Jon Kyl

Mr. KYL

Mr. KYL. Mr. President, I ask unanimous consent Senator Nickles be shown as a cosponsor of amendment No. 854.

Mr. KYL. I understand that Senator Frist would like to quickly proceed. There are several people who would like to speak in support of my amendment. Therefore, what I would like to propose is that we lay my amendment aside, go to Senator Frist, and I take up the remainder of my time prior to the vote.

Mr. KYL. Mr. President, if I could just conclude my remarks in support of my amendment and in response to Senator Kennedy, how much time remains under my time?

Mr. KYL. I thank the Senator.

Mr. KYL. I thank the Senator.

Mr. KYL. Mr. President, if I may answer the question of the Senator from Kentucky, I am remiss for not acknowledging that my idea for this amendment came exactly from the proposal the Senator has just discussed. It seemed to me that if it worked well in that context, it would also work well in this context. I should have mentioned that earlier. I know the Senator did not ask the question to get credit, but credit certainly is due him for this idea.

Mr. KYL. Mr. President, I rise to introduce the consumer health care choice amendment. This amendment would amend section 302 of the underlying legislation to provide that employers and health plan issuers would be free to offer, and participants and beneficiaries free to choose, health plans with two remedy options, in addition to the underlying plan: equitable relief--the benefit or value of the benefit; and unlimited economic damages. The bill provides damages as provided under S. 1052 unlimited economic and non-economic, and up to $5 million in punitive damages. This amendment applies only to the new remedies established by S. 1052 for Federal contract actions and state ``medically reviewable'' claims. It explicitly protects the regulation of medical care delivery under state law. The problem: Increased premium costs lead to greater numbers of uninsured. The Congressional Budget Office predicts that S. 1052 would result in a 4.2 percent increase in premiums costs. This predicted increase is in addition to the 10-12 percent increase employers are already facing this year. The CBO report illustrates the cold truth about a critical, but often overlooked, public policy issue: The irrefutable link between health- care premium increases and the number of Americans without insurance. As the Congress debates the various health-care proposals, we must keep this linkage in mind. Supporters of S. 1052 are quick to claim that their bill will improve health care, but not so quick to admit that it will also raise costs and cause the ranks of the uninsured to swell. We know this will happen, because cost increases will cause some employers to stop offering health-care coverage, making insurance unaffordable for more Americans. This fact is politically inconvenient. We should keep an important statistic in mind. According to the Lewin Group consulting firm, for each one percent premium increase, an additional 300,000 citizens lose their insurance. As I mentioned, the Congressional Budget Office predicts that S. 1058 will increase premiums by 4.2 percent. A premium increase of this amount would cause about 1.3 million Americans to become uninsured as a result of S. 1052. The Office of Management and Budget recently predicted that between 4-6 million more Americans would become uninsured as a result of S. 1052. How can we call this a Patients Bill of Rights when it will result in fewer patients? I believe our first goal should be to ``do no harm''; or, at a minimum, to reduce the harm, as my amendment will do. My amendment would allow employers or plans to offer two options for employees to voluntarily choose, in addition to the general plan covered by this bill, Option No. 1: A low premium policy with a remedy limited to the benefit, or the value of the benefit. Option No. 2: A mid level premium policy that would allow for full economic damages only. There are in addition to the higher premium policy that would allow for the full range of damages provided under S. 1052. This amendment should be appealing to employers and plans as a way to control their costs and appealing to employees as a way to hold down their premiums by voluntarily limiting their right to sue. Data from the CBO and the Kaiser Family Foundation estimate that S. 1052 would cost a typical family with health coverage roughly $300 per year. Certainly, we should promise not to pass legislation that would reduce or completely consume the $300 or $600 rebate that many Americans will be receiving sometime this summer as a result of the tax-relief bill just signed into law by President Bush. If adopted, this amendment would afford Americans a chance to recoup some of the loss imposed by S. 1052. Some have argued that so-called patients' rights legislation that includes an unlimited right to sue is overwhelmingly popular with Americans. It is worth noting that a Kaiser Family Foundation/Harvard School of Public Health Survey from January 2001 asked the following question to voters: ``Would you favor a law that would raise the cost of health plans and lead some companies to stop offering health care plans to their workers?'' In answer to this question, only 30 percent voiced support, and 70 percent voiced opposition to such a law. Fortunately, we don't have to force people to make that choice. We can give them a choice. For those who prefer the right to sue and are willing to pay they have their plan. For those who are willing to forgo lawsuit, they can buy their plan. And, state remedies apply in any event--so called ``quality of care'' suits. Certainly, enhancing a patient's right to sue is cold comfort to those who currently can't afford health insurance, or those who lose their coverage due to increased costs. Clearly, the proposed legislation to reform health care comes with a steep price tag attached. Before we commit to passing legislation, perhaps we should first promise not to pass a bill that will lead to more uninsured Americans. My amendment would merely reduce this price tag, and reduce the harm we will do by enacting S. 1052. This amendment is very simple. I ask for my colleagues' attention because I can't imagine that anyone would want to oppose this amendment if the concern is really about patients rather than lawyers. Let me restate that. If we are really concerned about health care for patients rather than fees for lawyers, this amendment will probably do more to provide that we keep people insured than anything else we have done during the last week because it provides for a simple option. For any plan of an employer that provides coverage under this bill, they may also offer another option. That option is a plan that would enable their employees to forego damages in court. It is that simple. You can't just do that. You have to be providing a plan that is covered by this act, so that the full benefits, including all of the rights to go to court and file lawsuits for damages, are preserved. You still have the right to choose that policy. We all know that policy is going to cost more money. The reason it is going to cost more money is because lawsuits drive up the cost of insurance, which drives up premiums, which means that fewer employers can pay for insurance, which means that fewer employees are insured. And that is what is concerning all of us. This amendment makes it possible to offer, in addition to the higher cost policy, a lower cost policy that would say you can forego your rights to litigation. You can just receive the benefits that ERISA provides for today. Those benefits are health care that you contracted for--or the dollar value of that health care. There is a second option in here. That is a limited one, which is you could also go to court and get unlimited economic damages, but no pain and suffering damages or punitive damages. Maybe some companies would write that kind of a policy, too. But either of those policies would have a lesser premium than the policy that would be offered as the underlying plan under this legislation. To some who say there might be a case where there is a quality of care decision which just needs to go to court, and damages need to be collected, my amendment specifically protects all of the State court litigation that is currently developing about quality of care. Even if an employee exercised an option to buy this lower cost policy, that employee would still have all of the rights of litigation for damages in State court. Some have said: Isn't this a little bit similar to the Enzi amendment? The answer is no. The Enzi amendment said if a particular group of employees were merely offered a specific kind of policy, they wouldn't be covered by the act. That is not my amendment. All employers are covered by the act under my amendment. It is just if they offer a plan to their employees, they may in addition to that plan offer this lower cost alternative. Why do I offer this? As we know, the Congressional Budget Office predicts that the underlying bill would result in a 4.2-percent increase in premium costs. This is in addition to the 10- or 12-percent increase that employers are already facing this year. The Congressional Budget Office report illustrates the cold truth that has been overlooked in this debate; that is, the irrefutable link between health care premium increases and the number of Americans without insurance. There is a study by the Lewin Group, a consulting firm, which says that for each 1 percent of premium increase, an additional 300,000 citizens lose their insurance. We have CBO's estimate that the cost of premiums is going to increase 4.2 percent. We have a study that says every 1 percent, an additional 300,000 people lose their insurance. Do the math. Under this bill, more than a million Americans are going to lose their insurance if something isn't done to keep the cost of those premiums down. The Office of Management and Budget recently predicted that between 4 million and 6 million more Americans would become uninsured as a result of S. 1052. That is where this amendment comes in. It is probably the best way to ensure that we can get premiums down over an alternative that doesn't have as much risk for the insurer, and, therefore, won't have to have as high a premium. But I reiterate, it is not in lieu of the benefits that we are promising under this bill but, rather, in addition to. It is an option. For this to occur, three voluntary decisions would have to be made. First of all, some insurance companies would have to develop a product that they might offer to employers or plans to sell for their lower cost option. Second, employers would have to decide that in addition to the plan offered under the bill, they would offer one of these lower cost alternatives that is on the market. Third, employees would have to decide to take advantage of that lower cost option. It is all a matter of choice. Nobody is making anybody do anything. None of the benefits under the legislation go away at all, nor is the State court remedying. It seems to me, since it is all voluntary, that there is nothing mandatory but it gives us one opportunity to reduce premium costs. We all ought to be supportive of this proposal. I ask that the remaining time that I have not be yielded but, rather, see if there are any others who might wish to speak.

