Medicare

MEDICARE

Mrs. MURRAY. Mr. President, I have been fighting for a real prescription drug benefit for years. In the 106th Congress, I helped draft the MEND Act, and year after year I have used my seat on the Budget Committee to set aside money for a good drug benefit. I voted for several Medicare prescription drug bills, including S. 1 last June and the Graham-Miller-Kennedy bill in the last Congress. I have written and I have introduced legislation to make Medicare more fair to the people of my home State of Washington. I have worked to improve health care for seniors on the HELP Committee, on the Labor-HHS appropriations subcommittee, and here on the Senate floor.

After all of these years of work, no one wants prescription drug benefits more than I do. But I am very troubled by the proposal that is now before us.

I am unhappy at the prospect that this plan could force seniors and the disabled into an overly restrictive health care rationing regime in which they could lose their choice of doctors just to get a pretty meager drug benefit.

I am unhappy at the prospect that this plan could tell our seniors they must give up the good retirement health plan they have worked all of their lives to earn.

I am unhappy at the prospect that this plan could leave our seniors and disabled at the mercy of ever-increasing premiums.

I am unhappy at the prospect that this plan could tell patients who have complex medical conditions they cannot get direct access to specialists they need to see.

I am unhappy at the prospect that this plan could tell patients with MS, or Parkinson's disease, or ALS they can't get the drugs they need because their plan will not cover them.

I am unhappy at the prospect that this plan could tell our rural seniors they will have to roll the dice on how they receive health care coverage because this is not a real choice in their communities.

I am unhappy at the prospect that this plan would tell disabled Americans who are fighting poverty that the drugs they get today can be off limits tomorrow.

I am unhappy at the prospect that this plan would tell seniors if their drugs cost more than $2,300, they won't get a dime of help until they pay $3,600 out of their own pockets.

I am unhappy at the prospect that this plan could break the promise that Medicare has had for our seniors and our disabled since 1965.

This isn't just about plans and formularies and medical services areas; this is about people. It is about our parents and our grandparents and generations of Americans coming behind us.

I have sat down with seniors in my State, and I have heard how badly they need a real drug benefit. Just last August, I met
with more than 200 seniors in Edmonds, WA, at the South County Senior Center. They told me in their own words just how
important the drug benefit is.

During this debate, I have listened to my colleagues. I have listened to seniors and the disabled in Washington State. I have heard from doctors and hospitals at home. I have read the key provisions in the package, and I have reviewed the Congressional Budget Office estimates. Without a doubt, this is one of the most complex and controversial proposals this Congress has considered.

One needs only to review what happened in the House a few days ago to see how controversial and political the vote was. What occurred during that vote speaks volumes about the failures of this bill and the lengths the majority will go to in order to pass this flawed measure.

At the end of the allocated time for that vote in the House, the bill had been rejected. But the majority leadership refused to close that vote. They held it open for many more minutes, and those minutes turned into hours, and finally at about 6 o'clock in the morning, after holding that vote open for 3 hours, the majority managed to pressure a few Members to switch their votes.

An issue this important deserves a thorough debate. I am troubled that it appears as though this bill is being railroaded through Congress on twisted arms and backroom pressure.

When I look at Social Security and Medicare, I don't just see a program, I see a promise. It is a promise from one generation to the next. It is a promise from our Government to our seniors. And it is a promise that reflects our values.

Coupled with Social Security, Medicare is the most important antipoverty program ever. In fact, before Medicare, in 1963, 44 percent of our seniors were uninsured. Today, it is just 1 percent. In 1966, 29 percent of seniors lived in poverty. Today, it is down to about 10 percent. Since 1960, life expectancy for those over 65 has increased by 25 percent.

Medicare is a success story. It promised our seniors that they will have health care security, regardless of their ability to pay, regardless of where they live, and regardless of their medical condition.

Not only has Medicare helped seniors, but it forms the foundation of all of our health care. Medicare helps train our doctors. Medicare payments help keep our rural hospitals open. And Medicare helps keep emergency rooms and neonatal units operating. Medicare is open to every doctor and every hospital. It doesn't force providers into restricted networks. It lets doctors make decisions based on what their patients need-not on some mandate from some accountant.

It is troubling to think of what rural America would be today and whether inner-city trauma centers would even be in existence today without Medicare.

Let us not forget the reason we created Medicare in the first place. The market failed our seniors.

I approach this debate with a clear understanding of the importance of Medicare to our seniors and to our entire health care system. When I look at this bill, I want to know what it means to the seniors I represent. So far, I have found five big dangers for Washington State seniors.

