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[Congressional Record Volume 141, Number 79 (Friday, May 12, 1995)]
[Senate]
[Pages S6587-S6589]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

                   THE BUDGET RESOLUTION AND MEDICARE

  Mr. FEINGOLD. Mr. President, I appreciate the comments of the junior 
Senator from Massachusetts with regard to the question of including the 
Presidential checkoff for campaigns in the budget resolution. It is an 
important program for our elections being free and fair in this 
country, and it does not belong in the budget resolution. I intend to 
comment on that more as we get into the budget resolution itself. I am 
grateful to the junior Senator from Massachusetts for those remarks and 
for his constant dedication to try to do something about this really 
awful system of financing campaigns that we have in this country.
  Mr. President, I rise at this time to offer a few comments on the 
debate that really does belong as part of the budget resolution, and 
that is the debate that has been taking place about Medicare. I would 
like to share my own perspective on the direction we ought to pursue.
  As we consider the budget resolution, presumably starting next week, 
this will be one of the two or three most central issues that we 
debate. As the Senator from Nebraska [Mr. Kerrey] noted on the floor 
last week, the Medicare debate has been obviously politicized in quick 
order. That should not surprise us given the nature of the program and 
especially how it is viewed by millions of Americans. It is a valued 
program. The presence of the White House Conference on Aging last week 
certainly had an impact on what was said, and said by Members of both 
parties.
  Mr. President, the White House conference also gave me an 
opportunity--a great opportunity--to talk to many of the leading aging 
activists from Wisconsin on the issue. I found their thoughts 
interesting. I think Wisconsin has one of the best groups of advocates 
for sound and compassionate policies for the elderly in the country. 
They always give the straight view. They tell me not only what is good 
for the elderly but what is good for society as a whole, including 
their children and grandchildren.
  In a meeting I had with most of the Wisconsin delegates to the White 
House Conference on Aging, there was a clear consensus that some 
changes do need to be made to Medicare. But there was also agreement, 
Mr. President, that those changes to Medicare have to be done in a 
certain way. We need to ``cut smart,'' not ``cut mean,'' as we look to 
keep the Medicare hospital insurance fund solvent and reduce the 
pressure on the Federal deficit.
  It bears emphasizing that there are these two features with respect 
to the Medicare problem--both the solvency of Medicare and the impact 
of Medicare on the Federal budget deficit.
  As every Medicare beneficiary knows, there are two parts to Medicare 
called part A and part B. Part A is what is formally known as hospital 
insurance. It pays some of the costs of hospitalization, certain 
related inpatient care, as well as skilled nursing facility care and 
home health care. I should add--and I have always been somewhat 
distressed by this--it does not cover chronic or long-term care in that 
part of the program. Other than copayments and deductibles, part A 
services are paid from the hospital insurance trust fund, which itself 
is funded from payroll taxes.
  Mr. President, it is this hospital insurance trust fund that is in 
jeopardy, and it is expected to be insolvent by the year 2002. The 
other part of the program, part B, is the supplementary medical 
insurance program that covers doctors' fees, most outpatient and some 
other related services. Part B is partially funded by the monthly 
premiums that beneficiaries pay, but most of the part B program is 
funded from the Federal budget.
  Mr. President, some are characterizing the cuts they expect to 
propose to Medicare as being needed to keep Medicare solvent. That 
portrayal is entirely misleading, as, of course, it is meant to be; for 
though some changes are needed to keep the hospital insurance fund 
solvent, that trust fund is not the whole story. Medicare is also 
slated for cuts as part of the broader effort to reduce the deficit, 
possibly leading to a balanced budget.
  So let us be clear within this body and to all Americans, the goal 
here of those who want to cut Medicare drastically is not just to make 
the fund solvent, they want to use a lot of those billions of dollars 
to deal with our national deficit problem.
  Mr. President, I make this point because I fear that the political 
spin doctors who have chosen to depict Medicare cuts as being apart and 
separate from the rest of the budget are really doing a great 
disservice to the cause of deficit reduction itself. And there is no 
other issue I care more about or work harder on than reducing the 
Federal deficit.
  In an effort to minimize the political fallout that surely will come 
from cuts to Medicare, I fear they may undermine any chance for a real 
budget package that will achieve the consensus it must have if we are 
going to make the politically tough decisions needed to actually 
balance the Federal budget.
