Mike Crapo

Mr. CRAPO

Mr. CRAPO. Yes. As a matter of fact, in my own mind, I distinguish between taxes on the American people and fees that will be charged to companies and businesses in the private sector that are also being passed on to the American people. All of those will occur. One interesting clarification or explanation with regard to this refundable tax credit that is talked about so often: it isn't actually refunded to the taxpayer, as I understand it, or to the individual who doesn't pay taxes but is receiving the credit. It is paid directly to the insurance company, as I understand it. So even though some people could be claimed to be paying less taxes by this argument, because some of those who receive the subsidy will get a greater subsidy than they will a tax increase, the fact is even they still get a tax increase and even they still pay their taxes at the higher level. It is just that some of them will get a subsidy that will help to offset that.

Mr. CRAPO. Mr. President, I thank my colleagues for their comments. How much time remains on our side?

Mr. CRAPO. I will make a couple of other comments, and I will allow my colleagues to wrap up with their final comments. I want to raise an additional issue. On this chart, we show what is going to happen with the IRS. Right now, the CBO estimate indicates that because the IRS is in charge of the implementation of so many of the mandates and other requirements in this bill and because of the new taxes that will be forced onto the American people, there will need to be an expansion of the IRS. The CBO says that could mean as high as an additional $10 billion at the IRS. If there are no new taxes in this bill or no new mandates in the bill, if there is no increased role of the Federal Government in the management of the health care economy in this bill, why do we need to have the size of the IRS, which is a $12 billion institution today--why does it need to grow to almost double, up to $22 billion? The point is, the motion I have made is very simple and straightforward. We can argue back and forth about what the President said or whether this bill has tax cuts or tax increases in it or whether, in the net result, it does one thing or another. The bottom line is, with regard to about 157 million Americans who get their health insurance through their employer, by 2019, they are not going to be eligible for these tax credits people are talking about. They are going to be paying increased taxes. All this motion does is protect those 42 million people we were talking about who are going to see their taxes go up; 42 million households will see their taxes go up. If the other side is right and what we are talking about does not exist in the bill, then this motion should be harmless because all the motion says is commit the bill to the Finance Committee and tell the Finance Committee to take out the taxes that impact the middle class. I ask if either of my colleagues from Nebraska or Tennessee would like to make any concluding remarks.

Mr. CRAPO. Mr. President, I ask unanimous consent to speak for up to 20 minutes.

Mr. CRAPO. Mr. President, will the Senator yield for a question?

Mr. CRAPO. Mr. President, I ask unanimous consent to speak, as well as engage in a colloquy with several of my colleagues.

Mr. CRAPO. I will yield on the Senator's time.

Mr. CRAPO. There is a payroll tax. There is.

Mr. CRAPO. Reclaiming my time, although people do pay a lot of sales taxes--not Federal sales taxes, by the way--and although people do pay a lot of other types of taxes, they will pay penalties and fees--in fact, under this bill they will be paying a lot more taxes. The reality is I don't think that is what President Obama was talking about. When he made his pledge, I think his words were: ``You will not see any of your taxes go up.'' The bottom line is you can't say, well, if you offset this tax and you don't count the sales tax or if you add in the sales tax to counteract it--that is not what the President was talking about. Once again, as Joint Tax has said, by 2019 individuals making between $50,000 and $200,000 on average would see a tax increase of $590,000, and families making between $75,000 and $200,000 would see a net increase on average of $670,000. Let's go to the next chart. I note my colleague from Tennessee is here. If he would like to step in at any time, please feel free. I just have two other charts to show, and then I will toss the floor to the Senator. I see he has, I think, a question brewing. In the analysis that was done by the Joint Tax Committee, by 2019, these people whose taxes I have just described who are squarely in the middle class, there will be at least 73 million American households-- that is not individuals, that is households--73 million American households earning below the $200,000 that will face a tax increase. Sometimes the proponents of this bill say, well, that doesn't net out the subsidies we are providing to some of them. If you net out the subsidies--and I don't think that is necessarily an argument, but if you do net out the subsidies--it is still at least 42 million American households that will see their taxes increase under this legislation. How can that comply with the President's promise? All the motion I have brought does is say to commit this bill to the Finance Committee and make the bill fit the President's pledge. The President pledged that people in the middle class, which he defined as families making less than $250,000 or individuals making less than $200,000, would not see their taxes go up. With that, again, I see my colleague from Tennessee is ready to join in with me, and I would ask if he has any comments or questions to raise.

