Health Care And Education Reconciliation Act Of 2010

Floor Speech

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Mr. DURBIN. Madam President, I urge my colleagues to oppose the Sessions amendment. It does two things. First, it requires legal permanent residents in the United States to produce documentary proof of their legality. We tried this under Medicaid and found out that many people in our country, the elderly and others, found it difficult to produce documentation though they were clearly eligible and clearly legal and entitled to basic assistance.

Instead, our bill that we passed, health care reform, verifies that a person is legal by declaration of their Social Security number, which is verified. So we go through a good process here to make sure only those eligible will receive, and, secondly, what Senator Sessions' amendment does, is say to legal permanent residents paying taxes, they cannot use the Tax Code like other citizens for deductions and credits for 5 years. They are paying taxes under the Tax Code. They should be allowed the same tax credits as other Americans, other people living in this country.

I urge my colleagues to defeat it for those two reasons, and the fact that this is an attempt to derail this bill.

I move to table the Sessions amendment and ask for the yeas and nays.

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Mr. DURBIN. Mr. President, our colleagues on the other side of the aisle have confused some statements made by the President and made by me regarding whether the new health law will cause premiums to go down.

The President has spoken forcefully about the impact of the new reform law on health insurance premiums. He has contrasted the effect of reform with the effect of doing nothing. He made it clear that if we passed a reform bill, premiums would go down compared to the status quo of not enacting a reform law.

A couple of weeks ago, I said on the Senate floor that no one claims premiums will go down tomorrow when we pass this legislation. I was speaking in absolute terms. Premiums have been rising at a high and unsustainable rate. With these reforms, premiums will rise more slowly.

The President and I were saying the same thing, using different words. The point is the same. With this new law, American families and businesses can have hope that their premiums will not rise as fast as they have been in the past.

The days of 39 percent premium increases, as we have seen in California, will be over once this law is fully implemented.

The days of 60 percent premium increases, as we have seen in my home State of Illinois, will be over once this law has been carried out.

And if we repeal this new law, as the Senators on the other side of the aisle advocate, premiums will continue to rise at an unsustainable rate with spikes like those we have seen this year.

Senators on the other side of the aisle are right to ask what will happen to premiums.

Every American wants to know, ``What is going to happen to the cost of my healthcare?'' And they are right to ask that question.

But the obstructionists and naysayers on the other side of the aisle are wrong when they oppose this bill and the new law based on the false claim that it will cause premiums to rise faster than the status quo. That is simply not true.

And you don't have to take my word for it. Just ask the nonpartisan Congressional Budget Office--the congressional ``umpire'' when it comes to questions of what legislation will cost or save.

Early in the health reform debate, throughout most of last year, we had useful data from the Congressional Budget Office--but it was not definitive. It was easily distorted by the opponents of reform and the defenders of the insurance companies, who want to stop all action and allow premiums to be increased by 10, 20, 39, 60 percent each year.

The initial CBO reports compared premiums in today's market with the cost of a more generous health plan that is likely to be offered in the insurance exchanges of a reformed market.

That is not a fair comparison, but it is all we had.

It showed that people would pay more if they chose better coverage. But it didn't clearly say that for coverage comparable to what is available today, premiums would be lower.

And so there was confusion.

In January, when no one was paying attention and the debate on the Senate floor had shifted to jobs, we received some important additional information from CBO.

The new data, from the people who know the numbers best at CBO, backs our conclusion that the Senate health reform bill will reduce the premiums people will pay for health insurance, compared to current law.

That clear answer came in response to a request from the senior Republican Senator from Maine, Ms. Snowe.

At the request of Senator Snowe, CBO estimated the premiums for a Bronze plan under the Senate reform bill.

Bronze plans will cover roughly the same proportion of an individual or family's total health care costs as the average plan sold in the individual market today.

So using Bronze plans to compare the Senate reform bill to current law provides an ``apples to apples'' comparison. It tells you what premiums you can expect if the bill passes, compared to what premiums you can expect for a similar policy if the bill is defeated. That is a fair comparison.

Here's what CBO tells us:

A Bronze plan in 2016 will cost an individual between $4,500 and $5,000 a year.

Earlier, CBO estimated that under current law, with no health reform in place, an average plan in 2016 will cost an individual $5,500.

So, under reform, the cost of a typical plan will be considerably less than the cost if we do nothing. In fact the savings will be roughly $500-$1,000 a year.

We see the same story for family coverage. According to CBO, under the Senate reform bill, a family can expect to pay between $12,000 and $12,500 for family coverage. If we do nothing, a family can expect to pay $13,100.

That is a savings of $600-$1,100 a year for American families.

So now we have the answer that many Senators, and many Americans, sought.

CBO's analysis provides a fair assessment of the effect of reform on the individual and family pocketbook.

And the answer is savings of $500 to $1,100 a year, from 2016 on.

But only if we preserve the reforms the President signed into law.

And that is just the direct effect on premiums. Millions of Americans will be eligible for subsidies that will dramatically reduce their costs beyond these basic reductions available to everyone.

But even people who don't receive subsidies will have lower premiums. Lower than if we don't implement the reform law.

Not because of assistance from the Federal Government, but because health reform legislation will give people buying power and will take the necessary steps to rein in health care costs.

The changes included in the new law will make a difference in the health care system and those changes will reap benefits for all of us.

