Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, earlier today my colleague on the Finance Committee, Chairman Grassley, offered an amendment to S. 1054, the pending tax bill, to improve Medicare funding for rural patients and providers. I supported the amendment, which passed, 86-12. Many of the Grassley amendment's provisions were taken from S. 3018, Medicare legislation Senator Grassley and I introduced legislation last year. Many of those provisions were also included in the Senate Rural Health Caucus bill, which I support. And several of the provisions have been recommended by the Medicare Payment Advisory Commission (MedPAC), which advises Congress on Medicare payment policy. Taken together, these changes--including an equalization of the hospital base payment amount, changes to the Critical Access Hospital program, and language to improve access to physician care in rural areas--will go a long way toward ensuring greater geographic equity in Medicare reimbursement. That said, I believe the way in which the Senate passed these provisions--as an amendment to tax legislation--is far from perfect. A Medicare bill, debated in the Finance Committee, is the proper vehicle for changes to the Medicare law, and I would have preferred that these provisions be considered in that manner. A full debate in the Finance Committee will allow senators to exchange views and advocate changes they believe are important for Medicare. A debate in the Finance Committee will allow Medicare stakeholders an opportunity to share their views as well. Whether with respect to spending or offsets, the Committee should have the opportunity to consider all of those views fully. For example, while the provisions in the Grassley amendment are important, they do not represent a full list of Medicare changes I would like to see. Most notably, the amendment does not address Medicare's most severe inadequacy: the lack of an outpatient drug benefit. Further, the amendment does not address many concerns facing Medicare's various payment systems, including payments for physicians, nursing homes, teaching hospitals and hospital outpatient departments, to name a few. As for offsets, the Grassley amendment included three: a freeze in Medicare DME payments; establishment of copayments and deductibles for Medicare outpatient laboratory services; and reductions in payment for Medicare Part B-covered drugs. These offsets are not without controversy. For example, while independent experts agree that Medicare overpays providers for Part B drugs, agreement is less apparent on the proper payment providers should receive for the administration of these drugs. And while it is true that lab services are nearly unique in not requiring coinsurance under Medicare, it's also true that lab services are less discretionary than many other Medicare-covered services. Debate in the committee--as we recently had on the tax bill--is important to the legislative process. I urge Chairman Grassley to hold a markup on Medicare legislation, so that changes to Medicare-- including enactment of a Medicare drug benefit--can be considered in the appropriate manner.

Mr. BAUCUS. I agree with the distinguished chairman of the Finance Committee, Senator Grassley. The disputes resulting from any uncertainty regarding the proper application of the income forecast method are extremely unproductive and wasteful. To avoid further waste, resolution of any disputes must be resolved in a manner consistent with the clarifications contained in the bill.

Mr. BAUCUS. Mr. President, I ask for the yeas and nays.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, we will next turn to the amendment of the Senator from North Dakota, Mr. Dorgan. amendment No. 666

Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending amendments be set aside so we can consider the Durbin amendment.

Mr. BAUCUS. I ask unanimous consent that the next amendment in order be the amendment offered by the Senator from Massachusetts, Mr. Kennedy.

Mr. BAUCUS. Mr. President, let me read a quote of American Enterprise Institute, conservative economist, commenting on this amendment: Clearly, this proposal is one of the most patently absurd tax policies ever proposed. That is AEI, Republican economist, commenting on this amendment. Why say that? First, this amendment goes far beyond any other attempt to eliminate double taxation of dividends. What is the effect of this amendment? The effect of this amendment is in many cases to not only eliminate double taxation of dividends but to also eliminate single taxation of dividends. In many cases, as a consequence of the way this amendment is written--which we saw just for the first time half an hour ago--is to say there is no taxation on many dividends offered by corporation shareholders, not the shareholder paying any tax, and not the corporation paying any tax. Second, who subsidizes this if that is the nontaxation of dividends under this proposal? Americans are subsidizing this. Who? Americans today who otherwise would receive the relief under the marriage penalty contained in this bill are going to be subsidizing and paying for, in effect, these tax-free dividends. That is because that is the pay-for in this bill. In addition, this bill increases the budget deficit so our children will be paying for many of those tax-free dividends contained in this bill. Next, this is a huge yo-yo tax provision. Now you see it, now you don't; 50 percent 1 year, 100 percent the next year, 100 percent another year, then zero. Tell me if any corporation will be able to plan on whether or not to pay dividends with a tax policy like that. Clearly, they will wait for the 100 percent and they will not know if it will be continued in law. This is absurd and irresponsible to enact tax legislation like this. I strongly urge Senators to consider what they are doing tonight if they support this amendment. This is an outrage.

Mr. BAUCUS. Mr. President, the next amendment is that of the Senator from New Mexico. Amendment No. 603 Withdrawn

Mr. BAUCUS. Mr. President, I ask unanimous consent that the pending amendments be set aside to consider the Santorum amendment.

Mr. BAUCUS

Mr. BAUCUS. I understand the next amendment is the Graham of Florida amendment.

Mr. BAUCUS. Mr. President, I move to reconsider the vote.

Mr. BAUCUS. I have no objection.

Mr. BAUCUS. Mr. President, might I ask the Senator from Ohio if the modification is the one that changes the ratio of the membership?

Mr. BAUCUS. I understand the regular order is the Voinovich amendment. The Senator from Ohio has the right to speak.

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to. The next amendment is the Warner amendment. The Senator from Iowa.

Mr. BAUCUS. I ask unanimous consent that the Burns amendment be set aside.

Mr. BAUCUS. Mr. President, what is the regular order?

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 550 Withdrawn

Mr. BAUCUS. Mr. President, I thank the Senator from Virginia for asking the question. All I can say at this point is we will do the very best we can.

Mr. BAUCUS. Mr. President, I yield to the Senator from Louisiana.

Mr. BAUCUS. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 619

Mr. BAUCUS. Mr. President, I ask unanimous consent that relevant pending amendments be temporarily laid aside so that Senator Landrieu's amendment can be voted on.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to speak in favor of the Medicare amendments offered by both Senator Grassley and Senator Harkin. Many of the provisions included in both amendments were part of legislation that Senator Grassley and I offered last year. And many of the provisions were included in the Senate Rural Health Caucus bill, which I support. Several of these Medicare provisions in these amendments have also been recommended by the Medicare Payment Advisory Commission, which advises Congress on Medicare payment policy. And they have the support of the American Hospital Association. Taken together, these changes mean a lot to rural providers and, by extension, rural seniors. They represent a significant leveling of the Medicare reimbursement playing field that my colleagues and I have sought to address. I would also like to add, however, that some of the offsets in the Grassley amendment have generated some controversy. For example, the proposed changes to Medicare payment for Part B covered drugs are of great concern to many cancer patients and oncologists, among others. Ideally, we would be legislating on these issues in the Finance Committee so that the committee has a chance to weigh in on these issues. But I believe that the changes on the whole are positive for the Medicare program, and so I intend to support both amendments. Mr. President, I yield to the Senator from Iowa, Mr. Harkin.

Mr. BAUCUS. Mr. President, I ask unanimous consent the Harkin amendment be withdrawn.

Mr. BAUCUS. Mr. President, I ask unanimous consent that the next amendment we vote on be the Murray amendment.