Judd Gregg

Mr. GREGG

Mr. GREGG. We are joined by a number of the distinguished members of our caucus. They have thoughts they want to express. We want to discuss a couple of points. Before I turn to the Senator from Missouri, I want to make a point, because I have been listening to a lot of the discussion on the floor, and I have participated and listened to a lot of it on television, from my colleagues on the other side of the aisle. They continue to use this number. They claim this bill will cost $800-some-odd billion and that is the number that has been reached as the expenditure on this bill. That is a totally dishonest number. That is the ultimate shell game. That is Washington cynical politics. Do you know how they get to that number of $800 billion as a cost of the bill? It is a 10-year number, by the way. That is a lot of money, $800 billion. That would run the State of New Hampshire for probably 100 years. Missouri is a little bigger, but it would run that State for a while, and it would probably run Alabama for a little while. South Dakota could probably run for 200 years on that. That is not the real cost of this bill, though. That is not the cost of the bill. The way that number was arrived at--and I think the American people need to understand this. If that number was so dishonestly arrived at for the number of the bill, what is wrong with the rest of the bill that they haven't been told about? That was a 10-year score for what the bill cost was, but they don't start spending money under this bill until the fourth and fifth year. In fact, the cynicism exceeds that. They couldn't get the score they wanted--they couldn't get the score they wanted from CBO, so they moved back another year in the 10-year cycle. They went from 4 years to 5 years as to the starting point of most of the spending in this bill. What they claim to the American people is the 10-year bill is going to cost about $800-plus billion. But what they don't tell the American people is they are not spending anything in the first 4 or 5 years of the bill. No, they do raise your taxes throughout the 10-year period. They do cut Medicare throughout the 10-year period. But they don't spend the money. They don't start the programs until the year 2014, when this bill is fully phased in. When all these new programs, this massive expansion of entitlements is created, brand-new entitlements, when all this new spending occurs, this bill will cost $2.5 trillion over that 10-year period--$2.5 trillion. That is the real cost of this bill. That is how this government is going to grow in a 10-year window as a result of this spending. I say to my colleagues, I think most of us understand we already have a huge debt problem in this Nation. We are passing on to our kids a country with so much debt they are not going to be able to afford it. Every year for the next 10 years, without this health care bill, the President has proposed budgets which will run a $1 trillion deficit, every year, on average, for the next 10 years. Sometime this month, we are going to have to raise the debt ceiling of this country because we reached $12 trillion in debt. Then it is going to have to be raised again because we are running up these massive deficits. The debt owed by this country will exceed 80 percent of our gross national product--80 percent of our gross national product at the end of that 10-year period--and will exceed 60 percent of our gross national product within 2 years. Those are unsustainable numbers. Yet a bill is being proposed that is going to expand the size of government by $2.5 trillion. It is alleged it is paid for, and we are going to get into a discussion in some depth because I think that is an equally cynical number as a result of bait and switch. I just wished to clear the air as to the real cost of this bill because I found it uniquely cynical that it would be represented that this bill costs $890 billion, whatever the number is. It does call into issue the credibility of the rest of the numbers that are being thrown out by the other side of the aisle when they use that number, which is a 5-year number that they claim covers the 10-year cost, when they don't do anything in the first 5 years. I appreciate the indulgence of the Senator from Missouri. I understand he wishes to speak and then we will go to the Senator from Alabama and then the Senator from South Dakota and then have a discussion about some of the issues, such as costs, how it affects Medicare, how it affects small businesses, how it is going to affect your personal insurance.

Mr. GREGG. That is $1.2 trillion because between the period 2010 and 2014, there are no expenditures because they don't start the programs until 2014.

Mr. GREGG. No, those are total expenditures which are represented to be offset by cuts in Medicare, increased fees, and increased taxes.

Mr. GREGG. When fully phased in, in the 10-year period, 2014 to 2023, the Medicare cuts are $1.1 trillion.

Mr. GREGG. The taxes and fees during that period--this period, when it is fully phased in--are approximately $1.5 trillion.

