONGRESSIONAL RECORD— SENATE May 11, 1995 

Why impose the most pain on those 

for whom it will be most difficult to 

bear? Why ask the very people who 

cannot tighten their belts to tighten 

their belts? Where is the Minnesota 

standard of fairness? 

I do not see a focus on cutting more 

unneeded military and corporate welfare spending. I do not see a focus on 

eliminating lucrative tax breaks for 

special interests. I do not see a focus 

on moving away on the House side, and 

it seems to be that some of my colleagues on the other side of the aisle 

have split on this, on dealing with the 

problem of tax cuts for wealthy people. 

What are we talking about? We are 

talking about $370-some billion, the 

vast amount of which flows to people 

on the top. If you have an income of 

$200,000 a year, it is a break of about 

$30,000. If you have a family income of 

under $30,000 a year, it is a break of 

about $100 a year. What are we talking 

about here? Where is the standard of 

fairness? 

Mr. President, over and over and over 

again, through the time of this 104th 

Congress, I have been on the floor. I remember when I first uttered these 

words, I thought to myself, ‘‘Are you 

just giving a speech or is it going to 

happen?’’ I had to believe it was going 

to happen to say it. I said that my fear 

is the deficit reduction is going to be 

based on the path of least political resistance. That is exactly what is going 

on. 

I remember David Stockman’s book 

about the early eighties. He said what 

we should have done was go after the 

weak claims, not the weak claimants. 

We are not going after the weak 

claims, we are not going after the corporate welfare, we are not going after 

the military contracts, we are not 

going after the tax breaks, but we are 

going after the family farmers, we are 

going after the children, we are going 

after senior citizens, we are going after 

education. 

There is no standard of fairness 

whatsoever. It is all based upon who 

are the folks who have the financial 

and the political clout to get their 

voice heard here and who are the vast 

majority of the people who are shut 

out of the process. We are going to 

have one sharp budget debate. When it 

gets to Medicare and Medicaid, I am 

going to insist that my colleagues 

know this policy well and understand 

exactly what the consequences are of 

what they are doing. When it comes to 

the cuts in agriculture—disproportionate cuts—I want to make sure that 

people know that we are talking about 

farmers not out of sight out of mind, 

but the producers in this country, and 

what this is going to do to family farmers. When it comes to education, I want 

people to understand the consequences 

of what it means when we do not invest 

in education and young people. When it 

comes to children and child nutrition 

programs, I want to make this argument: Do not go after the most vulnerable citizens in this country. 

When it comes to alternatives, I want 

to talk about the corporate welfare, I 

want to talk about the tax dodgers, I 

want to talk about the military contract, and I want to talk about how we 

really can contain health care costs. I 

look forward to this debate. I hope all 

of the people in the United States of 

America are engaged in it. 

I yield the floor and suggest the absence of a quorum. 

The PRESIDING OFFICER. The 

clerk will call the roll. 

The legislative clerk proceeded to 

call the roll. 

Mr. KENNEDY. Mr. President, I ask 

unanimous consent that the order for 

the quorum call be rescinded. 

The PRESIDING OFFICER (Mr. 

COVERDELL). Without objection, it is so 

ordered. 

Mr. KENNEDY. Mr. President, I ask 

unanimous consent to speak as in 

morning business. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

f 

THE ASSAULT ON MEDICARE: 

MYTH AND REALITY 

Mr. KENNEDY. The Republican 

budget plans in the Senate and House 

of Representatives propose unprecedented cuts in Medicare, some $250 to 

$300 billion over the next 7 years. Cuts 

of this magnitude will break America’s 

contract with the elderly. Millions of 

senior citizens will be forced to go 

without health care they need. Millions 

more will have to choose between food 

on the table, adequate heat in the winter, paying the rent, and medical care. 

These cuts will also be a heavy blow 

to the quality of American medicine. It 

will damage hospitals and other health 

care institutions that depend on Medicare and that provide essential care for 

Americans of all ages, not just senior 

citizens. Progress in medical research 

and training of health professionals depend on the financial stability of these 

institutions. Academic health centers, 

public hospitals, and rural hospitals 

will bear an especially serious burden if 

these deep cuts are enacted. 

In addition, such cuts will inevitably 

impose a hidden tax on workers and 

businesses who will face increased 

costs and higher insurance premiums 

as physicians and hospitals shift even 

more costs to the nonelderly. 

