Frank Pallone

Mr. PALLONE

Mr. PALLONE. I agree, and I appreciate the remarks the gentlewoman has made, if I could just follow up on two points that she made. One is when I was at the senior center in Edison on Monday, one of the very first things the gentlewoman discussed was prescription drugs and the cost of prescription drugs, and how some seniors simply cannot afford to buy them or they will not get a refill if they need it. It is amazing to me, because when we talk to seniors when we are in our districts, these issues in many ways are very plain to them. Many of the seniors in the audience in Edison said to me, ``Well, Congressman Pallone, I don't understand. What Medicare should do,'' and this is almost a direct quote from one of the individuals, ``what Medicare should do is to be expanded to include preventive care.'' He talked about prescription drugs, because he said, ``A lot of times I go to the doctor and he prescribes a drug to me, and Medicare is covering the cost of the doctor visit but it is not covering the drug. So I get the prescription but I go home and I never fill it.'' What good is that? The point is that if Medicare were expanded to cover certain kinds of preventive care, like prescription drugs or like home health care visits, we would actually save a lot of money. We should be thinking of creative ways to expand Medicare, deal with prevention, and then save money in the long run. That is what I was kind of hoping we were going to be doing when we started to talk about Medicare in the beginning of this Congress. But, obviously, I was very naive, and I think I was naive because I did not understand what the gentlewoman brought up, the basic idea, which is that this Republican leadership, both in the Senate and here in the House, really does not like the Medicare program. They have an ideological problem with the Medicare program, and that is why we are getting these quotes from Speaker Gingrich saying that we will deal with it piece by piece and it will wither on the vine, or from the Republican presidential candidate saying that he is proud of the fact that when he was in the House of Representatives he did not vote for Medicare. They are not really interested in creative ways of trying to save money and expanding the money to help seniors. They just basically want it to go away. The other thing the gentlewoman mentioned and I thought was so important, she talked about the dangers of Medicare becoming a second rate health care system, and I think we have talked about that a little tonight. But there is also sort of a corollary to that, the notion of a divided system, sort of a class battle, if you will, between the wealthier seniors and the middle class or poorer seniors. I see that happening, for example, with Medigap. We mentioned that about half the seniors have Medigap and half do not. That means that a lot of seniors, even those who are on Medicare now, increasingly are not able to get certain kinds of health care services because they cannot pay out-of-pocket, because they do not have Medigap. So already we have a two-tiered system. Now, in this Republican budget, one of the things we did not mention tonight, but I think we should, is that they have brought up again the Medical Savings Accounts, the so-called MSA's, which I call the tax break for the healthy and wealthy. Basically what they are suggesting, and the gentlewoman knows is the case, is that seniors opt into a situation where they get catastrophic coverage. If something really terrible happens to them and they have to go to the hospital for a long stay, they are covered, but they are not covered for anything else. The money that the Federal Government puts up for Medicare, like a voucher, is put into some sort of savings account, and if they have to go to a doctor or they have something that only takes a relatively small degree of care, then they have to pay all that out-of-pocket. But if an individual has a very high deductible, or are essentially only covered for catastrophic care, the only people that will be able to afford that are the healthy and wealthy, so to speak, because they will say, ``Well, that is fine, I will opt for that.'' So what do we do? Once these medical savings accounts become part of the Medicare system, we will have a two-tiered system, in essence. The cost for those who do not have the MSA's will probably go up, because they will be the ones that have less money and are more of a burden on the system. So the cost of the system will go up. I know the gentlewoman has been very concerned about that issue, so if the gentlewoman wants to talk about that I would yield to her.