Mr. KYL. I do indeed modify my unanimous consent request.

Mr. KYL. That would be my understanding. I thank the Senator from Nevada.

Mr. KYL. Mr. President, it has been requested that the time agreement on this amendment be 30 minutes on my side and 10 minutes in opposition, with an up-or-down vote at the conclusion of the debate. I propound that unanimous consent request.

Mr. KYL. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. KYL. Might the Senator from Nevada yield? I have given a copy both to Senator McCain and also to Senator Gregg to give to you. I am sorry if you do not have it yet. Maybe Senator Kennedy has a copy.

Mr. KYL

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

Mr. KYL

Mr. KYL. I move to lay that motion on the table. The motion to lay on the table was agreed to.

Mr. KYL. If the Senator will allow me to answer, that is a factual matter. I will not argue with his answer. I think I can explain the reason for the confusion. But the answer to the Senator's question is no. What the Senator said is not correct. That was correct a year ago because a year ago the language of the amendment was that you took the FEHBP standard. And the Senator would have been correct a year ago because it was both the fee-for-service standard as well as the managed care contract standard. So the criticism that the Senator levels would have been correct criticism a year ago. And to some extent, I agree with the Senator from Massachusetts about that criticism. We threw that aside. Instead, we asked: What is the contract that governs the fee-for-service FEHBP plans? The contract that governs, we think, 73 percent of the people-- in other words, about 6 million people--is the language that they have approved for the Blue Cross/Blue Shield fee-for-service contract, as well as some others. We didn't want to allow any discretion whatsoever. So we took the five specific provisions of that contract. Those are embodied in the legislation. There is no discretion. If you want a safe harbor now under this amendment, you would have to write your contract with those five items, and only those five items. That is what the reviewer then would be able to review. If I could just continue on with respect to the negotiated rulemaking, it was our idea that if anyone didn't like those five items, and all of the stakeholders would want to get together and negotiate something different, we would be very amenable to that. So we set up this voluntary rulemaking procedure. If the Senator from Massachusetts and others think there is something wrong with that and they would not want to create that option in the bill, we are very amenable to dropping that out. We thought we were doing people a favor by putting that option in so that if somebody didn't like these five items, they could engage in this negotiated rulemaking. But anybody in the negotiations could veto it so that it wouldn't go into effect. But if people somehow fear that, it is not our intention to try to superimpose some nonspecific standard. If the Senator would like to engage further on that, we can certainly discuss that. I indicated to the Senator last night our willingness to discuss that. I hope I have cleared it up. I understand the reason for the confusion because that was last year's amendment. Our amendment language was only available a couple of days ago. So it is understandable that one might not have been able to read our amendment language. But I assure the Senator that our language is very specific and very different from that which he criticized.

Mr. KYL. Absolutely.