Mr. CRAPO. Thank you, Mr. President. Before I begin my remarks, I would like to yield a couple minutes to my friend and colleague from Oklahoma who would like to respond to the question that has been raised as to whether the Republicans are presenting reliable, meaningful, and comprehensive alternatives.

Mr. CRAPO. I thank my friend from Oklahoma because it is frustrating sometimes to have it continuously said that there are no alternatives being put forward when we have for years promoted major and comprehensive alternatives to the kinds of issues Americans are asking us to address today. What is it that Americans are asking? I have said this many times on the floor. Americans are asking us to find a pathway to lower health care premiums and costs and to increase access to better quality health care. Yet what is it that we are being faced with in this legislation? This bill drives up the cost of health care, not down, contrary to claims that have been made on the floor repeatedly; raises taxes by hundreds of billions of dollars; cuts Medicare by hundreds of billions of dollars; grows the government by $2.5 trillion; forces the needy uninsured--it doesn't give them a pathway toward subsidized insurance or any access to insurance but instead forces them into a failing Medicaid Program; imposes damaging unfunded mandates on the struggling States; leaves millions of Americans still uninsured; and establishes massive government controls over our health care economy. And we wonder why we cannot get engaged in a meaningful bipartisan solution here with this kind of heavy-handed approach being insisted upon. When I talk about the fact that it raises the costs or the size of government, often the response is: No, this bill doesn't raise the size of government, it doesn't increase the size of government, it is balanced. Actually, CBO has issued a report that says it reduces the deficit. Well, the fact is it grows the size of government over a true 10-year period by $2.5 trillion. It does provide some increased taxes-- a lot--and it does cut Medicare. By doing so, it does reach an equilibrium, according to CBO, with regard to its impact on the deficit. But let's not mistake this deficit with the size of the government. This bill will grow the size of the government and the reach of the government by $2.5 trillion. With regard to the question as to whether it truly impacts the deficit, I think most Americans have already heard that there are some budget gimmicks here. You could not ever claim this bill doesn't increase the deficit unless you had all the taxes I am going to talk about in a minute and unless you had all of the Medicare cuts we have been talking about for the last week, and unless you had the budget gimmicks that are in the bill. The budget gimmicks are clearly depicted right here. Look at the first 4 years of this bill on the spending side: very little, if any, spending. The actual implementation of the spending part of the bill doesn't happen until 2014, but all the taxes start in the first year, and all the Medicare cuts come into place in the first year, and we start seeing the offset side of the bill run for a full 10 years. It is going to be easy to say you have balanced out spending and taxing if you don't count the spending for the first 4 years. But if you look at that first true 10-year period of time, it is a growth of the government by $2.5 trillion. What I am here today to talk about is my motion that is on the floor to do one very simple thing: to commit this bill back to the Finance Committee and have the Finance Committee make the bill comply with the President's pledge to the American people about taxes. And what was his pledge, repeated many times across this country? In the President's own words: I can make a firm pledge . . . no family making less than $250,000 will see their taxes increase . . . not your income taxes, not your payroll taxes, not your capital gains taxes, not any of your taxes . . . you will not see any of your taxes increase one single dime. That was the rhetoric. That was the pledge. What is the reality of the bill? In its first 10 years, the bill raises taxes by $495 billion. If you take that 10-year window that starts in 2014 where you are comparing spending and taxing at the same time, the total of taxes in that 10-year window is $1.2 trillion of new taxes, a huge proportion of which falls squarely on the backs of the middle class whom President Obama has defined here to be those earning less than $250,000, and that is per family. He said under $200,000 per individual. What are some of these taxes we are talking about? First, there is the excise tax on high-cost premium plans. One might say, wait a minute, that is a tax on companies, employers who provide very high quality insurance to their employees. It is an ingenious way--it is technically written that way--but it is an ingenious way to actually increase the cost, the tax base, of the workers and not the employer. Let's see the first chart. The way this works is the government will now say to an employer: You cannot provide health insurance to your employees that is worth more than a certain amount. Most employees who get health insurance--and that is most employees in the country who get health insurance from their employer--get wages and health care as a part of their total employment package. I picked an example of a woman who receives $50,000 in wages and let's assume a $10,000 employer-provided health care benefit. The government is now going to say wait a minute, to her employer; we are going to tax you if you provide that health care benefit on such a robust level. CBO and Joint Tax have told us that the reaction of the vast majority of all employers is going to be to reduce the health care benefit down below the level that gets taxed. They are not going to reduce the employee's overall benefit, however, their overall employment package. So let's pick a number. Let's say they reduce this $10,000 down to $7,000. They will increase the wages by $3,000 and the employee's total compensation package stays the same: $60,000, with one difference. Now that extra $3,000 is wages instead of health care, and it gets taxed. And that way the individuals in this country see their health care values go down. Their total compensation package stays the same, but then gets also reduced as it is taxed, and our Joint Tax Committee and CBO have told us that 84 percent of this $149 billion new tax is going to be borne by those with incomes under $200,000. That is one way this bill ingeniously gets at the pocketbook of those making less money than the $200,000 or $250,000 as a family that the President talks about. What is the next way? Medical deductions. I think everybody in America who itemizes deductions knows about the first line that says you can itemize your medical expenses, and to the extent they exceed 7.5 percent, you can deduct those medical expenses. So people who have a large proportion of their income represented by medical costs get a break in the Tax Code for that deduction. Well, that break is now going to be smaller under this bill because the level of where you are able to get it is no longer going to be 7.5 percent, it will be 10 percent. And as I indicated, that 84 percent of the excise tax is going to fall on people making less than $200,000 a year. Ninety-nine percent of the medical deduction restriction will fall on people making less than $200,000 a year; as a matter of fact, making a lot less than $200,000 per year. Then what about the next one? The next major tax in the bill is the Medicare payroll tax. This one has been presented to the American public as a tax on rich people. It starts out primarily impacting people at the higher levels, but at the outset, it will already hit 345,000 Americans, and it is not adjusted--I think