Service Members Home Ownership Tax Act Of 2009 - Motion To Proceed

Floor Speech

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Mr. CRAPO. Mr. President, I appreciate the opportunity to be here with my colleagues from Arizona, Mississippi, and Florida.

When the people of the United States talk about health care reform, they are seeking some way to control the punishing and skyrocketing increases, year after year, in health care insurance costs and medical costs and better access and quality of health care. Yet when this 2,074-page bill, which was crafted in secret for the last 2 or 3 weeks, was finally revealed, that is hardly what we got. In fact, the reality is that this bill will drive up the cost of health care insurance and medical care in this country. It will increase taxes by hundreds of billions of dollars. It will cut Medicare by hundreds of billions of dollars. It will grow the Federal Government by $2.4 trillion of new spending over a 10-year period. It will push the needy uninsured not into subsidized health care insurance but into a failing entitlement program, Medicaid. It will impose a damaging unfunded mandate on States that are already strapped financially. It will leave millions of Americans uninsured, while probably creating the most enormous and massive government extension of Federal control over our economy that we have seen in our country, starting with creation of a new federally owned and managed insurance company.

As the Senator from Arizona indicated, today we are here to focus on the Medicare cut aspect of this legislation. The Senate bill contains something in the neighborhood of $500 billion of cuts in Medicare. The first one I want to focus on is the one the Senator from Arizona already identified; that is, the Medicare Advantage cuts.

The Senate bill contains $118 billion in cuts to the Medicare Advantage Program. Let me talk about that program for a minute. Currently, there are nearly 11 million seniors, as has been indicated, enrolled in Medicare Advantage. That represents about one out of four of all Medicare beneficiaries in the United States. In my State of Idaho, there are more than 60,000 Medicare Advantage beneficiaries, which is about 27 percent of the population in Idaho.

In addition, this is an extremely popular program. A 2007 study reported very high overall satisfaction with the Medicare Advantage Program. Eighty-four percent of the Medicare respondents said they were happy with their coverage and 75 percent would recommend Medicare Advantage to their friends or family members. Yet, despite this, there are massive cuts coming forward in the bill. Why would that be the case?

I don't think most Americans who are not on Medicare recognize the difference between Medicare generally and Medicare Advantage. Medicare Advantage was a modification of the traditional Medicare Program that, frankly, was put into place--I ask my colleague from Arizona to comment. Wasn't it put into place when the Republicans were in control of the Congress to try to help get market forces more engaged and involved in the administration of Medicare benefits?

Mr. KYL. Mr. President, the answer to that is yes. The idea was that seniors were complaining about the existing program. One thing was that a lot of folks in rural areas were not receiving good, efficient, and quick care because they had to drive long distances and couldn't find a doctor to serve them and hospitals couldn't take care of them.

Republicans tried to figure out, how could we incent the insurance companies to put together pools of physicians and hospitals to go into rural areas and take care of citizens who live there. The Medicare Advantage Program was one of the ways in which that was done. It has proved to be very successful.

Mr. CRAPO. If you look at the Federal entitlement program Medicare, the portion of Medicare that truly does have some private sector involvement, where private sector companies can come in and contract to provide the government's responsibilities under Medicare, it is the most popular of all Medicare programs, the one that was growing and letting the private sector deliver the benefits.

One of the aspects of the Medicare Advantage Program is that senior citizens on Medicare Advantage actually get additional benefits beyond those traditional Medicare benefits that those in the normal or standard Medicare Program get because the private sector options have been able to identify ways to enhance and create opportunities for greater and stronger benefits.

Yet those who don't want to have anything but a single-payer system, those who want to make sure the government-provided health care is provided only by the government, do not like the Medicare Advantage Program. So it is not surprising that we see this level of cuts in this program.

During the Finance Committee markup, CBO estimated that the value of extra benefits that Medicare Advantage plans provide will drop from $135 a month to $42 a month of extra benefits. The CBO Director, Mr. Elmendorf, confirmed this during the markup. I asked him:

So approximately half of the additional benefit would be lost to those current Medicare Advantage policyholders.