Mr. KYL. I yield myself 2 minutes. I am very sorry to have to say this, but the amendment that Senator Kennedy has just proposed is not our amendment. I want to be very clear about what our amendment does. The amendment that Senator Kennedy has been talking about was part of last year's bill. When Senator Nelson came forward this year, he said: Let's try to come up with something new. We did that. So the language we have before us today is not the language to which Senator Kennedy has been referring. When he talks about the Signet language and the other plan language, that would be absolutely prohibited by what we are talking about here. That was last year. We would absolutely prohibit that. When he talks about the plans choosing from among a range of definitions that could include cost effective, that would be absolutely prohibited under our language. That was last year. Let me again restate what we did this year.

Mr. KYL. Madam President, how much time remains on our side?

Mr. KYL. Madam President, I will speak and then yield time to Senator Nelson of Nebraska, my colleague on this amendment. In discussing this proposed amendment with some of the stakeholders involved, a couple questions have been raised. I want to clarify my intention and turn the time over to Senator Nelson. One question asked was, With respect to the external review, is this a de novo hearing? That is to say, does the external reviewer begin with whatever record is before it, but can bring in other witnesses, or consider other material or other factors or records in addition to that which may have been considered by the internal reviewer. The answer to that question is yes. I believe that is what the underlying bill provides. Our amendment intends the same. To the extent that would need to be clarified, we are willing to do that. Secondly, there is concern that with respect to the negotiated rulemaking procedure that is provided for in the amendment, that the composition of the stakeholders be fair. Obviously, we believe that should be fair. We believe that the providers need to have adequate representation in such rulemaking procedure, that all stakeholders should be represented. I do not know what we can do to make our commitment any more firm, but to the extent anyone has a suggestion about how we ensure that fairness, it would certainly be our intention to do so. In summary, we have identified a specific problem with the bill, a need to add a standard that is uniform and to ensure that the two extremes do not represent what occurs here. One extreme is that the external reviewer has no guidance and can just ignore the contract. The other extreme is that an HMO can draft a contract that is so strict that the reviewer has no ability to provide medically necessary care for the patient. We are proposing a standard of care that can be utilized by the external reviewer to ensure that the patient receives the necessary care and that neither ignores the terms of the contract nor is so pinched that it would not be able to provide the care. That is why we have chosen the terms that apply to over 73 percent of Federal employees under the FEHBP that serves all the Members of Congress, our families, as well as other Federal employees. That is the language we have. I ask my colleague, Senator Nelson, to speak to this. Senator Nelson has probably as much experience as anybody in this body with insurance contracts at the State level from his previous positions in Nebraska, as well as being Governor of the State of Nebraska. It has been a pleasure for me to work with Senator Nelson who had the idea for this and brought a group together and expressed his idea. It made sense to me at the time. The more I work with him, the more sense it makes to me, and what he is proposing is desirable for us to do. I urge my colleagues to respect the experience he brings to this issue from his perspective from the State of Nebraska which, I might add, is my State of birth. I am very pleased to have worked with Senator Nelson on this. Again, I just hope my colleagues respect the experience he brings to this particular issue. I yield to the Senator from Nebraska.

