Jim McCrery

Mr. McCRERY

Mr. McCRERY. Mr. Chairman, I yield myself such time as I may consume. Mr. Chairman, today this transportation bill contains a number of tax-related provisions, and I am going to summarize those very quickly. But the thrust of what we are doing here with these tax provisions, and I think the most important thing to point out, is that with these changes we have added $18 billion over 6 years to pay for highway funding here in the United States, and that was a very important part of getting the number high enough so that we could do at least the basic necessities through the transportation bill that is on the floor today. So I want to commend my chairman, the gentleman from California (Mr. Thomas), for working with the chairman of the full Committee on Transportation, the gentleman from Alaska (Mr. Young), in arriving at these approaches to increasing the revenues going into the Highway Trust Fund. I will just briefly summarize what those are. The tax provisions of this bill extend the authority to spend money out of the Highway Trust Fund and updates the purposes for which that money can be spent. It extends the gas tax through 2011 at current rates and maintains the current law deficit protection rule that requires a 2-year cushion of reserves in the Highway Trust Fund. It increases Highway Trust Fund receipts by $18 billion over 6 years to pay for the highway spending authorized in this bill. Receipts are raised by, number one, reducing the fuel tax evasion that goes on around the country; number two, crediting the Highway Trust Fund with the full gas tax; and, number three, by restructuring the ethanol subsidy so that the trust fund is made whole, so the trust fund does not lose money to the general fund as a result of the ethanol subsidy. The bill also extends the ethanol subsidy through 2010. It simplifies and reforms the rules relating to certain highway excise taxes. It provides alternative minimum tax relief, particularly for small businesses and farmers. Finally, it extends the enhanced section 179 expensing for small businesses, allowing them for 2 more years to expense up to $100,000 of purchases for use in their small business. So, Mr. Chairman, those are the essential provisions of the tax portion of this bill. Mr. Chairman, I reserve the balance of my time.

Mr. McCRERY. Mr. Chairman, I thank the gentleman for yielding me time. It is a pleasure to be on the floor this morning to talk about some of the advantages that are in the 6-year reauthorization of our transportation funding. One of the innovations that the committee came up with that I think is remarkably farsighted is setting aside some of the Highway Trust Fund money, in particular funds that will be available for grants to States to participate in building highways of national significance. These are highways that could be very important for trade in our hemisphere, they could be very important for easing congestion, they could be very important for moving commerce from one region of the country to other. But in each case they will be highways that truly have national significance. What is just as important is these highways, in the main interstate highways, probably would not be built were it not for the availability of funds in these particular categories that are set up by this bill. Because if the funding were not available through these categorical grants or these categorical funds, the States individually would not be able to build these highways out of their regular annual allocations. So I think that is a very innovative, far-sighted approach to solving the problem of continuing to improve our highway infrastructure, particularly in terms of those highways which will add significant economic benefits to not just one particular region of the country but to the whole country. So as we move forward in this age of increased global trade, of increased need to create jobs and grow our economy, these highways of national significance are going to be extremely important in moving us forward. So I commend the committee for their far-sightedness in making it possible for these highways of national significance to be built in the next 6 years; and then, of course, I would expect this to be continued until we have quite a more extensive network of highways across our Nation, which will enable us to grow jobs and grow our economy.

Mr. McCRERY. Mr. Chairman, I have no further speakers. I yield back the balance of my time.

