Service Members Home Ownership Tax Act Of 2009 - Continued
Floor Speech
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Mr. DURBIN. Mr. President, I have listened carefully to the profound and eloquent statements from my friend and colleague from New Hampshire, Senator Judd Gregg. He has frequently invoked the name of the Ponzi family, though I am not personally familiar with them. I believe they have had some skeletons in their closet by virtue of the references that have been made. But I will tell him that what he said about the CLASS Act is inaccurate.
I know that Senator, I see, is leaving the floor. I hope he does not miss out on this conversation. But--
Mr. GREGG. I was just wondering if the Senator would yield for a question.
Mr. DURBIN. I would be happy to.
Mr. GREGG. Is the Ponzi family from Chicago?
Mr. DURBIN. No, they are not. I think they are from New England--Patriots' fans.
I would like to ask the Senator from New Hampshire, if he would yield, if he is familiar with Doug Elmendorf and the Congressional Budget Office and the letter of November 18, 2009, to the majority leader, Harry Reid, in relation to the deficit impact of the CLASS Act.
Mr. GREGG. I appreciate the assistant leader asking me that question. Regrettably, I am not immediately familiar with it. I have probably seen it, although I apologize for not being immediately familiar with it. Therefore, I presume the assistant leader is going to remind me or at least reacquaint me with its terms. I would note the term ``Ponzi Act'' did not come from me. It came from the chairman of the Budget Committee.
Mr. DURBIN. I would just say, it is unfortunate the Senator from New Hampshire has not seen this letter because if he had had an opportunity--and it is impossible to read everything--if he had had an opportunity to read that letter, I do not think he would have made the speeches he just made on the floor about the CLASS Act because the Congressional Budget Office tells us that in the first 10 years, the CLASS Act will reduce the Federal budget deficit by $72.5 billion; in the second 10 years by a substantial amount, though somewhat less than $72.5 billion; and in the third 10 years--30 years out--it is anticipated it will add to the deficit, but, in the words of the letter from the Congressional Budget Office, by a very small amount over that next decade.
Mr. GREGG. If the Senator would allow me to comment on that one point?
Mr. DURBIN. I would be more than happy to allow that.
Mr. GREGG. I fully agree with that analysis. The first 30 years of the CLASS Act will generate revenues. It will add to the Federal Treasury and will--and that was the purpose of my discussion; that is the point I made--during the first 30 years of this proposal, younger people will be paying in and very few people will be taking out because they will not have yet qualified for the insurance because they will not be old enough to go into assisted living.
Mr. DURBIN. Reclaiming the floor, I would just say, if I understand what the Senator said, he is concerned that in the year 2040, this program may not work as effectively as we had hoped it would work. I trust in the wisdom of future Members of the Senate and the House, if that is necessary, to modify the program.
But it certainly is worthwhile for us to at least reflect on what this program is. It is a voluntary, self-funded insurance fund for long-term care for American citizens. It was one of the visions of Senator Kennedy as part of health care reform, understanding we are living longer and many times need help in our late years in life and it can be expensive and deplete a family's savings. Senator Kennedy said: Let's try to put together a voluntary program where you can pay in and have, in fact, long-term care insurance available to you, if you need it.
The fact that this program is virtually solvent for 30 straight years is an indication of the wisdom of that idea and the way it is planned.
I might add one other thing. We just finished a motion to commit on the floor relative to Medicare, and many of us argued that the bill before us, the bill that represents health care reform in this debate, protects Medicare and guarantees the basic benefits of Medicare. Those on the other side of the aisle protested and said: No, it does not.
Well, then, Senator Michael Bennet of Colorado offered an amendment which said, pointblank and clearly, nothing in this bill will, in any way, diminish guaranteed Medicare benefits, and a surplus generated here will be to give a longer life to the existing Medicare Program. The Bennet of Colorado amendment passed 100 to nothing, so not only does the bill originally protect Medicare, the Bennet amendment repeated that, and all the Republicans voted for it. Yet they continue to come to the floor and say: We do not believe what we voted for. We believe this bill is going to hurt Medicare.