Mr. KYL. Madam President, I do not intend to take the full time right now. There may be others who wish to speak. Senator Allard has been kind enough to allow those who support the Nelson-Kyl-Nickles amendment to take some of the time right now. I would like to change the subject back to that amendment which we brought before this body last night and debated for about an hour, and then we will also have an opportunity to conclude the debate on it after the vote on the Allard amendment. But now that we have a few moments, I would like to discuss that. For those who were not in this Chamber last night to hear the debate, let me make it clear that there were two essential problems that we saw that needed resolution. We had worked with Senator Kennedy, Senator Edwards, and others--and Senator Nelson had extensive conversations-- about how to resolve these issues. One of the issues has apparently been resolved by agreement, although no amendment has yet been proposed to deal with it; and that all has to do with reviewing a case by the external reviewer. In other words, the insurance company has an internal review of an issue, and then if that isn't resolved, it goes to an external reviewer. I think everybody agrees that if we can resolve the case at that stage and not have to go to litigation, it is better for everybody. So the question is, what exactly can be considered by that independent reviewer? The first problem that we saw was that the independent reviewer actually had the authority, under the bill, to order that benefits be provided to a patient that were excluded by the contract-- legally excluded. The insured bought a certain set of benefits, and there were certain benefits excluded, but the independent reviewer would theoretically have the right to order excluded benefits to be provided for a patient. I think everybody realized that was not what was intended, and it is at least the representation of those on the other side--and specifically Senator Edwards has made the point--that there is a way to fix that, and a very specific way, which we all understand. If that amendment is offered, then I think it will be a satisfactory conclusion to that particular matter. The other matter that remains has to do with the other kind of issue that can come up. There is a benefit which is covered but the question is, what exactly is the appropriate medical service in this case? Here is a very simplistic example. The plan says: We are not sure exactly what is wrong with this person. We will take an x-ray to find out. But the doctor and the patient say: Look, we already had an x-ray, and the x-ray was not definitive enough. We think we need a CAT scan or an MRI. Those are pretty expensive. The plan says: Look, we just don't think we need the MRI. That is the dispute. There is no question that the diagnostic service is covered. The question is, which diagnostic service is appropriate or medically necessary in this particular case? So it goes to the internal reviewer. Let's say the internal reviewer says that an x-ray is good enough, but that is not what the doctor or the patient wants to hear. So they go to the independent or external review and make their case. What is the standard for the external reviewer to decide whether or not an x-ray is good enough or whether or not there should be a CAT scan or an MRI, for example? There should be some kind of standard that is relatively uniform, unless the States have adopted a specific standard for review of plans within their particular State. I will read the language in the bill that causes us concern because this is the deficiency as we see it. It is on page 37 of the bill. Under ``Independent Determination.--'': In making determinations under this subtitle, a qualified external review entity and an independent medical reviewer shall-- Let me read the two subparagraphs here. (i) consider the claim under view without deference to the determinations made by the plan or issuer or the recommendation of the treating health care professional . . .; and (ii) consider, but not be bound by the definition used by the plan or insurer of ``medically necessary and appropriate'' or ``experimental or investigational''. . . . ``Consider, but not be bound by the definition used by the plan''--of course, that could raise a question of abrogation of contract. When the insurer says: Look, this is the insurance that you bought, and here is the definition under the plan, who has the right to go in and change the definition? So we think that language is inappropriate. The independent reviewer should not be able to just ignore the definition in the plan. But that then raises the question of whether or not a plan's definition could be overly restrictive. What we basically agreed to, at least some of us believe is an appropriate compromise, is to say: You have to use the definition of the plan, but the plan has to have a reasonable definition. What would that definition be? First of all, if a State mandates certain language, then obviously we need to use that language. So for the 13 or so States that actually mandate language, that would have to be applied. But for the rest of the States, there would be a definition, and the definition that we use is the definition that the Federal Employees Health Benefits Plan has used, approved by the Office of Personnel Management for fee-for- service plans. So, Madam President, you and I, and the other Members of this body have an opportunity to acquire health insurance through the Federal Employees Health Benefit Plan just as all other Federal employees do. And there are basically two standards that they use for these contracts. One is for managed care. We consider that to be insufficiently protective of the patients. The other is for the fee- for-service. It is a more strict standard. That is the standard that we use. For 49 percent of the people who are covered by a Blue Cross-Blue Shield contract--and that language, we believe, is also used by another 23 percent. So almost three-fourths of the people are covered by very specific language. That is exactly the language we have included in the bill. There are five specific elements of it. The one that matters the most is the second one, which is: ``Consistent with standards of good medical practice in the United States.'' So the reviewer--if you are in a State that does not have a mandatory definition--would then apply this definition. You might say: ``Consistent with standards of good medical practice.'' That is pretty broad. That could be almost anything. It is not almost anything. What it is is good medical practice. And good medical practice can be determined by experts in the field, based upon the standards of the community, what literature suggests should be done in a particular case, and at least affords an opportunity for the independent reviewer to decide whether or not the patient needs the MRI or the CAT scan, in this case, whether good medical practice would ordinarily call for that, or whether, based on the circumstances of this case, it is just not that difficult and an x-ray ought to be good enough. There are four other elements to it as well, but that is the key one. There is a third opportunity here. If people do not like that definition, even though it covers three-fourths of us under a Federal plan, then we provide for a negotiated rulemaking procedure whereby all the stakeholders can get together and figure out a definition. I do not know what that would be. If they can all agree on a definition, we provide a mechanism for them to do so. And if they do, then that supplants this other definition. One year after that is agreed to, then this other definition is gone. So there is an opportunity to come up with something that all of the parties agree is better if, in fact, they can do that. In the meantime, this is the definition that would apply. We think that is reasonable. We think it is an improvement on the legislation. Certainly something has to be done with this particular section. Senator Kennedy last night talked to both Senator Nelson and me about some possible changes in that. We are very open to that. I am hoping that in the remaining hour of debate on the Allard amendment--and then we will have the vote on the Allard amendment--and then we have an hour of debate on the Nelson-Kyl amendment--I am hoping in that 120 minutes or so we can come to an agreement as to what exactly this language should be. If we can, we are very willing to change the amendment and adopt whatever we can agree to. Senator Kennedy had one particular idea last night that both Senator Nelson and my staff are exploring right now. If we can do this, then we will announce it to the body. We will explain what it is, and hopefully we will have an agreement that everyone can support. If not, then obviously we will need to proceed with this language. In any event, we have identified a problem. We have a reasonable solution to the problem. If somebody has a better idea, we are open to consider what that might be. I urge my colleagues who are interested to come to the floor and speak to it. We not only have a few remaining minutes under Senator Allard's time, but we have additional time when the amendment is debated after the vote on the Allard amendment. I reserve the remainder of the time. Again, I invite anyone who is interested in speaking to this matter to come to the Chamber and address it.

