Press Conference with Senator Charles Grassley (R-IA) and Senator Max Baucus (D-MT)

HEADLINE: PRESS CONFERENCE WITH SENATOR CHARLES GRASSLEY (R-IA) AND SENATOR MAX BAUCUS (D-MT)
 
RE: MEDICARE

BODY:
SEN. GRASSLEY: Thank you all very much for coming.

Senator Baucus and I are here and working today to look to final action, and we hope that before too late tonight -- (chuckles) -- on the Medicare prescription drug bill. We started together this year with a commitment to retiring prescription drugs as an election issue and making it a public policy issue instead. We got busy doing the people's business, and we worked across party lines to pass out of committee a comprehensive bill that offers all seniors a voluntary, affordable, comprehensive and universal drug benefit.

Medicare needs to be brought into the 21st century practice of medicine. Medicare should cover prescription drugs. It should not -- it should also include preventive services and provide better protection against catastrophic illnesses. We also need to strengthen the program so it would be available not only for this generation, but for generations to come. And finally, for rural states like Senator Baucus and I represent, and a lot of other states that are rural, the Medicare payment formula needs to be fixed so that hospitals and doctors and other providers no longer are penalized for delivering high-quality, cost-effective medicine.

Our Senate bill, I believe and we believe, achieves these goals. We reached a good compromise on how to spend the $12 billion, and we announced that last night. And that will be voted on later today. Medicare beneficiaries will benefit from competition and PPOs can help bring prices down, but we also have very important demonstration projects for the beneficiaries that -- of 5 percent that create about 50 percent of the cost.

We're optimistic that final passage of our bipartisan Senate bill. This issue has momentum. After five years of talk about prescription drugs, this Congress is within reach of helping senior citizens with life-enhancing medicines and to strengthen Medicare both for the consumers and for the taxpayers. And we wouldn't be here without the cooperation.

And so, I haven't thanked Senator Baucus this morning. I hope I thanked him several times earlier in this process.

But it's been wonderful working with him, and it's another continuation of a partnership we've had for a long time.

SEN. BAUCUS: Thank you very much. Well, thanks very much, Mr. Chairman.

Well, we're here. We're on the eve of passing a historic prescription drug coverage legislation. And I say "historic" because there are so many Americans that have no coverage or inadequate coverage. And it's about time that the United States government, the president and the Congress joined together and passed aid and assistance to so many seniors.

Now, I want to also point out that this is -- this is not the final effort that we'll undertake to make sure that prescription drug benefits are sufficiently and adequately provided. Now, this is just a first step. This is a down payment. This is the beginning. There's a lot more we have yet to do. And there's -- not only with respect to coverage. There's also because it's a bit complex. And I am concerned, I think we're both concerned, that some of the complexities of this plan are going to be bit confusing to people. And it doesn't come into effect until 2006. And it's my hope that between now and then we'll be able to iron out some of the complexities and some of the confusion so it's more, as a practical matter, readily available for more seniors. But the passage of the -- first, the agreement that the chairman and I reached with respect to the extra $12 billion now enables us to, I think, pass this legislation tonight. I mean, that is -- that's -- that agreement put wind back in our sails, and I think it's going to allow for smooth sailing for a final passage.

I'd like to thank Senator Grassley. I could not be luckier to have as a chairman of my committee somebody of the quality, the intelligence and the -- just the good character of the senator from Iowa. He's a great person to work with. And we're here today in large part because of his leadership. He's done just a super job and been a great person to work with. And that's enabled us -- that is, working together, the two of us -- to reach out to more senators on both sides of the aisle who see that we're working closely together. We do want to get a balanced, sound bill passed so that they themselves are more inclined to want to join in with us.

And I think that's one reason why we're making progress, just trying to set the proper tone at the beginning, and that allows other senators to say, "Hey, you know, those two are working well together, so that's something I'd maybe want to get on board with." And we just keep working at it and listening to senators' very legitimate concerns, and it's just helped us reach the point we are at today, that is, on the eve of passing an excellent bill.

There are also some provisions in this bill which are needed for rural states. Rural states today are discriminated against with respect to Medicare payments, and we have some provisions in this bill which redress that imbalance or to address that imbalance so that there's a more level playing field and all parts of the country essentially get the same benefits.

I believe that we're going to look back on this date -- that is, June 26th of 2004 (sic) -- as an important date in the history of American health care. This isn't a perfect bill, it doesn't contain everything that any one senator would like, but it sets up a very important framework. It's a beginning. It's a start. It's a framework that will allow our seniors to afford prescription drugs that they need to maintain a high quality of life. And I think in the coming years, as more funds become available and as more new ideas pop up, we're going to find ways to improve upon it.