Mr. McCRERY. Mr. Chairman, I have no further speakers at this time, and I reserve the balance of my time.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I appreciate the gentleman bringing this resolution to the floor. Mr. Speaker, I am a graduate of LSU Law School, so, of course, I am very proud of the LSU Tigers and their national championship this year. But I have to tell you not only LSU graduates are proud of the LSU Tigers. LSU is an institution in Louisiana that exceeds just the confines of the campus and the student body and the alumni. Everybody in Louisiana takes great pride in watching the LSU Tigers play, so, of course, the State is just very excited still about the national championship. Southern University, the Jaguars, have a long history of great football teams, this year, of course, winning the national championship for Black Colleges. So Baton Rouge, as the gentleman from Louisiana (Mr. Tauzin) pointed out, is the home of two national champions, and we all of us in Louisiana, north Louisiana and south Louisiana alike, are very proud of those two schools and our capital of Baton Rouge. I took my two boys and my wife to the Sugar Bowl; and just to give you some idea of the excitement that was generated by LSU, my two boys, who are 10 and 8, I have never seen them get so excited about anything, whether it is Christmas morning or birthday presents. These guys were excited. Just throughout the stadium, people were excited about what was going on in our State and with our football team, the LSU Tigers. So it was a great victory not only for LSU but for everybody who lives in Louisiana and who enjoys watching the LSU Tigers play football. The same thing I am sure for the alumni fans, children of graduates of Southern University. So, all in all, this year we just could not have asked for a better ending to the football season at both Southern and LSU. So I thank the gentleman for bringing this resolution to the floor. I commend the coaches of both schools and the players. I want to particularly point out Nick Saban's performance not only on the football field and not only on the sideline but before the cameras. In every interview leading up to the Sugar Bowl, I think Coach Saban was extremely gracious in his comments about the BCS and who might be the eventual champion, who should be and what game. He never, ever got cross-wise with the press. He never stuck his nose up and said LSU ought to be here or there. He just said, look, we are just going to play the game and see what happens; and whatever game they tell us to go to and play, that is where we will go and play. I thought he exhibited a great deal of character and class in that whole time period leading up to the game. So congratulations to Coach Saban for a fine performance on the field and off the field.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, October 24th of this year, Louisiana and the United States lost a fine American and a good friend. Frank Lampkin, Jr. of Bossier City passed away at the age of 79. Though he has passed away, he leaves behind a rich legacy and a community made better by his good work. Mr. Lampkin was a giver in every sense of the word. He gave to his country as a Sergeant in the Marines. He gave his time and energy, inspiring the children of Northwest Louisiana as a teacher, a coach, and a principal for more than three decades. He raised a family. And he continued to find ways to give back even more to his community. Over the years Mr. Lampkin was an integral member of campaigns like the Clean City Committee, the Salvation Army Food Drive and Bell Ringing, Shots for Tots, and awards programs to inspire learning in elementary school children. His list of awards and achievements is remarkable. He was a Kiwanian of the Year and had 50 years of perfect attendance at the Kiwanis Club of Bossier. He was inducted into the Louisiana High School Athletic Hall of Fame and the Northwestern Educators' Hall of Fame. He was a recipient of the Air Force R.O.T.C. Outstanding Service Award. Despite all of these achievements, Mr. Lampkin will best be remembered as a husband, a father, a mentor, a neighbor, and a friend. Frank Lampkin was an inspiring member of his community and I am pleased to have had a chance today to share some of the highlights of his life with those who never had the chance to meet him.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Portman), a member of the Committee on Ways and Means, a gentleman who has done tremendous work on the pension elements that are contained in this bill and will continue, I am sure, to provide leadership in this area.

Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the gentleman from Michigan (Mr. Camp), another distinguished member of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. Weller), another member of the Committee on Ways and Means. (Mr. WELLER asked and was given permission to revise and extend his remarks.)

Mr. McCRERY. Mr. Speaker, I yield 2 minutes to the gentleman from Pennsylvania (Mr. English), a distinguished member of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. Mr. Speaker, to begin this explanation of the bill, the bill before us is very straightforward. It includes many elements which have passed this House before, in some cases numerous times. The Tax Relief Extension Act of 2003 extends a number of important tax incentives strongly supported by Members on both sides of the aisle including incentives which create jobs and encourage restoration of brownfields. One extension provision ensures that the benefits of individual tax credits are not lost to the bite of the alternative minimum tax. Those credits do little good if they are countered by the effects of the AMT. And the bill promotes economic growth by extending a provision first enacted in the 2002 stimulus bill allowing companies to carry back net operating losses up to 5 years. The measure before us allows two important provisions related to defined benefit pension plans which must set aside enough money today to pay promised benefits tomorrow. As a result of declining rates on 30-year Treasury notes, plans are forced to assume that plan assets will grow more slowly than we know will be the case. This assumption results in employers having to set aside additional funds in their pension plan today, depriving them of money needed to expand their businesses and create more jobs. The bill temporarily replaces the 30-year Treasury rate as the benchmark used for these calculations with an index based on high-grade corporate debt. The provision in this bill mirrors H.R. 3108, a bill approved last month in this Chamber by a vote of 397 to 2. Further, the bill provides relief for embattled airlines facing burdensome mandatory contributions. This industry has been hard hit by the recession, a post-9/11 suspension in air travel and the resulting reduced passenger loads, and the higher costs of security resulting from terrorist fears. Airlines are generally either in bankruptcy, coming out of bankruptcy or teetering on bankruptcy's brink. Forcing them to make billions of dollars in additional pension contributions at this time could be disastrous. Accordingly, the bill before us contains relief which allows airlines to pay 20 percent of what current law would require into their plans during the next 2 years. Together, these provisions will give Congress the time to develop long-term solutions to pension funding issues. Finally, the bill includes several trade-related provisions. It includes the provisions of the Miscellaneous Trade and Technical Corrections Act, a compendium of bipartisan trade-related items, duty suspensions, and technical corrections drawn largely from legislation introduced by individual Members. These duty suspensions are critical to many American employers since they are paying unnecessarily high prices for supplies which are not made here in the United States. The House passed a substantially similar version of this bill in March of 2003 by a vote of 415 to 11. The legislation before the House today includes several additional trade provisions, including an extension of Permanent Normal Trade Relations status to Armenia and an increase from $1,200 to $1,600 in the personal duty exemption for travellers returning to the United States from the Virgin Islands. Like the tax provisions outlined above, the trade provisions included in this bipartisan bill are noncontroversial, small in cost and will help United States companies better compete. Mr. Speaker, I urge my colleagues to support this package. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Ohio (Mr. Boehner), the distinguished chairman of the Committee on Education and the Workforce.