Mr. KYL

Mr. KYL. Madam President, this amendment is offered on behalf of myself and Senator Nelson. It is an amendment that deals with the definition of ``medical necessity'' under the bill and is intended to provide a safe harbor for those who comply with certain requirements. I should also say this amendment is also offered on behalf of Senator Nickles. I apologize to my colleague from Oklahoma. First, let me offer some general views on S. 1052, the Kennedy-McCain Patient Protection Act, and then I will discuss this amendment. As you know, President Bush has reiterated his intention to veto this legislation because, in his view, it ``would encourage costly and unnecessary litigation that would seriously jeopardize the ability of many Americans to afford health care coverage.'' None of us wants that result. As a result, we are trying to do our best to work with the sponsors of the bill to make some changes that would make it palatable to both the President and to most of us in this Chamber. My concerns include the fact that it will undoubtedly raise premium costs due to new lawsuits and increased regulation, that it will undermine the States' traditional role of regulating the health insurance industry and make employers who voluntarily provide health care coverage to their employees vulnerable to frivolous lawsuits, and that it will violate the terms of the contract between the employer and the health plan. This latter issue is the one the Nelson-Kyl-Nickles amendment is intended to address. Under S. 1052, the external reviewer is ``not bound by'' the ``medical necessity'' definition contained in the plan document. And there is no substitute definition provided, so there is really no standard for review. Let me put in context what this means. What we have provided for here is a method by which people will actually get the care they believe they have contracted for and deserve. The object is not to create a lawsuit to try to pay the money after the fact for some injury they suffered but, rather, to get the care for them upfront. That is what this should all be about. So we have a review process by which first somebody within the company, and then an external reviewer, takes a look at the case and says: All right, this is what the contract means. This is what medical care would require under this circumstance as called for under the contract, and therefore the patient is entitled, or is not entitled, to this particular procedure. That review process is supposed to occur quickly so that the patient receives the care he or she has contracted for and deserves under the circumstances. In order for an external reviewer to know whether or not a particular procedure or treatment is called for, there has to be some standard by which to judge that. The Presiding Officer and the other lawyers in this body will know that anytime you ask some reviewer to determine whether or not something has to be done, you need to provide some standard upon which that reviewer can base a decision. The bill right now contains no standard, and it needs such a standard. Our amendment supplies that standard. We believe it supplies a very fair and reasonable standard. The language in S. 1052 gives the external reviewer a free hand to disregard the definition of ``medical necessity'' contained in the contract and, as I say, supplies no substitute definition. As in all of the bills, this external review requirement is the last process prior to going to court. But, as I said, the external reviewer is ``not bound by'' the contract's key definition of ``medical necessity'' or ``experimental and investigational.'' As a result, the external reviewers can simply make up their own definition of ``medical necessity.'' Private contracts negotiated between the parties--insurers and employees, or insurers and individual consumers--would become virtually meaningless in this circumstance, and the financial obligations of the health plan could become totally unpredictable. The plan or insurer could become obligated to pay for items or services based on definitions outside the contract, even potentially including contractually excluded items that were deemed to be medically necessary by the reviewer. The ``not bound by'' provision, therefore, would have the effect of eliminating the ability of the parties to negotiate the key terms and conditions of health insurance contract agreements. Madam President, in addition to vitiating legal contracts, the ``not bound by'' language would have the following negative effects. First, inconsistent standards: The standards used by reviewers would vary with each review panel and with each case within the same plan. We are trying to create some degree of uniformity with this legislation, but under the bill you could have the potential for a wide variety of very arbitrary decisions because of the lack of a standard. Second, quality of care: The mere threat of contract nullification could prompt some plans to pay for all claims regardless of the cost and the impact on the quality of patient care. Solvency and stability: The use of unpredictable outside definitions of medical necessity will impose costs for unanticipated treatments not reflected in actuarial data used to determine the amount of the health care premium. And finally, cost increases: Solvency concerns would result in increased cost for employers and increased premiums for employees. The net result of that, of course, will be to remove more people from the rolls of the insured. Under S. 1052 as written, these contracts, negotiated between the parties and often approved by State insurance regulators, will be voidable, not by a judge or a court of law but by an unrelated nonjudicial third-party reviewer. This will undermine the principles of the contract as well as due process. So, as I said, to address this problem we have sponsored an amendment that would allow the plan to adopt a widely accepted safe harbor definition of medical necessity as its contract definition. If a plan utilized this safe harbor definition, then the external reviewer would be bound by it when hearing a patient's appeal of denial of coverage. Safe harbor definitions contained in the amendment are basically at three different levels. First, we take the definition from the Federal Employee Health Benefits Plan that currently covers about 73 percent, as best we can calculate it, of the employees under the Federal Employee Health Benefits Plan. Over 6 million Federal employees and Members of Congress are covered by this definition. It is important to recognize--I think some of our friends on the other side misunderstood and thought we were offering an amendment that had been offered a couple years ago; I want to make it very clear--this definition is not the FEHBP or Office of Personnel Management definition for managed care plans, for HMO plans. This definition is the definition for the fee-for-service plans. As a result, it is a more strict definition. The insurance companies are going to have to provide a higher quality of care under this definition than they would under the HMOs that provide some coverage to roughly one-fourth of the people served under the FEHBP program. So, first of all, we have this definition. I will actually read it in just a moment. Secondly, there are going to be some States that already have a binding State statutory definition. There are 13 of them. Of course, a legally binding State definition of medical necessity would apply to claims filed in those States. That would constitute a safe harbor for the companies that use that definition. Obviously, it would be only prospective, not an after-the-claim adoption of the definition. So obviously that would have to apply. Third, if there is a question about whether this first FEHBP definition works or that people like it, we have established a negotiated rulemaking process under the bill which would involve all of the stakeholders involved--the plans, the employers, providers, and consumers--and they could arrive at a definition that is different if they felt that it could be improved. If the rulemaking failed to arrive at a definition, then, again, you either have a State definition or the FEHBP definition we provide. But if the rulemaking did achieve a definition that all agreed to, that then would supplant the FEHBP definition we have. I will ask staff to give me the actual language now since I gave the copy of my legislation to the clerk. I would like to read the elements of this definition now. This is the definition, as I say, that already applies to, we know, about 49 percent of the employees, and we think it applies to another 23 or 24 percent as well. First of all, the determination provides whether services, drugs, supplies, or equipment provided by a hospital or other covered provider are, No. 1, appropriate to prevent, diagnose, or treat your condition, illness, or injury--obviously, very straightforward and, No. 2, probably the most important point, consistent with standards of good medical practice in the United States. That is the key. If the employee argues that something is being denied in the way of treatment or care and good standards of good medical practice in the United States would call for that treatment, then that treatment will have to be provided under this definition. So standards of good medical practice is the same standard essentially that would be used in a court case. It is the same standard that is used for most of the Federal employees. It is obviously a good standard to use. There are three other aspects of it. I will read each of the three. They deal with very specific situations: Not primarily for the personal comfort or convenience of the patient, the family, or the provider; No. 4, not part of or associated with scholastic education or vocational training of the patient; and No. 5, in the case of inpatient care, cannot be provided safely on an outpatient basis. That would enable the treatment to be provided on an outpatient basis if it could be done. It is a very straightforward definition. It is one that has been used literally hundreds of times. It covers a significant portion of the 6 million people covered, and we think it is a good definition to be included in this legislation. We think it represents a reasonable compromise on the one hand between requiring an external reviewer to be bound by a too narrow definition in a ``rogue'' plan contract and, on the other hand, affording a majority of the plans that operate in good faith the opportunity to adopt a widely accepted safe harbor definition of medical necessity to which the external reviewer would be bound. Madam President, we think this is a good compromise. It is clearly important for us to include some kind of definition in the legislation. We had hoped that the sponsors of the legislation would be willing to work with us to include this definition. So far they have declined to do so. But I am hopeful that we can continue to talk with them, and perhaps we can reach some understanding that would enable us to substitute this definition for the lack of a definition in the legislation right now. At this point, I yield time to the cosponsor of the amendment, Ben Nelson, the Senator from Nebraska.