most people understand how the alternative minimum tax works today. It is not adjusted for inflation properly. So over time, the payroll tax itself is going to increasingly hit more and more people in that income category under $200,000. There has been some analysis on these three provisions in the bill. Joint Tax has indicated that by the year 2019, at least--and I say at least because we are only talking about three provisions in this bill right now, and there are more--73 million American households--not individuals, households--73 million American households earning below $200,000 that are going to face a tax increase. Some have responded to this by saying, Wait a minute. Our bill actually cuts taxes and you are not characterizing this fairly. The tax cuts they are talking about are primarily a $394 billion government subsidy for purchase of health insurance, a subsidy that will be administered through the Tax Code. What they don't tell you is that $288,000 of this so-called tax cut is nothing other than a direct government payment to those who don't pay any taxes today anyway. It is not reducing their tax liability; they have no tax liability. It is a direct government subsidy, and CBO says so. It is scored by CBO not as tax relief; it is scored by CBO as direct government spending. To characterize that as tax relief I believe is inaccurate. Moreover, even if it were true tax relief, is that what the President was saying, that I won't raise your taxes more than I will lower someone else's or was he saying to the American people that he would not raise taxes on people who are making less than $200,000 a year, or $250,000 as a family? I believe it is inherently obvious what the President was saying. And to say now that we are cutting somebody else's taxes so we can raise yours does not comply with the President's pledge. To give another couple of perspectives on this in terms of numbers, when all is said and done, 7 percent of Americans will get this so- called tax relief that is, in reality, direct Federal spending, and the rest of Americans--specifically, those who don't fall in that category--will get the tax increases. Out of 282 million Americans with some kind of health insurance today, only 19 million of them will be helped by this subsidy. The rest are going to fall into that category of those who get to share in the burden by seeing their taxes increase. But let's say we give credit for all of these arguments and say, All right, we will let you claim that all of this spending is tax relief. What is the true story then? Even if you give that argument, which is not valid, by 2019, there will still be at least 42 million American households earning below $200,000 that will face a tax increase. This is information from the Joint Committee on Taxation. In fact, the data there is rather interesting. Joint Tax data indicates that by 2019, individuals earning between $50,000 and $200,000 on average will see an increase in their taxes of $593. Families earning between $75,000 and $200,000 will see on average a net tax increase of $670. So what does my amendment do? My amendment says very simply that the bill will be committed back to the Finance Committee and that the provisions in the bill that violate the President's pledge should be removed. Simply make the bill comply with the President's pledge. The President, frankly, shouldn't sign this bill unless this amendment is passed and implemented, because that is the direction we need to go. Once again, the President's pledge is that no family making less than $250,000 is going to see their taxes increased. There is further information available about this, though. I recently sent a letter to the Joint Tax Committee. I recently sent a letter to the Joint Tax Committee asking them about whether there were other provisions in the bill other than these three--the reason I talked about these three taxes is because those three taxes have been analyzed by Joint Tax and it is Joint Tax that is telling us what they are going to do. In response to my letter saying are there more taxes in the bill than those you have analyzed, the answer has come back, yes, and below, they say, is a list of the provisions that they have not previously distributed and that have statutory incidence on individuals with those who fall below the income threshold which has been defined already. What are these taxes? There is a confirmed definition of medical expenses for health savings accounts. In other words, the reduction of benefits in health savings accounts will have an impact, and I believe that impact is about $1.5 billion. The increased penalty for nonqualified health savings account distributions and limitations on flexible spending arrangements will raise almost $15 billion. Most of this--although we don't have the data yet from Joint Tax--most of this comes from families below the income tax threshold, as well as the 5 percent excise tax on cosmetic surgery and similar procedures and the individual mandate in the bill that will force all Americans to purchase insurance or the IRS will come and collect a fee from them. I don't have the chart here that shows what will happen with the IRS, but think for a minute. The current size of the IRS is about $12 billion in terms of the appropriations we give them to perform their functions. CBO says that if this bill passes, there will be so much additional business for the IRS in monitoring health care and the new plans and programs in the bill, there will have to be at least another $5 billion and maybe a $10 billion increase in the size of the IRS just so it can implement its enforcement responsibilities under this bill. The bottom line is that the President of the United States, Barack Obama, has made a pledge. It was that pledge, among a number of others--such as ``if you like what you have, you can keep it''--that caused us to see a strong low-confidence level by the American people, and maybe it is time for Congress to truly dig in and build a strong health care reform package. That pledge is being squarely broken by this bill. Again, all we are asking in this amendment is to send the bill back to the Finance Committee and have the Finance Committee make the bill conform to the President's pledge. What that will mean to the American people is that in the first 10 years of the bill, just under $500 billion of new taxes will not be imposed, and over the true first 10- year period, when the spending starts kicking in, $1.2 trillion worth of taxes will not be imposed. There are many other issues with this bill that we have seen discussed. There is the question of whether it truly increases the cost of premiums in health care. Virtually 10 out of 11 studies say that it does. The CBO report says that, clearly, for 30 percent of Americans, it does it in major ways, and for the other 60 percent, the impact is marginal, or the status quo. As we move forward, some of these big problems with the bill need to be fixed. My motion focuses on taxes. We have debated Medicare for some time now. We need to talk about the unfunded mandates on the States. We need to talk about the impact on premiums in health care because we don't want to be passing legislation that drives up the cost of health care at a time when that is the primary purpose for people calling for health care reform. I urge my colleagues to let us step down for a moment from the intensity of the debate, commit this bill to the Finance Committee, and let's, on a bipartisan basis, work out some of the solutions to these problems and do so in a way that does not result in such a massive growth of our Federal Government, such a massive increase in taxes, such a massive unfunded deficit on the States, and all for no control of cost or health care premiums. With that, I yield back the remainder of the time I requested.