His answer was:

For those who would be enrolled otherwise under current law, yes.

In other words, compared to current law, if these cuts are put into place, about half of the benefits would be lost to these Medicare Advantage beneficiaries.

We now have more detail on that. I am sorry we don't have a bigger chart. We will have one in the future. If you can see the United States here, the States in the deep red are those that have cuts in excess of 50 percent to their Medicare Advantage beneficiaries; those in the lighter red are between 25 and 50 percent. In the white, there are only five States; they are the ones that don't have a negative impact. So 45 of the 50 States will see significant reductions in the Medicare Advantage benefits that are provided to their constituencies. You just have to look at the map to see it is a large percentage of those 45 States that are getting cuts in excess of 50 percent of their benefits.

Mr. LeMIEUX. Will the Senator yield for a question?

Mr. CRAPO. Yes.

Mr. LeMIEUX. The Senator is saying that seniors who have Medicare Advantage now will have big reductions in the benefits they receive. My understanding is that includes flu shots, eyeglasses, and hearing aids--as the Senator from Arizona said, programs to keep seniors healthy. My folks in Florida very much appreciate the Medicare Advantage

Program. We have more than 900,000 Floridians who are on Medicare Advantage.

I want to make sure I understand this correctly--that under the proposal put forward by Senator Reid, we are going to make substantial cuts to Medicare Advantage and the benefits Medicare Advantage provides.

Mr. CRAPO. The Senator is right. The way I look at it is that it is the extras. Some say Medicare benefits aren't being cut by these proposals, but that is a real stretch. When you look at Medicare Advantage, it is an outright misrepresentation. The benefits are vision benefits, dental benefits, and the kinds of preventive medicine, such as the mammograms, the PSA tests, and other types of things we have found that help you to dramatically increase your health, if you pursue these kinds of preventive medicine options. They are the ones that will be deprived through these benefits.

Mr. WICKER. Will the Senator yield?

Mr. CRAPO. Yes.

Mr. WICKER. I notice that in Florida that reduction, according to the CBO map, would be 81 percent. That is an unthinkable, drastic change in Medicare Advantage. In my area of the country, over in Arkansas, for example, it has a 40-percent reduction. My State, Mississippi, has a 41-percent reduction. Our neighboring State of Louisiana--these are some examples--has an 81-percent reduction, the same as the proposed reduction this legislation would cause for the State of Florida. I think it is important for our constituents to understand the magnitude of these Medicare Advantage reductions.

Mr. CRAPO. That is absolutely true. Taking a couple of other States, California is 68 percent; Arkansas, 40 percent; New York, 69 percent; New Mexico, 65 percent. The list goes on. The point here is this: The CBO Director made it clear that these will be benefits Medicare Advantage holders will be losing.

I want to move on to some of the other reductions in Medicare. The argument being made by the proponents of this bill is that we can cut $500 billion out of Medicaid and not impact anybody's benefits or the quality of the medical care they are receiving. That is not true. Where are the other cuts, non-Medicare Advantage cuts, coming from? They come from home health agencies, hospice, skilled nursing facilities, hospitals that provide care to seniors, and other Medicare providers in what is called the market basket.

You might say we can just continue to cut the compensation or the allocation of return for procedures and health care provided in these medical providers' services and not have any impact. The reality is far from that. What will happen is this. I will give a couple of specific examples. In general, what happens is, when a home health agency or a skilled nursing facility or a hospital receives these massive reductions of over $100 billion worth of cuts in these areas, they have to adjust somehow. Let me give you some examples. The adjustment is this: In some cases, providers simply stop taking Medicare patients because they can no longer make a profit. In that case, the Medicare population loses access because they have fewer providers from which to choose. In other cases, they reduce services or reduce employees. Again, both the quality and the quantity of health care services to seniors is reduced.

Let me give some examples. A few weeks ago, I spoke to Gary Thietten of Idaho Home Health and Hospice about the impact of Medicare cuts to home health and hospice providers, which is his business. He described to me just how bad the fiscal situation has already become for home health, hospice, and other Medicare providers in Idaho.