Mr. KYL. Madam President, I ask unanimous consent reading of the amendment be dispensed with.

Mr. KYL. Madam President, I have an amendment I send to the desk.

Mr. KYL. Madam President, I ask unanimous consent the order for the quorum call be rescinded.

Mr. KYL

Mr. KYL. Mr. President, President Bush has just returned from his trip to Europe, and the newspapers are full of glowing accounts. Some of the headlines include the following: ``Europe sees Bush's Trip Exceeding Expectations.'' That from the New York Times on June 18. The International Herald Tribune: ``President Climbs in European Esteem.'' Similarly, other headlines and stories noted the fact that the President was successful in communicating his views on a wide variety of subjects, including most especially our view of national security issues and specifically the question of missile defense. I want to spend a few minutes talking about the President's successful trip, his vision for the future in a new post-cold-war era, and the acceptance of those views by most of our allies and even, to some extent, by those whom he characterizes as friends, countries that could, indeed, someday perhaps be allies, countries such as Russia, following especially his visit with President Putin during the course of this trip. I think the pundits had a good time as the President was preparing for his trip, speculating about whether this President, who had not extensively traveled abroad and did not have a great deal of international experience, would be able to impress these savvy international leaders. What they found--and it was interesting--on the Sunday morning talk shows they were all doing a little bit of a retreat, which pleased me because I had seen the same kind of questioning of the President when he was beginning his run for the Presidency as Governor of Texas. There were those who said: He is a very congenial fellow, but does he really have what it takes? I think we all saw, and even my Democratic colleagues who supported Vice President Gore at the time concluded, that this is a man who not only has great charm but also significant substance and a view of the world which is in keeping with the times as we commence our journey into this 21st century. He proved that during the campaign. He proved it in domestic affairs, achieving a milestone of success with the tax cuts we passed and he signed into law a little over a week ago, and then this foreign trip, which was the first major trip, the trip to Europe, to visit with our NATO allies and other leaders in the region. We heard the same kind of questions: Was the President prepared to meet these leaders? There is a problem here, Mr. President, as you know, and that is that most of the countries of Western Europe--the majority, I should say-- are governed by left-of-center political leaders. They are, obviously, not of the same political viewpoint as President Bush, but our alliance with our NATO allies has gone through a series of changes where we have had generally conservative leadership, more left-of-center leadership, and then a combination of the two. We have always been able to accommodate our differences politically because of the common goal of providing a defense for the members of the NATO alliance and in working together in national security matters that go beyond just the question of the NATO alliance, especially during the cold war as we were dealing with the then-Soviet Union and subsequent to that time dealing with other challenges, including the Balkans and, of course, in dealing with the evolution of the changes that have been occurring in the country of Russia itself. That was the state of play when the President made this journey. Yet what we found was, notwithstanding the political differences of these leaders, there still is more that binds us than divides us. President Bush is one of those innate leaders who has the capacity to bring people together because of the force of his personality, which is one of reaching out, of showing that he is willing to listen, that he is willing to accommodate, but also making it very clear he has some very firm principles upon which U.S. policy is going to be based. At the conclusion of my remarks, I am going to ask unanimous consent to print in the Record two very fine pieces by one of the finest columnists and political writers of our time, Charles Krauthammer. One of them appeared in the Weekly Standard in the June 4 issue. It is entitled ``The Bush Doctrine, ABM, Kyoto, and the New American Unilateralism.'' The other is an op-ed the Washington Post carried on June 18 in which he makes a similar point that the type of unilateralism President Bush took to Europe and is intent on pursuing with respect to United States interests throughout the world is not a unilateralism that says the United States is going to do what we want to do no matter what anybody else thinks and basically ignores their points of view at all, but, rather, as Charles Krauthammer carefully points out, this new Bush doctrine is a subtle change from the past in this regard. It says we are going to identify what we believe is in the best interests of the United States of America and in the interests of the rest of the family of nations of the world. We are going to pursue a course that achieves the goals that sustain those interests, and we are not going to be deterred by naysayers, by countries that, frankly, do not have the same goals in mind or by any kind of international view that everything has to be done by international accord or it cannot be done at all. We are not going to have our national security interests vetoed by any other country of the world. So we will pursue our national interests, and we are not going to allow other countries of the world that do not share those goals to dictate the results. However, that does not mean we are simply going to try to impose our will on others or that we are going to go our own way and to heck with the rest of the world. Not at all. As Mr. Krauthammer points out, President Bush has very carefully conducted an overarching strategy, and then the tactics of achieving that strategy include a very heavy dose of consultation, especially with our allies and particularly with our NATO allies. It also involves consultation with other friends of the United States, countries such as Russia and India, and other countries such as China, with which we have had some difficulties in recent times. But the point of these consultations is not to tell other leaders what we are going to do come heck or high water but, rather, to say: Look, this is what we believe is in our best interests and your best interests. Let's work together to try to find a way to achieve these goals. There is some room for discussion. We have not finalized everything we plan to do, so there is an opportunity for everybody to help shape the future of the world as we begin this next century. But there are certain goals and objectives we are going to attempt to achieve. If you want to be with us we would like to have you come along and help us find the right way to do that. In that spirit, he visited with these European leaders. We all know the President is very convincing. I realize the situation there is a little different. In politics, it is not the typical kind of diplomacy coming out of the State Department or other areas of diplomatic expertise, in our country and in others, where subtlety and the spoken word are so very important. President Bush is a man who means and says what he means very plainly. There is a certain advantage to that when you are dealing with foreign leaders who do not know you so well. It quickly becomes apparent to them that what you are telling them is exactly what you believe, exactly what the United States intends to do, and that there is no guile, there is no hidden agenda. I think it has an effect of disarming some leaders who might be looking for hidden agendas or games that sometimes people in the political world like to play. President Bush is not like that. He has been very