It's often said a journey of a thousand miles begins with a single step. Well, the passage of the Senate's Medicare prescription drug legislation, I think, begins us on the journey toward effective, comprehensive Medicare reform. And I think our seniors will soon have access to the health care and prescription drug coverage that they deserve.

Thank you very much.

SEN. GRASSLEY: The lady over here.

Q Two questions. One, could you tell us a little bit about the schedule today, what to expect in terms of any important amendments, and what time you'll be voting on the final passage?

And secondly, could you just look ahead to the issues and the challenge that you face in the conference committee? Obviously, the House has a very different bill.

SEN. BAUCUS: I can't speak for the chairman. (Chuckling.) But personally, I've not thought much about the conference.

Q (Chuckles.)

SEN. BAUCUS: I'm just so busy with this bill. There are just so many particulars.

There will be several amendments scheduled for a vote fairly soon, and another batch a little bit later. In the meantime, we'll -- batches of accepted amendments.

A big amendment that may come up is income-related -- that is, where benefits are income-related -- and changing the assets test is another one. I think we've -- the amendments dealing with gaps in coverage and whether premiums should be covered during, you know, the so-called gap and amendments of that nature have already been brought up, and senators have voted. So I don't think there are many more amendments of that nature.

Rather, there -- many amendments are a little more narrowly focused, as I mentioned, like the assets test and whether premium payments should be income-related. Those are -- or dual-eligibles. That's the degree to which dual-eligibles -- the degree to which Medicaid pays for -- Medicare -- (chuckles) -- and so forth is another one that might come up.

SEN. GRASSLEY: Yeah. I haven't thought much about conference, either. But remember that there is one philosophical difference between the House and the Senate, and that is, in the Senate, we have the working towards market forces and the PPOs in our bill, in a very forceful way. And that's been enhanced by this $12 billion compromise that we worked out. And the House has nothing like that. And I would expect, then, even though it's far short of what maybe the president wants, the Senate bill, though, is something that the White House is going to concentrate on over the House bill.

Q Do you think the White House will support the Senate bill over the House bill?

SEN. GRASSLEY: No, I'm not saying I -- we're not going to get statements of support, but we're going to get statements of satisfaction that this process is moving along very successfully.

Q Senator Grassley, does this deny an issue for the Democrats who are running for the White House?

SEN. GRASSLEY: No, I don't think so, because there are so many other health issues. In fact, I think you see this -- well, it denies -- yeah, might deny an issue. So the answer ought to be yes, but only from this standpoint. There are so many other health issues out there that I've got to deal with, that Democratic candidates, the president can deal with, like, for instance, just the uninsured is a very big problem Max and I have to work on. Another one is on possible changes in Medicaid.

SEN. BAUCUS: Yeah, I don't know that it denies the Democrats an issue. The fact is that Democrats have for years been advocating substantial prescription drug benefits for seniors, and I think that's very well-known. I think seniors know that. You know, it is true that the president is proposing drug benefits legislation, and it's also true that the other party's in -- majority party in both bodies and will claim credit. (Chuckling.) Frankly, I think both parties are going to claim credit for this --

SEN. GRASSLEY: Yeah. I think you'll see a vote that says that.

SEN. BAUCUS: Yeah, right. Yeah, and it's going to -- I think it's going to be a very lopsided vote. And I totally agree with the point that, hey, there are lots of health care issues out there. I think the largest unresolved issue facing America today is health insurance, inadequate health insurance for 40-some-million Americans. And that, I think, is extremely important that the candidates on both sides of the aisle I'm quite certain during the presidential campaign are going to address -- at least they should.

Q Mr. Baucus --

Q Two questions about the conference, please. You spent a lot of time in the last couple of weeks trying to satisfy conservatives here, and they still don't see terribly happy. Are you going to have to keep them sort of at bay during the whole conference process? Or are they going to be making demands?

SEN. GRASSLEY: I think -- I think the only fair thing to say is, there's been no commitments made about a conference. We're going into conference with everything on the table, and we're just going to have to work our way through it. You know, everybody's going to be there, and all those points of view are going to be represented, and I think you just ought to let the conference process work its way out.

