Speeches & Floor Statements

Floor Remarks of U.S. Senator Lamar Alexander (R-Tenn.) -- Health Care Reform

Posted on September 16, 2009

Mr. President, I congratulate the Republican leader, the Senator from Kentucky, on his remarks. He made it very clear that we on the Republican side of the aisle want health care reform, but our definition of that is a little different from that on the other side of the aisle. We want health care reform that reduces costs--costs to the American people when they buy health insurance and the costs of the government of the American people. We do not want more debt and another Washington takeover, which we are seeing so much of these days. President Obama said in his address to us that he ``will not sign a plan that adds one dime to our deficits--either now or in the future. Period.'' That is good. As David Brooks wrote in the New York Times this past Friday: This sound bite [of the President] kills the House health care bill. It kills the House health care bill, because it would add $220 billion to the deficit over the first 10 years of its operation and another $1 trillion over the next 10 years after that. The President's sound bite about the deficit would effectively knock out the bill passed by the Senate HELP Committee as well. According to a recent letter from the Congressional Budget Office to the ranking member of the Senate HELP Committee, Senator Enzi of Wyoming: The 10-year cost of the coverage expansion [of that bill] to the Federal Government, including such a change in Medicaid eligibility, would probably exceed $1 trillion. So that is off the table. There appears to be growing bipartisan concern about a health care bill that might add to the debt. Senator Warner of Virginia said on Monday: My feeling is, [health care reform] can't just be paid for in a 10-year window. It has to be paid for in the out years as well. That is Washington-speak for over the long term. He says: This is so much bigger than health care. It goes to the deficit. It goes right to the heart of our competitiveness. That is Senator Warner of Virginia. I couldn't agree more. All of the health care reform bills produced so far by the Democratic Congress--either in the Senate or in the House--flunk the first test, which is reducing cost--cost to the American people and cost to the American government. In July, the Congressional Budget Office Director, Douglas Elmendorf, said that the House bill and the Senate HELP bill did not propose ``the fundamental changes that would be necessary to reduce the trajectory of Federal health spending by a significant amount.'' Additionally, the Congressional Budget Office has indicated that the House bill would result in a ``net increase in the Federal budget deficit of $239 billion'' over 10 years. This is likely a low-ball estimate, because it assumes that Congress will increase taxes by $583 billion over the next 10 years. So if we are going to implement health care reform without increasing our debt, how are we going to pay for it? Who is going to pay for it is the more precise question. Here are some of the answers that have been proposed so far by the Democratic side of the aisle. No. 1, grandma's Medicare is going to pay for it. The bills--and the President's own plan, which we have yet to see the details of--propose ``Medicare savings.'' Nice words for Medicare cuts. If there is $500 billion in savings to be found in Medicare, we should use it to keep Medicare solvent, because the trustees of Medicare say that we are now spending at such a rapid rate that we will run out of money for Medicare by 2017. We should not use Medicare cuts to pay for a new government program. We should use any Medicare savings to make Medicare stronger. No. 2, the way to pay for these bills we have been seeing in the House and the Senate is to shift the costs to the States. This is done by expanding Medicaid, which is the largest government-run program we have today. Almost 60 million low-income Americans have their health care from Medicaid, which the Federal Government pays about 60 percent of and the States 40 percent. The plans we have been hearing about have the Federal Government expanding Medicaid coverage--this is the State plan I was talking about--from 60 million to 80 million or 90 million people and, after a few years, asking the States to pick up their additional share of the cost of that expansion. According to the National Governors Association, expanding Medicaid to 133 percent of the Federal poverty level would cost the States an additional $31 billion per year. Although details are still lacking--and we may find out more today about the proposals from the Senate Finance Committee--the Democratic Governor of Tennessee, Governor Bredesen, said on Friday that he is concerned about the plan being proposed by Senator Baucus and that his guess was it might cost our State as much as $600 million to $700 million per year. In Washington that doesn't sound like a lot of money, but to Tennessee that is a lot of money. We had a big fight a few years ago over whether to have a new State income tax. We don't now have one, and our former Governor didn't succeed on that. People got very upset about that. That would only have raised $400 million. But this is an increase of $600 million or $700 million that would, after a few years, be shifted to the States. That is not all. Since States only reimburse doctors and hospitals for about 60 percent of their cost of serving the 60 million patients on Medicaid, these expansion proposals of Medicaid usually also require States to increase reimbursements to doctors and hospitals. Increasing reimbursements to doctors and hospitals would basically double the increased cost to States. So you can see why earlier in the debate many of the Governors--including many of the Democratic Governors of this country--objected to this proposal. Governor Bredesen called those proposals ``the mother of all unfunded mandates.'' We know where unfunded mandates lead in our State, and that is higher State taxes. No. 3, in addition to cutting Medicare and increasing State taxes by expanding Medicaid, the bills we have seen ask small businesses to help pay for the bills through employer mandates and fines. Under the Senate HELP Committee bill, for example, firms with more than 25 workers would have to pay the new tax, with penalties equal to $750 per year per full-time employee and $375 for part-time employees. The Congressional Budget