straightforward. He has been very clear about his vision. He has not wavered from that, which is, of course, tempting to do when visiting with other world leaders who do not totally share your world view. The net result of that diplomacy and the new American vision of national security for the family of nations of the world has been an acceptance by many of the European leaders, expressed very overtly. As the headlines noted, a view among even those who do not necessarily totally share the President's view is that there is room to work with this President on these common goals. Our NATO allies, countries such as Spain and Italy, the Czech Republic, Vaclav Havel, made some very eloquent statements in support of the President. The Polish Government, even some statements from leaders of the British Government, Hungary, and other countries in Europe, have in one way or another expressly supported the President's plans for missile defense to protect the United States, our troops deployed abroad, and our allies. Vaclav Havel said: The new world we are entering cannot be based on mutually assured destruction. An increasingly important role should be played by defense systems. There are many similar quotations in these various news stories that were filed by the reporters covering the President's trip. While there were many European leaders who overtly expressed support for what the President was trying to do, as I said, there were others who were not specific in their endorsement but who made it very clear they believed President Bush was somebody with whom they could sit down, talk these things over with, and reach some kind of mutual conclusion. I was especially pleased this morning to find President Putin being quoted over and over again, in the lead story in the Washington Post saying he believed there was room for the United States and Russia to talk about these issues. He was talking about something that has been very fundamental, from the Russian point of view, to the relationship between Russia and the United States, the ABM Treaty. There is a suggestion it is no longer absolutely necessary that that treaty remain in existence as the cornerstone of the strategic relationship between Russia and the United States, as he has characterized it. President Bush has said it no longer is the cornerstone. That was a treaty developed during the height of the cold war when the Soviet Union and the United States totally mistrusted each other. Whether or not it helped keep the peace during that time is totally irrelevant to the circumstances of today, where the threat of mutually assured destruction simply cannot be the basis for the relationship, the strategic relationship between the Russian people and the American people. It has even been put into the context of a moral statement. Dr. Henry Kissinger was one of the architects of the ABM Treaty. He was there at the creation. He has testified to Congress, and he has told many of us, that it is time to scrap this treaty. He knew why it was put into place in 1972. He knew the function it might perform at that time. But he now fully appreciates that it no longer serves that function and, more importantly, leaves us nude, unprotected, vulnerable to attack by countries that were not parties to that treaty and never would be. Here is what he said during testimony in 1999: The circumstances that existed when the treaty was agreed to were notably different from the situation today. The threat to the United States from missile proliferation is growing and is, today, coming from a number of hostile Third World countries. The United States has to recognize that the ABM Treaty constrains the nation's missile defense programs to an intolerable degree in the day and age when ballistic missiles are attractive to so many countries because there are currently no defenses against them. This treaty may have worked in a two-power nuclear world, although even that is questionable. But in a multinuclear world it is reckless. He was even more blunt during a press conference with then-Governor Bush on May 23, 2000, when he said: Deliberate vulnerability when the technologies are available to avoid it cannot be a strategic objective, cannot be a political objective, and cannot be a moral objective of any American President. He is correct. For any President of the United States or Congress to deliberately leave the United States vulnerable to attack when we understand that there is a growing threat of that attack, and to leave in place any kind of legal regimes that would inhibit us from developing the means of protecting ourselves, is intolerable; it is morally indefensible, especially, as Dr. Kissinger says, when the technology is there to provide a defense. One of the questions raised by some of our European friends was, Is the technology really there? By the way, I am somewhat amused by the twin arguments of opponents. ``This thing will be so effective that it will start another arms race.'' That is argument No. 1. Argument No. 2: ``It will never be effective.'' It is going to be effective or it is not going to be effective. I think it will be effective. I also do not think it will start another arms race. But what about the state of technology? The Bush administration has decided that, because of the immediacy of the threat identified in the Rumsfeld Commission report 3 years ago, we need to get on with this now; that we cannot test forever to try to develop the perfect system. There will never be a perfect system, at least for the amount of money we are willing to spend, and right now we do not need a perfect system. The threat is from an accidental launch or rogue nation, and those are not the most robust threats to have to defeat. So I think what Secretary Rumsfeld and the President have in mind doing is fielding, as soon as possible, whatever technology we have, understanding that it is not necessarily the best and it may not work in all circumstances. Now, is that an indictment of what they intend to do? I do not think so. It is an honest acknowledgement of the fact that there is no such thing as a perfect shield, and that we are in the beginning stages of actually fielding this equipment. We have done a lot of research, to be sure. But, frankly, for political reasons, a lot of that research has been wasted because the systems that could take advantage of that research have been stopped from development and eventual deployment. So we have had a lot of starts and stops, but we have never gone the next step, which is to actually put it out in the field and see how it works. What Secretary Rumsfeld has said is go back to the gulf war. That was an emergency. We knew the Iraqis had Scud missiles. In fact, they were beginning to shoot them toward Israel. We did not have a missile defense. But Secretary of Defense Cheney at that time said: Don't we have anything that we might employ here? And the answer from the Pentagon was: Yes, we have the Patriot. It is an anti-aircraft system, but it is very good at that, and it might be able to shoot down some Scud missiles. So they tinkered with it. They took the Patriot batteries that we had--I think some of them were even test batteries--and put them into the field. And those Patriots did a remarkably good job. I think that the end result was somewhere in the neighborhood of about one-third of the Scud missiles were brought down by the Patriot. That is important when you recognize--and you will recall, Mr. President--that the single biggest loss of life of U.S. servicemen in the gulf war occurred when 28 American soldiers were killed by one Scud missile. It is a very lethal weapon if you don't have a defense against it. So what Secretary Rumsfeld and President Bush have decided to do is to take what we have--such as the Patriot missile of the gulf war time-- get it into the field and begin working with it, all the while continuing to test more and more advanced systems. In this way, we will actually have a rudimentary defense to begin with, and we can continue to build on that as the technology evolves. I