First, this plan jeopardizes the health benefits retirees have earned during their working years. In Washington State, 47,250 seniors could lose their retiree health benefits. In return, they get much less coverage and they will pay for more than they had planned.

This plan is an unpredictable benefit that requires huge out-of-pocket costs and has massive gaps in coverage. This bill changes the ground rules on seniors in the middle of their golden years, and that is just not right.

Second, seniors could be forced into an overly restrictive health care rationing regime if they want a drug benefit. On paper, it looks as if seniors have a choice. That is what the proponents keep repeating. When we take a closer look, we see what is going on. Supporters claim that seniors can stay in traditional Medicare, but that is only if insurance companies decide to offer drug-only plans. They could offer drug-only plans, but the affordability of those plans is unknown and unknowable. That is because there is no limit on how much a plan can charge, so seniors will not be protected from price gouging.

On paper it may look as if seniors get a choice, but in reality many will face a new system that rations their health care in exchange for a very small drug benefit. Seniors could get fewer choices and less coverage than they have today. They will face fewer choices because of an imposed system of rationing that may not let them pick their own doctor, and they will have less coverage because the plans they will be forced into do not need to cover every drug that is medically necessary.

Third, if you get a chronic, life-threatening disease such as cancer or AIDS, you are not guaranteed the drugs you need. Here is what one client of The Lifelong AIDS Alliance in Washington State had to say:

The current bill as it is written will affect me personally as it limits the drugs I can have access to because it only allows for up to two drugs under the prescription part of the bill. Since I am on a multiple-drug regimen, I will not have access to the other life-saving drugs that I will have to take to stay HIV healthy.

Those are the chilling words of one of my constituents who is HIV positive and understands what this bill will mean for him.
That is why AIDS service providers in my State oppose this bill.

In addition, if you need access to a clinical trial, forget it. This bill does not require any plan to give you access to experimental treatments.

This plan will mean fewer choices and less coverage for millions of seniors.

Fourth, this bill is especially bad for seniors and disabled Americans who are fighting poverty. Today, about 6 million Americans are eligible for both Medicare and Medicaid. Through these two programs, they get the coverage for the drugs they need. But this new bill we are looking at strips away what is known as wraparound coverage. In Washington State, that means about 92,000 people will get less coverage than they have today. That is just in my State. Those are the most vulnerable among us, the very people Medicare and Medicaid were designed to protect.

Fifth, there is a huge gap in coverage. Many seniors will see a big hole in their coverage. Payments will not stop. What you have to pay will not stop, but your coverage will. If your drugs cost you more than $2,250 a year, you will get zero help until you spend a total of $3,600 out of your own pocket. You get no coverage, but you still have to pay the premium.

When you look at what the average Medicare beneficiary spends for drugs, this coverage gap gets even worse. According to the Kaiser Family Foundation, in 2003, the average Medicare beneficiary paid $2,322 for prescription drugs. If you spend the average, you are already in the coverage gap. Those figures were included in the Los Angeles Times article that appeared in the Seattle Times on November 21. They show that the average senior will end up with a gap in coverage from which few seniors will ever emerge.

When I ask, what does this bill mean for the seniors I represent, I am pretty troubled by the answers. I am troubled this could force 47,000 seniors in Washington State to give up the retiree health benefits they have worked for their entire lives. I am troubled this could force seniors in Washington State into overly restrictive health care rationing, to get a limited drug benefit and to lose their choice of doctor. I am troubled this could force patients with cancer, AIDS, and other life-threatening diseases into a system that will deny them the drugs they need. I am troubled this could force 92,000 low-income seniors or disabled
Washingtonians out of Medicaid into a market where they lose access to the drugs they get today. I am troubled this could
force millions of seniors into a coverage gap where they have to spend more than $3,600 out of their own pocket without getting coverage or benefits.

This bill is also bad for Washington State in seven ways:

It could result in unequal benefits throughout Washington.

It could force providers and seniors to reevaluate their participation every single year, and they will get very little in return for that added unpredictability.

It could encourage seniors who are healthier and financially secure to leave traditional Medicare.

It could undermine Medicaid in Washington State.

It could require my State to send to the Federal Government a very large chunk of the savings it realizes.

It could force Washington State to manage new bureaucracies to test the assets of seniors in my home State.

And it could put Washington State even further down the list in Medicare reimbursements per beneficiary.