Office estimated that this would raise $52 billion over 10 years. The House bill would impose over $200 billion in fines on businesses who cannot afford to finance their workers' health coverage. There is another consequence to that. We have often heard the President say: Well, if you like your health care plan, you can keep it. But, what he doesn't go on to say is that if we create this government plan and if we require employers to pay $750 per full-time employee and $375 for a part-time employee, many employers are going to look at that and decide it is much cheaper to pay the $750 or the $375 for an employee. So they will just pay the government a fine and let the government plan offer health care to their employees. It is estimated by most groups that have looked at the plans we have seen that the combination of a government plan and an employer tax will result in millions of Americans losing their employer-provided health insurance. Then there is one other way of paying for the bill: to tax people who have health care insurance. That is why the Democratic Senator from West Virginia, Mr. Rockefeller, is quoted as saying today that the bill coming out of the Finance Committee--which we haven't seen yet--has a big tax on coal miners, on the middle class. That is according to Senator Rockefeller. So we are barking up the wrong tree. This debate about health care should be about reducing costs. That should be the first goal of what we mean when we say the words ``health care reform''--reducing the cost to individuals and families and small businesses that are buying health care plans and paying for insurance--that is 250 million individuals in the country today--reducing the cost to the government in higher health care spending. That is why Republicans have suggested we should start over. A lot of good work has been done. A great many of us understand much better this complex subject we are dealing with. There is no embarrassment in saying we have gotten to this point; we are headed in the wrong direction. The Mayo Clinic, the Democratic Governors, the Congressional Budget Office, millions of Americans in town meetings are saying: You are heading in the wrong direction. You say: Ok, fine. We hear you. Let's start over. How should we start over? Instead of passing 1,000-page bills that add to the debt and increase costs, we should work step by step to re-earn the trust of the American people. The era of 1,000-page bills is over. Smaller steps in the right direction are still a very good way to get where we want to go. There are some steps we can take, some things we can do today to move step by step in the right direction and to lower costs. No. 1, allowing small businesses to pool and reduce health care costs by putting their resources together would increase accessibility for small business owners, unions, associations and their workers, members and families to health care. This legislation has already been considered in the Senate and in the House. It is nearly ready to pass. Estimates are that passing a small business health insurance plan would permit small businesses to offer coverage to one million more Americans. No. 2, reform medical malpractice laws so runaway junk lawsuits don't continue to drive up the cost of health care. The President mentioned that the other night in his remarks. I congratulate him for that. But, we should do even more than he suggested. We have 95 counties in Tennessee, and in 60 of them we don't have an OB/GYN doctor because they will not practice there anymore. Their medical malpractice insurances premiums are too high--over $100,000. So pregnant women have to drive a long way--to Memphis or to Nashville or to other large cities--for their prenatal health care or to have their babies. That is a way to lower costs--reduce junk lawsuits. There is some disagreement about how much that would save, but there is no disagreement that junk lawsuits contribute to higher medical costs. No. 3, allow individual Americans the ability to purchase health insurance across State lines. As a former Governor, I jealously protect States rights. I like States to have responsibilities. But, I think, in terms of health care, we should allow more purchasing of policies across State lines, as people do with their car insurance today. That is a third way to take a step toward health care reform that actually begins to lower costs. No. 4, we don't have to pass a new bill in order to insure more Aericans. About 20 percent of the uninsured Americans--maybe 10 million or 11 million--are already eligible for existing programs, such as Medicaid and the Children's Health Insurance Program. They are not enrolled. We should sign them up. No. 5, we could create health insurance exchanges. I hear that from the Democratic side; I hear it from the Republican side. These are marketplaces in each State so individuals and businesses can shop around and find a cheaper and a better source of health insurance. No. 6, all of us have talked about encouraging health information technology, which the Government Accountability Office has said ``can improve the efficiency and quality of medical care and result in costs savings.'' I have suggested six areas we could work on together to reduce cost. We have forgotten, in this health care debate, what we set out to do. The first goal of health care reform is to reduce cost--the cost of health care to Americans, to American businesses, and the cost to Americans of their government, which is spiraling out of control in debt because of the cost of health care. We are spending 17 percent of everything we produce in this country--and we produce 25 percent of all the wealth in the world year in and year out--on health care; twice as much on health care as a percentage as most industrialized countries. If we don't reduce costs, we will bankrupt the government and make health care unaffordable for most Americans. The President of the United States was right to say he will not sign a bill that increases the deficit. Since that eliminates all the legislation the Democratic Congress has produced so far, I hope we will now take Republican advice and start over and get it right. A good way to begin would be for the President to send us a health care reform bill that not only doesn't add to the debt but that begins step by step to reduce costs to the American people and to the American Government. And by taking those steps, we can re-earn the trust of the American people.