Mr. McCRERY. Mr. Speaker, I move to suspend the rules and pass the bill (H.R. 3521) to amend the Internal Revenue Code of 1986 to extend certain expiring provisions, and for other purposes, as amended.

Mr. McCRERY. Mr. Speaker, I yield 2\1/2\ minutes to the gentleman from Michigan (Mr. Knollenberg).

Mr. McCRERY. Mr. Speaker, I yield the balance of my time to the gentleman from Florida (Mr. Foley), a respected member of the Committee on Ways and Means, who will close the debate on this bipartisan bill.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, I rise in strong support of the conference agreement on H.R. 6, particularly title XIII, the Energy Tax Policy Act of 2003. Since beginning work on this bill in the Committee on Ways and Means more than 30 months ago, my goal has been to create legislation which, in fact, looks forward to the promise and potential of conservation and renewable fuels but recognizes that for the foreseeable future traditional fossil fuels will continue to provide the vast majority of our energy supplies. Our tax policy must also address bottlenecks in the distribution chain, which gets energy to where it is needed, when it is needed. The tax title of this agreement is a success on all accounts. It extends the current law incentives for the production of electricity from wind and adds several new renewable energy sources, including production from open-loop biomass. It will encourage automakers to develop more fuel-efficient cars and trucks. It will help promote the use of fuel cells, by both businesses and individuals, as a clean source of power which reduces the load being carried on our already strained transmission grids. It repeals the 4.3 cent surtax currently charged on rail and barge fuel taxes. It improves the reliability of the energy system by encouraging investment in electric transmission lines, something we hope will prevent another blackout like the one which hit the Northeast in August. It will extend and expand proven tax incentives for producing oil and gas from nonconventional sources. It encourages investment in technologies which turn coal into electricity more efficiently and with lower emissions. Finally, it contains incentives which will be of particular benefit to the construction of a pipeline to bring natural gas from Alaska to the lower 48 States. Mr. Speaker, I urge all the Members to support this very good, comprehensive energy bill.

Mr. McCRERY

Mr. McCRERY. Mr. Speaker, last week, I introduced H.R. 3633 a bill of great importance. Federal law generally allows states to use matching federal Medicaid funds to pay for in-patient psychiatric care. There is, however, a key exception that poses risks both to patients in need of services and the facilities that serve them. Specifically, federal law does not permit the use of federal matching funds to provide acute inpatient psychiatric services at free-standing non-governmental psychiatric hospitals, the so-called Institutions for Mental Diseases (IMDs). The exclusion applies only to patients between the ages of 21 and 65 who are on Medicaid. That is not to say the federal government is not willing to pay for this population's acute in-patient psychiatric care. To the contrary, Medicaid funds can be used to pay for the care of these patients in general hospitals that provide psychiatric services. The difference has nothing to do with the patient or the care. It has everything to do with the type of facility. States are free to spend their own money on these patients when services are delivered in an IMD. They have been reluctant to do so, however, because there is no federal match and, perhaps more importantly, the patients are already getting the care without the state having to spend a dime. How is that possible? Simple. Under the Emergency Medical Treatment and Labor Act, better known as EMTALA, patients presenting themselves to a hospital which provides emergency services must be assessed and stabilized before they can be discharged. With many hospitals emergency rooms full to capacity and with a shrinking number of acute psychiatric beds in the U.S., patients with psychiatric problems and their families either seek emergency services in a non-governmental psychiatric hospital or are transferred from a general hospital to an IMD. Once the patient comes into the IMD's emergency room, the hospital is legally obligated under EMTALA to provide treatment to stabilize the patient, which can take several days or more. If the patient is on Medicare or private insurance, the IMD can be paid for the services rendered. But if the patient is on Medicaid and happens to be between the ages of 21 and 65, the psychiatric hospital generally has to render care for which they will not be reimbursed. Consider the unfairness. Washington has passed a law requiring a hospital to provide medical care for an entire class of patients and simultaneously refused to make Medicaid matching payments for those services. Required to take these patients, IMDs are placed under tremendous financial pressure. Those with a particularly high number of these EMTALA Medicaid cases may find their only option is to close their doors, creating a real access problem in local communities. In Shreveport, Louisiana, for example, there is one non-governmental IMD whose continued financial viability is tenuous. Over the past year, this facility has taken emergency transfers from over 70 hospitals throughout the state and from as far away as 300 miles. If this psychiatric hospital closes its doors as a result of their unreimbursed Medicaid costs, these mentally ill patients will lose their only access to care in North Louisiana. In order to address this unfair conflict in two federal laws--the IMD exclusion and EMTALA--I introduced H.R. 3363, the Medicaid Psychiatric Hospital Fairness Act of 2003. This measure would allow states to use federal matching funds to pay for the care of Medicaid recipients between the ages of 21 and 65 in IMDs if the patient was admitted pursuant to EMTALA or as a result of a transfer from another hospital and required immediate, in-patient hospitalization. The measure is supported by the National Alliance for the Mentally Ill--the country's largest advocacy organization for the mentally ill, the National Association of Psychiatric Health Systems, the American Hospital Association, the American Psychiatric Association, and the National Association of County Behavioral Healthcare Directors. Mr. Speaker, I urge swift action on this legislation that will help ensure nongovernmental psychiatric hospitals remain open to serve one of our most vulnerable populations, individuals with serious and persistent mental illness.