Idaho has already lost nearly 30 percent of its home care providers. Let me repeat that. Already, it has lost nearly 30 percent of its home health care providers. They are going out of business because we are squeezing them down so tight. And that included Idaho's largest provider. The providers that are still in business are working under the same Medicare reimbursement levels they received in 2001--8 years ago. If the kinds of cuts contemplated by this legislation go into effect, on top of the current reimbursement issues, the situation will get worse.

Gary said that he compared this situation for home health and hospice providers to the farmers in Idaho. He said that most farmers don't grow just one crop. Similarly, home health agencies do more than just provide home health; they provide hospice and private-duty care along with medical supplies and equipment. All of this will get reduced.

Let me give another example. Robert Vande Merwe of the Idaho Health Care Association talked to me about the impact of these cuts on skilled nursing facilities.

Skilled nursing facilities, such as the hospice facilities, already face a budget challenge under recent CMS rules restricting their compensation for the services they provide. The cuts they have already received, not counting what will come at them in this bill a hundredfold more, have already caused a reduction in reimbursement in Idaho by over $4 million per year to skilled nursing facilities.

He pointed out to me that in the nursing home world, more than 70 percent of the expenses they have are labor, primarily nurses and nursing assistants. He said when payment cuts like these occur, they cannot go to their buildings and take bricks out of it. What they have to do is reduce their employment. That cuts employees. That cuts benefits and services to those who are there.

Let me make this clear. First of all, these cuts are going to reduce jobs and, secondly, they are going to directly tie to the quality and number of staff there to provide care for those in the Medicare system.

Mr. KYL. Mr. President, I ask if my colleague will yield for a quick question.

Mr. CRAPO. Yes.

Mr. KYL. We talked a lot about the rationing of health care that is the inevitable result of these cuts in this bill; that when you reduce the amount of money you compensate hospitals, doctors, nurses, and others, they cannot provide as many services. Some leave the business altogether. As the Senator from Idaho pointed out, some businesses go out of business. So there are fewer entities providing the care. That means it takes longer for patients to obtain the care where it is available, and frequently they do not get as good of care because folks cannot take that much time to take care of them in that sense.

Will my colleague please talk about his concerns about the overall problem of rationing that comes from the reductions in the benefits to providers? By the way, the Senator's chart says ``other Medicare cuts to providers.'' We use that term ``providers'' as a short-cut term. Will my colleague explain what it means to a 70-year-old woman in Idaho who is a provider and how important is that, what happens when you don't pay that provider so that provider is no longer available to take care of her?

Mr. CRAPO. Mr. President, I appreciate that question, who are the providers. If this Medicare beneficiary is in a skilled nursing facility, the provider is the facility itself, which I said we already lost 30 percent of our facilities. It is the nurses and the nurse assistants who are there to assist them and care for them.

The bottom line is, you simply cannot cut hundreds of billions of dollars out of these services and expect to provide the same level of access and quality and available health care.

The same would be true if the care were being provided in a home setting, which a lot of the home care services are compensated by Medicare or in a hospital which is there to provide care in some of the most serious types of circumstances. Whatever it is, whether it is home hospice care, skilled nursing facility, a hospital or what have you, what we see is a reduction in the number of facilities and personnel available, and that is nothing other than rationing.

It is a different kind of rationing than will occur under some other parts of this bill where the government will actually get in the business of saying what kind of health care you can get and at what time in your life you can get it. But it is a kind of rationing that simply forces the availability of health care down so far that the system itself rations it out.

Mr. LeMIEUX. Will the Senator yield?

Mr. CRAPO. Yes.

Mr. LeMIEUX. I wanted to follow up on my colleague's point. With all these cuts to Medicare, $464 billion in this proposal, $192 billion in reductions to most services, $118 billion in cuts to Medicare Advantage, $21 billion cuts to hospitals serving low-income patients, $23 billion from other sources, it seems inevitable that seniors are going to have a lower quality of health care. We were told by the President that if you liked your health care, you were going to be able to keep it. But it seems to me that we need to change that a little bit because under this proposal, you might be able to keep it unless you are a senior and that seniors are going to have a diminished quality of health care under this proposal; is that correct?