Let me walk through how this program would work to show how it is bad for my home State. Under this plan, the country will be
divided into as many as 50 regions. States such as Washington could be divided into as many as three regions. Within these new, undefined regions, private insurance plans would be able to run the Medicare Program-not just the drug benefit, but Part A and Part B of the Medicare Program as well.

Washington State will be an attractive market for the PPOs and HMOs because we have areas that are healthier and wealthier and a tradition of health care delivery.

Currently, Washington State has one of the highest Medicare+Choice participation rates in the country with 18 percent of
Medicare beneficiaries receiving Medicare through a Medi care+Choice plan.

Washington State also has a long tradition of managed and efficient care, so we will be a prime target for the new PPOs and HMOs. That means Medicare benefits in my State, just within my State, will vary from region to region and county to county depending on where you live. In theory, seniors in my home State may have more choices, but they give up a guarantee of a defined benefit.

Providers in Washington State could also face the same changes and uncertainty. Every year, seniors in Washington State would have to evaluate each insurance plan to find the one that best meets their needs.

Here are some of the things seniors every year in my State will have to figure out. While not knowing what medical conditions they may confront, they will have to figure out how much they have to pay out of pocket. Without knowing what their future holds, they will have to predict what providers they will be able to see. Without knowing, they will have to figure out what doctors have dropped out of their plan or may drop out, what restrictions will be on drug coverage, what their copayments will be, what plan formulary includes expensive new drugs, what hospitals are in their network.

That is an awful lot to figure out, especially since health plans, as we all know, are never written in plain English and no one knows what medical conditions they may confront in their future.

Today, Medicare provides predictability. An 85-year-old woman in her home knows what Medicare provides. Under the Medicare+Choice plan, seniors got more than they gave up.

I do want to state there have been some managed care success stories in my home State. We have some great providers in
Washington State that led the way in providing innovative, comprehensive care that puts the focus on patients, not profits. But overall, we need to think how this plan would expand the Medicare+Choice model.

Medicare+Choice has worked only in limited parts of Washington State. A total of 131,391 seniors in Washington State participate in these plans. But they are not open to all seniors and they are limited to a very few select regions. Even in this limited program, we have seen significant changes and instability just within Washington State. I am not at all convinced this is
a model we should now expand for all seniors and disabled.

If these new plans that are coming in attract higher income, healthier seniors, we need to ask, what will be left of traditional Medicare? I am afraid traditional Medicare will begin to look more and more like Medicaid.

The prospects for this plan are deeply troubling. They could have a massive financial impact on Washington State.

I will turn to how this plan will affect Washington State and its Medicaid Program.

I received a letter from the Democratic Governors' Association. It is signed by three Governors, including Governor Locke of Washington.

Mr. President, I ask unanimous consent that letter be printed in the RECORD at the conclusion of my remarks.

The PRESIDING OFFICER. Without objection, it is so ordered.

(See exhibit 1.)

Mrs. MURRAY. Mr. President, the Governors' letter urges Congress to give the States time to determine the impact on their Medicaid programs before enacting sweeping changes in how we treat Medicaid beneficiaries and how States pay for coverage for low-income seniors and the disabled.

So under this plan, if States save money by shifting drug costs from Medicaid to Medicare, States have to give a portion of those savings that they get back to the Federal Government every year.

Many States, such as Washington, have stepped up to the plate and have tried to fill the gap in Medicare by providing affordable, comprehensive prescription drug coverage through Medicaid for people who are eligible for both programs.

Over the past 10 years, as drug costs have rapidly increased, this burden has become overwhelming. Many States are now being forced to scale back their coverage in access.

In 2002, Washington State spent an estimated $212.8 million on drug costs for people who are eligible for both Medicare and Medicaid. That was a huge strain on my State.

Under this plan we are considering, the States will see some relief by shifting Medicaid beneficiaries to Medicare for drug coverage. But, unfortunately, the plan gives with one hand and takes back with the other.

Washington State, under this plan, will be forced to surrender much of the savings it sees back to the Federal Government.
That could reduce Washington State's Federal Medicaid dollars by almost $2 billion from 2006 to 2013. That could devastate the entire program and result in further Medicaid reductions for low-income children and families. It could force the State to again implement reductions in provider payments for doctors, hospitals, and nursing homes.

A $2 billion give-back, just for my State, will mean more uninsured, lower provider payments, and more children losing any health care safety net they have today.

Let's not forget that States will be handed a massive new administration burden under this plan. Washington State will now have to administer new asset tests to determine who qualifies under Medicare for low-income assistance. These tests are extremely restrictive and will result in many low-income seniors being pushed into higher income categories.