Mr. GREGG. Actually, if you accept these assumptions that we are going to cut Medicare by $1 trillion and take that to create a new entitlement instead of using it to help Medicare be more solvent and then we are going to raise taxes and fees by $1 trillion--remember, most of this is not going to come out of the wealthy. It is going to come out of small businesses and higher premium costs to people on insurance or it is going to come out of HI taxes. If you accept that logic, which I find to be a bit of a reach, then it will not have any impact on the deficit in that timeframe because they have cut Medicare to pay for it, and they have raised all these taxes to pay for it.

Mr. GREGG. That is a fascinating question because I was chairman of the Budget Committee the last time we tried to do something in the area of the rate of Medicare costs because we received a directive from the Medicare trustees that Medicare had to be made more cost-effective or else it was going to go broke. So we suggested, when I was chairman of the Budget Committee--and everybody in this room voted for it, by the way--that we should reduce the rate of growth of Medicare by $10 billion on a $1 million timeframe. In other words, Medicare was going to spend $1 trillion over a period, 5 years. We were going to suggest a $10 billion reduction in that rate of growth which was going to be paid for by requiring people who were getting Part D premiums and had high income to pay for part of their premiums--people such as Warren Buffett would not be subsidized by people working down at the local restaurant. We did not get one vote from the other side of the aisle. We passed it by having the Vice President sit in the chair and break the tie. That was $10 billion over 5 years. So I think this idea that you are going to do $1 trillion over 10 years and pay for this--first off, if you are going to reduce spending or raise Medicare taxes, it should go to pay for Medicare solvency because Medicare is insolvent. It shouldn't go to create a new entitlement. Senior citizens, paying into Medicare all their lives, should not have their money taken to start a brand-new entitlement for other people, and that is what this bill does. As a practical matter, we are not going to do that. We know that. We know this is all going on the debt. Ninety percent of this is going to end up on the debt.

Mr. GREGG. Will the Senator yield?

Mr. GREGG. It is important to know where that cut is proposed to primarily fall. Is Medicare Advantage used by a number of seniors in South Dakota?

Mr. GREGG. Under this plan, it will be eliminated for all intents and purposes.

Mr. GREGG. Madam President, what is the regular order?

Mr. GREGG. Thank you, Madam President.

