Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, sometimes when Senators vote in this Chamber, the real-world results of our actions are unclear. But tonight, we can make a real-world difference for 44 million American seniors, and for nine million TRICARE users in America's military families. In less than an hour, the Senate will vote to override the President's veto of the Medicare bill. Here is the difference that our votes will make: Will doctors' doors stay open to older Americans, and to the children of our fighting men and women? Our votes tonight will make the difference. Will seniors living on a shoestring, and those in rural areas, be able to get decent health care when hospitals are few and far between? Our votes tonight will make that difference. Will the ambulances keep running? Will the medicines be covered by Medicare prescription drug plans? Our votes tonight will make all the difference. The President made his decision. His veto of the Medicare bill would shut the doctor's door to seniors and military families, and all on ideological grounds. My bill does good things for seniors. It makes Medicare better for every beneficiary, and it's time to enact it into law. The House has already voted to override the veto. Overwhelmingly--383 to 41. Folks in my home State of Montana know I am going to do what is right, and vote to make the Medicare bill law--for Montana seniors and for our 32,000 folks in TRICARE. Today I told a large rally of folks supporting this bill, reversing the cuts that keep our seniors and military families from seeing their doctors will be our finest hour. I hope--and expect--that the Senate will stand together, just as our colleagues across the Capitol have done. Senators of all parties have one more chance to make all the difference. Let's do what is right for seniors. Let's do what is right for military families. Let's do what is right for America. Let's do it together and enact the Medicare Improvements for Patients and Providers Act tonight.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I wish today to recognize the achievements of an outstanding teacher and her seventh grade students. This is a story of community and folks coming together to make their town a better place to live. The students at Monforton School in Bozeman, MT, with their teacher, Sally Broughton, saw a playground at the school that was outdated and unsafe. These ambitious young people then sprung into action and set out to inform the principal, school board, other students, and community members of the subpar condition of the playground and gathered input and support for building a new playground. In the Montana spirit of folks working together to make their community a better place to live, local businesses pitched in by donating nearly $40,000 worth of supplies and labor toward completion of the playground. Monforton parent and carpenter, Alan Ripley, worked with students to design the octagonal climbing structure for the playground. The students spent countless hours with volunteers in building the playground. Thanks to the work of these students, their teacher, and the community all Monforton students now have a safe playground at their school. The efforts of these fine young people have not gone unnoticed. The Corporation for National and Community Service honored the students and their teacher, Sally Broughton, with the 2008 Spirit of Service Award, and We the People: Project Citizen presented them with the Montana Project Citizen Award for their contributions to the community. This spirit of service is prevalent at Monforton School as all students participate in service-learning projects. Classroom lessons are combined with meaningful service to their community. Through these efforts students have been responsible for improving the food service at the school, constructing a walking path, and informing the larger community about the need for a new jail and a warning system for Hyalite Dam among other projects. I would like to join the chorus recognizing the seventh grade students of Monforton and their teacher, Sally Broughton. They are a perfect example of how Montana's world-class education system is preparing children across Big Sky country to meet the challenges they will face. These outstanding young people are the future of our Nation, and I am sure that they will continue to serve and make many contributions to their communities.

Mr. BAUCUS

Mr. BAUCUS. Madam President, the Prophet Isaiah urged: Cease to do evil, learn to do good; seek justice, correct oppression; defend the fatherless, plead for the widow. Since 1965, Medicare has been about defending the disabled. Medicare has been about providing for the elderly. From its beginning, Medicare has been about doing good. Before Medicare, old age was very much about widows. In 1960, a man could expect to live a little more than 66 years, whereas a woman could expect to live past 73. Now, with the help of Medicare providing health care for the elderly, men can expect to live beyond 75 and women can expect to live beyond 80. Before Medicare, in 1959, more than 35 percent of the elderly lived in poverty. When President Johnson signed the Medicare Act into law, he said of the elderly: Most of them have low incomes. Most of them are threatened by illness and medical expenses that they cannot afford. Thus, before Medicare, the elderly received poorer health care. They endured more pain. They met early death. But then, 43 years later, in July 1965, with my fellow Montanan Mike Mansfield looking on, President Johnson signed the Medicare Program into law. This chart to my left shows the picture of that day. That day President Johnson said: No longer will older Americans be denied the healing miracle of modern medicine. No longer will illness crush and destroy the savings they have so carefully put away over a lifetime so they might enjoy dignity in their later years. No longer will young families see their own hopes eaten away simply because they are carrying out their deep moral obligations to their parents. Further quoting President Johnson: And no longer will this Nation refuse the hand of justice to those who have given a lifetime of service and wisdom and labor to the progress of this country. Thus, from its beginning, Medicare has been a moral issue. Medicare has been about doing good, about doing what is right. I come to the floor today to speak in defense of Medicare. I come to plead for the widow. I come to fight for the disabled. Today Medicare is threatened. Health care costs have been growing rapidly. Federal Reserve Chairman Bernanke told the Finance Committee's health care summit: Health care has long been and continues to be one of the fastest growing sectors in the economy. Over the past 4 decades, this sector has grown, on average, at a rate of about 2.5 percentage points faster than the gross domestic product. But the fruits of the 1997 law threaten to cut--yes, cut--payments to doctors who treat Medicare beneficiaries unless we act. If we do not act, the law will force cuts in payments to doctors by 10.6 percent. We have to stop that cut. That cut threatens access to care for America's seniors. Already some providers are declining Medicare patients. My colleagues hear that constantly. Fewer and fewer doctors are taking Medicare; more and more are dropping. Why? Because reimbursement rates are already too low, and unless we act today, those reimbursement rates will be much lower. Doctors know about these cuts. My colleagues in their home States hear this constantly. I am sure, over the July 4 break, they heard over and over that the doctors are very concerned about Medicare reimbursement. The share of doctors accepting new Medicare patients has been falling. It is falling for those who accept and do not accept Medicare. It is falling for those military personnel in TRICARE who seek services from doctors as well because TRICARE payments are tied to Medicare. Unless we act, those patients in the TRICARE system, our military service men and women, will also find that their doctors are not treating them either. That trend will accelerate if we do not act. An American Medical Association survey found if the scheduled cuts stay in effect, 60 percent of doctors will have to limit the number of new Medicare patients whom they treat; 60 percent would have to limit, unless we restore these cuts. These cuts also threaten access to health care for our military men and woman. As I mentioned, TRICARE uses the Medicare formula to pay their doctors. Those cuts could endanger health care for military retirees and even for those on Active Duty. I do not think that is well understood, that TRICARE is tied to Medicare. If we cut Medicare, we cut TRICARE. That means about 9 million American service men and women, Active Duty and retirees, the doctors who service them will no longer provide that service; a 60- percent reduction. The Military Officers Association of America reports that declining participation of providers due to low reimbursements is already one of the most serious health care problems facing military families. Real and threatened cuts in the level of Medicare reimbursements have caused many providers to stop accepting new TRICARE patients. Since 1965, there have been those few who did not think that Medicare was good. There have been those who have sought to call it evil. In the 1960s, there were those on the fringe who called it socialized medicine. In 1995, there were those who said it was going to wither on the vine, those who wanted to do away with Medicare. But the truth is, from the start Medicare has had broad, very broad, bipartisan, very bipartisan, support. The original Medicare Act passed the House of Representatives with a vote of 307 to 16. It passed the Senate by a vote of 70 to 24. That broad support was evident again on June 24 of this year before the break. That day the House of Representatives passed the Medicare Improvements for Patients and Providers Act. That bill would stop those cuts in doctors' payments. The House passed that bill with an overwhelming vote of 355 to 59; 355 House Members voted for it. That is better than a 6-to-1 margin. Even among Republican Members of the House, more than twice as many voted for it than against it. On June 26, the Senate fell one vote short of invoking cloture on the motion to proceed to that bill. But today the Senate will reconsider that vote, and we should. The Senate should take up and pass this Medicare bill. The Senate should pass this Medicare bill because there is no alternative. If we fail to enact this bill, millions of America's seniors will be worse off. We cannot let that happen. This bill can prevent that. The House-passed bill is very similar to the Baucus-Snowe bill the Senate considered earlier in June, but the House made three noteworthy changes. First the House-passed bill includes legislation to delay the competitive acquisition program for durable medical equipment. Congress needs to ensure that these savings do not harm beneficiary access to care. We need to take a closer look at competitive bidding before it goes forward. Passage of this Medicare bill would allow that. The House-passed bill also does not include cuts in funding for oxygen supplies and equipment, and it does not include cuts in funding for powered wheelchairs. Those who support these reforms make a good case. But ultimately, the cuts could not be included as part of this must-pass legislation. This bill is a balanced package. It is a compromise. It makes modest changes. When the House passed its children's health bill last year, the House made major changes to the Medicare Advantage Program. Last year's House CHIP bill would have significantly restructured the program. This House Medicare bill, however, would not do that. This bill includes a reduction in the double payment for medical education costs to private plans in Medicare, and this bill would protect seniors from unscrupulous marketing practices by private health plans. This bill would require so-called private fee-for-service plans to form provider networks. It would make sure that there are doctors behind those plans. Currently, those private fee-for-service plans do not have to do that. By fiat, they deem it to be the case. But it is not accurate. This bill would make sure there will be doctors behind those plans. This bill does not include deep cuts due to the Medicare Advantage Program. Some suggest it does. It does not at all. It does not cut private fee-for-service plan payments at all. I wish to go further on Medicare Advantage. I think we should do more. But this is not the time, and this is not the legislation on which to do so. This, however, is the time to avert the pending cut in payments to doctors. That payment cut would devastate access to care for America's seniors. We cannot let that happen. For Medicare beneficiaries, this Medicare bill would expand access to services. We all talk about greater access to preventive services. It would eliminate the discriminatory copayment rates for seniors with mental illnesses. We all talk about that. We want mental health parity. We do it in this Medicare legislation. And it will provide additional needed help for low-income seniors. We all talk about that need too. This Medicare bill would take important steps to shore up our health care system in rural areas. It includes provisions from the Craig Thomas Rural Hospital and Provider Equity Act. Let's do this for Craig Thomas. This bill also includes important relief for ambulance providers, community health centers, and primary care physicians. Primary care doctors represent the backbone of our health system. We all hear from home that primary care doctors are especially vulnerable and we give additional help to them. This Medicare bill would make important improvements in pharmacy payments. It would make payments under the Part D drug benefit fairer and more timely to those who dispense drugs to our Nation's senior citizens. We have all heard that pharmacists need this help because they are in a disadvantageous position in dispensing Part D drugs. This bill would save money by providing a single bundled payment for all the services related to treating end-stage renal disease, and that will help reduce costs. For the first time, dialysis facilities would receive a permanent, market-based update to their payments each year, giving them a little bit of predictability. This would ensure that Medicare payments keep up with costs. The bill would expand emergency health care for veterans in rural areas. It would increase payments for doctors who work in rural areas. It would stop the payment cut to providers. It would give them a decent increase in reimbursement. All of this would help to ensure that seniors and military families would be able to keep seeing the doctors they need to see. On July 30, 1965, President Truman watched President Johnson sign the Medicare Act. That is what is shown in this photograph to my left. President Truman at that point said: Mr. President, I am glad to have lived this long and to witness today the signing of the Medicare bill, which puts this Nation right where it needs to be, to be right. Yes, from its beginning, Medicare has been a moral issue. Medicare has been about doing good. So let us defend the elderly. Let us defend the disabled. Let us provide for our military families, and let us enact this important Medicare bill. I know others are waiting to speak on the other side of the aisle. In a moment I will yield the floor, but before doing so, I yield half of the time remaining under my control to Senator Schumer and half of the time to Senator Durbin for their use when they are recognized.