Under the conference agreement, assets will be limited to $6,000 for a single person and $9,000 for a married couple.

In order to get any additional financial assistance under this plan, many seniors and the disabled will be forced to impoverish themselves and give up almost everything they have worked so hard to earn. Even if the States want to provide a more humane benefit or assistance, they will not be allowed to do so.

Now, many of us fought to provide relief to States just this year by temporarily increasing the Federal Medicaid match. This was a critically important fight to save Medicaid and prevent massive Medicaid cuts on doctors and hospitals. Our success in achieving a small measure of relief is now being undone by imposing an even greater burden on the States.

Finally, Mr. President, this bill will punish Washington State even further in Medicare payments. For several years, I have been working to address the geographic disparities that punish providers and seniors in my State of Washington. For years, Washington State has received unfair treatment.

Today, Washington State ranks 41st in the Nation in Medicare payments per beneficiary. We are being penalized because we have a tradition of low-cost, efficient health care, and healthy seniors. Medicare should reward that. Instead, its outdated reimbursement formulas are causing doctors to leave my State or close their practices to new Medicare patients.

I have spoken at great length on the Senate floor before about this, and I have introduced legislation to correct that inequity.
But under this bill, the situation would be even worse.

Washington State would fall from 41st in the Nation to 45th in the Nation. Even though there will be a slight increase in payments to Washington, because of what happens to other States, we end up falling even further behind. This is a fundamental shift in the Medicare entitlement, in exchange for a very weak benefit.

Philosophically, this plan goes in the wrong direction. We should be strengthening the foundation of Medicare, not experimenting with imposing a new health care system on seniors.

This plan undermines the role of the Federal Government in ensuring that every senior can live with the dignity and respect and stability they deserve. It could force seniors into an overly restrictive, ever-changing health system.

Let's not forget why Medicare was enacted in the first place. It was created because the private insurance market failed seniors and the disabled. Coverage was sporadic, expensive, and unpredictable. Medicare, when it was enacted, changed all of that for our Nation's seniors. Now I am afraid we are flirting with that original failed model. I believe we can do better.
During my time in the Senate, I have been proud to work on prescription drug coverage-from helping to draft the MEND Act in the 106th Congress to working on the Budget Committee over the past 4 years to fund prescription drugs.

I was proud to support the Graham-Miller-Kennedy bill in the 107th Congress that would have provided an affordable, reliable, comprehensive prescription drug benefit as part of Medicare. We had a chance to do much better.

I believe a prescription drug benefit ought to be a seamless part of Medicare. It should be treated just like a doctor's office visit or an outpatient surgical procedure.

By implementing a seamless, affordable benefit as part of Medicare, as we did when we added the Part B benefit, we would guarantee that all seniors have access to the same level of care, regardless of their health status or their age or their income or their assets or where they live. That access would be stable, and it would be predictable.

I know we can do this. Many of us in this Chamber, on both sides of the aisle, have worked to significantly boost our investment in NIH funding. We have fought to reform and modernize the FDA to ensure timely approval of new, lifesaving drugs. I want all of my seniors and disabled constituents to benefit from those kinds of investments.

Under the plan before us today, I cannot be sure they will reap the rewards of this Federal investment.

The PRESIDING OFFICER (Mr. GRASSLEY). The Chair is responding to the request that the Senator be notified when she has 5 minutes left.

Mrs. MURRAY. Thank you, Mr. President.

Mr. President, we should be on the floor today debating a prescription drug benefit package, not a proposal to radically alter Medicare. This should be a fight about providing good, affordable, stable coverage, not about experimenting with Medicare.

I do want to thank my friend and colleague, Senator Baucus, for his efforts. I know he worked hard to do the best he could. Senator Baucus understands the importance of Medicare for seniors and the disabled, and I know he fought against incredible odds. He was sitting across the table from Members of Congress who tried before to privatize Medicare, and many who still hope to turn Social Security over to Wall Street. He faced an impossible task.

I know he did all he could, and I thank him for his fight.

Mr. President, I do want to note there are some things in this bill that I fought for that are important.

It does prevent additional cuts in payments to doctors who are scheduled to take effect early next year. The scheduled reduction of 4.5 percent, as we all know, is unacceptable. I worked hard to prevent that scheduled reduction of 4 percent in 2003, and I do applaud the conferees for meeting our demands on this issue.