Mr. GREGG

Mr. GREGG. If I could join this colloquy with my colleagues from Wyoming--what a great State to have two such exceptional Senators. First off, I want to make this point: Obviously, a lot of folks are pointing at this bill which I have right here--the Senator from Wyoming has one, and the other Senator from Wyoming has one--because it is real. Up until now most of the debate that has been occurring around here has been media. A lot of it has been theater. Some of it has been good theater, I hope, but it has been theater to a large degree. Now we are dealing with something that is extremely real. Every page of this 2,074-page bill will have an impact on Americans. Every page of this bill will make a decision and direct a policy that will affect the health care of every American everywhere. It is an extraordinarily intrusive and expensive bill. The Senators from Wyoming have been alluding to this, but it really is historic. The colleagues on the other side say this is a historic bill. It is historic. Never in my experience, and I don't think in any experience, has the Congress taken up a bill which is essentially going to restructure and fundamentally change the way that 16 to 20 percent of the national economy is going to be affected in such an immediate and intrusive way. Essentially, the Federal Government will affect every decision that has to do with health care as a result of this legislation, every decision that has to do with health care. The cost this is going to create in the area of increasing the size of the government is astronomical. We have heard this number, that this is a $890 billion bill. That is pretty big. I suspect that would run the State of Wyoming for a few years, maybe a century. I think the State of New Hampshire would probably run for pretty close to a century--in fact, more than a century, to be honest with you. I don't think our budget is $8 billion yet. So that is a lot of money, $800 billion plus. But that is not the real number. That is a phony number. That is a bait-and-switch number. That number is arrived at by claiming, over a 10-year period, that the programs that are initiated in this bill--which is a massive new entitlement--will not start until the fourth and fifth year. In fact, the House bill was at least a little more honest than the Senate bill. It started in the fourth year. The Senate bill starts in the fifth year with most of the spending. But the taxes which the Senator from Wyoming, the senior Senator from Wyoming was just talking about, and the fees and the reductions in Medicare, they start pretty much in the first year. So they have taken 10 years of taxes, fees, and cuts in Medicare, and they have matched them against 4 or 5 years of actual spending and claimed that they are in budget balance and that the bill only costs $890 billion--only. In fact, CBO has scored this over the real period, when all the programs are in place. Over that period, over that 10-year window when all the programs are functioning that are created under this bill--all of them being Federal programs, brandnew entitlements, extraordinarily expensive initiatives--when that occurs, this bill costs, by CBO's estimate, $2.5 trillion. In order to pay for that we would have to cut Medicare by over $1 trillion. In order to pay for that we would have to raise taxes, fees, by over $1.5 trillion. This is a massive increase in the size of government, a massive increase in tax burden, a massive effect on Medicare. The Senator from Wyoming mentioned there are a few gimmicks in here on top of the huge gimmick, that it is a bait-and-switch, that this is a $800 billion bill when in fact it is a $2.5 trillion bill. There are a lot of other games in here that deal with budgeting. I found one of the more entertaining ones: the fact they take credit in this bill for creating a new program, the CLASS Act, a massive new program, a long- term care program. They take credit in this bill as that being a budget surplus item. How do they figure that out? Because on a long-term care program, basically people in their twenties, their thirties, their forties, even into their fifties, pay into it. It is like buying insurance under this plan, so that money comes into the Federal Treasury. What they do not account for is when those folks go into their long- term care facility and the money goes out, the money goes out at an incredibly fast rate, and the program balloons radically in its costs. They do not account for that. They just account for the years when people are paying in, and they claim that as surplus money they apply to try to reduce the cost of the bill. So they spend the money. This is classic. First, they take in the money and claim it as an adjustment against the debt they are running up, and then they spend it so it will not even be available to pay for the program they claim they are going to fund with it. It is just inconceivable. Bernie Madoff is in jail. Whoever thought up this program and scored it in this bill, Bernie Madoff would be proud of that person. He would say: My type of guy. That is the way you do accounting--fake it. It is unbelievable. There are a whole series of these types of games in here. The States are going to be taken to the cleaners by this bill. The allegation that we are going to expand Medicaid by 20 to 30 million people, and the States are not going to end up paying a huge bill as a result of that? Absurd on its face. It is absolutely absurd on its face. More importantly, when we expand Medicaid by 20 or 30 million people, the doctor will tell you, back here, the reason Medicaid is in such dire straits is because doctors will not see Medicaid patients. Why? Because they are reimbursed at 60 percent of the costs. Who pays the other 40 percent, by the way, for the present Medicaid recipients? Who pays the other 40 percent? I will tell you who pays. Mary and Joe Jones, who are working down at the local restaurant who have health insurance, they pay it with their premium. Bob and Marie Black, who are working over at the local software company, they pay it with their health care premium. The 40 percent of Medicaid that is not paid for by the government is paid for by people who are in private insurance. Their insurance premiums go up because they are subsidizing Medicaid reimbursements because the hospitals have to get paid for the cost, and they are only getting 60 percent of it from the government and the other 40 percent is being picked up by the private sector. When we expand Medicaid by another 20 or 30 million people, we are inevitably going to drive up the costs of private insurance again. So the private insurance policies go up. What does that do? It does what this bill is basically intended to do: it will force employers to drop private insurance and move people over on to the public plan. That, when you get down to it, is what this is all about. This is an exercise in having the Federal Government get control over all health care. It is being done in an incremental way. They are setting up a scenario that will not be immediately apparent to people. But as we move through the years it will become apparent because what will happen is the costs of private health care will go up so much that private employers will start to drop their health care. They will take the penalty, which is not that high in this bill compared to what they have to pay in health care costs, and move their people, and say: Sorry, I am not going to give health care anymore--or never did--and go get this government plan. Then down the road Congress will change this government plan a little bit, and they will start to put price controls in, just like they want to do in Medicaid. Basically, that will mean people will get fewer products because as you put price controls in you will have less innovation, fewer drugs. Fewer devices will be developed because people will not be getting a return on their investments because these will be price-controlled events. You will find delays because that is what happens when you move to a government program that controls costs. The government can only control cost by controlling price. That creates delays in access which is what happens in England and Canada. So the quality of the health care system goes down. I ask my colleague from Wyoming, who is uniquely qualified to comment on this because he is a doctor and he has experienced the problems of dealing with Medicaid, is this not a reasonably accurate reflection of what will happen if we move another 20 or 30 million people into the Medicaid Program? Doesn't that mean that private insurance policies have to go up, fewer doctors will see fewer people, and inevitably we will end up with a cost shift which forces private insurers to drop insurance?