This is confirmation that the reform bill represents an important victory for Americans struggling with the high cost of health insurance.

And now we can put a value on the savings: $500 to $1,000 a year for individuals and $600 to $1,100 a year for families.

The Senators on the other side of the aisle haven't been talking about this report, which was provided by the CBO to a member of their own party, because they don't want the American people to know that premiums will go down relative to doing nothing.

So instead, they try to find alleged discrepancies between the President and me that simply do not exist on this issue.

The evidence is clear. The Congressional Budget Office has weighed in. The facts are plain.

The health reform bill will reduce premiums compared to the do-nothing outcome pursued by the obstructionists.

Similarly, there has been some confusion about the magnitude of the tax cuts in this bill.

The tax cuts in the reform bill passed by the Congress and signed into law by the President are the largest middle-class tax cut for health care in the history of our Nation.

No Congress has provided greater tax assistance to American families and individuals and small businesses to help them afford the cost of health care.

There have been larger tax cuts unrelated to health care--not all of them wise.

But American businesses and families need help to deal with the high cost of health care, and this Congress has responded.

The new law, combined with the improvements in the reconciliation bill, will provide refundable tax credits to people with incomes up to 400 percent of the poverty level--around $88,000 for a family of four--so that they can afford their health insurance premiums.

Ordinarily, a tax credit is provided when you file your tax return after the end of the year. The new law allows the credit to be paid to the insurer month by month, so that you can afford your monthly premiums. That is a good thing if you live month to month and can't wait until the end of the year to receive the tax credit and still pay your monthly premiums.

The new law also provides tax credits to small businesses--available starting right now--to help them pay for health insurance.

These provisions will give nearly $500 billion of tax cuts and cost-sharing assistance to middle-class Americans. That is what makes this the largest middle-class tax cut for health care in the history of our nation.

We received no help from the Members on the other side of the aisle in enacting these tax cuts. This Democratic Congress did it anyway. We provided the largest middle-class tax cuts for health care ever, and we are proud to have done so.

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Mr. DURBIN. Mr. President, the reconciliation bill on the floor today realizes a dream of my friend and mentor, former Senator Paul Simon--consolidation of the Federal student loan program entirely into direct loans.

The very first Federal student loans were direct loans provided under the National Defense Education Act of 1958--directly from the Federal Government to students.

In 1965, the Federal Government began guaranteeing student loans provided by banks and nonprofit lenders through the Federal Family Education Loan, FFEL, Program. Through this program, the Federal Government would pay banks a certain rate of return on student loans and guarantee those loans against default.

By the early 1990s, it was clear to Paul Simon that incentivizing banks through subsidies no longer made sense. The Federal Government could make loans more cheaply and more simply directly to students.

As he said: ``Are we in the business of helping banks and guarantee agencies, or are we in the business of helping students?''

Paul Simon became the leading Senate champion of a new direct college loan program, enacted in 1992 as a small pilot program. He and others hoped that the Direct Loan Program would be quickly expanded to replace the FFEL Program.

In 1993, during a budget reconciliation fight, lobbyists for the banks and Sallie Mae joined forces to try to defeat the effort to move the student loan system into direct loans. The result was our current system: the Direct Loan Program and the FFEL Program operating side-by-side.

This system hasn't worked. Private lenders like Sallie Mae have retained the majority of the student loan market through special deals with financial aid offices and have continued to make billions off of taxpayer-funded subsidies--$6 billion per year. Taxpayers are absorbing all the risk of student loan defaults, while private corporations bank all the profit.

Senator Kennedy, a longtime proponent of direct loans, once said: ``We
waste billions of dollars in corporate welfare every year on student loans, and we cannot afford it any longer.''

I agree with Paul Simon and Ted Kennedy. And so does Chairman Harkin, who led this bill through the HELP Committee. I join him in supporting this bill that would finally end corporate welfare in the Federal student loan program and put that money back in the hands of students.

The reconciliation bill will shift all loans into the Direct Loan Program that Paul Simon envisioned and use the $68 billion in savings to invest in education priorities.

We will put $36 billion over the next 10 years into the Pell Grant Program, a program that we know is essential for many poor families and struggling students.

For the first time, we will index the Pell grant to inflation. We will also avert a projected Pell grant budget shortfall caused by recent increased demand for Pell grants.

Without this investment, 8 million students could see their Pell grants cut by 60 percent next year, and 600,000 students could lose their scholarships completely.

The bill will cap monthly student loan payments at just 10 percent of discretionary income, so that college graduates can pursue careers in teaching or public service without the burden of student loan bills they couldn't keep up with.

We will also invest in historically Black colleges and universities, minority serving institutions, community colleges, and state-based college access programs that help students succeed in college.

And we will reduce the deficit by $10 billion over 10 years.

Families and students will benefit enormously from this bill and the realization of Paul Simon's vision. And who will suffer? Bank and lending executives who have grown rich off of unnecessary taxpayer subsidies for decades.

Paul Simon was right 20 years ago, and he is still right today. It is time to take the middleman out of the student loan industry and return our focus to students.

I would like to thank Senator Harkin for his hard work on the student loan reform provisions in this bill and for his tireless efforts on behalf of college students across the country.

I strongly support the student loan reform provisions that are included in the reconciliation bill and I look forward to seeing Paul Simon's full Direct Loan Program finally signed into law.

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