The package also provides additional relief for rural hospitals, home health care agencies, and rural health care providers. This relief is truly a life line for saving rural health care. I have always supported these provisions, and I will continue to fight for fair and equitable rural payments.

I can promise health care providers and patients in my home State that regardless of the outcome of this legislation, I remain committed to stabilizing Medicare payments.

Now, Mr. President, I know many organizations representing doctors and hospitals think we can come back in 2006 and
correct the mechanisms in this bill that undermine Medicare. That is a pretty dangerous gamble. Not only that, but we don't know what the people who put this bill together will demand down the road in exchange for changes-premiums support or vouchers for States; larger gaps in coverage; more copayments; more restrictions on access; more deals on the House floor in the middle of the night?

We do not know what the pricetag will be to undo the damage that this bill will impose. I assure everyone, it will not be easy.

I had looked forward to the day when the Senate would pass a Medicare prescription drug benefit. That day is upon us, but I believe that the price of this benefit is far too high.

In the coming months and years we will see the theory behind this bill put to practice. As more and more people discover what this bill and this President have done to their health care, I am confident we will hear from seniors as we have never heard before.

This is a difficult decision. The $400 billion in this bill does represent a step forward. The provider payments contained in this bill are needed in my State, and seniors deserve the prescription drug coverage they have been asking for. Passage of this bill and being signed into law is not the end of the story. A tremendous amount of work will be required to fix the deficiencies in this bill. I will be there, as I have been all these years, working the best I can to do the right thing for the people I represent in my State and the people across this country.

I yield the floor.

EXHIBIT 1

DEMOCRATIC GOVERNORS' ASSOCIATION,
Washington, DC, November 21, 2003.

Members of the U.S. Senate,
U.S. Capitol,
Washington, DC.

Dear Senator: As you know, the near 700-page Medicare reform bill was unveiled yesterday. As a consequence, states have not thoroughly reviewed the language or seen individual cost estimates needed to make an accurate determination of its benefits and/or costs. Late yesterday, the Congressional Budget Office (CBO) released numbers portraying a net savings to states of $17 billion over ten years. Notwithstanding this projected rosy scenario, neither CBO, nor any other independent entity has completed a state-by-state impact analysis of this legislation. Even CBO is projecting that states will be $900 million in the red in the first year of the Medicare's program implementation in 2006. States need to ensure that their reading of the legislation confirms that the projected new state costs have not been underestimated by CBO.

With this in mind, we urge you to reject any effort to vote on this legislation before you know its full content and cost impact on your state and the people we both serve. To this end, CBO estimates on Medicare reform impact and expedited state reviews of the direct and indirect cost/savings impact from this legislation must be done and fully disseminated. Any rush to judgment, without this information, may have both short and long-term consequences that could prove to be irrevocably severe.

Early in the deliberations of the Medicare reform conference, governors were advised that at a minimum, the conferees were committed to ensuring that states would face no new costs as a consequence of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. This commitment was made for each and every state, for each and every year, of the ten-year budget. For this reason, we are writing to urge you to not vote on this legislation until it is absolutely clear that this assurance has been upheld.

In recent days, there have been reports that the new administrative and other indirect state costs of this program-combined with the bill's exceedingly high "claw-back" of state savings-would more than exceed any Medicare savings for many states.
Such an unacceptable outcome would be in addition to another misguided policy, reportedly seeking to mandate states and the territories to permanently pay 75 percent of the current Federal prescription drug cost-shift to states. In 2006, the first year of the bill's enactment, states would have to pay 90 percent of these costs.

Some have already suggested that this is a poorly crafted bill and in the long run it would do more harm than good to the very population it was intended to benefit. Although some states are witnessing a small increase in revenues, most states will continue to experience budget shortfalls for the current fiscal year. Some analysts believe that the overall shortfall will likely be $25 to $40 billion. With the continued sluggish growth in state revenues, any increases in state costs imposed by this legislation would be yet another unfunded federal mandate, creating additional pressure on states to cut essential programs and/or raise taxes.

Similarly, any permanent continuation of the Federal government's prescription drug cost-shift to states runs counter to existing National Governors Association (NGA) policy that, "if Congress decides to expand prescription drug coverage to seniors, it should not shift that responsibility or its costs to the states and territories" and establishes a damaging precedent.

Sincerely,

Gov. Gary Locke,
Washington, DGA Chair.

Gov. Tom Vilsack,
Iowa, DGA Vice-Chair.

Gov. Bill Richardson,
New Mexico, DGA Federal Liaison.