Mr. BAUCUS. Madam President, may I inquire, what is the pending business before the Senate?

Mr. BAUCUS. Madam President, reserving the right to object, I have looked at the Senator's bill, and I must say that any objective observer would know that this is not a serious effort. It is a big warm kiss on doctors to show to them that they love doctors when, in fact, this is going nowhere. It is a $380 billion bill unpaid for. It is not a serious effort whatsoever. I regret the Senator from Texas has the audacity to bring this up. I object.

Mr. BAUCUS

Mr. BAUCUS. Madam President, there is a little general store in West Yellowstone, MT, that has been there for 100 years. Built in 1908 when only the bravest and most determined Americans were settling the West and the State of Montana was barely 20 years old, Sam and Ida Eagle set up shop. When Sam and Ida Eagle established Eagle's Store just outside Yellowstone Park's west entrance, they were also establishing, along with three other families, the town that we now call West Yellowstone, MT. The Eagles spent their lives in the town they helped found. They raised a family of 10 children, built their business and played a pioneering role in the community. Sam served as the postmaster for 25 years and helped create the West Yellowstone airport. He also led the town's struggle to gain title to the properties they had settled. The Eagle family still owns and operates Eagle's Store today on the land their ancestors received as a Presidential land grant, in a vintage store on the National Register of Historic Places. A lot has happened in these last 100 years, and Sam and Ida Eagle and their neighbors probably could not have imagined some of the luxuries we take for granted today--coast to coast flights, television, or the Internet. Our world is still changing, but we have got to make sure we are doing what is right for small towns everywhere. Creating good paying jobs, keeping our economy strong, and ensuring the vitality of places like West Yellowstone, is essential to who we are as Americans. Of course, some things have not changed all that much in West Yellowstone. The sense of community, the small town values, and the commitment to a job well done still radiate from West Yellowstone's residents. They are timeless qualities still apparent everywhere around town, and they represent the very best of America.

Mr. BAUCUS

Mr. BAUCUS. I ask unanimous consent that the following Finance Committee staff be allowed floor privileges during the consideration of the Medicare bill: Mel Hanes, Adam Lythgoe, Ashleen Williams.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, on Tuesday, the House passed the Medicare Improvements for Patients and Providers Act, and I urge the Senate to take up and pass this bill tonight. The House passed the bill with an overwhelming vote, 355 to 59. That is a 6-to-1 ratio. Even among Republican Members of the House, more than twice as many Republicans voted for the bill as against it. The Senate should take up and pass this Medicare bill not just because the House passed it with 355 votes, but, rather, because it is the right thing to do. The Senate should pass this Medicare bill because time is running out. I understand the House is going to adjourn today. I think they have cast their last vote. If we don't act soon, the law cuts payments to doctors by 10 percent on July 1. We have to stop that cut. That cut threatens access to care for America's seniors. Already, some providers are declining Medicare patients. That trend will accelerate--believe me, I have talked to a lot of doctors--that trend will accelerate if we don't act. We must pass this bill tonight. The Senate should pass this Medicare bill because it is the only way to avoid the cut. There is no other option. There is no alternative. There is no short-term solution. This is the only train in the station. This is it. The House-passed bill is very similar to S. 3101. That is the Baucus- Snowe bill the Senate considered 2 weeks ago, but the House made three noteworthy changes to that bill. First, the House-passed bill includes legislation to delay the Competitive Acquisition Program for durable medical equipment. Congressmen Pete Stark and David Camp introduced legislation to do that in the House, and Senator Grassley and I, along with 24 other Senators, introduced that legislation here in the Senate. I support competitive bidding as a way to decrease costs, but Congress needs to ensure that these savings are not achieved at the expense of beneficiary access to the care they need in their own communities. We need to take a closer look at competitive bidding before it moves forward. The passage of this Medicare bill will allow that. The House-passed bill also does not include cuts in funding for oxygen supplies and equipment, and it does not include cuts in funding for power wheelchairs. Those who support these reforms make a good case, but ultimately the cuts could not be included as part of this must-pass legislation. This bill is a balanced package. It is a true compromise. It does not go nearly as far as many House Democrats wanted it to go, and it goes about as far as some of my Republican colleagues in the Senate can go. When the House passed its children's health bill last year, the House made major changes to the Medicare Advantage Program. Last year's House CHIP bill would have significantly restricted the program, but this House Medicare bill does not do that. This bill includes a reduction in the double payment for medical education costs to private plans in Medicare, and this bill would protect seniors from unscrupulous marketing practices by private health plans. That has to be corrected and it is in this bill. Both of those changes were also included in a bill crafted by Senate Republicans. I think they are wise, and they are wise to follow up with a similar vote later on tonight. This bill would do more. It would also require the so-called private fee-for-service plans to form provider networks. All other plans must, all other Medicare Advantage plans must, and so should private fee-for- service plans. It would also make sure there are doctors behind those plans. It is not the case in current law, but that change is made in this bill. This bill does not--I must say--does not include deep cuts to Medicare Advantage payments. It also does not cut private fee-for- service plan payments at all. It just has this provision which I think is a major reform. I would go further on Medicare Advantage, but I must say to my colleagues that this is not the time and this is not the legislation to do that. This is the time to avert the pending cut in payments to doctors. That payment cut would devastate access to care for America's seniors. We cannot let that happen. We cannot let those cuts go through, which would devastate care for America's seniors. So what else will this bill do? For Medicare beneficiaries, this Medicare bill would expand access for preventive services. We have all talked about that, and this bill does it. It would eliminate the discriminatory copayment requirements for seniors with mental illnesses. We have talked about that. We should not have discriminatory copayment requirements for seniors with mental illness. And it provides additional needed care for low-income seniors. The Medicare bill would take important steps to shore up our health care system in rural areas. It includes provisions from the Craig Thomas Rural Hospital and Provider Equity Act. We included that in this bill. The bill includes important relief for ambulance providers, community health centers, and primary care physicians. They need some additional help. Primary care doctors represent the backbone of our health care system. This legislation, the House-passed bill and the Senate bill, does make those provisions. This Medicare bill would make important improvements in pharmacy payments. It would make payments under the Part D drug benefit fairer and more timely, especially to those who dispense drugs to our Nation's senior citizens. This bill would save valuable Medicare dollars by providing a single bundled payment for all the services related to treating end-stage renal disease. That is a reform. And for the first time, dialysis facilities would receive a permanent, market-based update to their payments each year, something they have been asking for and deserve. This would make sure Medicare payments keep up with their costs. I wrote the legislation on which this Medicare bill was based to make sure the seniors in my home State of Montana and everywhere in our country can get quality, affordable health care. This Medicare bill would do right by low-income and rural seniors. This bill would expand emergency health care for veterans in rural areas. We all talk about helping our veterans who are coming home. This helps do that, particularly in rural areas where the networks are not there. It needed special attention. It is there in the urban areas on the margin but even less in rural areas. It would increase payments for doctors who work in rural areas. It would stop payment cuts to providers, and it would give them a decent increase in reimbursement. All of this would ensure that seniors will be able to keep seeing the doctors they need to see. I have worked for months to write a strong Medicare bill that could pass both Chambers with wide support. Tuesday's overwhelming House vote makes clear that this bill can be that bipartisan vehicle. In a sense, it is being taken up just in time, just before July 1. The House will not take up another vehicle. This is it. The House has gone home for its Fourth of July recess. There is not time left to craft a viable alternative. Even if there were, the House cannot pass it in time. The clock is ticking. This Medicare bill can be a slam dunk at the buzzer for 44 million American seniors who depend on Medicare. Let's do what is right. Let's ensure that seniors have access to doctors. Let's avert the impending payment cut to doctors, and let's pass this bipartisan Medicare bill. Mr. President, I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I yield my hour post cloture to Senator Dodd.