Mr. PALLONE. Mr. Speaker, tonight I would like to once again talk about the proposed Republican cuts in Medicare and Medicaid that are included in the budget, which we are most likely going to be voting on this Thursday in the House of Representatives. I had the opportunity on Monday of this week, just this past Monday in fact, to speak before the Edison Senior Center. Edison is the largest municipality in my district in New Jersey, and there must have been 100 senior citizens at the Edison Senior Center when I was there. I talked to them about what the Republican leadership was proposing to do with Medicare and Medicaid once again, and how similar the proposals in this budget we will be voting on are to the cuts and fundamental changes in Medicare and Medicaid that the Republican leadership proposed last year, and which the President and which the Democrats in the House of Representatives fought so hard to keep from becoming law. We were successful. We were successful in stopping those changes to Medicare and Medicaid last year, and many of the seniors at the Edison Senior Center, I indicated to them I felt very strongly that they and the seniors throughout the country were a big part in our effort to try to stop those changes in Medicare, because many of them wrote to their Congressmen or Congresswomen and wrote to their Senators and said they did not like the changes that the Republicans were proposing. So I asked them to once again start a writing campaign, and talk to other seniors that they know and their family members to say we do not want these radical changes being proposed by the Republicans. Now, as we know, this current budget plan, this current Republican plan would cut Medicare by $168 billion over the next 6 or 7 years, and cut Medicaid by $72 billion. Most of the Medicare cuts this time would be in hospital care. That is particularly important to the State of New Jersey, because many of the hospitals in New Jersey, particularly in urban areas, but also in suburban and rural areas, are having a very difficult time making ends meet. Many of them are more than 50 percent, sometimes 60 percent dependent on Medicare and Medicaid, to keep their operations going. A significant cut in either of those programs really could cause many of those hospitals to close, particularly in the urban areas. The whole reason we started the Medicare program that was started under President Johnson back in 1963 is because many seniors did not have health insurance, and found it difficult because of lack of funds or because of their condition, their physical condition, to buy health insurance. I think a lot of times we forget what it was like prior to Medicare coming into existence, how many senior citizens did not have health insurance, how many basically were so poor and had to pay money out of their pocket if they wanted health care, so they just basically delayed it, did not go to the hospital or the doctor. We do not want to go back to that era, the era when seniors were impoverished in order to provide health care for themselves, or when so many of them did not have any health insurance coverage. One of the things that I told the seniors in my district on Monday is that we are not just talking about money here. I think the money aspect is important, because essentially these large cuts in Medicare and Medicaid are being used to finance tax breaks for mostly wealthy Americans. So the money is an important part of this. But there are also some fundamental changes in the Medicare program and the Medicaid program that are being proposed here by the Republican leadership that go way beyond the monetary aspect. Essentially what it amounts to is choice, the fact that senior citizens are going to have less choices of doctors and less choices of hospitals. Because what is happening is the way that Republicans have structured these changes in Medicare and Medicaid, they are pushing more and more seniors into HMO's or managed care, where often times they do not have the choice of doctors. They cannot go to the doctor, the specialist they traditionally go to, or sometimes cannot even go to the hospital that they traditionally go to that may be nearby. I guess one of the things that really bothers me about the Republican rhetoric on the Medicare issue is they keep stressing what they are doing with Medicare is providing more choices. That somehow choice is sort of the linchpin, if you will, of their recommendation. And I would maintain that just the opposite is true, that the way the reimbursement rate is set up is so that seniors, basically a higher reimbursement rate goes to managed and HMO's, and less to traditional fee for service, where you have your choice of doctors or hospitals. That means seniors are going to have less choices as more and more are pushed into managed care. I am being joined here tonight by the gentlewoman from Connecticut [Ms. DeLauro] and I wanted to yield some time to her. But I did want to mention, because there was one thing before I do yield, that there was an article in the New York Times this Sunday, that although it did not mention what was happening here in the House with regard to Medicare and Medicaid per se, I think is relevant, and I mention it because they specifically mention our two States, New Jersey and Connecticut. The article is entitled ``The high cost of plugging the gaps in Medicare.'' Basically what the article says is that Medigap insurance, which is the insurance that seniors buy in order to cover the health care programs or the health care costs that are not covered by Medicare, and about 50 percent of the seniors in this country have Medigap because they want additional coverage, that the cost of Medigap insurance is skyrocketing. They mentioned the AARP, which has a policy sold by Prudential, that will go up an average of 26 percent more this year. They specifically mention that in New York, the average premium of the five largest Medigap insurers soared 11 percent in a year, a rate equalled or topped in Connecticut or New Jersey. In both our States, we are talking about increases in Medigap insurance that are at least 11 percent in 1 year. I think that this is directly related to what is happening in Washington with Medicare, because as you make cuts in Medicare, and, of course, the Republicans are talking about much deeper cuts than the President or anything that the Democrats have put forward, as you make these huge cuts in Medicare, and also in Medicaid, what is going to happen is that you are going to find less services that are covered or quality of services that are covered, more out-of-pocket expenses for senior citizens, and I think that that is going to be reflected more and more in higher Medigap premiums. The other thing it will result in is that more and more people again will be pushed into managed care or HMO's, where they do not have a lot of choices because they will opt for that, rather than have to pay for the large premium increases in the Medigap program. I would like to yield at this time to Ms. DeLauro, who has been an outspoken advocate of protecting the Medicare program, and I believe has had a lot of impact over the last year when we were fighting these terrible Republican leadership proposals to try to significantly change the Medicare program.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, that is a very good question. If I could have a couple of minutes to respond.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, this notion that somehow the Republicans are trying to save Medicare is just a lot of baloney, but they are at it again. They are at it again, basically making these cuts in the Medicare Program just to pass on tax breaks to the wealthiest Americans, and they are going to destroy the Medicare Program in the process. What they are essentially doing is making cuts that are so severe that we will see hospitals closed and we will see the quality of health care services for seniors significantly decline. And they are also passing and changing the Medicare Program in a way that the senior citizens will not have a choice of doctors. They will be pushed into managed care systems. They will be forced to spend more money out of pocket that goes back to Medicare providers in order to have the same benefits that they have now. So this idea that somehow they are solving the problem with Medicare or they are dealing with the potential insolvency is not true. The President has put forth a proposal in his budget that would guarantee the continued solvency of the Medicare Program, but the Republicans are going way beyond that. They are cutting $44 billion more than what the President proposes. They are not trying to deal with Medicare in an effective way.