Mr. CRAPO

Mr. CRAPO. Madam President, I have a motion at the desk which I wish to call up and ask for its immediate consideration.

Mr. CRAPO. Mr. President, I rise today to discuss the Medicare Advantage Program again. It is one that is facing nearly $120 billion in cuts under the Democratic health care bill. Currently, there are nearly 11 million seniors enrolled in Medicare Advantage, which is about one out of every four seniors in the United States. In my home State of Idaho, that is about 60,000 people or 27 percent of all Medicare beneficiaries in the State. Medicare Advantage is an extremely popular program. In fact, it is probably the most popular and fastest growing part of Medicare. A 2007 study reported high overall satisfaction with the Medicare Advantage Program. Eighty-four percent of the respondents said they were happy with their coverage, and 75 percent would recommend Medicare Advantage to their friends or family members. But despite the popularity of the program, the massive cuts in the Reid bill will result in most seniors losing benefits or coverage or both under Medicare Advantage. I have a chart in the Chamber which I have shown before. You cannot see the individual States too well on it from this distance at this size, but you can see the coloring on the United States in this chart. If you live in a State that is red, deep red, or the pinkish color-- which is almost every State in the Union--then you are going to see your benefits cut under Medicare Advantage under this bill. Why am I bringing it up again? We have already had a vote on it. In fact, we have had two votes on it. The majority has insisted on keeping these cuts in the bill. The reason I am bringing it up again is because, as we have combed through this 2,074-page bill, we have found out there is a provision in the Reid bill that would protect Medicare Advantage benefits for some people in the United States, for just a few in this country. During the Finance Committee markup, Senator Bill Nelson of Florida advocated on behalf of Medicare Advantage and the beneficiaries in his home State of Florida. Subsequently, during closed-door negotiations, the legislative language was added to protect those beneficiaries. This is interesting because one of the responses to us, as we have tried to stop the imposition of these cuts to Medicare, has been this bill will not cut any Medicare benefits. Well, if not, then why does Florida need a special exemption for its citizens? If not, why not support the McCain amendment that would give the same protection to all Medicare Advantage beneficiaries that the bill gives to primarily just a few in Florida? Specifically, section 3201(g) of the Reid bill, very deep in the bill on page 894, has a $5 billion provision drafted to prevent the drastic cuts in the Medicare Advantage Program from impacting those enrollees who reside primarily in three counties in Florida: Broward, Miami-Dade, and Palm Beach. It seems unfair that taxpayers would foot a $5 billion provision that provides protection for only some of the Medicare Advantage beneficiaries. It certainly proves there are cuts to Medicare Advantage benefits in this bill; again, benefits that one out of four beneficiaries in America receives--one of the fastest, if not the fastest, growing parts of Medicare. Instead of preferential treatment for some, why not extend these same protections for Medicare Advantage to all beneficiaries under Medicare? I know the 60,000 Medicare beneficiaries on Medicare Advantage in Idaho, my home State, want and deserve that same level of protection. That is why I am here to support the McCain motion to commit, and that is what his motion to commit would accomplish, very plain and very simple. The McCain motion would extend this grandfathering provision to all beneficiaries in the Medicare Advantage Program so all seniors in this popular and successful program could maintain that same level of benefits that today they enjoy under the current law. Every senior in the Medicare Advantage Program deserves to keep these critical extra benefits, which include things such as dental protection, vision coverage, preventive and wellness services, flu shots, and much more. In fact, most people who are not on Medicare Advantage in the Medicare Program have to buy supplemental insurance to get access to this coverage. Those in Medicare Advantage, which is one of the reasons it is such a popular program, have the opportunity to get it through their Medicaid services. Why is Medicare Advantage so opposed? Well, some say it is because of the extra costs, except that the extra costs in Medicare Advantage are returned to the government or shared with the beneficiaries. I think the reason might be because Medicare Advantage is one part of the Medicare Program that we have successfully been able to turn over to the private markets for operation. Interestingly, when the private sector gets involved in administering this part of the Medicare Program, the Medicare beneficiaries get more benefits, and it becomes the most popular program in Medicare. I know my colleague from Pennsylvania, Senator Casey, has filed an amendment to protect the 864,000 Medicare Advantage beneficiaries in his home State, and I would expect strong bipartisan support for the McCain motion to commit, since I think every Senator representing their constituents in their State wants to see this kind of protection. At the end, the McCain motion to commit is simply an amendment that will protect nearly 11 million seniors today enrolled in the Medicare Advantage Program and help to keep the President's promise when he said if you like what you have, you can keep it. If this bill is not amended in the way it is being proposed to be amended by Senator McCain's amendment, 11 million Americans are not going to be able to keep what they have in the Medicare Program, and that is just a start on the impact of what people in America are going to see under this legislation in terms of a reduction of their benefits and the quality of services they have access to. I urge my colleagues to support this amendment, and I yield the floor.