Mr. BAUCUS

Mr. BAUCUS. Madam President, following my remarks, I ask unanimous consent that Senator Casey be recognized to speak for 12 minutes, Senator Isakson be recognized to speak for 10 minutes and, following Senator Isakson, Senator Sanders be recognized to speak for 15 minutes.

Mr. BAUCUS. Madam President, Confucius said: The strength of a nation derives from the integrity of the home. Today we are here to protect the strength of our Nation. We are here to help keep families in their homes. The tax provisions in the amendment before us are meant to stabilize the housing market and boost our economy. They are designed to provide temporary, targeted, and timely tax relief for the housing market. In 2007, 1 percent of all homes were in default. That is more than 1.2 million homes. The Nation's 2007 foreclosure rate was 2\1/2\ times what it was in 2005. In my home State of Montana, the 2007 foreclosure rate was up almost 30 percent from 2006 and more than 50 percent from 2005. And the number of foreclosures continues to grow. Nationwide in May, the number of homes receiving a foreclosure-related notice was up 7 percent from the month before, and up 48 percent from a year before. This means that 1 in every 483 American households received a foreclosure notice last month. That is a record high. Behind every foreclosed property, there is a family. There is a family losing its home, and there is a family losing a piece of its future. Our Nation's current economic weakness is largely a result of the weak housing market. More than 5 million households now owe more on their mortgage than their house is worth. That is about 1 out of every 10 home mortgages. As home prices continue to fall, these numbers will only get worse. This amendment is a response. It would provide tax relief for homeowners, for home buyers, and for homebuilders. It would provide an additional $11 billion of mortgage revenue bonds so that State housing agencies can immediately respond to the housing downturn. This would help homeowners avoid foreclosures, and it would increase first-time home purchases. Mortgage revenue bonds are tax-exempt bonds issued by State and local housing finance agencies. The bonds help those agencies to provide mortgages for home buyers at below-market rates of interest. The virtual collapse of the subprime and affordable mortgage markets has increased the demand for mortgages financed through mortgage revenue bonds. Increasing the cap on mortgage revenue bonds and providing States the option to refinance subprime mortgages can allow State housing agencies to immediately respond to homes at risk of foreclosure. And additional mortgage revenue bonds can also help clear out the glut of homes on the market. Additional mortgage revenue bonds can lead to more first-time home purchases. The amendment also would provide broad-based tax relief by expanding the number of people who may deduct property taxes. Currently, homeowners are allowed to deduct local real estate property taxes from their Federal tax returns only if they itemize. According to the Joint Committee on Taxation, more than 28 million taxpayers pay property taxes, but do not itemize. This proposal would allow these 28 million taxpayers to deduct the amount of their property taxes, up to $500 for individuals and $1,000 for married filers. They could take this deduction even if they did not itemize their deductions. This change would benefit low-income individuals. It would benefit those who have already paid off their mortgages and thus don't have that reason to itemize. It would benefit young families just starting out, and it would benefit senior citizens. The Congressional Research Service estimates that nearly 130,000 property taxpayers could benefit in my home State of Montana alone. Listings of distressed properties dominate the real estate market. In the first quarter of this year, one out of every four home sales was a distressed sale. The papers are full of foreclosures and vacant new homes. As of April 2008, there were more than 456,000 newly constructed homes for sale on the market. That is more than 10 months worth of supply. And according to the National Association of Realtors, 4\1/2\ million existing homes are for sale on the market. To help reduce the excess inventory of foreclosed, vacant, and existing homes, the amendment includes a one-time home buyer credit of $8,000. The credit would apply to first-time home buyers. It would begin to phase out for home buyers with incomes of $75,000 for individuals and $150,000 for joint filers. The purchase of the home would have to be on or prior to April 1, 2009. And the credit would be repaid over 15 years at zero percent interest. The short-term nature of this credit is critical. It would help to provide immediate stimulus to put homebuilders, and the housing industry, back on track, but it would also avoid oversubsidizing the housing industry. The amendment would also make critical improvements to the Low Income Housing Tax Credit program. This program is the engine that drives low- income rental housing in America. But it is long overdue for a tuneup. The amendment would increase the total number of credits available by 10 percent per State. And the amendment would broaden the investor class by allowing the credit to be taken against the AMT. The State housing finance agencies are good stewards of this Federal program, and the amendment would give these agencies more discretion to allocate credit dollars to projects that the State deems a high priority. These tuneups would help to make this engine run more smoothly, and they would lead to an increase in affordable rental housing across the country. The amendment would also allow taxpayers to choose to take a refund of AMT or R&D credits in lieu of bonus depreciation deductions. Companies without Federal tax liability cannot use the tax deductions. But under this amendment, they could take advantage of a refund, and they could use that funding invest in capital assets. That would create and maintain jobs. These proposals would be fully paid for by responsible offsets. As much as possible, we should avoid increasing our national debt and our reliance on foreign creditors. The amendment includes a House-passed proposal to close a loophole involving the sale of second homes. It would apply to houses that are used both as a principal residence and for other purposes. An example would be a principal residence that also was used as rental property. Under current law, an owner can exclude income from the sale of that second home. The owner just needs to have lived in the home for 2 out of the last 5 years. The proposal would limit the gain that the owner could exclude from income when the owner sells the residence. The idea behind the proposal is that a personal-income exclusion should be limited to the personal use of the residence. A second pay-for would require information reporting on credit card transactions. It would also apply to many online transactions. Merchant banks that settle credit and debit card sales would report annual gross payments to the businesses making the sales and to the IRS. Third-party networks that facilitate electronic transactions would do the same. In response to concerns about possible burdens this proposal could put on small e-business sellers, the proposal contains a de minimis exception. The exception excludes from the reporting requirements operations with aggregate sales of $10,000 or less a year. The exception would also exclude a volume of 200 transactions or fewer. The proposal gives ample time to banks and others so they can program their systems and verify the information they need from sellers before issuing the information documents. This proposal does not raise taxes on anyone. These information reports would just cause people to file more accurate returns. The administration has included this proposal in its annual budget for the last 3 years. Earlier this year, Senator Grassley and I released a bipartisan staff draft of the proposal for public comment. Working together with the House, we have taken these comments into account to develop a proposal that reflects industry practices and will improve tax compliance. The amendment also enhances several IRS penalties. These penalties encourage the filing of timely and accurate tax and information reporting returns. These filings are the cornerstones of effective tax administration and voluntary tax compliance. A lot of irresponsible actions led to the current housing crisis. But now a lot of responsible homeowners, home buyers, and homebuilders are caught up in the mess, and they cannot afford to wait any longer for our help. The tax provisions in this amendment would go a long way to address the housing downturn and the economic weaknesses in our country. So I say, let's help these folks. Let's help them keep their homes and thereby help them sustain the economic strength of this Nation. And let's adopt this housing amendment. Madam President, I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, before the Senator leaves, I would like to make a simple point. He mentioned various provisions he would like to see enacted. I suppose most of them concern his State of Louisiana, as they appropriately should. Let's ask ourselves, what is the parliamentary position we are in now? It is very clear. The vote before us, which will be taken soon today, is very simple. It is whether we move to the next step to get on legislation. It is called a motion to proceed. It is true it is a motion to proceed to a House-passed bill. If the Senate lets us proceed--including the Senator from Louisiana--to that bill, then I will offer a substitute and presumably we will be on the substitute. I thought it was not only the prerogative of the Senate, but it is an opportunity for Senators to debate amendments and for Senators to offer amendments--amendments to strike certain provisions or amendments to add certain provisions. That is called legislating. It is debate. Before we can do that, we have to get onto the bill. We cannot pass legislation until we can get on the bill. So I am asking my good friend from Louisiana if maybe the better alternative--nobody is playing politics. We are trying to get ourselves into a procedural situation so we can debate legislation and pass legislation for the good of the country. I ask my good friend from Louisiana if he might consider voting for the motion to proceed so that we can get on the legislation and so that other Senators can offer amendments to improve the legislation and so the Senate can vote.