Mr. McCRERY

Mr. McCRERY. Reclaiming my time once again, Mr. Speaker, as the gentleman knows, the $87 billion is in the form of a supplemental request from the administration, and that is not covered by the budget that we passed earlier this year. Mr. Speaker, I reserve the balance of my time.

Mr. McCRERY. Reclaiming my time, Mr. Speaker, as the gentleman well knows, the budget that was voted on by this House earlier this year, which takes care of all of the priorities of government which we have the duty and the obligation to do, did anticipate a deficit at the Federal level. So any spending that the gentleman wants to point out, whether it is for projects in his district or highways or any other thing, one could say that is going to drive us deeper into deficit. But I think it is unfair for the gentleman to point out one item that we might pass and agree on and send to the President and say that is all going into the deficit. There are a great many other things we spend money on at the Federal level; and it would be fair to say, I suppose, that any one of those would be deficit spending.

Mr. McCRERY. I yield to the gentleman from North Dakota.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. I would just point out to the gentleman from North Dakota, Mr. Speaker, and to those listening to the debate, that the entirety of the cost of this bill, as noted by the gentleman from North Dakota, is accommodated by the budget that this House voted on earlier this year by a majority vote. Also, we should know that this bill, in its current form, at its current cost, as noted by the gentleman from North Dakota, passed this House with a bipartisan majority, with 15 Members of the minority supporting this bill in its current form. So while it may be true that the bill changed from the time it was introduced to the time it reached the floor, there is no one that was unaware of the cost when this was voted on by the Members of the House at large, and the amount is accommodated by the budget that we all agreed on earlier this year.

Mr. McCRERY. Mr. Speaker, as far as I know, I am the only speaker on our side. So I reserve the balance of my time until such time as the gentleman from New York (Mr. Bishop) has arrived at his last speaker, and I will deliver my remarks at that time.