Mr. CRAPO. The Senator is absolutely correct. I will comment on that and then conclude and turn the floor over to my colleagues from Mississippi and Florida for their comments. That is exactly right. In fact, one of the most clear and obvious places in which this legislation violates the President's pledge--that if you like what you have you can keep it--is in Medicare Advantage because one out of four Medicare beneficiaries in America will not be able to keep what they have and will see their benefits cut.

There are also other parts of this bill that impact people outside of Medicare in terms of the kind and quality and extent of health care insurance coverage they have and expect that will be impacted. It would impact beyond this. This is about as clear a case there is of violating that promise.

Mr. WICKER. Mr. President, before the Senator leaves that subject matter, I wonder if I could interject. My friend from Idaho also has listed specific cuts under this legislation: hospitals, Medicare Advantage, cuts to nursing homes, cuts to home health, and hospice. But also I think Senators and Americans need to understand that the Reid bill also establishes a permanent board of unelected members appointed by the administration which, in this case, initially at least would be the Obama administration, and they would dictate further savings under Medicare.

This gets to the question of my friend from Arizona about rationing. It would dictate annual Medicare cuts geared toward reducing Medicare spending. These people are not going to be like us--accountable. They will not have to go back to their district every 2 years or their States every 6 years. But they will have the unbelievable power under this legislation to dictate additional cuts that we know not. The Wall Street Journal called this a rationing commission. This ties right in with the concerns that Americans have had over the last 2 or 3 days about these recommendations with regard to mammograms.

I realize I am intruding on the Senator's time, but I have a letter from a physician in Mississippi who is fearful that this sort of rationing board is going to impose the requirement that mammograms not be given until after age 50. He says:

My wife and I have two daughters who had breast cancer in their 40s. One daughter was age 42 and it was picked up on a routine yearly mammogram. The other daughter was age 49 and she found an abnormality by self breast exam and it was confirmed by a mammogram. .....

Now we have a group of unelected people coming forth and saying you are not supposed to get a mammogram, you are not entitled to a mammogram, and we learned that some insurance companies have already decided to follow that dictate. This gentleman, a physician, says my two daughters would be dead from breast cancer if that were imposed.

I am afraid that in addition to these very definite cuts, this permanent board of unelected members would impose the very type of requirement that we are fearful might come forward on mammograms.

Mr. CRAPO. The Senator is correct. I will conclude with this. I think we have all seen folks are almost falling over themselves backing away from the news on the mammograms that came out. But it is a very clear example in a way a study can come out from a government source or otherwise to say we don't need to have this kind of health care in the United States, it is a cost saving. What do you think is the potential for this commission to say: We are charged with saving costs in these programs, and we are going to do that.

I suspect that the mammogram issue is one they would not do it on today because of the reaction to it. Somewhere this commission is going to save tens of billions of dollars, in addition to these kinds of cuts, by reducing services. Color it as you want, you cannot make this kind of reduction of health care services, personnel, and infrastructure without reducing the access to and the quality of care that Americans receive.

I will conclude by saying these issues face every State in America. We are going to see in this arena a dramatic reduction of the quality and content and quantity of health care that our Medicare beneficiaries today see because of these proposals, and they are being done not in order to make the Medicare system more solvent but to finance yet another major Federal entitlement program that will cost hundreds of billions of dollars. As a matter of fact, if you look at the true numbers, the cost will be over $2 trillion in a full 10-year period of time.

There is a lot more we could say, but I know my colleagues from Mississippi and Florida have some remarks they wish to make. I yield to them at this time.

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Mr. CRAPO. The Senator is right. As a matter of fact, if I understand the
legislation correctly, it assumes the current projected cuts for physicians are going to happen. That is how it says it is not going to increase the deficit. You and I both know this Congress will not let that happen.

But even today, 29 percent of Medicare beneficiaries looking for a primary care doctor had a problem finding one because, both with regard to Medicaid and Medicare, because of the problems we have been discussing here, there are fewer and fewer providers who will take patients in those programs.

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