Mr. BAUCUS. I will ask another question. If we vote for the motion to proceed, with the assurance and understanding that there would be the full opportunity for amendments, but also, I think, in the spirit of comity and good faith--sometimes amendments are blocked because they are not good-faith amendments, such as on abortion and other issues that have nothing to do with the bill. They are political amendments. The Senate has, unfortunately, come to the point where because they offer political amendments, with nothing to do with the issue at hand, the majority leader is sometimes forced into that situation in order to set up a procedure to minimize the possibility of the occurrence of those political amendments. So it is a two-way street. It is my objective--and I would counsel the majority leader to allow amendments. That is the way the Senate should operate. There has to be a good-faith understanding on the Senator's side of the aisle on good-faith amendments.

Mr. BAUCUS. Maybe we are making headway because the substitute amendment I will offer would not include Davis-Bacon, or may not consider some provisions the Senator is addressing. Again, to go back, there has to be an understanding on the Senator's side of the aisle that the amendments offered would be good-faith amendments and not obstructive political amendments. I thank the Senator for the dialog. Maybe we have made a little headway so we can get enough support to proceed to the bill. Mr. President, Samuel Johnson called a second marriage ``the triumph of hope over experience.'' Actually, that is where we are today. The Senate seeks a similar triumph of hope today because we are here again to consider the vote on a motion to proceed to H.R. 6049, the Renewable Energy and Job Creation Act of 2008. This time I hope for a better result. And maybe somewhat, based on the discussion I just had with the Senator from Louisiana, we can find a way so that we can proceed to the bill and pass these very important provisions. This bill will foster clean, new energy sources. This is a bill to extend some very important tax provisions that benefit American families and businesses. This is a bill on which I hope to offer an amendment to stave off certain tax increases under the alternative minimum tax. Last Tuesday, we tried to do this same thing--move to this bill--but we fell short of 60 votes. Many of my colleagues on the other side of the aisle were against moving to the bill. That meant we could not even get on the bill; therefore, we could not offer amendments to improve it and pass it to help many Americans and individuals in businesses. Again, that meant we could not even discuss the merits of the bill. That meant we could not consider my substitute amendment, which would have addressed several Senate priorities, including a couple on the other side of the aisle. This bill contains a robust energy package, with more than $17 billion in incentives for alternative energy, efficiency, and clean coal. This package is important for our environment and our energy security, and it is important to facilitate the transition to a carbon- controlled economy. If we don't get this bill, we cannot do any of that. This bill would extend expiring individual tax provisions, including the teacher expense deduction and the qualified tuition deduction. The bill would also extend expiring business tax provisions. These include the R&D tax credit and the active finance expensing provisions. These business provisions help to keep America competitive in a global economy. These business provisions help to maintain and create jobs. If these individual and business provisions are not extended, millions of families and businesses will face tax increases. If we don't pass this bill, many individuals and businesses will find their taxes going up. The bill is paid for with two revenue raisers that have very broad support. It is also sound tax policy. The arguments against this bill this week may as well be the same as last week's arguments. Last week, we heard that we should not increase taxes to pay for tax cuts. As I said before, and will say again, these revenue raisers are not tax increases. The first revenue-raising provision in the bill is the delay of the effective date of the worldwide allocation of interest. This provision would delay application of the interest rule, which was not supposed to go into effect until next year. Many of the companies that will benefit from this provision told me they would rather have the business extenders than early applications of the worldwide application of interest. Why? These companies realize that because of the firm position of the House of Representatives, we need to offset extending these valuable tax benefits. To make that point more clear, this body knows the House has been insisting that offsets be utilized to pay for some of these tax reductions that will pass with this bill. That is a political reality, something we all face. That is partly why these offsets are in this bill, including delaying application of worldwide allocation of interest. These companies have weighed the costs and benefits, and they have made the choice in favor of the tax extenders in the bill. The second revenue-raising provision addresses offshore deferred compensation. This provision would prevent hedge fund managers from deferring income. This is not an increase in tax on hedge fund managers. Rather, it is a change in the timing of when income tax will be applied. This is a timing issue, not a tax increase. Therefore, I believe it is sound tax policy. Last week, we heard that we should not need to offset extending current tax benefits. This is a curious argument. It is curious because the Senate paid for extending expiring tax provisions in the recent past. We paid for extenders in the JOBS Act in 2004, we paid for extenders in the Tax Relief Act of 2005, and we paid for extenders in the military tax relief bill that Congress just passed and presented to the President on June 6. We have done that. So this week the Senate is faced with a choice that, in my opinion, is relatively easy. If we can get to H.R. 6049, if the Senate will vote to get to the bill, we could then take up my substitute amendment. My substitute amendment contains the provisions that I have talked about, plus a 1-year AMT patch--making sure people don't have to pay the AMT in the next taxable year, and that is without any offsets. So by going to the bill and seeing it through, Congress would take care of a lot of families and a lot of businesses. We need to decide whether we will develop new jobs and new medications. We need to decide whether we will help teachers, families, and schools. We need to decide whether we are going to make energy independence a priority, or we can continue to allow hedge fund managers to defer, without limitation, their compensation for investing other people's money. Let's show America we can make the right choice. Let's give American families and businesses reason for hope. Let's not give them the same experience they received last Tuesday. Let's proceed to this important tax relief bill for many American families and businesses. Mr. President, I ask unanimous consent that the quorum calls prior to the recess be charged equally to both sides, and I suggest the absence of a quorum.

