Health Care

Floor Speech

HEALTH CARE -- (Senate - July 17, 2008)

Mr. WYDEN. Mr. President, this morning there was some remarkable testimony given by Dr. Peter Orszag, the head of the Congressional Budget Office, which, in my view, is going to set the bar for how this Congress contains skyrocketing health care costs. Dr. Orszag has zeroed in on the question of health care costs, as my friend from Colorado knows, saying that escalating health care costs are essentially the premier determiner of this country's fiscal condition. So when Dr. Orszag, in effect, lays out what it is going to take for America and the Congress to contain medical costs, it seems to me that is a real wake-up call for this body and for the country.

What Dr. Orszag did is to spell out the extent of the inefficiencies in American health care. We are going to spend this year about $2.3 trillion on medical care. Dr. Orszag has said that the system is now so riddled with inefficiency that perhaps $700 billion of that $2.3 trillion is going to be spent on care and services that is of relatively little value as it does not contribute toward improved health outcomes.

Given this enormous economic challenge for our country--and, in effect, economic insecurity to a great extent is determined by rising health costs and rising gasoline prices--I wanted to get to the bottom of what the Congressional Budget Office thinks is going to be necessary to contain medical costs. So what I asked Dr. Orszag, specifically, was about his sense of what it will take to bend the health cost curve downward. Dr. Orszag said, in response to my questions, that it is going to take two things:

First, it is going to be essential to demonstrate to our people very directly how much these inefficiencies cost them, for example, in their reduced take-home pay at work. Second, Dr. Orszag made it very clear that to contain cost and to wring out these inefficiencies, it is going to be necessary for the Congress to pass health reform legislation so that in a more efficient, more fair health care system our people will have a new financial incentive to select health care carefully.

The reason I say Dr. Orszag set the bar today for containing health costs is because it is clear there are a lot of ideas for how to go about this task. I know the Senator from Colorado is very interested in health information technology, for example--virtually all Senators are--and all those new approaches are going to be very important. But I asked Dr. Orszag was it the only way that you could contain costs, to take those two steps--one to make sure people see directly what they lose if we continue a system with all these inefficiencies; and, second, what happens if there are no new financial incentives--and Dr. Orszag said very specifically that to contain medical costs you need to take those two steps: demonstrate to people what they are losing and give them new incentives to hold down costs.

Now, I have been honored to be able to join with 16 Members of this body, 8 Democrats and 8 Republicans, around legislation that is built on the two principles that Dr. Orszag affirmed today are going to be essential to contain health care costs. We make sure everybody understands what the implications are for propping up all these inefficiencies in their wages, because for the first few years under our legislation we would stipulate that workers are entitled to the cash value of what their employer is now spending on health care. So with that requirement, we address what Dr. Orszag has said is essential--to demonstrate to workers what they lose out on with the status quo.

The second thing we do in our legislation, which tracks Dr. Orszag's plan to contain costs, is we make sure that in a new system--where insurers have to take all comers, where people are part of a large group so that they have bargaining power, where there are lower administrative costs because you use the tax system to sign up people, and there is uniform billing--we also give a cash reward to individuals for making more careful purchases of their health care.

For example: Under our legislation, if their employer has spent $15,000 on their particular health care, and the individual worker either chooses an employer's package or, say, another package, and the package they chose would cost $14,200, that individual worker has $800 in their pocket to go on a great fishing trip in Oregon or Colorado, where we have some of the best recreation in the country.

So in our legislation, by way of giving a reward to workers, a cash reward for a careful selection of their health care, we do what Dr. Orszag has recommended as the second approach for containing medical costs.

I made clear this morning--and I especially appreciate Chairman Baucus's leadership because these hearings are a follow-up to our Finance Committee summit--and Chairman Baucus has made it clear we are going to work in a bipartisan way. He and Senator Grassley, in my view, are sort of the example of how to work in a bipartisan fashion. I said this morning I think there are probably other approaches that ought to be examined in this whole discussion, but what we do know from this morning is that Dr. Orszag has said you have to have those two essentials to contain costs--workers understanding what they lose out of the current system and new financial incentives for making careful purchases.

That is why it seems to me that what Dr. Orszag did today was to set the bar; to, in effect, lay out a vision of what it is going to take to hold down medical costs. It seems to me, when we look at the double whammy our people are facing today--the combination of skyrocketing medical bills and getting clobbered at the gasoline pump--we see that those are the two areas where you need to take action.

Under the leadership of the Majority Leader, Senator Reid, we are going to go after those gas price hikes before the Congress breaks for the recess. I am pleased to be part of our caucus's efforts to work on this and pleased that we are reaching out across the aisle so, hopefully, there will be bipartisan support for our efforts to hold down gasoline price hikes. But I think we need to start laying out, as Dr. Orszag did today, the strategy for holding down medical costs.

I have been very fortunate to be able to work with Senator Bennett, the Senator from Utah, as part of a group of 16 Senators--8 Democrats and 8 Republicans--in what is the first bipartisan effort in the history of the Senate. This is the first time where there has been a significant coalition, a bipartisan coalition, working for universal coverage. Today, what Dr. Orszag did was to affirm the guts of what we have been advocating for.

He affirmed it specifically, that this was a way to achieve the cost containment in our health care system that is so essential. There may be other ways, but this is one way to do it. We now have an opportunity over the next few months, as we get ready for a new President, to work together, Democrats and Republicans, to address this critical question.

I will close with one last comment. On the floor last night were Senator Landrieu and Senator Crapo. I am very honored to have both of them as cosponsors of the Healthy Americans Act. We were talking about older workers. Today one of the worst spots to be in is if you are 57 or 58 years old and you are laid off from your job, because if you are laid off at 57 or 58, you go off into the broken individual health insurance market. You better not have any illnesses. It is going to be hard to get coverage. It is going to be very hard to afford it because you are going to be out on your own rather than in a group. And finally, you are not going to get the tax break, if you are all on your own, that you would get if you were with an employer health plan.

The Healthy Americans Act addresses each of those three concerns and, boy, those are not abstract questions for anybody in Colorado or Oregon or Idaho. Ask the GM retirees who got clobbered a few days go. If you are 57 or 58 and you are 8 years away from Medicare, you have a lot to worry about.

Our bipartisan coalition is working, I think, effectively and in the bipartisan fashion it is going to take to address those concerns as well.

I hope colleagues will reflect on what Dr. Orszag said this morning with respect to cost containment. We will have a lot more discussion in the days ahead about the concerns of older workers, as we started last night with Senator Landrieu and Senator Crapo. We are especially thrilled that the distinguished Senator from Colorado is a member of the Finance Committee and I know we will have a chance to work together on those issues as well.

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