According to recent statistics, Medicare now pays only 64 percent of what 

the private sector pays for comparable 

physician services. For hospital care, 

the figure is 68 percent. The proposed 

Republican cuts will widen this already 

ominous gap even farther. 

Because of the current gaps in Medicare, senior citizens already pay too 

much for the health care they need. Elderly Americans pay an average of onefifth of their income to purchase health 

care, a higher proportion than they 

paid before Medicare was enacted. 

Yet the reason Medicare was enacted 

in the first place, 30 years ago, was to 

deal with the health care crisis affecting the lives of older Americans at that 

time. How can we care any less about 

their needs today? 

Medicare today does not cover prescription drugs. Its coverage of home 

health care and nursing home care is 

extremely limited. We go to any senior 

citizen home in America and ask the 

senior citizens there how many of them 

are paying, say, $50 a month for prescription drugs, half the hands will go 

in the air. If asked how many pay $25 a 

month or more per month for prescription drugs, three-quarters of the hands 

go in the air. 

Looking at what has happened in 

terms of cost of those prescription 

drugs, which are so necessary for the 

senior citizens, we find those costs 

have been going right up through the 

roof. They are absolutely an essential 

part of the needs for our elderly people, 

and they are not included in the Medicare Program, and they are draining 

down scarce resources for retirees and 

for senior citizens. 

Unlike virtually all private insurance 

policies, Medicare does not have a ceiling on out-of-pocket costs. It does not 

cover eye care, it does not cover foot 

care, it does not cover dental care. All 

of those are important needs for our 

senior citizens. 

Yet the Republican budget cuts will 

ask senior citizens to pay $900 more a 

year out of their pockets when the cuts 

are fully implemented. And the Republican tax bill already passed by the 

House of Representatives gives the tax 

cut of $20,000 to wealthy individuals 

making more than $350,000 a year. That 

is not right and the American people 

know it. 

The assault on Medicare is based on 

five myths. Myth No. 1 is that deep 

cuts are needed to save Medicare from 

bankruptcy. The hypocrisy of this 

claim is astonishing. A few weeks ago, 

the House Republicans included a provision in their tax bill to take $90 billion out of the Medicare hospital insurance trust fund over the next 10 years. 

We did not hear a word then about the 

impending bankruptcy of Medicare. 

They took that amount of money out 

of the Medicare trust funds. They did 

not have to unless they were interested 

in increasing the tax reductions for the 

wealthiest individuals, but they took 

that out of the Medicare trust funds. 

Now they are talking about how the 

Medicare fund itself is facing financial 

difficulties, when just 3 weeks ago they 

took $90 billion out of there to use it 

for tax cuts for the wealthiest individuals. 

It is true that an April 3 report of the 

Medicare trustees projects that the 

Medicare hospital insurance trust 

funds will run out of money by the 

year 2002. Few, if any, Republicans will 

be talking about deep Medicare cuts to 

cure that problem if they did not also 

need such cuts to finance their tax cut 

for the wealthy. 

As the Medicare trustees themselves 

noted in their report, modest adjustments can keep Medicare solvent for 

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May 11, 1995 CONGRESSIONAL RECORD— SENATE S6475 

an additional decade—plenty of time to 

find fair solutions for the longer term. 

Similar projections of Medicare insolvency have been made numerous times 

in the past. Each time, adjustments enacted by Congress were able to deal 

with the problem without jeopardizing 

beneficiaries, and we can do the same 

again. 

For example, an estimated 20 percent 

of all Medicare hospitalizations could 

be avoided with better preventive services, and more timely primary and outpatient care. As much as 10 percent of 

all Medicare expenditures may be due 

to fraud, and that could be reduced 

substantially by the better certification procedures. This has been shown 

by the hearings that have been held by 

Senator COHEN of Maine with a series 

of recommendations which, fully implemented, would stabilize the Medicare trust fund. 

The message is clear: We do not have 

to destroy Medicare in order to save it. 

The American people understand that 

basic point, and Congress should recognize it, too. 

Myth No. 2 is that the Republican 

budget proposal is not a cut, because 

the total amount of spending will continue to grow. In fact, the Republican 

plan calls for spending $250 billion less 

on Medicare than the Congressional 

Budget Office says is necessary to 

maintain the current level of services 

to beneficiaries. 