Mr. BAUCUS

Mr. BAUCUS. I suggest the absence of a quorum.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I introduce, with my friend Senator Grassley and twenty-four other Democratic and Republican Senators, the Medicare DMEPOS Competitive Acquisition Reform Act of 2008. In doing so, I would also like to recognize the efforts of Congressman Pete Stark, Congressman Dave Camp, and so many others in the House of Representatives who worked very hard on this bipartisan legislation. This legislation will delay the durable medical equipment, prosthetics, orthotics, and supplies competitive acquisition program. Many Members of Congress and I have received reports about potential inaccuracies in the implementation of the CAP program. These reports range from suppliers who believe they were wrongly disqualified to questions about the clarity and consistency of information that suppliers received during the bidding process. Some providers were awarded contracts to serve areas in which they did not previously have a presence. Other suppliers were awarded contracts for service lines with which they have little or no experience. While I support the concept of competitive bidding as a way to decrease costs, it is the obligation of Congress to make sure that these savings are not at the expense of beneficiary access to the care that they need in their own communities. I believe that Congress should take a closer look to make sure this program lives up to its potential. In order to ensure that we are getting the best possible price and quality for beneficiaries, it is critical that the competitive bidding process be accurate and inclusive. I am most concerned about the impact that a poorly designed program will have on Medicare beneficiaries, many of whom are confused about what this new program means for them and are concerned that they won't be able to get care from someone in their own community. This means we must have as many bidders as possible who offer not only the best price but clearly meet high quality standards. Based upon the numbers we have seen as a result of bidding in phase one, I think we need to look more closely to make sure that we are not missing an opportunity to consider additional suppliers who have experience furnishing these services in the communities at play. Furthermore, we need to examine the bidding process outcomes to make sure that the suppliers being offered contracts to serve patients in a selected area have the team on the ground to help patients in those areas. I have also heard concerns that some of the products included in the first phase of the competitive acquisition program may not be the best fit for this type of program because they require specialized handling or expertise. At the end of the day, the most important goal of the Medicare program is to make sure patients get the care that is appropriate for them, so we must tread carefully when we move ahead with a program covering these products. The Centers for Medicare and Medicaid Services put forth an admirable effort to implement a complex competitive bidding program in a short time frame. I think that many of the concerns that people have raised about the program can be resolved, but we cannot afford to ignore them. The beneficiary services at stake are just too important to move hastily; no matter how much money we believe we can save. I think that it is worth it for us to delay for just a bit and take a closer look to make sure this program lives up to its potential. With a few minor tweaks here and there, I am convinced that the competitive acquisition program will live up to its promise to provide cost effective, high-quality services and products to patients. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I introduce, with my friend Senator Grassley and twenty-four other Democratic and Republican Senators, the Medicare DMEPOS Competitive Acquisition Reform Act of 2008. In doing so, I would also like to recognize the efforts of Congressman Pete Stark, Congressman Dave Camp, and so many others in the House of Representatives who worked very hard on this bipartisan legislation. This legislation will delay the durable medical equipment, prosthetics, orthotics, and supplies competitive acquisition program. Many Members of Congress and I have received reports about potential inaccuracies in the implementation of the CAP program. These reports range from suppliers who believe they were wrongly disqualified to questions about the clarity and consistency of information that suppliers received during the bidding process. Some providers were awarded contracts to serve areas in which they did not previously have a presence. Other suppliers were awarded contracts for service lines with which they have little or no experience. While I support the concept of competitive bidding as a way to decrease costs, it is the obligation of Congress to make sure that these savings are not at the expense of beneficiary access to the care that they need in their own communities. I believe that Congress should take a closer look to make sure this program lives up to its potential. In order to ensure that we are getting the best possible price and quality for beneficiaries, it is critical that the competitive bidding process be accurate and inclusive. I am most concerned about the impact that a poorly designed program will have on Medicare beneficiaries, many of whom are confused about what this new program means for them and are concerned that they won't be able to get care from someone in their own community. This means we must have as many bidders as possible who offer not only the best price but clearly meet high quality standards. Based upon the numbers we have seen as a result of bidding in phase one, I think we need to look more closely to make sure that we are not missing an opportunity to consider additional suppliers who have experience furnishing these services in the communities at play. Furthermore, we need to examine the bidding process outcomes to make sure that the suppliers being offered contracts to serve patients in a selected area have the team on the ground to help patients in those areas. I have also heard concerns that some of the products included in the first phase of the competitive acquisition program may not be the best fit for this type of program because they require specialized handling or expertise. At the end of the day, the most important goal of the Medicare program is to make sure patients get the care that is appropriate for them, so we must tread carefully when we move ahead with a program covering these products. The Centers for Medicare and Medicaid Services put forth an admirable effort to implement a complex competitive bidding program in a short time frame. I think that many of the concerns that people have raised about the program can be resolved, but we cannot afford to ignore them. The beneficiary services at stake are just too important to move hastily; no matter how much money we believe we can save. I think that it is worth it for us to delay for just a bit and take a closer look to make sure this program lives up to its potential. With a few minor tweaks here and there, I am convinced that the competitive acquisition program will live up to its promise to provide cost effective, high-quality services and products to patients. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. BAUCUS. Mr. President, unless we act, on July 1 the law will cut Medicare payments to doctors by 10 percent. Today, we have an opportunity to vote on proceeding to a bill that will stop that cut. In addition to averting the 10-percent payment cut, the bill on which we will vote today will also make important improvements for beneficiaries. It will help those with very modest incomes to get the help they need, and it will expand access to preventative benefits in Medicare. We should all agree that prevention is critical to moving our health care system from one that treats disease to one focused on wellness. The bill includes a provision intended to give a boost to primary care physicians. These represent a downpayment on changes that I would like to consider in the near future to advance the role of our front- line physicians. The bill will improve access to health care in rural areas. The bill includes many policies from the Craig Thomas Rural Hospital and Provider Equity Act, all supported so strongly by so many Senators. The bill will lend a hand to pharmacists. Pharmacists face so many challenges right now. And the bill will help ambulance providers. Today, these first responders must contend with record high and rising gas prices. That is what this bill will do. It is a good bill, it is a balanced bill, and it is a bill that my colleagues should be proud to support. Let me also talk about what this bill would not do. I have heard some claims made about the bill. I would like to set the record straight. First, the bill would not make drastic cuts to Medicare Advantage payments. This is not the House-passed CHAMP bill. Although I believe there is justification for making significant reductions to Medicare Advantage benchmarks, this bill will not do that. This bill would not affect the benchmarks in Medicare Advantage. Second, this legislation will not eliminate private fee-for-service plans. What it will do instead is take away the ability of these plans to ``deem'' doctors and hospitals into their networks. Right now private fee-for-service plans are permitted to circumvent network requirements. They can deem any Medicare provider to be part of the plan network. They can do so without any formal agreement between the provider and the private fee-for-service plan. What does that mean? That means that doctors and hospitals are automatically considered by the plan to have agreed to all the terms and conditions of the plan automatically. They are automatically considered to have agreed to payment levels, to patient cost-sharing obligations, and to billing procedures, even when they have not made such agreements. So it is no wonder that we hear from providers that they do not like dealing with these plans. I would go so far as to say that forcing doctors and hospitals to accept the terms that plans lay out, without a chance to negotiate, seems un-American. How will this legislation address deeming? It will eliminate this deeming authority in 2011--yes, 2011; not right now but 2011; not next year, not 2010 but 2011. The plans would have 2.5 years to develop a network. I believe that is plenty of time. Moreover, the bill will protect choice in rural areas. The deeming provisions will only affect areas where there are already two or more plan options available that have a network. In those areas where existing plans have contracted with providers to form a network, private fee for service has a competitive advantage. This bill will level the playing field across all plans. Second, this bill will not cut teaching hospitals. It will not jeopardize access to plans in areas where academic medical centers are most prevalent. Right now, Medicare pays twice for indirect medical education on behalf of patients in Medicare Advantage plans. Medicare pays once when it reimburses teaching hospitals directly for IME costs, and Medicare pays a second time by inflating payments to Medicare Advantage plans for the same costs. So under this bill, teaching hospitals will continue to receive IME payments directly from Medicare, but the unnecessary double payments will be eliminated. Third, this bill will not allow wealthy seniors to qualify for low- income subsidies, as has been claimed. The bill will raise the asset test from $4,000 to just under $8,000 for individuals. And it will raise the asset test from $6,000 to $12,000 for couples. The bill will give more seniors with very limited means the ability to qualify for additional subsidies. The income cut-offs to qualify for the subsidies will remain the same. Beneficiaries will need to have incomes below $10,200 for the Qualified Medicare Beneficiaries Program, and below $12,500 for the Specified Low-Income Medicare Beneficiaries Program. That is under current law, no change. I think we all would agree that anyone with an annual income below $12,500 and personal assets below $8,000 is someone we should want to help. And if we can get the 60 votes to get to this bill, I will do something else. I will offer an amendment to delay implementation of the competitive bidding program for durable medical equipment. That is a pledge that I made to many of my colleagues, and it is a pledge that I make publicly, a promise I intend to keep. I will offer as an amendment the language of the bipartisan bill introduced earlier today in the House by Representatives Stark, Camp, Boehner, and Pallone. Their bill is thoughtful, it is balanced, and it responds to many of the concerns we have all heard from the DME industry. If we get to this Medicare bill, we will include that language in this bill. Another policy in S. 3101 that I intend to revisit is oxygen cuts. Congress needs to address overpayments to oxygen. In some cases, Medicare pays 1,000 percent above what these supplies cost, and beneficiaries pay the price through inflated copayment rates. But this is a limited bill. It is not intended to fix all that ails Medicare. We will revisit oxygen payments when the Congress next takes up Medicare. By my estimate, that would be next fall when the 18-month physician fix and other policies will expire. In sum, time is running out. It is running short. We need to complete a bill by June 30. That is not many days away. The options before us are few and fraught with pitfalls. By far, the best option for getting a Medicare bill done this year is a bill on which we will vote today. This bill is bipartisan. It is carefully balanced. It does what we need to do. I urge my colleagues to vote for cloture on the motion to proceed.