  Mr. President, my message is that we have to be honest with the 
American people on what is really going on with Medicare. Medicare 
clearly does have an impact on the budget. Part of the reason cuts are 
being proposed in that area does stem from our Federal budget deficit, 
and rightly so. Medicare does have to be on the table as we look at the 
budget. I will say, Mr. President, Medicare is not Social Security. It 
has to be considered along with other areas of Federal spending. In 
fact, I have sponsored legislation that has included some specific, 
targeted Medicare cuts.
  Medicare cuts were part of the 82-point plan to reduce the Federal 
deficit that I used and created during my campaign for the U.S. Senate 
in 1992.
  More importantly, I have voted for legislation that contained 
significant, but specific, targeted cuts to Medicare twice during the 
103d Congress. The reconciliation legislation we passed as part of the 
President's deficit reduction package included nearly $60 billion in 
Medicare cuts. This is not some new idea. It is not as if Medicare has 
not already, in effect, given at the office. It has already been hit to 
the tune of $60 billion just 2 years ago.
  Mr. President, I also voted for, and was pleased to be a cosponsor 
of, the bipartisan Kerrey-Brown deficit reduction package. It also 
included significant, specific Medicare cuts on top of the $60 billion 
that was included in the President's deficit reduction package.
  Yes, Mr. President, I am willing again to vote for certain Medicare 
cuts if they are appropriate and do not cut at the heart of the health 
care of the people who need Medicare.
   [[Page S6588]] But while Medicare needs to be on the table as we 
search for ways to reduce the deficit, we have to ensure that any 
changes make sense both within the context of the Medicare program 
itself and in the broader context of our entire Federal budget. For 
just as Medicare clearly has an impact on the Federal deficit, Medicare 
beneficiaries and Medicare providers should not be asked to fund other 
political or policy priorities apart from the goal of reducing the 
Federal deficit.
  So I am concerned, Mr. President, that those who argue the loudest 
for a balanced budget tend to be the people who are the first to demand 
massive tax cuts and not decreases but increases in Federal spending. I 
do not think the use of Medicare cuts to do those two things is 
appropriate in the context of this budget resolution.
  Mr. President, I want to be one of the people on this floor to say 
that neither political party is blameless in this regard. Both 
Republicans and Democrats have argued for increased defense spending 
and for tax cuts at the same time they are out here promising a 
balanced budget and saying that their top priority is a balanced budget 
amendment.
  We cannot argue that changes to Medicare are needed to lower the 
deficit and then devote our very scarce resources to tax cuts and 
defense increases.
  Again, Mr. President, I am willing to support certain further cuts to 
Medicare to bring the Medicare trust fund into balance, and even, where 
appropriate, to help reduce the Federal budget deficit.
  That is not something I would say about Social Security. I will say 
it about Medicare. I am not willing to support cuts to Medicare, 
however, to fund an irresponsible tax cut and increase our bloated 
defense budget.
  Looking to the Medicare Program for cuts will be hard enough. It 
would be far better to be making changes to Medicare as part of 
comprehensive health care reform. In my view, Mr. President, that would 
be my first choice as the health care reform debate illustrated 
powerfully last year.
  The cost-shifting takes place because of Medicare, and Medicare 
mushrooms health care costs. Making changes to Medicare unilaterally as 
we apparently will do in this budget this year, outside of 
comprehensive reforms to the entire health care system, I am afraid 
invites even more of the cost-shifting.
  I am afraid, though, Mr. President, to be realistic, there is no sign 
that comprehensive health care reform will be before the Senate in the 
104th Congress. That complicates the job of finding savings in Medicare 
and limits what to expect in the way of potential savings.
  Nevertheless, Mr. President, I want to say today and be specific that 
there are changes in Medicare that can and should be made. For example, 
we could consider making some changes to the Medicare home health care 
benefit.
  For example, I am willing to consider requiring a modest copayment on 
those home health services as long as adequate provision is made for 
those with lower incomes. Proposals I have seen for 20 percent 
copayment may be too high. Maybe they are looking at a 5-or-10-percent 
copayment, making sure that those who cannot afford it are taken care 
of. It could at least be on the table.
  Moreover, Mr. President--again to be specific, not just talking in 
the abstract about Medicare cuts--let me acknowledge that some have 
suggested that we might move to have a prospective payment system for 
home health care providers under which Medicare would reimburse 
services on a per episode basis. Some say that would not harm people 
and would be more efficient and save money. Given the dramatic rise in 
the number of visits per person served on the Medicare home health 
benefit in recent years, such a change might make sense. It certainly 
is something we should examine.