Mr. CRAPO. Thank you, Madam President. As the motion which has just been read clearly states, this motion would be to commit this bill to the Finance Committee for the Finance Committee to do one simple thing, and that is to make the bill conform to President Barack Obama's pledge to the American people about health care reform and who would pay for health care reform. In a speech he has given in a number of different places, President Obama has very clearly stated: I can make a firm pledge . . . no family making less than $250,000 will see their taxes increase . . . not your income taxes, not your payroll taxes, not your capital gains taxes, not any of your taxes. You will not see any of your taxes increase one single dime. All this motion does is to commit this bill to the Finance Committee to have the Finance Committee assure that its provisions comply with this pledge. Now, why would we want to do that? I think most Americans are very aware today that this bill comes at a huge price. There are $2.5 trillion of new Federal spending, $2.5 trillion of new Federal spending that is offset, if you will, by about $500 billion worth of cuts in Medicare and $493 billion worth of cuts in the first 10 years are tax increases, $1.2 trillion of tax increases in the first real 10 years of the full implementation of the bill. There is no question but that much of the tax increase that is included in this bill to pay for this massive increase in Federal spending will come squarely from people in the United States who make less than $250,000 as a family or less than $200,000 as individuals. All we need to do is to go through this bill to see that by the analysis we have made so far, it appears that at least 42 million households in America will pay a portion of this $1.2 trillion in new taxes, people who are under these income levels to whom President Obama made the pledge. I will have a greater opportunity tomorrow to discuss this motion in more detail. Tonight I just had a few minutes to make the introduction and to call up the motion, and we will then get into a fuller discussion on how this bill provides a heavy tax burden on the middle class of this country in direct violation of the President's pledge. So as I conclude, I would simply say this is a very simple amendment. We can debate about whether the bill does or does not increase taxes--I think that is absolutely clear--on those in the middle class. But all the motion would do is to commit this bill to the Finance Committee to have the Finance Committee make the bill comport with the President's pledge. I will conclude by just reading his pledge one more time. The President, in his words, said: I can make a firm pledge . . . no family making less than $250,000 will see their taxes increase . . . not your income taxes, not your payroll taxes, not your capital gains taxes, not any of your taxes. . . . you will not see any of your taxes increase one single dime. That is what this motion accomplishes. With that, I yield the floor.