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, George Bernard Shaw once said: ``If all economists were laid end to end, they would not reach a conclusion.'' Sometimes I feel the same about legislation to extend expiring tax provisions. Sometimes it feels as though that process never reaches a conclusion. Regrettably, Tuesday, the Senate failed to invoke cloture on the motion to proceed to the House-passed renewable energy and tax extenders bill. Today, we must begin anew the march to a conclusion for the tax extenders package. Next week, the Senate will face a choice. We'll vote again on getting to the tax extenders bill. We'll vote on allowing the Senate to get to the substitute amendment, the text of which I introduce today. I think that it's a pretty easy choice. We need to decide whether we will develop new jobs and new medications. Or, we can continue to allow hedge fund managers to defer, without limitation, their compensation for investing other people's money. The choice is easy. We must pass this package of expiring provisions. We must reach a conclusion. Last month, the House passed its renewable energy and tax extenders package, by a vote of 263 to 160. It came over to the Senate last week. My Colleagues on the other side of the aisle objected to moving to the House bill, for which I was prepared to offer a substitute amendment. Today, I am introducing that substitute amendment as a stand-alone bill. This extender package is fully paid-for. These offsets are fiscally responsible. And these revenue-raising provisions are also sound tax policy. The first revenue-raising provision is an extension of the effective date of the worldwide allocation of interest. The bill would delay application of the new rule. This section of the code is scheduled to take effect in 2009. Many of the companies that will benefit from this provision told me that they would rather have business extenders, including R&D, active financing, and CFC look-through. They prefer those important extenders to a 2009 application of the world wide allocation of interest. These companies want a conclusion. And, they realize that to get a conclusion, they, along with Congress, must be fiscally responsible and pay for these provisions. This provision allows Congress to be fiscally responsible and to pay for the priorities of the business community. The second revenue-raising provision addresses offshore deferred compensation. This provision prevents hedge fund managers from deferring income. This is not an increase in tax on hedge fund managers. Rather, it is a change in the timing of when they have to pay their income tax. We need to make decisions about our priorities. Is the ability of hedge fund managers to defer taxation of their compensation more important than spurring research and development? This bill has a solid energy-tax package. It has about $17 billion in incentives for alternative energy, efficiency, and clean coal. This package is important for our environment and energy security. And it's important to facilitate the transition to a carbon-controlled economy. I have been working to get the Congress to pass a good energy-tax package for the better part of a year. At the beginning of last year, the Finance Committee conducted several hearings. Last June, the Committee marked up a bill to bolster investment in clean energy, efficiency, and clean coal. Our bill--a roughly $30 billion package-- passed the Finance Committee with a 15-to-5 vote. The bill included a 5-year extension of the credit for production of renewable electricity. That credit enjoys strong bipartisan support. It included 8-year extensions of credits for solar power. Solar power still needs significant subsidies to compete with fossil-based energy. It included $4 billion in new funds for clean coal tax credits. These credits are needed to demonstrate that coal--which accounts for half of this Nation's electricity--can be burned cleanly. The bill included a new consumer credit for plug-in hybrids. Already prototypes of plug-in hybrids can go a hundred miles on a gallon of gas. The bill included a new credit for cellulosic ethanol. Some experts predict that cellulosic ethanol will become the fuel of the future. Last June's Finance Committee package was largely financed by reducing tax benefits for oil and gas companies. We proposed repealing the manufacturing deduction for oil and gas firms. That raised about $9.4 billion for the package. We proposed a tax on production in the Gulf of Mexico, with credit for the tax provided to companies paying royalties on that production. This raised more than $10 billion. We also proposed tightening the rules on tax credits received by oil and gas companies that pay taxes to overseas jurisdictions. This proposal raised about $3.2 billion. Taken together, these tax changes would have financed about two- thirds of the roughly $30 billion energy-tax package. We argued that the oil and gas offsets were justified, in part because of record-high oil prices. Recall that in 2005, President Bush said, ``With $55 (a barrel) oil we don't need incentives to oil and gas companies to explore.'' When the Finance Committee passed this energy-tax bill, oil traded at $69 a barrel. After moving the bill through the Finance Committee, Senator Grassley and I offered that measure on the Senate floor. We offered it as an amendment to the energy policy bill. But our amendment got 57 votes on the floor, 3 shy of the 60 votes that we needed to break a filibuster. The objections, almost entirely from the other side, were that the bill would increase energy prices. They argued that our bill unreasonably targeted the oil and gas industry. They argued that the package was simply too big. So we went back to the drawing board. In negotiations with the House, we cut the size of the energy package by about a third. We dropped the $10 billion tax on Gulf production. We retained repeal of the manufacturing deduction for large oil and gas firms, and the provision to tighten loopholes on foreign tax credits for oil and gas companies. And we also included nearly $7 billion in offsets from President Bush's own budget proposal. That's right. About one-third of the package that came to the Senate floor in December was offset by items taken directly from proposals offered by President Bush in his 2008 budget. Even though we cut the package by about a third, the bill still maintained meaningful support for alternative energy and efficiency. It included extension of the renewable energy production credit. It included long-term extensions of credits for solar power. It included $2 billion for clean-coal projects. And it included a new consumer incentive for plug-in hybrid cars. It was not as ambitious as the June 2007 Finance Committee bill. But the compromise product that came to the Senate floor in December was a very good package. Nonetheless, the President issued a veto threat on the bill. And 40 Senators followed his lead. On December 12, 2007, the compromise package failed in the Senate by a vote of 59 to 40, just one shy of 60 needed to break yet another filibuster. Faced with the choice of maintaining tax breaks for oil and gas companies and investing in a fledgling alternative energy industry, the Senate minority chose to protect the oil and gas companies. Faced with the choice of investing in green-collar jobs or maintaining the status quo on energy, the minority chose the status quo. Remember the President's assertion that tax breaks were not needed when oil traded at $55 a barrel? Well, when the Senate voted on the energy package on December 13, 2007, oil cost more than $92 a barrel. So where are we now? Vital new energy-tax provisions--such as incentives for plug-in hybrid vehicles--have not become law. Existing incentives--such as those for energy-efficient appliances--have lapsed. And in less than 7 months, many others will lapse, including the renewable energy production credit, solar credits, incentives for efficient buildings, and credits for biofuels. So what do we do about it? To paraphrase Thomas Edison, ``I have not failed. I've just found two ways that won't work.'' I hope that this attempt will work. The bill that I introduce today, and on which I hope the Senate can vote next week, includes a robust energy package. It is very similar to that negotiated with the House last year. It is very similar to the one that got 59 votes in the Senate. Like last year's bills, this package includes long-term extensions of renewable energy credits. It includes major funding for clean coal projects. It includes a new incentive for plug-in hybrids. And it includes extensions of vital incentives to promote energy efficiency. This $17 billion energy package is slightly smaller than last December's. But it's still critically important to our Nation's energy future. There is a key difference between this year's package and last year's: the offsets. In response to criticisms of the oil and gas offsets and the President's veto threat, we have dropped proposals to repeal oil and gas tax breaks. Instead, we have included two offsets that have nothing to do with oil and gas. In fact, they have nothing to do with energy. They are simply good policy. And they have broad support. The bill also extends provisions that offer tax benefits to individuals and businesses. One such provision is the teacher expense deduction. Our schools are in desperate need of repair. Our students don't have the books or supplies they need. Some teachers have taken it upon themselves to use money from their own pockets to provide classroom supplies for their students. In 2005 alone, more than 3.4 million families took the teacher expense deduction. The average salary for a teacher is about $38,000. This says a lot about this profession's dedication to educating America's youth. These teachers work diligently to make sure that America stays competitive in this global economy by educating our children. And yet they pay out of their own pockets for supplies. The least we can do is to help share the cost. Another provision that is important to American families is the qualified tuition deduction. Tuition costs have long been increasing faster than inflation. Parents and students worry about how to cover these escalating costs. 4.4 million families took the qualified tuition deduction in 2005. But the provision expired at the end of 2007. The bill that I introduce today has other important benefits. Millions of families get tax relief from these expiring provisions and will suffer without this legislation. Businesses will also suffer if Congress does not act. Many of the business provisions contained in the extenders package are crucial in allowing U.S.