The same thing is true with the CLASS Act because Senator Whitehouse, who was on the floor momentarily, came forward and said: I will put it in writing. We are going to put it in writing that the surplus in the CLASS Act program cannot be used for other purposes and has to be saved and used for the purposes stated here for long-term care insurance. I think the Whitehouse amendment is likely to get another 100 votes.
So every time we address a concern from the Republican side of the aisle, and say the bill addresses that concern or a separate amendment addresses that concern, they protest: It is not enough. We need more. I think they protest too much.
I would also say I am troubled today, as I have been for several weeks, by the position taken from the Republican side of the aisle about health care reform. For about 13 or 14 days, this bill, in its entirety, has been available to the American people. You can find it by Googling ``Senate Democrats'' and it will direct you to our Web site and you can click on this bill, H.R. 3590, and read it, page after page--all 2,074 pages of it. That is the way it should be.
There was a lot of angst and worry last August in townhall meetings: Well, are you going to get this bill sneaked by us? Are we going to get a chance to read it? Everybody has a chance to read it. But then I would recommend to those who are searching the Internet to read health care reform bills that if you want to find the Republican health care reform bill, look for ``Senate Republicans'' and go to their Web site and you will be able to click on ``health care reform bill'' and you will find the Democratic health care reform bill because, unfortunately, there is no Republican health care reform bill. They have not offered one. They have had a year to prepare it. They have had plenty of ideas they have expressed on the floor. They have been critical of our efforts. They have offered literally hundreds of amendments in committee, and yet they cannot come up with a bill.
It leads you to conclude this is not an easy task. It is not easy at all. It certainly is not easy to produce a bill such as this one, the Democratic bill, which generates, over the first 10 years, a $130 billion Federal surplus in our Treasury. This bill adds more in terms of surplus and deficit reduction than any bill in the history of the Senate. In the second 10 years, the Congressional Budget Office says there will be another $650 billion in savings on our deficit.
So for those who argue if we pass this bill we are going deeper in debt, they ignore the Congressional Budget Office, that referee that takes a look at all the bills and tells us that over the span of 20 years, we are going to reduce our deficit by some $700 billion or $800 billion, just by virtue of this bill.
Republicans have been unable to produce a bill that reduces the deficit, when it comes to health care, by a penny. They come here and criticize what we have done, but they can't produce a bill. All the great legislative minds on their side of the aisle, and we have been waiting patiently for them to produce a health care reform bill. They can't or they don't want to. Maybe they like the current health care system. Maybe they think this is the way America should be.
Well, many of us don't believe that, and a lot of Americans don't either. There are a lot of good parts of our system we want to protect, but there are many parts that need to be changed. We need to make health care and health insurance more affordable for families and individuals and businesses. This bill does.
We just had another report from the Congressional Budget Office that said yes, the cost of premiums will be coming down for many Americans as a result of this bill. We also understand that some 50 million Americans don't have health insurance at all. This bill will reach the highest level of protection for health insurance in the history of the United States. Ninety-four percent of people in this country will have the peace of mind and security of health insurance--a dramatic increase. The Republicans have been unable to come up with any proposal that moves us toward more coverage for people who don't have health insurance.
This bill also has many provisions to finally give consumers across America a chance to fight back when the insurance companies say no, and they do all the time. People who need critical surgical procedures and medicines, people who need the kind of care their doctors recommend end up fighting with the clerk at an insurance company. This bill, the Democratic health care reform bill, gives these families a fighting chance against these health insurance companies. I have yet to see the first bill coming from the Republican side of the aisle in the course of this debate that would give our families a chance against these health insurance companies.
I wish to also say when I finish speaking, and we finish on this side of the aisle, the Senator from Utah will come and speak. I understand it is the Medicare Advantage Program he will speak to. Now, the previous motion to commit by Senator McCain of Arizona said: Send this bill back and make sure you take out any reference to savings in the Medicare Advantage Program. That was defeated. The vote was 42 to 58. There were two Democrats who joined the Republicans. They needed 60 votes; it didn't make it. I take it the Senator from Utah may offer another motion to commit relative to Medicare Advantage. I expect it to have the same fate, but he has his chance to argue his point of view, and he may be persuasive to more Members on this side of the aisle. Unfortunately, although we are good, close friends, and I bask in his wisdom on a daily basis, he is not going to change my mind on this issue because the Medicare Advantage Program is a program that needs to be changed.