Mr. CRAPO

Mr. CRAPO. Madam President, I am here to speak in support of the Gregg amendment. I rise in support of my colleague's amendment because it would prohibit using Medicare cuts in the Democratic health care bill to pay for new government spending. It is interesting, as you listen to the debate--in fact, I was interested to hear my colleague from North Dakota say the Republican amendments would increase the deficit. They would only do that if you assume all of the spending in the bill, which is also opposed by the Republicans. One of the key parts of the debate that I think needs to be emphasized here is, among all of the other things this bill does, when you have the first full 10 years of real implementation of the bill, it is a $2.5 trillion increase in Federal spending, paid for with hundreds of billions--in fact, trillions in new taxes and cuts in Medicare. The purpose of the Gregg amendment is to require that when we do achieve savings in Medicare, instead of it being used to just transfer into a new government entitlement program, making Medicare less solvent, we use the savings for Medicare itself. In the first 10 years of their bill, we will see cuts in Medicare by $465 billion, every dollar of which will simply be transferred over to a massive new Federal entitlement program. If you actually take the first 10 full years of the implementation of the bill--and recall that there are some budget gimmicks being played to say it is not generating a deficit, and it is not really implemented fully until about 4 years into the bill--if you take the first 10 years of implementation, the cuts to Medicare are not $465 billion but $1 trillion, and $3 trillion over a longer period of time as we evaluate the bill moving into the future. In Medicare's hospital insurance trust fund, annual outlays already exceed the annual income, so the fund is drawing down its holdings to pay full benefits--but not for long. By 2017, the HI trust fund will be insolvent and will no longer able to pay full benefits for seniors. These cuts will make it worse. This amendment provides that the major provisions in the underlying bill, including the subsidies and Medicaid expansion, cannot go into effect unless the Director of OMB and the Centers for Medicare and Medicaid Services certify that all of the projected spending in the bill is offset with savings, but that savings shall exclude any changes to Medicare or Social Security. In other words, we require that Medicare savings be used for Medicare and Social Security savings be used for Social Security. This will ensure that the savings generated from the Medicare cuts in the bill don't go toward the creation of a new entitlement program at the expense of our seniors. If the non- Medicare savings don't offset the new costs, then the Secretary of the Treasury and the Secretary of HHS are prohibited from implementing new spending or revenue-reduction provisions in the bill. Republicans have opposed the Reid bill's harmful cuts to Medicare through three votes. Should those cuts remain, the Gregg amendment makes sure Medicare savings go to making the program more solvent, not to offsetting the new entitlement programs. Congress should not raid Medicare--a program that has $38 trillion in unfunded liabilities--and use it as a piggy bank to pay for a new health care entitlement. The government already has $70 trillion in unfunded obligations over the next 75 years, and we should not add to it with these dangerous provisions. The $70 trillion in unfunded obligations represents a burden of $600,000 per American household. The Reid bill carries an estimated cost of $2.5 trillion over the first 10 years that it is fully implemented. It is fully loaded with budget gimmicks. Earlier in the debate, we voted 100 to 0 for the Bennet amendment--a rule of construction--which stated that nothing in the bill ``shall result in the reduction of guaranteed'' Medicare benefits. In contrast with the Bennet amendment, the Gregg amendment actually guarantees there will be Medicare for future generations, while guarding against the creation of a new unfunded entitlement this country cannot afford. I wish to respond a little bit to some of the arguments my colleague from North Dakota just made. I mentioned we have had three votes already to try to take these Medicare cuts out of the bill. All of those votes have failed. The Senator from North Dakota indicated those votes would have reduced the deficit or would have caused a huge deficit problem. That is only true if you assume the $2.5 trillion of spending in the bill will continue. But those who claim there is a reduction in the deficit in this bill can do so only if they assume three things--one, if they assume the budget gimmicks are implemented. They have not included the SGR payments for physicians--a $245 billion cost over the next 10 years. It is just not in the bill because it cannot be accounted for. Second, they have delayed the cost implementation portions of the bill by 4 years now, so that they have 10 