  Mr. President, I want to also remind my colleagues that a great deal 
of the increase in the utilization we see in the Medicare home health 
care benefit has been the direct result of previous policy changes to 
Medicare that were also supposed to create savings. It did not work 
that way, in part, because of changes to Medicare patients who are 
being discharged from hospitals quicker and sicker than they used to 
be. In many cases, Medicare policies have just moved the site of care 
from the hospital to the home, with the resulting increase in home 
health care benefit utilization.
  I am pleased that much of the care can be given in the home, but we 
have to be realistic about the cause and effect resulting from Medicare 
changes. It should serve as a caution to all as we seek to find savings 
in Medicare, we should not just make a cut here and find out we are 
paying the same or more through Medicare at another location. That does 
not accomplish anything either for Medicare, the people who benefit 
from it, or for the goal of reducing the Federal deficit.
  Mr. President, in other areas there may again be more room for 
modifications, to the way, for example, we make payments to hospitals 
for capital-related costs of inpatient service. Some have argued that 
those capital-related rates reflect erroneous inflation forecasts, and 
adjustments ought to be made to account for the errors.
  This sounds like the kind of specific cut in Medicare that does not 
go to the heart of Medicare, does not harm the individual's ability to 
get the care they need, but the inefficiency and excesses of the way 
the system is set up. These should be at the top of our list, not at 
the bottom.
  During last year's health care reform debate, this kind of 
modification was considered. I think it deserves review again.
  Mr. President, one change that must be a high priority also, is to 
ask wealthier beneficiaries to shoulder more of the cost of part B 
services, relieving taxpayers of some of the subsidy they are now 
providing, which amounts to about 75 percent of the full value of the 
Medicare part B premium.
  I proposed that in 1992 as part of my deficit reduction proposal, and 
I recall the comments made by the majority leader that those with 
higher incomes ought to be asked to pay a little more for part B 
services. So that should be on the table.
  We should also consider making changes to eliminate so-called 
formula-driven overpayments for hospital outpatient services. The 
Medicare part B copayment of 20 percent is intended to lower the cost 
of Medicare to taxpayers on a dollar-for-dollar basis. For every dollar 
of copayment made by a beneficiary, Medicare's own liability is 
supposed to drop by $1. It is my understanding there are anomalies in 
the Medicare reimbursement formula for certain outpatient hospital 
service. The result, Mr. President, is that the liability to Medicare 
is just greater than it should be.
  So we are talking here about real ways to save dollars to achieve our 
deficit reduction goals without scaring the people in this country who 
need the basic Medicare services, like the possible changes to 
inpatient capital-related payment rates. This matter was debated during 
the health care reform debate last session. We did not get it done. We 
did not get these cuts implemented. We could be getting the benefit and 
savings of those today if we had acted then instead of waiting until 
now.
  Some suggested we change the formula-driven overpayments. Again, I 
want the specific ideas on the table for the people of this Congress 
and for the whole country to examine.
  Mr. President, I am willing to consider proposals that provide 
incentives to seniors to select managed care alternatives. There are 
other changes that I would certainly be willing to consider.
  Mr. President, I do want to say a few other things about changes that 
do not make sense. Some we should not be doing. For example, shifting 
Medicare costs on the backs of those with very low income not only 
unfairly burdens those least able to bear additional costs, but, again, 
to the extent it swells Medicaid costs, all it will do is transfer the 
tax burden from the Federal taxpayers to the State taxpayers.
  Of course, that is a convenient result for our Federal budget 
writers, but not an improvement for the taxpayers back home in 
Wisconsin or Minnesota.
  Mr. President, I mentioned the Kerrey-Brown package as legislation 
which I supported and which also contains specific and significant 
Medicare cuts. As I have noted before on this floor, the process, Mr. 
President, the 
 [[Page S6589]] process by which Senator Kerrey of Nebraska and Senator 
Brown of Colorado and others put together this package was, to me, a 
model of bipartisan cooperation.
  We did not hear much about it during the 1994 campaign. People 
assumed that everything that happens out here is partisan. But that is 
not what I have found. There are people in this body who do want to get 
together on a bipartisan basis to solve the deficit problem. They have 
done it. They have put a lot of time into it. They are willing to do it 
again.
  For my part, I came away from that process greatly encouraged that 
there were Senators on both sides of the aisle who were willing to band 
together to find some common ground in reducing the deficit, even if it 
meant bucking the partisan political rhetoric of their respective 
parties.
  Mr. President, I believe that in this 104th Congress we can achieve 
that kind of bipartisanship again, and I want to signal today as we 
move into next week of the budget resolution, that I am not only ready 
but very eager to participate in that bipartisan effort. I yield the 
floor.
  Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER (Mr. Grams). The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. KEMPTHORNE. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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