Let me tell my colleagues about this program. We started years ago with the health insurance industry telling us: Government cannot do a good job when it comes to insurance. Let us show you how private health insurance companies can sell a Medicare policy more cheaply than the government. And we invited them to do it.
Over the course of the years, some of them did. They showed some savings, and they demonstrated to us they could provide Medicare at a cost lower than the government. But then things changed, and the health insurance companies kept coming back and saying: Well, we actually need more money now to provide the same benefits in Medicare that the government provides.
At last count, the Medicare Advantage Program costs 14 percent more to provide the same Medicare benefits as the government program. So these leaders in the private sector who were going to teach us a lesson about how to sell insurance ended up failing their own lesson plan, and now this Medicare Advantage Program has turned out to be a flatout subsidy to the health insurance industry--$170 billion over 10 years. In other words, the Medicare Program is paying more for Medicare than what it has to pay so it can subsidize health insurance companies which are turning multimillion-dollar profits and giving bonuses to their CEOs.
Some on the other side of the aisle think we need to preserve this; that we need to preserve this subsidy, make sure we protect the profits of the health insurance companies, and we need to protect Medicare Advantage. Well, as Senator Dodd has said so frequently on the Senate floor, Medicare Advantage is neither Medicare nor an advantage.
I believe, and most agree, it is time for this party to end. These private health insurance companies didn't keep their word, didn't keep their promise, and because of that we are in a situation--a predicament--where we are asking other people covered by Medicare to subsidize the profits of these private health insurance companies. What does it cost every Medicare recipient in America to provide this subsidy and profits to these private health insurance companies under Medicare Advantage? Ninety dollars a year, on average.
So those who are defending the Medicare Advantage Program as we currently know it and don't support the reforms in this bill are also supporting a $90 annual tax on Medicare recipients. My fiscally conservative Republican friends who run against taxes every chance they have should reflect on the fact that they are protecting a tax on Medicare recipients. That, to me, is indefensible.
Mr. WHITEHOUSE. Will the assistant majority leader yield?
Mr. DURBIN. I am happy to yield to the Senator from Rhode Island.
Mr. WHITEHOUSE. I just wanted to ask the distinguished assistant majority leader to yield for a question through the Chair. Since the distinguished assistant majority leader was here at the time, and I am newer to this body and was not here at the time when the Medicare Advantage Program was originally proposed, I wonder if the distinguished assistant majority leader would remind us of what the promises and assertions were that were made by the private insurance industry at that time as they sought this foothold to get their hands on this Medicare population.
Mr. DURBIN. It was very basic, I would say to the Senator from Rhode Island through the Chair. They just said: Now, listen. When it comes to insurance, the government never gets it right. The bureaucrats who work for the government, those Federal employees, don't get it right. We do this for a living. We can show you how to provide Medicare benefits and save money. So, please, would you just step aside? The private health insurance companies are going to demonstrate to you how much money we can save.
Initially, there were some savings; I will say that in fairness. But over the years, they got greedy, and their greediness led in most recent times to--I think in 2003, if I am not mistaken, with the Medicare prescription drug program, when they came in and these same private health insurance companies said: Now we really need subsidies to keep offering our wonderful programs, now they tell us they are charging 14 percent more than basic Medicare.
The PRESIDING OFFICER. The Senator from Illinois has used 15 minutes.
Mr. DURBIN. Mr. President, I ask unanimous consent for 5 additional minutes.
The PRESIDING OFFICER. Is there objection?
Without objection, it is so ordered.
Mr. BROWN. Mr. President, will the Senator yield?
Mr. DURBIN. I am happy to yield.