-based multinational corporations to compete effectively in a global economy. America accounts for a third of the world's spending on scientific research and development, ranking first among all countries. This is impressive. But relative to the size of our economy, America is in sixth place. And the trends show that maintaining American leadership in the future depends on increased commitment to research and science. Asia has recognized this. Spending on research and development has increased by 140 percent in China, Korea, and Taiwan. In America, it has increased by only 34 percent. Asia's commitment is already paying off. More than a hundred Fortune 500 companies have opened research centers in India and China. I have visited some of them. I was impressed with the level of skill of the workers I met there. There are workers in other countries who seek coveted research positions. Ireland, Poland, and other European countries would like American corporations to shift their R&D operations to their countries. Some of these countries offer incredible tax and non-tax benefits. Yet our R&D tax credit expired on December 31. American corporations are at a competitive disadvantage. They are unsure if they will be able to obtain the benefit of the credit this year. And they need to plan for the future. We need to pass an extenders package that allows American companies to take the credit as soon as possible. American businesses need the R&D tax credit to compete in a global economy. The R&D tax credit gives companies an incentive to begin or continue research here in America. These jobs pay well and result in the creation of intellectual property. We want these jobs. And we want the intellectual property to be created in our country. American financial services companies successfully compete in world financial markets. We need to make sure, however, that the U.S. tax rules do not change that. This legislation will extend the active financing exception to Subpart F. This provision preserves the international competitiveness of American-based financial services companies. This provision also contains appropriate safeguards to ensure that only truly active businesses benefit. The active financing exception applies to active financial service income earned abroad by American financial services companies or American manufacturing firms with a financial services operation. The exception makes sure that this income is not subject to U.S. tax until that income is brought home to the U.S. This provision will put the American financial services industry on an equal footing with foreign-based competitors who are not taxed on active financial services income. There are several other provisions in this bill that encourage businesses to invest in this country. There are provisions that will help American businesses compete in a global economy. We must extend these provisions as soon as possible. Finally, my bill will provide an AMT patch for 2008. The provision is not offset, because we recognize the reality of the budget constraints we face. We need to get this done. This is an important provision to the American families. The patch will hold the number of people subject to the AMT at 4.2 million. As a result, over 20 million taxpayers will avoid the AMT next year. The choice is easy. We should continue to support teachers, families and schools. We should continue to support the creation of jobs and intellectual property. That is why I urge my Colleagues to support this fully offset package. Which is more important, Mr. President? 11 million families who take the state and local tax deduction, or a few hundred hedge fund managers? Which is more important? 3.5 million teachers who pay out of their pocket for school supplies, or a few hundred hedge fund managers? 4.5 million families who struggle to pay for college tuition, or a few hundred hedge fund managers? It is time to reach a conclusion. You can lay all the extenders bills end to end. But I submit that the best conclusion is the extenders package that I introduce today and that the Senate will try to get to next week. I urge my Colleagues to support the motion to invoke cloture on the motion to proceed. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, George Bernard Shaw once said: ``If all economists were laid end to end, they would not reach a conclusion.'' Sometimes I feel the same about legislation to extend expiring tax provisions. Sometimes it feels as though that process never reaches a conclusion. Regrettably, Tuesday, the Senate failed to invoke cloture on the motion to proceed to the House-passed renewable energy and tax extenders bill. Today, we must begin anew the march to a conclusion for the tax extenders package. Next week, the Senate will face a choice. We'll vote again on getting to the tax extenders bill. We'll vote on allowing the Senate to get to the substitute amendment, the text of which I introduce today. I think that it's a pretty easy choice. We need to decide whether we will develop new jobs and new medications. Or, we can continue to allow hedge fund managers to defer, without limitation, their compensation for investing other people's money. The choice is easy. We must pass this package of expiring provisions. We must reach a conclusion. Last month, the House passed its renewable energy and tax extenders package, by a vote of 263 to 160. It came over to the Senate last week. My Colleagues on the other side of the aisle objected to moving to the House bill, for which I was prepared to offer a substitute amendment. Today, I am introducing that substitute amendment as a stand-alone bill. This extender package is fully paid-for. These offsets are fiscally responsible. And these revenue-raising provisions are also sound tax policy. The first revenue-raising provision is an extension of the effective date of the worldwide allocation of interest. The bill would delay application of the new rule. This section of the code is scheduled to take effect in 2009. Many of the companies that will benefit from this provision told me that they would rather have business extenders, including R&D, active financing, and CFC look-through. They prefer those important extenders to a 2009 application of the world wide allocation of interest. These companies want a conclusion. And, they realize that to get a conclusion, they, along with Congress, must be fiscally responsible and pay for these provisions. This provision allows Congress to be fiscally responsible and to pay for the priorities of the business community. The second revenue-raising provision addresses offshore deferred compensation. This provision prevents hedge fund managers from deferring income. This is not an increase in tax on hedge fund managers. Rather, it is a change in the timing of when they have to pay their income tax. We need to make decisions about our priorities. Is the ability of hedge fund managers to defer taxation of their compensation more important than spurring research and development? This bill has a solid energy-tax package. It has about $17 billion in incentives for alternative energy, efficiency, and clean coal. This package is important for our environment and energy security. And it's important to facilitate the transition to a carbon-controlled economy. I have been working to get the Congress to pass a good energy-tax package for the better part of a year. At the beginning of last year, the Finance Committee conducted several hearings. Last June, the Committee marked up a bill to bolster investment in clean energy, efficiency, and clean coal. Our bill--a roughly $30 billion package-- passed the Finance Committee with a 15-to-5 vote. The bill included a 5-year extension of the credit for production of renewable electricity. That credit enjoys strong bipartisan support. It included 8-year extensions of credits for solar power. Solar power still needs significant subsidies to compete with fossil-based energy. It included $4 billion in new funds for clean coal tax credits. These credits are needed to demonstrate that coal--which accounts for half of this Nation's electricity--can be burned cleanly. The bill included a new consumer credit for plug-in hybrids. Already prototypes of plug-in hybrids can go a hundred miles on a gallon of gas. The bill included a new credit for cellulosic ethanol. Some experts predict that cellulosic ethanol will become the fuel of the future. Last June's Finance Committee package was largely financed by reducing tax benefits for oil and gas companies. We proposed repealing the manufacturing deduction for oil and gas firms. That raised about $9.4 billion for the package. We proposed a tax on production in the Gulf of Mexico, with credit for the tax provided to companies paying royalties on that production. This raised more than $10 billion. We also proposed tightening the rules on tax credits received by oil and gas companies that pay taxes to overseas jurisdictions. This proposal raised about $3.2 billion. Taken together, these tax changes would have financed about two- thirds of the roughly $30 billion energy-tax package. We argued that the oil and gas offsets were justified, in part because of record-high oil prices. Recall that in 2005, President Bush said, ``With $55 (a barrel) oil we don't need incentives to oil and gas companies to explore.'' When the Finance Committee passed this energy-tax bill, oil traded at $69 a barrel. After moving the bill through the Finance Committee, Senator Grassley and I offered that measure on the Senate floor. We offered it as an amendment to the energy policy bill. But our amendment got 57 votes on the floor, 3 shy of the 60 votes that we needed to break a filibuster. The objections, almost entirely from the other side, were that the bill would increase energy prices. They argued that our bill unreasonably targeted the oil and gas industry. They argued that the package was simply too big. So we went back to the drawing board. In negotiations with the House, we cut the size of the energy package by about a third. We dropped the $10 billion tax on Gulf production. We retained repeal of the manufacturing deduction for large oil and gas firms, and the provision to tighten loopholes on foreign tax credits for oil and gas companies. And we also included nearly $7 billion in offsets from President Bush's own budget proposal. That's right. About one-third of the package that came to the Senate floor in December was offset by items taken directly from proposals offered by President Bush in his 2008 budget. Even though we cut the package by about a third, the bill still maintained meaningful support for alternative energy and efficiency. It included extension of the renewable energy production credit. It included long-term extensions of credits for solar power. It included $2 billion for clean-coal projects. And it included a new consumer incentive for plug-in hybrid cars. It was not as ambitious as the June 2007 Finance Committee bill. But the compromise product that came to the Senate floor in December was a very good package. Nonetheless, the President issued a veto threat on the bill. And 40 Senators followed his lead. On December 12, 2007, the compromise package failed in the Senate by a vote of 59 to 40, just one shy of 60 needed to break yet another filibuster. Faced with the choice of maintaining tax breaks for oil and gas companies and investing in a fledgling alternative energy industry, the Senate minority chose to protect the oil and gas companies. Faced with the choice of investing in green-collar jobs or maintaining the status quo on energy, the minority chose the status quo. Remember the President's assertion that tax breaks were not needed when oil traded at $55 a barrel? Well, when the Senate voted on the energy package on December 13, 2007, oil cost more than $92 a barrel. So where are we now? Vital new energy-tax provisions--such as incentives for plug-in hybrid vehicles--have not become law. Existing incentives--such as those for energy-efficient appliances--have lapsed. And in less than 7 months, many others will lapse, including the renewable energy production credit, solar credits, incentives for efficient buildings, and credits for biofuels. So what do we do about it? To paraphrase Thomas Edison, ``I have not failed. I've just found two ways that won't work.'' I hope that this attempt will work. The bill that I introduce today, and on which I hope the Senate can vote next week, includes a robust energy package. It is very similar to that negotiated with the House last year. It is very similar to the one that got 59 votes in the Senate. Like last year's bills, this package includes long-term extensions of renewable energy credits. It includes major funding for clean coal projects. It includes a new incentive for plug-in hybrids. And it includes extensions of vital incentives to promote energy efficiency. This $17 billion energy package is slightly smaller than last December's. But it's still critically important to our Nation's energy future. There is a key difference between this year's package and last year's: the offsets. In response to criticisms of the oil and gas offsets and the President's veto threat, we have dropped proposals to repeal oil and gas tax breaks. Instead, we have included two offsets that have nothing to do with oil and gas. In fact, they have nothing to do with energy. They are simply good policy. And they have broad support. The bill also extends provisions that offer tax benefits to individuals and businesses. One such provision is the teacher expense deduction. Our schools are in desperate need of repair. Our students don't have the books or supplies they need. Some teachers have taken it upon themselves to use money from their own pockets to provide classroom supplies for their students. In 2005 alone, more than 3.4 million families took the teacher expense deduction. The average salary for a teacher is about $38,000. This says a lot about this profession's dedication to educating America's youth. These teachers work diligently to make sure that America stays competitive in this global economy by educating our children. And yet they pay out of their own pockets for supplies. The least we can do is to help share the cost. Another provision that is important to American families is the qualified tuition deduction. Tuition costs have long been increasing faster than inflation. Parents and students worry about how to cover these escalating costs. 