Every household in America knows 

that if the cost of rent and utilities 

goes up and income stays the same, 

there is a real cut in your standard of 

living. If Medicare pays $80 toward the 

cost of your visit to a doctor in 1995 

and the same $80 in 1996, but his fee 

goes up by $20, the value of your Medicare protection is cut by $20. Every 

senior citizen understands that. 

The irony is that our Republican colleagues accept this argument when 

they talk about defense expenditures. 

They know that defense is being cut if 

funds increase more slowly than inflation. Our colleagues should apply the 

same accounting rules to the needs of 

senior citizens as they do the purchase 

of guns and tanks. 

Myth No. 3 is that Medicare is different from Social Security and is an 

entitlement less deserving of protection. In fact, the distinction between 

Medicare and Social Security is false 

because Medicare is a part of Social Security. 

Like Social Security, Medicare is a 

compact between the Government and 

the people. It says, ‘‘Pay into the trust 

fund during your working years and we 

will guarantee decent health care in 

your old age.’’ Any elderly American 

who has been hospitalized or suffers 

from a serious chronic illness knows 

there is no security without Medicare. 

The cost of illness is too high. A week 

in intensive care can cost more than a 

total yearly income of most senior citizens. Low- and moderate-income elderly will suffer the most from Medicare 

cuts. Eighty-three percent of all Medicare spending is for older Americans 

with annual incomes below $25,000. 

Two-thirds is for those with incomes 

below $15,000. 

Imagine, average income of $15,000 

and trying to make ends meet when a 

person fought in the world wars of this 

country, has been a part of the whole 

building of the American economy, 

sacrificed to bring up children, and is 

barely making it at $15,000, and then 

there are the important health care 

needs to be attended to that are no 

fault of your own. Those are the people 

that we are talking about that are 

going to be adversely impacted with 

these cuts. 

When the Republicans tried to cut 

Social Security in the 1980’s, the American people said, ‘‘No,’’ and they will 

say no to these equally damaging proposals to cut Medicare in the 1990’s. 

Myth No. 4 is that Medicare costs can 

be cut by encouraging seniors to join 

managed care. True, it can help bring 

medical costs under control in the long 

run. Enrollment by senior citizens in 

managed care is already increasing 

rapidly. It is up by 75 percent since 

1990, but no serious analyst believes 

that increased enrollment in managed 

care will substantially reduce Medicare 

expenditures in the timeframe of the 

proposed Republican cut. In fact, according to the General Accounting Office, Medicare is now actually losing 

money on managed care because only 

the healthiest senior citizens tend to 

enroll in it, leaving Medicare left to 

pay for those more seriously ill. 

The only realistic way to save money 

in the short term on managed care is 

to penalize senior citizens who refuse 

to enroll. This option has already been 

suggested by the Republican health 

task force in the House. I say it is 

wrong to force senior citizens to give 

up their freedom to choose their own 

doctors and hospitals. It is wrong to 

penalize them financially if they refuse 

to enroll in managed care. 

I will add, in the debate we had on 

the health care measures of last year, 

that particular option was preserved 

for our senior citizens and it ought to 

be preserved in any health care reform. 

Myth No. 5 is that the deep, unilateral cuts in Medicare are necessary to 

balance the budget. As President Clinton told the White House Conference 

on Aging last week, 40 percent of the 

projected increase in Federal spending 

in coming years will be caused by escalating health costs. 

What this Republican budget fails to 

recognize is that the current growth in 

medical care is a symptom of the underlying program in the entire health 

care, not a defect in Medicare alone. In 

fact, Medicare has done a better job 

than the private sector in restraining 

costs in recent years. 

Since 1984, Medicare costs have risen 

at an annual rate of 25 percent lower 

than comparable private health care 

spending. Slashing Medicare unilaterally is no way to balance the budget. It 

will simply shift the costs from the 

budget of the Federal Government to 

the budgets of senior citizens, their 

children, and their grandchildren. 

If Medicare is cut in isolation, senior 

citizens will also face greater discrimination from physicians and hospitals, 

who are less willing to accept the elderly as patients, because Medicare reimbursements are much lower than the 

reimbursements available under private insurance. 

We know that previous cuts in the 

Medicare reimbursement have led to 

serious cost-shifting, as physicians and 

hospitals seek to make up their reduced income from Medicare patients 

by charging higher fees to other patients. The result has been higher 

health care costs and higher health insurance premiums for everyone, as 

cost-shifting becomes a significant hidden tax on individuals and businesses. 