Mr. GREGG. If I may ask a question on that point, this is an important point. As a practicing physician, if all your patients had been Medicaid, would you have been able to pay your bills?

Mr. GREGG. If I might follow up, doesn't that inevitably mean that the people who are paying more are in the private sector, which means premiums for people in the private sector go up, which means fewer people are willing to give that type of coverage because the cost is too high for the business to cover; right?

Mr. GREGG. I thank the Senator from Wyoming. He has a unique perspective which we should listen to, as a practicing physician for how many years?

Mr. GREGG. That is impressive. He understands this whole issue and the point on cost. It is very hard to conceptualize that this is a $2.5 trillion bill when honestly scored. When honestly scored, it is a $2.5 trillion bill. This page right here, page No. 1, cost the American people $2 billion. You could pick almost any page in this bill. And I don't think they are worth $2 billion a page. This page here, what does that say? I don't know. I am just picking this out: Transfer to the Secretary of Treasury a list of individuals who are issued a certification under subparagraph (h), including the name and taxpayer identification number for each individual, the name and taxpayer identification number of each individual who was an employee of an employer but who was determined to be eligible for the premium tax credit under section 36(b) of the Internal Revenue Code of 1986 because, A, the employer did not provide essential coverage, and B, the employer provided such minimum essential coverage, but it was determined under section--and on it goes--section 36 (b)(c)(2)(c). I don't understand what that said. We now will have about 72 hours to figure it out. But I know this much: When a bill costs $2 billion a page and when it includes language such as that, it is something we should spend some time on. This bill is being rushed. It should not be rushed. This vote that will occur tomorrow at 8 o'clock at night, after having this size of a bill on our desks for less than 2, 3 days, is very serious. We are firing real bullets here. This is no longer theater. It is no longer political media. This is the passage of a piece of legislation, the potential passage of a piece of legislation. Tomorrow's vote is a critical vote because it basically will mean we are on the road to passage. In fact, 97 percent of the bills that come to the floor of the Senate under a motion to proceed pass. So this piece of legislation is serious. It is real bullets at $2 billion a page. Tomorrow's vote is something we need to look at as a vote that is not some sort of a procedural vote. It is a substantive vote on whether we are going to fundamentally change the way health care is delivered, cause the size of this government to grow by trillions and trillions of dollars, and put the Federal Government virtually into every decision that has anything to do with health care. With the way you choose a doctor, the way you get your insurance, with the type of procedures you get, with the type of drugs you can obtain-- the Federal Government will be involved. How much it costs, the Federal Government will be involved. And with the type of debt that will be passed on to our children. This bill will play a major role. Remember something about the Federal Government: Once you give the Federal Government power, you don't get it back. This bill is all about moving power here to Washington. That is what this legislation is about, about centralizing the decision process, the national decision process on health care. In the end, the goal, as openly stated by some of my colleagues on the other side of the aisle--and I appreciate the fact that they are forthright--is to have a single-payer system where the government essentially runs health care top to bottom, much as it does in Canada and England. I believe that fundamentally undermines quality and is fundamentally unaffordable. It passes on debt to our kids which we obviously don't want. In the process, it will take Medicare, which is already in serious trouble--there is already a $55 trillion unfunded liability in Medicare--it will take Medicare's problems and aggravate them dramatically. To the extent savings are taken out of Medicare and used to create this new entitlement, which has nothing to do with Medicare or Medicare recipients but is going to be funded by Medicare both on the tax side with the HI tax in here and in the cuts in Medicare benefits with the elimination basically of Medicare Advantage, all of that is Medicare money that should be going, if you are going to do those things, to making Medicare more solvent for seniors, not to creating a new entitlement. I see the Senator from North Carolina wants to jump in here.

Mr. GREGG. Fully phased in, it is a trillion dollars.