Mr. BROWN. I thank Senator Durbin for his recollection and Senator Whitehouse for his question and the comments and understanding of this. My recollection was back 10 years ago when it passed it was the insurance companies that said: We will do it 5 percent cheaper. We will save taxpayers 5 percent. But as soon as they did that, as soon as President Bush was elected in 2000, I remember they started lobbying Congress for more insurance subsidies. It sort of peaked in 2003 with the prescription drug deal giveaway where the drug companies and the insurance companies both got huge government subsidies. They formed the doughnut hole, and seniors ended up paying a lot more so the drug and insurance companies could get subsidies. Then that is when the tax was increased, that $90 tax, if I recall.
Am I right about that, that originally it was actually a good thing for taxpayers, but then during the Bush years the insurance company lobby was able to increase that tax on the other 80 or 85 percent of Medicare beneficiaries, the people who were in what was called fee for service, who would go to the doctor, go to the hospital and submit to Medicare and not do it through a private insurance company? Is that what has happened?
Mr. DURBIN. I would say to the Senator from Ohio that is exactly what happened because what we have is that in order to pay for the subsidy, the private health insurance companies that are selling Medicare Advantage, they had to take the money out of the Medicare system, which meant less money for everybody else. It translated into $90 a year more for every Medicare recipient to pay for the subsidy, for the private health insurance companies that are protected by Medicare Advantage.
Mr. BROWN. If the Senator from Illinois would yield, so these subsidies then went directly to the insurance companies and then the insurance companies--they had to live under the Medicare laws, of course--but these insurance companies then began to insure generally some healthier people so they could make more money, right?
Mr. DURBIN. That is right.
Mr. BROWN. In those days, the insurance companies--Senator Whitehouse has talked often about this, as has Senator Harkin who is standing here now too--that the insurance companies' business model has been to hire a lot of bureaucrats. They say they are more efficient than Medicare, but surely they are not. Their administrative costs are 15 percent and Medicare is 5 percent. But they hire all of these bureaucrats to keep people from buying policies if they are sick--a preexisting condition--and then they hire a second group of bureaucrats on the other end to make sure those people who submit bills for their health care, their claims, that 30 percent of them are initially denied. So they hire bureaucrats on both ends to restrict care, add a lot of administrative costs.
Medicare, I don't think, prohibits people for a preexisting condition, right? They don't do anything like that.
Mr. DURBIN. No. I would say to the Senator from Ohio the difference is obvious. With Medicare, anyone who shows up age 65 is eligible for coverage, no questions asked, other than your age and whether you have contributed over the course of your lifetime. These health insurance companies cherry-pick the healthiest people they can, then try to deny coverage where they can as well, and that is how they make their profits.
Mr. BROWN. They are pretty good at it.
Mr. DURBIN. So good at it that they are one of the most profitable sectors in the American economy, and virtually everybody knows somebody they work with or someone in their family who has had a bad experience with a health insurance company in America. That is the reality we are facing today.
Mr. WHITEHOUSE. Mr. President, if I could ask the Senator to yield for a question, it would appear, then, that not only is there this subsidy that goes to the private insurance industry, funded by a tax on all other Medicare recipients, but those private insurance companies are actually doing their level best to try to pick out a disproportionately healthy Medicare-eligible population, so what we end up doing is not only paying more for Medicare Advantage but also for a healthier population. So it is a double subsidy.
Mr. DURBIN. Make it a triple whammy because the third impact, of course, is that the healthier people are not part of Medicare. Those left in Medicare are sicker and more expensive, so the government-run program ends up being more expensive because those private health insurance companies cherry-pick out the healthiest people they can find.
There are those who want to defend Medicare Advantage who think it is great that we would pay $170 billion in subsidies to these companies over a 10-year period of time. This bill moves us away from that and says if these private health insurance companies can't basically compete and match what government Medicare offers, then it is time for them to get out of the business and get out of the way. I don't see why in the world we are arguing about a subsidy for private health insurance companies when they already make so much money.
So I would at this point yield the floor. I know Senator Hatch has asked for an hour to speak on his motion. I believe it is a motion to commit. I yield the floor.
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