years of revenue and 4 years of spending, so they can claim it balances. Even then, they cannot claim this bill helps the deficit unless they assume the hundreds of billions of dollars of new taxes and the hundreds of billions of dollars of cuts in Medicare. If any one of those items was taken out-- the Medicare cuts, the tax increases, or the budget gimmicks--this bill would be shown to be what it is: a huge expansion of the Federal Government that is going to necessitate increased tax burdens and reductions in spending, as well as budget gimmicks to hide what cannot be hidden in order to claim it doesn't generate a deficit. I think most Americans understand that those kinds of gimmicks are the things we see all the time in Congress when we are trying to make it look as if we are not engaging in debt spending and increasing the national debt. The bottom line here is that there is a significant amount of reform that can be achieved, that can reduce the cost of health care, that can reduce the cost of health insurance premiums, that we could agree to on a bipartisan basis if we were not stuck in this debate on the insistence that we create a massive new intrusion of the Federal Government into the operation and control of the health care economy and the development of another massive new Federal entitlement program at the expense of some of the current entitlement programs. I haven't even talked about what is being done in Medicaid yet. I am sure others will talk about that. This bill, as I said, will increase spending and the size of the government by $2.5 trillion. It will cut Medicare benefits over that same true full period by $1 trillion. It will increase taxes by hundreds of billions of dollars, and over that true full 10-year period of implementation, over $1 trillion. It will force the neediest of our uninsured in this country not into the opportunity to gain insurance coverage but into another failing entitlement program, which is Medicaid. It will drive a massive, unfunded mandate onto our States, which are already trying to figure out how they are going to deal with their fiscal problems. It will cause the cost of health insurance to go up for 30 percent of all Americans immediately and for the 70 percent who are in the large groups and get insurance from large companies, and they will basically see no significant savings and ultimately more taxes. The bottom line is, we are not going to see an increase in the ability to control or handle the cost of health care. We are going to see an increase in government, an increase in government controls, an increase in taxes, and a reduction in the stability of our Medicare programs. That is not the way we should approach reform. The Gregg amendment simply says let's create a lockbox, if you will, for Medicare, the same kind of lockbox we need for Social Security to keep the Congress from continuing to raid Social Security. Let's put it into place to ensure that all these great statements we hear on the floor about how we want to protect and preserve Medicare are enforced. It simply creates by power of law, by force of law, the necessary mechanism to help all of us be sure that what we are talking about on the floor actually happens; namely, that we protect Medicare from being raided for the establishment of yet again another massive Federal entitlement program. Madam President, I yield back my time.

Mr. CRAPO. That is fine.

Mr. CRAPO

Mr. CRAPO. I wish to make a comment or two and then engage with the ranking member of the Budget Committee. Often people talk about driving the cost curve down. Frankly, when you talk to Americans about what they want in health care reform, the vast majority of them say the reason we need health care reform is because of the skyrocketing cost of health care and health care insurance. Those who are promoting this bill say they are bending that cost curve down. My question is which cost curve are they talking about? Is it the size of government? Are they bending the size of government growth down? No, as the Senator from New Hampshire said, they are growing government by $2.5 trillion for the first true 10-year period of the bill. Are they driving personal health care costs down? No, the CBO report we recently got said 30 percent of Americans will see their health insurance go up, and the other 70 percent will, at best, see it stay about what it is today, rising at the same levels it is today. Are they talking about the Federal deficit? The chairman of the Budget Committee has indicated to us we are going to see skyrocketing deficits. Those who claim this bill is going to reduce the deficit can say so only if they take into account all of their budget gimmicks, such as not counting the first 4 years of the spending, or the hundreds of billions of dollar of taxes that are going to be imposed on the American people, or the Medicare cuts we have been talking about. Take any one of those three out of this bill and it drives the deficit up in a skyrocketing fashion, is that not correct, Senator?