Mr. McCRERY. Mr. Speaker, might I inquire of the gentleman from New York (Mr. Bishop) if he has additional speakers.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. I will point out once again that the motion to instruct before the House today does not in any way devote any funding to the prescription drug benefit. It merely deletes division B from H.R. 1. It does not supplement in any way, by any amount of money, the Medicare prescription drug benefit. Also, Mr. Speaker, I would like to point out that I am familiar with the RAND study, it is probably the same RAND study cited by the last speaker which showed that yes, when people are spending their own money for health care, there is a reduction in the utilization of health care services. But if Members read on in that same study, it says that there was no significant decline in health outcomes as a result of that. I would submit as we go forward with the baby-boom generation about to retire, we should be looking at the effectiveness of health care expenditures and health care outcomes, and not how much money we can spend on how many health care procedures. Mr. Speaker, in closing, we have had a good discussion today, I think, about some of the attributes of the health savings accounts and health savings security accounts, and I am not going to give the big long speech which I have prepared here, I will submit that for the Record, and I also want to submit for the Record a recent article from the New York Times which talks about utilization of services in the health care system. There has been a lot of talk today about wealthy people and low- income people and access to health care and health insurance and employer-provided health insurance. Mr. Speaker, the whole idea behind health savings accounts and allowing employers to contribute on behalf of employees to health savings accounts, the whole idea of allowing employees to roll over $500 a year from their flexible spending accounts into a health savings account or health savings security account is to get people coverage for health care. We have too many people in this country today who are either uninsured or underinsured. This bill, which passed the House, is designed to allow some of those people to get insurance. I am not sure that the Members who spoke today have focused on the advantages of this bill. I think they are trying to find some way to get some money to put into prescription drugs which would not be allowable under the budget agreement that we have. But this bill before us that is the subject of the motion to instruct today is designed to get more people in this country insurance. Yes, they could opt for high-deductible insurance. We think that is a good thing. At least they would have some insurance. By having a high- deductible policy for minor medical expenses, they would be spending their own money. And, yes, as the RAND study shows, they would be more prudent with their health care choices when they are spending their own money. That could help get overall health care costs down. It certainly could help inject into the health care system some market forces that are not there presently. Mr. Speaker, I think, unfortunately, this motion to instruct is ill- advised. It is not designed to supplement the prescription drug program. It is designed to kill a very worthwhile tax incentive to encourage people in this country to get health insurance, to insure their families for health care expenses, and even if they are lucky enough to be basically healthy for most of their lives, to be able to use their health savings accounts and health security savings accounts to provide long-term care in their old age if they should need it. This is a very good proposal. Mr. Speaker, the Motion before us is an interesting one. Generally made by a member of the minority party, Motions to Instruct allow this Chamber to go on record with respect to one aspect of a measure pending in conference. These motions generally tackle a specific piece of a bill and allow the moving party to encourage the House to recede to a Senate-passed provision or to force the House to take a position on a provision or provisions which were not subject to an individual recorded vote during House debate. That is not the case here. The House has already voted, overwhelmingly, against the position being advocated by my colleague from New York. While the Motion before us is a new one, the issue is not. The Motion asks the conferees to reject Division B of the House-passed Medicare bill, which, as my colleague from New York has noted, relates to the creation of tax-favored savings accounts to meet current and future health care needs. Before becoming Division B of H.R. 1, the text in question was a stand-alone bill, H.R. 2596. On June 26 of this year, the House voted to pass that measure by a vote of 237 to 191. I should add that the vote was bipartisan, with 15 Members of the minority supporting the provision. Under the terms of debate for the bill, as set by the Committee on Rules, H.R. 2596 was appended onto H.R. 1, the Medicare Prescription Drug and Modernization Act of 2003 as Division B. Mr. Speaker, I have provided this detailed legislative history so that we can all understand that the House is already on record on the issue presented by the Motion to Instruct. Before casting their votes on this Motion, I hope my colleagues will review their vote on the identical issue which occurred on June 26. Having discussed the legislative history of this provision, let me turn to the substance, which is not less distinguished. This week, the Census Bureau reported what we all know to be true. There are far too many Americans without health insurance. The economic slow-down, from which we are only now starting to recover, left too many without jobs and has caused some workers to lose employer- sponsored health insurance. That problem demands bold and innovative thinking. I have long believed that the employer-based system for health insurance, the product of historical happenstance, must be radically restructured if we are to provide affordable health insurance for all Americans. I have worked across party lines to explore this issue and hope those efforts will someday lead to fruition. Part of the solution lies in taking steps which increase personal responsibility. That is why the provisions creating HSAs and HSSAs are so important. Mr. Speaker, I will insert in the record an article which ran in the New York Times on September 13, 2003 entitled ``Patients in Florida Lining Up for all That Medicare Covers''. The article outlines how some seniors, shielded from the true cost of health care services by Medicare and supplemental insurance, have turned visits to doctors from a dreaded necessity into a focal point of their social schedule. The conclusion, frankly, is not a shocking one. I think we all know that people tend to consume more of things they perceive to be free. To the extent health insurance