The right way to slow Medicare 

growth is in the context of overall 

health reform that will slow rising 

health costs in the economy as a 

whole. That is the way to bring Federal 

health costs under control without cutting benefits or shifting costs to working families, comprehensive reform, to 

try to make available to our seniors 

good health care, preventive care programs to provide the services to keep 

people out of the hospitals so they do 

not go into the high-cost facilities, and 

to try to do something in terms of 

home care, community-based care, 

which is much more satisfactory for 

our seniors and can be done at considerably less cost. And to build upon the 

nurses, nursing profession, to assist 

with skilled nursing attention some of 

the needs for our seniors. 

In the context of broad health reform, the special needs of academic 

health centers, rural health centers, 

inner-city hospitals also can be addressed. Deep Medicare cuts alone, by 

contrast, will undermine the availability and quality of care for young 

and old alike. 

We are talking about the kind and 

quality of trained health personnel 

that Medicare participates in. We are 

talking about necessary institutions, 

academic institutions which are the 

center for much of the research that 

benefits our senior citizens. We are 

talking about diminishing the kinds of 

research that has to take place in 

those areas as well. 

President Clinton has emphasized he 

is willing to work for bipartisan reform 

of the health care system, but the Republicans have said no. The only bipartisanship they seem to be interested in 

is the kind that says, ‘‘Join us in slashing Medicare.’’ That is not the kind of 

bipartisanship the American people 

want. It is not the kind of bipartisanship that senior citizens deserve. 

It is especially telling that Republicans are proposing these harsh cuts in 

Medicare at the same time they support the massive tax cut that will disproportionately benefit the richest individuals and corporations in our society. The Republican tax plan that has 

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S6476 CONGRESSIONAL RECORD— SENATE May 11, 1995 

already passed the House will reduce 

Federal revenues by $250 billion. Without that tax cut for the wealthy there 

would be virtually no need to cut Medicare in order to achieve a balanced 

budget under their plan. The Senate 

Budget Resolution reserves $170 billion 

for tax cuts. Without that allocation 

the Medicare cuts could be reduced by 

two-thirds without any increase in the 

deficit. 

The arguments used to justify deep 

cuts in Medicare cannot pass the truthin-labeling test. They will not fool the 

American people. As the ceremonies on 

V–E Day earlier this week commemorating the end of World War II in Europe reminded us, today’s senior citizens have stood by America in war and 

peace and America must stand by them 

now. The senior citizens of today are 

the veterans of the Army, the Navy, 

the Air Force, the Marines, and the 

hard-working men and women on the 

home front. They pulled us through 

that terrible war. We cannot pull the 

rug out from under them on Medicare 

now. 

I urge the Senate to reject these unwise Republican proposals. 

Mr. President, I suggest the absence 

of a quorum. 

The PRESIDING OFFICER. The 

clerk will call the roll. 

The legislative clerk proceeded to 

call the roll. 

Mr. BURNS. Mr. President, I ask 

unanimous consent that the order for 

the quorum call be rescinded. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

f 

ORDER OF PROCEDURE 

Mr. BURNS. Mr. President, I ask 

unanimous consent that I may proceed 

as if in morning business for no more 

than 10 minutes. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

f 

THE BUDGET 

Mr. BURNS. Mr. President, we have 

all been receiving phone calls and getting letters about the proposed budget 

that is being recommended now or 

being talked about and marked up in 

the respective committees in the Senate and House of Representatives. We 

have had time to talk to the chairmen 

of those committees and get copies of 

the proposal that they have put forth. 

In other words, the great debate has 

started on this year’s budget. 

I think we have to applaud the chairman of each committee because they 

have come forward with very daring 

proposals. I applaud the chairmen, especially Senator DOMENICI of the Senate Budget Committee. When you look 

at our deficit spending we see, yes, that 

the deficit did become lower last year. 

It went down. But it now continues to 

climb. The deficit this year alone 

stands at $175 billion, and for a while. 

But, nonetheless, it is growing at the 

outrageous rate of $482 million a day. 

That sounds like a lot of money to me. 

So, consequently, it is time for this 

body and this Government to do something responsible and to deal very 

frankly with the budget, to be up front 

about it, and to try to address some of 

the problems that we have because I 

think most Americans are wanting 

something done to rein it in. 