will give you an analogy. We build ships in classes. We will start the Los Angeles class of attack submarines, for example. The first of the Los Angeles class submarines that came out of the dock was a good submarine, but it was not nearly as good as the last Los Angeles class submarine that came out many years later. Throughout the time that basic class of submarines was built, changes were being made and embodied in that submarine, so that the last one that came off the dock, in many respects, was not much like the very first one; it was much, much improved and, frankly, was the basis for the evolution to the next generation of attack submarines. And so it is with missile defenses. I believe what the Secretary and the President have in mind is fielding a combination of air and space and land systems, combined with the satellite and radar that is necessary to detect a launch, and continue to follow a rogue missile, and then provide information at the very end of its flight for intercept and shootdown. That combination might include the airborne laser, something with great promise. It might include standard missiles aboard the so-called Aegis cruisers, cruisers with very good radar, and a missile which today is, obviously, not capable against the most robust of intercontinental ballistic missiles but at least has some capability if especially you are able to sail the cruisers close enough to the launching point of the missile. As those missiles are made bigger, and another stage is added to them, and a more sophisticated seeker is put on top of that missile, it will become more and more robust, to the point that at some point it will have the capability of stopping just about any missile that might be launched against us. We also have the potential for land-based systems. The point is this: The President has in mind moving forward, getting off the dime. Almost no one, any longer, denies the threat. Even President Putin has pointed that out. So the question is: Do you test forever, until you are absolutely certain, or do you move forward? I saw my little nephew over the weekend. He is just now trying to crawl and walk; and he is falling down more than he is walking, but he is trying. And the next time I see him, I suspect he is going to be walking. You don't quit just because you fell down the first time. And we don't stop just because we had a couple tests that were not totally successful. The point is, we will continue to test; we will continue to develop; we will deploy what we have as we get it ready to deploy, and we will continue to evolve those systems until we are satisfied that we have a system that can work. To those critics who say we don't have the technology or we won't have it, I say, give us a chance. Let's try. Let's see. Don't say, you can't do it, and we never start and we never try. The consequences are simply too great. As Dr. Kissinger said, it would be literally reckless and immoral for us not to try when the technology is there. Another question in this respect that the allies asked is, What would the reaction from Russia be? It is a fair question. Russia has some concerns. But Russia should not have concerns. Does anybody believe that the United States intends to attack Russia? Even the Russians have to acknowledge that is no longer the relationship between our two countries. And we don't believe they intend to attack us. Why would they? So these large inventories of nuclear weapons that both sides have, frankly, are going to come down. We are not going to maintain that level of warhead, and we do not think the Russians are either. In fact, they have made it clear they cannot afford to do so. Frankly, we would rather not have to spend the money on all those weapons so both sides can draw down their nuclear weapons. For anybody to suggest that our building the rudimentary defense is going to cause the Russians to begin spending billions more to build new weapons, when they cannot afford to keep the ones they have, is, I think, ludicrous. It is not going to happen. It is a misplaced fear. I acknowledge the concern that these people express, but I ask them to think about the facts. Even Russian leaders have acknowledged they would not be able to maintain more than about 1,500 warheads--down from about 6,000 or more that they have today. So I do not think it makes sense to argue that we should not prepare to defend ourselves just because the Russians might be fearful somehow and, therefore, might decide to spend billions more that they do not have in developing new weapons. Nor do I think that argument applies to anyone else. What we are talking about is building a defense that rogue nations will understand, making it unprofitable for them to develop and deploy the technology of missile defenses. Are there other threats out there from these countries such as the so-called suitcase bomb? Yes, we are spending a lot to try to deal with that, too. The cruise missile is another challenge that we have to meet. But the mere fact that we have other kinds of challenges as well does not mean that we ignore the one that is first and foremost on the minds of these rogue leaders. Why else would they be spending the billions of dollars they are spending to develop or buy the technology for these missiles and the weapons of mass destruction that they put on top of the missiles? Why? This kind of weapon offers them a blackmail potential. In the wrong hands, with this kind of weapon a country can essentially say to the rest of the world--at the time they intend to attack someone else, or want to get something from the rest of the world--look, you know we can launch this missile against you. We have done it in the past. We will do it again. So you better give us what we want, or you better stay out of our way, or you better do whatever we want you to do. It is that blackmail component that worries so many of our leaders the most. Go back to the Persian Gulf war again. If Saddam Hussein had had the weapons that could put a missile on London or Paris or Berlin or Rome or any other country in that area of the world, do you think we would have had the same quality of allied contingent to face him down in that Persian Gulf war? Do you think other countries would have been as willing to join the United States? And if, in fact, those weapons could have killed a lot more Americans, would the United States have been as anxious to kick him out of Kuwait? The argument would have been: Kuwait is of no interest to us, especially when he can rain so much destruction down upon us. So you need the kinds of defenses that prevent these rogue nations from carrying out their aggressive intentions. That is why--just getting back to the President's visit in Europe this week--I am so heartened by not only the way he has laid this vision out but the way he has stuck to his guns, all the while being very open in his discussions with allied leaders, as well as the Russians. I must say, I was also heartened by the descriptions of the policy, and the steadiness with which Secretary of State Colin Powell and National Secretary Adviser Condoleezza Rice presented this case again Sunday on the talk shows. Dr. Rice, despite, I would say, bating by the questioner, was very calm and very firm in articulating that the United States will do what it takes to protect the citizens of the United States and the interests of other freedom-loving people around the world but that we will do so in a way in which we engage these other leaders. We will listen to what they have to say, and to the extent we are able to do so, within the confines of what is necessary for the United States, we will find ways to accommodate their needs as well. One of these would be to actually provide that kind of missile defense protection for them as well. I applaud the President. I congratulate him for a successful trip. I hope we will have more opportunities to discuss this important issue in the future. Mr. President, I ask unanimous consent that two articles by Charles Krauthammer be printed in the Record.