features low deductibles and minimal cost- sharing, enrollees are more likely to consume health care goods and services which they otherwise might not. This lack of personal responsibility is at the root of many of our health care cost problems. Division B of H.R. 1 takes concrete steps to ensure that health care consumers have more responsibility and more influence, in our healthcare system. Thought there are important differences, HSA policies are only available to those individuals who buy higher deductible health insurance. HSSAs will be available to those with more traditional health plans, but they may also be established by those who have no health plan at all, are therefore uninsured and who, I suppose, could be thought of as having an infinite deductible. By encouraging Americans to shift to higher-deductible health insurance, these accounts address a fundamental problem in health care today--the phenomenon of first-dollar coverage paid for by third- parties. In his comments, my friend from New York indicated that these accounts will be used by the wealthy as a way to save money tax-free. About that I have several comments. First, in reviewing this bill, the Joint Tax Committee did estimate that enactment would result in a revenue loss to the Government of about $173 billion over the next decade. The vast majority of that loss came from individuals establishing HSSA accounts. Yet individuals can make tax-deductible contributions to HSSAs only if their incomes are below certain thresholds. Mr. Speaker, HSSA account holders are not the idle rich, looking for a tax shelter. They are the families in this country trying to get by and maybe get ahead a little. Allowing them to set aside some money on a tax-free basis for health care hardly seems like a tax-shelter. In fact, if the funds in an HSSA are not used for health care, the distribution is generally taxed as ordinary income and subject to an additional 15 percent tax. The 15 percent penalty does not apply if the account holder becomes disabled or withdraws the funds after reaching age 65. It is true that account balances remaining upon death are included in the decedent's estate. And, if the estate tax repeal is made permanent--as a vast majority of this Chamber supports--it is possible that some of these funds set aside for health care might be used for other purposes. But that fear is not in my estimation a good reason to reject an improvement to the tax code which will increase personal responsibility and whose benefits flow predominantly to those who otherwise will have the most difficulty meeting their health care needs as they age. Second, Mr. Speaker, a population today having real difficulty with high health care costs are those who are retired or laid off but not yet eligible for Medicare. Caught in this gap are millions of Americans between the ages of 55 and 65. As account balances in HSSAs may be used to purchase individual health insurance, these accounts could be a real helping hand to those too young for Medicare but not eligible for other employer-sponsored coverage. Third, if we really want to tackle the issue of ``tax fairness,'' it is not appropriate to look at the creation of HSAs and HSSAs in isolation Let's look at all of the tax subsidies, both hidden and explicit in the tax code and how they operate today. Consider the fact that in 1999, the Federal Government ``spent'' approximately $100 billion in a hidden tax subsidy for health care, the exclusion from income, and therefore taxes, of the value of employer- sponsored health care. If that exclusion were not in place, meaning employees were taxed on the value of the health benefits provided as if it were ordinary compensation, the federal government would have collected an additional $62 billion in income tax that year and $34 billion in FICA contributions. Those are large and abstract numbers. Let's break them down and see what they mean to American families. According to the Lewin Group, the tax exclusion provided the average family with a subsidy of $1,155 in 2000. But the benefits were not evenly divided. Families with incomes under $15,000 averaged just $79 in benefits, while families with incomes over $100,000 received an average subsidy of more than $2,600. Mr. Speaker, those figures are both shocking and disappointing. Encouraging employers to provide bigger and more generous health plans is not the answer. In addition to the odd distributional effects of the tax exclusion, there is ample evidence that the richest benefit packages are offered by employers with higher-income workers. A 1998 government survey found that only 42 percent of Americans under age 65 with incomes under 250 percent of poverty have insurance through an employer, compared to 83 percent of Americans with incomes above that level. Part of the reason may be because businesses with low-wage workers are less likely to offer health insurance. A Kaiser Family Foundation report in 2000 found that two-thirds of small businesses offer coverage to their workers. But that number is cut in half for small businesses in which more than 35 percent of the workers make less than $10 per hour. Part of the reason may also be that when coverage is offered to lower-income workers, it is generally offered on less favorable terms. A Moran Company study in 2000 found the average employees' monthly premium for family coverage was $130 for workers earning less than $7, while the cost for employees earning more than $15 per hour was just $84. Mr. Speaker, these are depressing statistics. I stand ready to work with any of my colleagues in designing a system which more rationally allocates scarce resources for health care. In the meantime, however, we must recognize that the uninsured and lower-income families are at a severe disadvantage when it comes to health benefits. I would not stand here and tell you that allowing them to set up tax-favored HSSAs is going to solve all of the distributional problems I mentioned. But surely providing more Americans an opportunity to use pre-tax dollars for health care cannot be a bad thing. I should also mention two other important provisions in Division B which merit their own discussion. First, the bill would allow individuals with unused balances in Flexible Spending Accounts to roll-over up to $500 each year. Even worse than insurance plans which make medical care appear free, FSAs have a use-it-or-lose-it feature. As a result, many account holders scramble at the end of each year to exhaust their accounts on marginally beneficial health care services. By allowing account holders to roll-over some unused funds, the provision reduces the very perverse current law incentive encouraging this over-consumption of health care. Second, the provision contains a clarification of current law which will eliminate a burdensome requirement on FSA plans which use debit cards to make and track account-holders' health care spending. In May, the Treasury