It is absolutely necessary if we are to 

continue the economic viability and 

the leadership in this world for our Nation. We cannot continue to stand by 

and conduct business as usual, and in 

so doing allow the national debt to increase by $1 trillion every Presidential 

term. 

So the time has come for bold initiatives to look at getting spending under 

control, and Senator DOMENICI’s budget 

right now does exactly that. 

The chairman of the Budget Committee slows the annual growth of 

most lines. Every line in that budget, 

with the exception of a few, grow every 

year. We have heard a lot of attention 

brought to the Medicare line, growing 

10 to 11 percent every year. Now we 

want to slow that growth because already the trustees of that trust fund 

have told us that by the year 2002 it 

will be broke and they will pay no bills 

at all. 

Also it transforms Medicaid into 

block grant funds to the States where 

they will have the responsibility to do 

something responsible to get spending 

under control. 

It further calls for the establishment 

of a bipartisan congressional committee to represent policy changes 

needed to maintain the short-term solvency of the Medicare system. Such 

measures would generate the savings 

needed to put the system on a financially sound footing for the next 7 

years while we work together to develop a long-term solution for Medicare solvency gap. There can be no getting around the fact that, if we continue on the path that we are presently 

on, Medicare will lapse into bankruptcy within 7 years and then it will 

be too late, or too expensive, to solve 

the problem. 

The chairman’s budget proposes the 

elimination of spending for the National Biological Survey. I have long 

said that we had the resources within 

the organizations of the Fish and Wildlife, the Park Service, or in the Department of the Interior to do that without 

creating another bureau or the money 

that goes with it. We also want our policy decisions based on sound science 

and we start dealing with the biological makeup of this country or this 

world. And I think we can do it without 

the National Biological Survey. 

The chairman’s budget proposes the 

reduction in the Agricultural Research 

Service by 10 percent which would reduce the total outlays in this program 

by $1 million. 

It is true that we all will not agree 

with this budget. This is one area 

where I do not agree. This is one area 

where we cannot pull back on any investment in the research and development in agriculture. I will stand on 

this floor and maintain until I can 

draw my last breath that the second 

thing everybody who lives in this Nation does every morning is eat. I do not 

know what the first thing is that they 

do. They have a lot of options there. 

But I know the second thing they do is 

eat. 

We still have an obligation to feed 

this Nation and this society. 

So when it comes time to talking 

about budgets, basically that is what a 

balanced budget amendment would 

have done; make us talk about the 

most important things and to set our 

priorities where we think those important things are. 

We have to look to the necessities of 

life, not to the frills but the necessities 

of life and also the individual responsibility that each one of us has at just 

being a citizen of this great country. 

You might be surprised to know that 

for the first time in the history of agriculture our yields in wheat are going 

down, because we are just not getting 

enough money for research, plant 

breeding, developing those strains of 

wheat that are disease resistant because that is a constant thing; it goes 

on all the time. And so we must, if we 

are going to feed this Nation—and 

right now, 1 farmer feeds 145 other people. Also, one of our greatest exports is 

agriculture. In fact, it has been in the 

black forever. We have to continue 

with our ability to produce foodstuffs, 

food and fiber for this society. 

The chairman of the Budget Committee also proposed the privatization 

of the PMA’s, the power marketing administrations. They are making money 

for the Treasury. They also generate 

and produce power for our REA’s. In 

rural America, we would not have electricity yet if it was not for REA’s. My 

father served on an REA board. I have 

often said if it was not for REA on the 

farms, we would be watching television 

by candlelight. 

We have to be very cautious in the 

way we set our priorities in this budget. So consequently I think we have to 

take a very hard look at long-term revenue implications that would happen, 

that is, if WAPA, western area power 

marketing, and the Southwest and the 

Southeast are moved into private 

hands. 

And this is nothing new. We will 

argue about different parts of the budget. Where we set our priorities is what 

is really important for this Nation and 

the people who live in it. That is what 

this budget will do. But it will be a responsible budget that I am sure, after 

America looks at it, we will have the 

confidence in its integrity to do what 

we have to do, and that is to balance 

the budget by the year 2002. 

I do not think there is anything that 

will come before this body that will be 

any more important than the issue of 

this budget and the roadmap, the blueprint to get us where we want to be as 

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