SEN. BAUCUS: If I might just add one point there because, you know, we're in large part where we are today, frankly, because we've worked as hard as we can, Chairman Grassley and I, to find balance. You know, the Senate is pretty much evenly divided, you know, 51-49, and we have two competing philosophies here; one's Medicare and the other is competition. And it's difficult to combine those two in an evenly divided body. And about the only way is to find a solution, albeit complex, that is and is perceived as balanced, as a fair attempt to try to let competition work, and also assure that beneficiaries get the drug benefits that we'd want them to have. And I think, therefore, we're going to get a good vote on final passage.

When we go to conference, I'd also -- I think we should maintain the same approach; that is balance. Senators and members of the House I think, by and large -- a large majority want prescription drug benefit legislation passed. And this is also -- this is very -- this is a fragile agreement in the sense that it's -- if the balance is tipped very much one way or the other, it could -- we could lose it. And so I think in conference that a major goal -- at least my major goal is to keep -- to maintain this balance, because that way we're able to get a bill and also a bill -- or conference reports on both sides gets a large vote.

Q Is it true that you're now considering that September's going to be a little more realistic for getting this done?

SEN. GRASSLEY: All I have heard along that line is that there's a feeling that this is a new program, first massive change of a program, and that we ought to do it right. And if it takes time to do it right, we'll take time.

Q Senator Baucus, you mentioned that there are some complexities that you'd hoped to get worked out by '06. Can you elaborate on what those complexities are? And are there any amendments that are being offered, or have been offered, that address some of those complexities?

SEN. BAUCUS: The complexities basically resolve around, you know, the number of plans; different components of plans that -- that is, that each plan will offer; whether there are two or more plans in an area, where there's a fall-back or not -- that is, with respect to the drug plan.

Then, on the PPO side, you know, it's submitting the bids; it's how the bids are determined; the effect of the $6 billion, at least during the demo period, for the Kyl approach. And then, so, I mean, I was going to kind of somewhat glibly respond, like: Well, how long do you have? (Chuckles.) Go over all the complexities, because they are there.

But having said that, you know, Medicare itself is already complex. And Social Security is already complex. And it's -- we're a democracy, and there are competing goals; on the one hand is simplicity and on the other hand is equity. You know, we do want things simple, but we also want things fair. And it's the drive toward fairness which tends to create the complexity; that it's fair to low-income groups, you know, fair to geographic areas of the country, you know, fair to urban -- I mean, every -- it seems like every group has its own claim on fairness. And it's -- in a certain sense, it does, but it's balanced off against simplicity.

Yeah, there have been some amendments offered to try to address the complexity problem. But I don't -- they have not made things more simple. The amendments that have been offered have attempted to address the fairness side; that is, people potentially switching in and out of plans and so forth, and they can try to make more stable, so that a senior is more likely -- is faced with less confusion. But most of those have been dealing with fairness.

Q Have you reached any kind of -- oh, I'm sorry -- reached any kind of agreement on an employer, on the whole issue of employer plans or --

SEN. GRASSLEY: We're still looking. We're still looking at that. in fact, we just discussed that privately in our small groups as we came here, and we're still looking at it from two standpoints: One, tax credits, and the other one, from some flexibility.

SEN. BAUCUS: Right. Yeah. I had to smile, because we just talked about that.

SEN. GRASSLEY: This lady here I called on.

STAFF: This is going to have to be the last question.

SEN. GRASSLEY: Okay.

Q Senator Grassley, could you comment on what Senator Baucus just said about how this is such a careful balance, and if it tips one way or another with an eye towards the conference, where on the House you've got leaders essentially trying to make this as conservative a bill as possible so they keep their members on board, when this comes together and those try to be married, it's hard to imagine how this doesn't get pulled further to the conservative side. And how does it stay together?

SEN. GRASSLEY: I don't think I can comment on that. I'm sorry, I can't. I just don't -- I have not studied the House bill enough. I don't know the dynamics. But remember that the president wants to move this along, and he got 20-some conservative members down to the house -- White House yesterday and said he's going to be watching how they vote. And he doesn't normally watch how people vote. I think that sends a stronger signal for problems they have compared to what we have. And don't forget, we've got market orientation and private plans much stronger in our bill than they do in theirs, and so you know where the White House is going to come down on that.

Q A follow-up on the employer question? You mentioned tax credits and flexibility. What, exactly, do you mean by flexibility? And if you were going to do tax credits, where do you get the money for it? And how much money are you talking about?

SEN. BAUCUS: The discussions we've had on this are not yet at the solution point. (Laughs.) We're getting there, working on it.

We've got a vote.