Mr. CRAPO. That is absolutely the case. I would like to point out, when we had the Finance Committee markup, I asked CBO Director Elmendorf directly whether provisions in the bill, which are still in the bill, would reduce the benefits that Medicare recipients received. His response was: For those who would be enrolled otherwise under current law, yes. There has been a lot of talk here about we are not cutting Medicare benefits or we are or it is this or that. The bottom line is, the CBO Director said it: Yes, we are cutting benefits. I would like to ask the sponsor of this motion a question because I know there are some who are saying the reason we are cutting Medicare Advantage is that it is so expensive, and we should be cutting Medicare and controlling its costs; that it is about 14 percent more expensive than fee-for-service Medicare. Some people say if you are defending Medicare Advantage, you are defending overpayments in health care plans. Would the Senator from Utah like to respond to that criticism some are making?

Mr. CRAPO. The Senator is absolutely right. A lot of people trying to defend these cuts are saying these extra costs in the Medicare Advantage Programs are just going to make insurance companies' profits bigger and help pay for large CEO salaries. Nothing could be further from the truth. The reality is, as the Senator from Utah already indicated, 75 percent of this 14 percent extra payment in these plans go to provide the seniors with the extra benefits we are talking about, and then 25 percent is returned to the Federal Government, not to insurance companies, not to CEOs. I have a chart. We are going to make it into a bigger one. But those who support this program say we are not cutting Medicare benefits. This chart--I apologize it is a little bit small--but this is a chart of the United States. It shows what is happening to the benefits of Medicare Advantage beneficiaries. As you might guess, the dark red is more than 50 percent reduction in the benefits of the people in those dark red States. In the medium red color, it is between a 25- and 50-percent reduction in coverage. The only States that do not have a reduction in coverage are the white ones. There are three or four States that are not seeing deep cuts in Medicare Advantage benefits. Those who say--like the President who said it was one of his goals-- if you like what you have, you can keep it--not if you live in one of the States that is not in white on this chart because your benefits will be cut.

Mr. CRAPO. Yes, I would. This chart shows the last two sentences of our colloquy when we were in the Finance Committee, but it went on for some time. But the bottom line is that I was asking the Director of CBO whether the cuts to Medicare Advantage that are in the bill would reduce benefits to senior citizens, and he said yes. And the reason he used this phrase here, which says ``for those who would be enrolled otherwise under current law,'' the reason he prefaced it that way-- which we don't have on the chart--is that for future seniors it will not be a viable option. So in the future, those who are not on it now won't have a significant viable option to get on it because it is going to be gutted. So he was saying that for those 75 percent--and by the way, Medicare Advantage is the most popular part of Medicare today. It is the fastest growing part of Medicare. It is popular because it provides these additional benefits that seniors have to pay so significantly for to get in supplemental insurance that AARP is going to provide. So what the CBO Director said was that for the future, those who aren't already on it won't get it.

Mr. CRAPO

Mr. CRAPO. I thank the Chair.

Mr. CRAPO. The Senator from Nevada is correct. I have in front of me the exact numbers right now from CBO that were provided in the Finance Committee markup. During the markup, CBO estimated that the value of the extra benefits offered by Medicare Advantage plans will drop from $135 a month to $42 a month, based on the cuts contained in that bill, which are essentially the same level of cuts we now see in the bill before us on the floor.

Mr. CRAPO. If I could interrupt, my understanding is, the Republican bill in the House, which has both ideas in it and which was evaluated, what it would do to the cost of health care and health care insurance premiums, that those ideas would actually reduce health care premiums by, I think, 5 or 6 or 8 percent. I don't remember the exact number, but the point is, those ideas would hit the reason Americans want health care reform; that is, reduce the cost of health care coverage.

Mr. CRAPO. I would be happy to yield.

Mr. CRAPO. I know my colleague from Mississippi wants to make a comment or two, but may I ask, Mr. President, how much time remains for our side?