Department and the Internal Revenue Service published a Revenue Ruling providing guidance on the use of debit and stored-value cards used to make payments under FSAs and health reimbursement accounts. Overall, the procedures will make it easier for millions of Americans to use stored-value cards to access the benefits of these accounts. There is, however, an impediment to the expanded use of these Cards. The Revenue Ruling requires that employers and other plan sponsors issue Form 1099 reports to service providers who accept these Cards. There is little evidence that the requirement will affect the administration of the tax code, but the administrative and paperwork burdens will serve as an impediment to the use of these stored-value cards. I was pleased that H.R. 2596 included a provision overriding the 1099 requirement. I have since written to Secretary Snow, urging him to issue a new Revenue Ruling removing the 1099 requirement. Based on conversations with Treasury officials, I am hopeful that this can be addressed without action by the Congress but am concerned that passage of this Motion could signal Treasury that Congress does not care if the 1099 requirement is left in place. Before concluding, Mr. Speaker, I do want to respond to concerns that the deficit is too large to justify a tax cut of this kind. I, too, am troubled by the recent projections of significant deficits for the next several years. But, as a share of our national income, those deficits--and more importantly the debt as a percentage of our gross domestic product--remain manageable. More importantly, to the extent HSAs and HSSAs allow Americans to accumulate funds to pay for health care and encourage them to consume medical services more prudently, we can stem the otherwise unchecked growth in medical inflation which is, in my estimation, the most serious cause of long-term upward pressure on our budget picture. Finally, Mr. Speaker, let me express my concern about any Motions to Instruct the conferees on H.R. 1. As my colleagues are well aware, the issued surrounding the creation of a Medicare drug benefit are as numerous as they are complex. These discussions will only be brought to a successful conclusion if the conferees are able to creatively address the difference between the two bills. By artificially seeking to tie the hands of the negotiators this motion makes it less likely, rather than more likely that the conferees will be able to strike the delicate balance necessary to produce a bill acceptable to each Chamber and the President. Accordingly, we should reject this Motion for fear it will make it less likely that a Medicare prescription drug benefit can be enacted this year. Mr. Speaker, I urge my colleagues to affirm the vote this House took in June and to defeat the Motion to Instruct. [From the New York Times, Sept. 13, 2003] Patients in Florida Lining Up for All That Medicare Covers (By Gina Kolata) Boca Raton, Fla.--It is lunchtime, and the door to Boca Urology's office is locked. But outside, patients are milling about, calling the office on their cellphones, hoping the receptionist will let them in. To say they are eager hardly does them justice. ``We never used to lock the door at lunch, but they came in an hour early,'' said Ellie Fertel, the office manager. ``It's like they're waiting for a concert. Sometimes we forget to lock the door and they come in and sit in the dark.'' Yet few have serious medical problems, let alone emergencies. ``It's the culture,'' said Dr. Jeffrey I. Miller, one of four urologists in the practice. Doctor visits have become a social activity in this place of palm trees and gated retirement communities. Many patients have 8, 10 or 12 specialists and visit one or more of them most days of the week. They bring their spouses and plan their days around their appointments, going out to eat or shopping while they are in the area. They know what they want; they choose specialists for every body part. And every visit, every procedure is covered by Medicare, the federal health insurance program for the elderly. Boca Raton, researchers agree, is a case study of what happens when people are given free rein to have all the medical care they could imagine. It is also a cautionary tale, they say--timely as Medicare's fate is debated in Congress--for it demonstrates that what the program covers and does not cover, and how much or how little it pays, determines what goes on in a doctor's office and why it is so hard to control costs. South Florida has all the ingredients for lavish use of medical services, health care researchers say, with its large population of affluent, educated older people and the doctors to accommodate them. As a result, Dr. Elliott Fisher, a health services researcher at Dartmouth Medical School, said, patients have more office visits, see more specialists and have more diagnostic tests than almost anywhere else in the country. Medicare spends more per person in South Florida than almost anywhere else--twice as much as in Minneapolis, for example. But there is no apparent medical benefit, Dr. Fisher said, adding, ``In our research, Medicare enrollees in high intensity regions have 2 to 5 percent higher mortality rates than similar patients in the more conservative regions of the country.'' Doctors say that Medicare's policies are guiding medical practice, with many making calculated decisions about whom to treat and how to care for them based on what Medicare covers, and how much it pays. ``The bottom line is that the stuff that reimburses well is easier to get done,'' Dr. Carl Rosenkrantz, a Boca Raton radiologist, said. Thomas A. Scully, administrator of the Centers for Medicare and Medicaid Services, said he knew the situation all too well. ``We have a system that does nothing to look at utilization,'' Mr. Scully said in a telephone interview. ``If you send in a bill and you are legitimate, we pay it.'' The effect shows up in the way doctors deal with office visits, for example. Medicare in Boca Raton pays $52.46 for a routine visit, in which a doctor sees a patient with no new problem. That is not enough, doctors say; it costs about $1,500 a day to run an office there, they explain. Payments in other states are different, adjusted for cost of living, but doctors say, and Mr. Scully agrees, that they are generally inadequate. Doctors who try to make a living seeing only Medicare patients for routine visits, he said, ``have a very rough time.'' Medicare bases its payments on a system in which each kind of service is assigned a ``relative value,'' Mr. Scully said. To increase the payment for routine office visits and stay within its budget, Medicare would have to decrease the relative value of other services. A committee of doctors meets each year to suggest relative values, he said, but ``the most aggressive and active groups tend to be the specialists.'' ``Year after year,'' Mr. Scully went on, ``the specialists come in and make a very strong