Mr. GREGG. The Senator has made a very good point, which is how you do health care correctly. You do not create a massive new Federal entitlement. You do not spend $2.5 trillion we do not have. There are a couple things you could do, though, on a step-by-step basis. One of them--and I would be interested to know if the Senator understands why it is not in here--one of them is to correct lawsuit abuse. It is estimated $250 billion a year of medical expenditure is defensive medicine which doctors order and hospitals undertake simply to avoid the potential of a lawsuit being filed. CBO estimates it would be a $50 billion savings if we would adopt the proposals they use in Texas, California. That is one approach. Another approach would be to allow employers to pay employees more who live healthy lifestyles, such as employees who stop smoking or employees who get the tests they need--whether it is mammograms or colonoscopies--when they should have them or employers who live healthy lifestyles and lose weight. Under the bill that is not allowed, other than what present law is, which is very restrictive. That would save a lot of money, by the way. The first proposal, as I understand, was opposed by the trial lawyers. Do you think that is why it is not in this bill--saving $54 billion on abusive lawsuits? The second proposal--allowing employers to pay a differential and pay employees who are living a healthy lifestyle more--is opposed by the big labor unions here in Washington. Do you think that is why it is not in this bill? I wonder whether maybe the Senator from North Carolina has some thoughts on those two approaches as to whether they would help the health care system in this country, and why they did not find their way into a 2,000-page bill, since we seem to have a lot of room in this bill for things.

Mr. GREGG. That is because we would have to change something called HIPAA.

Mr. GREGG. It is a technical term, but it basically allows companies to pay an employee who lives a healthy lifestyle more than other employees, and that is opposed, as I understand it. It was originally in one draft, and it got dropped somewhere.

Mr. GREGG. If I could jump in at this point. I think the Senator has touched on something that is important; that is, when you start putting these major fees on things such as medical devices and drugs, you reduce the willingness of people to invest in creating the next device, and not only do you end up with a device being priced out of the market or maybe not being produced, but----

Mr. GREGG. Then I will yield the floor. Mr. President, I ask unanimous consent we be allowed to speak for an additional minute each, so we may wrap up our time.

Mr. GREGG. My point is, this bill fundamentally undermines innovation, and innovation has been at the essence of what has made American medicine better than the rest of the medicine in the world. We are the most innovative country in the world in the areas of drugs and medical devices and procedures. I think this bill undermines that.

Mr. GREGG

Mr. GREGG. Madam President, I rise today to recognize the longest- serving lawmaker in congressional history; I rise to recognize a leader; and I rise to recognize a friend. Senator Byrd has served in Congress for over 56 years. His tenure has traversed 9 elections, 18,000 votes, 20,000 days, and 11 Presidents. I have had the privilege of serving with Senator Byrd on the Senate Appropriations Subcommittee on Homeland Security. I am proud of our efforts to protect Americans and make our Nation more secure, especially in the area of border security and addressing the threat of weapons of mass destruction. Senator Byrd was a terrific partner, and I valued his input. And when we would give introductory remarks at the committee markup of our bill, I have never received such generous compliments from another lawmaker. I hope Senator Conrad, my counterpart on the Budget Committee, is taking notes. More recently, it is a testament to his character and sense of duty that after battling illness and absence earlier this year, Senator Byrd returned to once again craft our Nation's homeland security budget: a $44 billion measure that funds natural disaster response, antiterrorism efforts, and other critical programs to meet and repel the various threats facing our homeland. Lastly, I want to recognize Senator Byrd for his dedication to the Senate as an institution and his understanding of its inner workings. No one can better recite or describe Senate rules and parliamentary procedures or better defend them. His encyclopedic knowledge of the Senate, as well as the copy of the U.S. Constitution which he always carries in his jacket pocket, is something that we can all respect and appreciate. He is a man committed to the principles and laws that founded our great Nation, and for that we should be thankful. In closing, we have much to thank Senator Byrd for: merit-based scholarships; teacher training programs; and the strengthening of American history curriculum in our schools. But one thing that many of us and our constituents might take for granted, Senator Byrd is responsible for the cameras in the Senate Chamber. As he often does, Senator Byrd put it eloquently when he said that proceedings should be televised to prevent the Senate from becoming the ``invisible branch'' of government. I couldn't agree more. Before yielding the floor, let me be one of the first to wish our esteemed colleague an early Happy Birthday. He turns 92 this Friday. Happy Birthday, friend.