4.4 million families took the qualified tuition deduction in 2005. But the provision expired at the end of 2007. The bill that I introduce today has other important benefits. Millions of families get tax relief from these expiring provisions and will suffer without this legislation. Businesses will also suffer if Congress does not act. Many of the business provisions contained in the extenders package are crucial in allowing U.S.-based multinational corporations to compete effectively in a global economy. America accounts for a third of the world's spending on scientific research and development, ranking first among all countries. This is impressive. But relative to the size of our economy, America is in sixth place. And the trends show that maintaining American leadership in the future depends on increased commitment to research and science. Asia has recognized this. Spending on research and development has increased by 140 percent in China, Korea, and Taiwan. In America, it has increased by only 34 percent. Asia's commitment is already paying off. More than a hundred Fortune 500 companies have opened research centers in India and China. I have visited some of them. I was impressed with the level of skill of the workers I met there. There are workers in other countries who seek coveted research positions. Ireland, Poland, and other European countries would like American corporations to shift their R&D operations to their countries. Some of these countries offer incredible tax and non-tax benefits. Yet our R&D tax credit expired on December 31. American corporations are at a competitive disadvantage. They are unsure if they will be able to obtain the benefit of the credit this year. And they need to plan for the future. We need to pass an extenders package that allows American companies to take the credit as soon as possible. American businesses need the R&D tax credit to compete in a global economy. The R&D tax credit gives companies an incentive to begin or continue research here in America. These jobs pay well and result in the creation of intellectual property. We want these jobs. And we want the intellectual property to be created in our country. American financial services companies successfully compete in world financial markets. We need to make sure, however, that the U.S. tax rules do not change that. This legislation will extend the active financing exception to Subpart F. This provision preserves the international competitiveness of American-based financial services companies. This provision also contains appropriate safeguards to ensure that only truly active businesses benefit. The active financing exception applies to active financial service income earned abroad by American financial services companies or American manufacturing firms with a financial services operation. The exception makes sure that this income is not subject to U.S. tax until that income is brought home to the U.S. This provision will put the American financial services industry on an equal footing with foreign-based competitors who are not taxed on active financial services income. There are several other provisions in this bill that encourage businesses to invest in this country. There are provisions that will help American businesses compete in a global economy. We must extend these provisions as soon as possible. Finally, my bill will provide an AMT patch for 2008. The provision is not offset, because we recognize the reality of the budget constraints we face. We need to get this done. This is an important provision to the American families. The patch will hold the number of people subject to the AMT at 4.2 million. As a result, over 20 million taxpayers will avoid the AMT next year. The choice is easy. We should continue to support teachers, families and schools. We should continue to support the creation of jobs and intellectual property. That is why I urge my Colleagues to support this fully offset package. Which is more important, Mr. President? 11 million families who take the state and local tax deduction, or a few hundred hedge fund managers? Which is more important? 3.5 million teachers who pay out of their pocket for school supplies, or a few hundred hedge fund managers? 4.5 million families who struggle to pay for college tuition, or a few hundred hedge fund managers? It is time to reach a conclusion. You can lay all the extenders bills end to end. But I submit that the best conclusion is the extenders package that I introduce today and that the Senate will try to get to next week. I urge my Colleagues to support the motion to invoke cloture on the motion to proceed. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I rise to urge passage of S. 3101, the Medicare Improvements for Patients and Providers Act. This is the right bill for America's seniors and the health care providers who treat them. It is a balanced bill, and it enjoys strong bipartisan support. It hasn't been easy to get to this point. I have engaged in earnest negotiations with Senator Grassley, Minority Leader McConnell, and the administration to reach a compromise on this bill. After several weeks of talks, it became clear that we would not be able to reach agreement on a bill that is fair to both rural and urban areas, and that balances the need to help America's seniors with the need to address the pending payment cut for Medicare providers. So I have worked with Democrats and willing Republicans to craft this legislation, the right legislation, and I urge all Senators to enthusiastically support it. There is urgency in this call for support. We must act now to block the cuts that Medicare's doctors will face on July 1. This legislation gives doctors a decent, measured increase in reimbursement that doesn't explode costs or excessively raise premiums. It includes provisions to improve the quality of care that is provided and, as is so urgently needed, increases access to primary care. It will also save lives and reduce costs by requiring doctors to use e-prescribing by 2011 whenever they give Medicare patients prescriptions. But the legislation goes further. It also takes care of America's seniors. First, it expands access to preventive services. Preventive care can identify health problems before they become health catastrophes. To help beneficiaries identify medical conditions and risk factors early, this bill allows new preventive services to be added to the program, so long as they are recommended by the U.S. Preventive Services Task Force and are approved through regular regulatory channels. Second, the bill finally gets rid of the discriminatory copayment rates for seniors with mental illnesses. Many older Americans experience depression and other mental health problems, but Medicare currently requires a much higher copayment for mental health services. That copayment is 50 percent, compared to the 20 percent required for physical health care services. This legislation lowers copayments for seniors' mental health services until they match other copays, making sure that seniors can afford the screening and treatment they need. The bill also expands the drug benefit's coverage to include benzodiazepines and barbiturates used for epilepsy and mental health treatment. Third, for low-income seniors this act expands programs that help with their out-of-pocket costs. Medicare pays many health costs for seniors, but some low-income beneficiaries need extra help to afford even basic care. And although subsidies are available through the Medicare Savings Programs, or MSPs, beneficiaries must prove their assets are low enough to qualify. The assets test for these programs has not been raised since 1989-- even though the cost of living, and certainly the cost of medical care, have increased astronomically since then. The bill takes an important step to improve access for these beneficiaries by increasing the level of savings that MSP applicants may have and still qualify for help. We also discount the value of life insurance policies and financial help from churches or family members from counting against a senior's eligibility for assistance. Fourth, this bill protects seniors from unscrupulous marketing practices by private health plans. Countless reports have surfaced about aggressive, fraudulent and even abusive sales and marketing practices used by Medicare Advantage plans, the private plan option in Medicare. This legislation builds on the CMS-proposed rule to ban abusive marketing of Medicare Advantage and other plans once and for all. Marketing abuses are extensive. This legislation stops that. The Medicare Improvements for Patients and Providers Act takes important steps to shore up our health care system in rural areas. It ensures that hospitals in these areas get the resources they need to keep their doors open, and expands access to tele-health services. It also includes important relief for ambulance providers and physicians serving rural areas. Pharmacy payments are another area where the legislation makes important improvements. Pharmacies are an integral part of the health care infrastructure in America. Prescription drugs play a huge role in medical treatment, and many people see their pharmacists more regularly than their physicians. Pharmacists are also vital to the ongoing success of the Part D prescription drug benefit. Changes in this bill, including fairer and more timely payments to those who dispense drugs to our nation's senior citizens, can make the benefit work better for pharmacists, and thereby for seniors. Furthermore, this act would save valuable Medicare dollars by providing one, fully bundled payment for all end-stage renal disease- related services. This will improve the quality of care these vulnerable beneficiaries receive by balancing incentives and instituting a rigorous quality improvement program. And, for the first time, dialysis facilities will receive a permanent, market-based update to their payments each year, to make sure that Medicare payments keep up with their costs. One of the questions I am asked most about is how this bill would address Medicare Advantage payments. Federal spending for private Medicare Advantage, MA, benefit plans, including health maintenance organizations, preferred provider organizations, and private fee-for-service plans, has grown rapidly since Congress increased payments for MA in the Medicare Modernization Act of 2003. CBO tells us that the Federal Government will pay these private plans $74 billion in 2008, at a rate 13 percent higher than traditional Medicare fee-for-service providers receive. In sum, every Medicare beneficiary in the country, regardless of whether they are enrolled in an MA plan or remain in traditional fee for service, will pay $2 extra per month to subsidize these extra payment rates. Private fee-for-service plans, in particular, get a special deal that costs taxpayers and beneficiaries alike. The law doesn't require these plans to sign contracts with hospitals or doctors, rather, providers are ``deemed'' part of the network. And plans can pay these providers 100 percent of traditional fee-for- service rates even as they receive 117 percent of that rate in reimbursement from Medicare. They are also exempt from reporting quality measures that all other plans must report. In other words, they have a good deal. Too good of a deal. Another, and just as obvious, example of how Medicare pays these plans too much is the double payment for indirect medical education, IME. So-called IME payments are intended to defray the higher patient care costs at facilities with graduate medical education programs. But these payments are made twice: once to the facility itself, and again to Medicare Advantage plans, with no requirement that plans pass the IME funding along to teaching hospitals. This bill will save taxpayers $13 billion over 5 years by requiring private-fee-for-service plans to form provider networks and eliminating the double payment for IME to MA plans.

Mr. BAUCUS. I ask unanimous consent to speak for an additional 3 minutes.

Mr. BAUCUS. It will also require private fee-for-service plans to report on quality measures like other plans are required to do. Some in the Senate, and many in the Bush administration, oppose any reforms to private fee-for-service plans. They oppose protecting beneficiaries from private plans' unscrupulous marketing practices. Just as regretfully, they oppose expanding access that poor seniors have to assistance with their out-of-pocket costs, and to evidence- based preventive services. So now we in the Congress have a choice. We can protect private health insurance plans. We can leave low-income beneficiaries behind. We can neglect our obligations to ensure that the Medicare program works for all seniors or we can do the right thing. We can pass meaningful, bipartisan Medicare legislation that, yes, blocks the cuts to physician payments, which is absolutely crucial, but which does so much more, that brings much-needed relief to rural areas, improves quality, and cuts costs in the appropriate places. That is what we ought to do. That is what America's seniors deserve. I urge my colleagues to support passage of this balanced legislation.

Mr. BAUCUS. I yield back the remainder of my time.