argument for higher reimbursements. There's eventually a squeeze on the basic office visit.'' In many areas of the country, private insurers pay more for office visits than Medicare does, so doctors can essentially subsidize their Medicare patients. ``If we just saw Medicare patients and didn't see anyone with regular insurance, we wouldn't be able to pay the bills,'' said Dr. James E. Kurtz, an internist at Chatham Crossing Medical Center in Pittsboro, N.C. Elsewhere, many doctors are refusing to see Medicare patients. ``Some counties in Washington have no doctors who take new Medicare patients,'' Dr. Douglas Paauw, a professor of medicine at the University of Washington, said. Doctors in South Florida do not have a choice. Private insurers there pay the same as Medicare or less, and so many old people live in the area that if doctors want to practice, they must accept them. But how to make a living? One way, Dr. Robert Colton, an internist in Boca Raton, said, is to see lots of patients, spending just a few minutes with each and referring complicated problems to specialists. Dr. Colton did that for a while, seeing as many as 35 patients a day. A typical busy internist, he said, would see 20 patients a day. ``I felt like a glorified triage nurse,'' he said. ``If you try to handle a complex problem, it slows you down,'' Dr. Colton said. ``You have to sit down with the family, meet with the patients, talk to them. If you say you have coughing and you are short of breath and your knee hurts, I might have sent you to two different specialists.'' The goal, Dr. Rosenkrantz said, is to move the patients on. ``The worst thing than can happen is for someone to walk into your office and say, `I have an interesting case for you.' Financially, you'd be dead.'' Even seeing patients in the hospital can become an exercise in time management, Dr. Rosenkrantz said. ``We have doctors who do rounds at 4 a.m.'' A second driving force behind medical care in Boca Raton is the demands of patients. They want lots of tests and specialists, they refer themselves to specialists, they ask for and get far more medical attention from specialists than many doctors think is reasonable or advisable. ``This Medicare card is like a gold card that lets you go to any doctor you want,'' Dr. Colton said, ``I see it every day. When there's no control on utilization, it's just the path of least resistance. If a patient says, `My shoulder hurts, I want an M.R.I., I want to see a shoulder specialist,' the path of least resistance is to send them off. You have nothing to gain by refusing.'' Patients here say they have mixed emotions. They complain about rushed primary care doctors but readily admit that they seek multiple specialists and multiple procedures. The primary care doctors are often irritatingly busy, patients say. ``In waiting rooms sometimes they are standing against the wall,'' said Marvin Luxenberg, a retired lawyer who lives in nearby Boynton Beach. Then, he said, ``when you get in to see the doctor, you get just three or four minutes of time.'' Dr. Colton says he found a way to give his patients more time. He joined a ``concierge'' practice, in which patients pay an annual fee in addition to the normal charges for medical services. Dr. Colton's group, MDVIP, charges patients $1,500 a year and limits the number of patients each doctor sees. But not everyone wants to pay that kind of fee. Many patients just spend their time in specialists' offices. Each specialist handles a different aspect of their care, with no one coordinating it. Specialists get no more than primary care doctors for an office visit, but they provide tests and procedures that demand higher Medicare reimbursements. Doctors say those payments allow them to stay in business, especially if they provide the procedures in their own office. Medicare pays the doctor and the facility where a procedure is done. For a nuclear stress test, for example, the doctor gets about $200 and the facility gets about $1,200. ``Doctors have incorporated these tests as much as possible into their offices so they can gain from the facility fee,'' Dr. Thomas Bartzokis, an interventional cardiologist in Boca Raton, said. Patients say they have lots of specialists, and lots of tests. Asked how many doctors he saw, Leon Bloomberg, 83, a patient of Dr. Miller, thought for a minute and looked at his wife, Esther. ``Between us, we have 10 or 12,'' Mr. Bloomberg said, including a pain specialist and a neurologist for his neuropathy, a cardiologist for his heart condition, ``a pulmonary man'' for his asthma, a rheumatologist for his arthritis and Dr. Miller for his prostate. Mrs. Bloomberg has her own doctors, including ones for heart disease and for diabetes. ``We have two to four or more doctors' appointment a week,'' Mr. Bloomberg said. It is easy to find all these specialists, he said. ``You get recommendation at the clubhouse, at the swimming pool. You go to a restaurant here and 9 times out of 10, before the meal is over, you hear people talking about a doctor or a medicine or a surgery.'' And of course there are the other patients in all those waiting rooms. Mr. Bloomberg even recommends specialists to his own doctors. But some patients say they are frustrated by what they call a waste of resources. ``The doctors are raping Medicare,'' said Louis Ziegler, a retired manufacturer of flight simulators who lives in Delray Beach. Mr. Ziegler recalled going to a doctor for a chronic problem, a finger that sometimes freezes. All he wanted was a shot of cortisone. But he got more, much more: ``I had diathermy. I had ultrasound. I had a paraffin message. I had $600 worth of Medicare treatment to get my lousy $35 shot of cortisone.'' Dr. Colton, the internist here, is frustrated, too. ``The system is broken,'' he said. ``I'm not being a mean ogre, but when you give something away for free, there is nothing to keep utilization down. And as the doctor, you have nothing to gain by denying them what they want.'' Mr. Speaker, I yield such time as he may consume to the gentleman from California (Mr. Thomas), the chairman of the Committee on Ways and Means.

Mr. McCRERY. Mr. Speaker, I yield myself such time as I may consume. I would just point out, Mr. Speaker, that while we have had a couple of proponents of the motion to instruct mention that more money should be used for the prescription drug program, this motion to instruct does not direct any of the savings which would be gained from deleting division B of the Medicare bill to prescription drugs or for any other purpose. So while they may use conjecture to think about what they might use this money for, this motion to instruct has nothing to do with that. Also, Mr. Speaker, I might point out that if this motion to instruct were to redirect that money to the prescription drug program, that would be in violation of the budget agreement that this House passed earlier this year. Mr. Speaker, I reserve the balance of my time.