Mr. PALLONE

Mr. PALLONE. Exactly. I just wanted to point to two surveys that were done, one involving the Medicaid safety net for children and the other for nursing homes. And just very quickly this is from an article that was in the Washington Post last November that says, ``Medicaid safety net for children could be imperiled.'' It was a report by the Journal of the American Medical Assocation. It said, ``From 1992 to 1993, an estimated 3 million children lost private health insurance as people lost jobs or employers stopped providing health insurance.'' But until now, increases in Medicaid coverage resulting from past legislation, congressional legislation, that broadened eligibility under Medicaid basically offset the fact that a lot of people lost their jobs and their children are no longer covered by health insurance. For example, they said that in 1988, 66 percent of all children under age 18 had health insurance based on the employment of a family member and 16 percent were covered by Medicaid, but in 1994, the share with employer base health insurance had propped to 59 percent and the Medicaid to 26 percent. So even though people were losing health care coverage for their children because they were losing their jobs in the last five or 6 years, because of the expansion of Medicaid coverage for children under Federal guaranteed entitlement status. Most of those children continued to be covered by health insurance under Medicaid, but now if we block grant this to the States that will not be the case anymore. Another study, this is from the New York Times back in November 1995, that pointed out how the Republican budget would create a shortage of nursing home beds for the elderly, and it says an array of advocates are warning that the Republican budget would put extraordinary strains on the Nation's patchwork system for paying for nursing homes. The chief threat comes from the Republican cuts to Medicaid. Critics say the changes proposed by the Republicans could diminish the availability of nursing home beds for all but the richest Americans, as well as its quality of care within those institutions and the amount of assistance available for care at the nursing home and would come apart when the over 85 population is projected to grow by 40 percent. Again, the same way the number of children who did not have private health insurance was growing, the number of seniors who need nursing home beds is growing, and here we are at the time when these populations and needs are growing and those people would become uninsured and not have coverage. We are talking about block granting and providing less money to the States for the very coverage where there is more need. What you are pointing out is exactly on point. The other thing that I wanted to mention that you talked about is this whole notion that somehow the Republicans, Gingrich and the others, are saying what we are really doing here is protecting Medicare because it is going to go insolvent and so we have to implement these cuts in order to make Medicare solvent 5 or 6 years from now. Again, I would say nothing could be further from the truth. I mean, these cuts are not being implemented in order to protect Medicare. These cuts are being implemented to give the tax breaks for the wealthy. And the President in his budget resolution, in his budget that he proposed earlier this year, guarantees the life of the Medicare Trust Fund for at least a decade. His budget proves that the Republican Medicare cuts, the damaging changes that we have talked about, are not necessary to balance the budget. There is over $120 billion remaining in the trust fund and there is no imminent danger that claims will not be paid. And although the trust fund did not perform as well as projected in 1995, the difference between the actual and projected performance was within the typical margin of error and has been incorporated into budget projections. Every year minor adjustments were made to make sure that the trust fund would remain solvent for the next decade. Democrats continued to do that. The President did that back in 1993. His health care reform would have expanded the life of the trust fund significantly. This is just an excuse, and I know you mentioned that. And I would not be surprised if our colleagues on the other side are going to suggest this again later tonight, that somehow Gingrich and they are protecting the trust fund from insolvency. It is not true.

Mr. PALLONE. I do not, Mr. Speaker. We are just doing special orders. There is no parliamentary inquiry.

Mr. PALLONE. In fact, the Congressional Budget Office has clearly indicated that medical savings accounts will actually cost more money to the Federal Government. So if you are talking about trying to save money, that clearly is not the way to go. I want to thank the gentleman again for being here tonight.

Mr. PALLONE. I agree. I know our time is almost over here, but again if it were really true that they were concerned about the Medicare program, they would deal with it separately from the budget. They would not use the cuts in Medicare and Medicaid as a reason, if you will, or as the basis for these tax breaks that are provided in this new budget that they are trotting out. And even more important, they would not make the changes, the substantive changes in the Medicare program and the Medicaid program that we talked about this evening. What they are doing is trying to push seniors into managed care, to deny them the choice of their doctors or their hospitals. They are including these balanced billed provisions that will force seniors to pay more out of pocket for the health care. All of these major structural changes in Medicare are being implemented and those are being done under the aegis or with the excuse that somehow they are trying to preserve Medicare as we continue, and it is just the opposite.

Mr. PALLONE. OK. Thank you, Mr. Speaker. I wanted to, if I could, comment on a couple of things that the gentleman from Ohio said, because I think they are really crucial. One is this concern that you have, which is extremely legitimate, over the fact that the number of uninsured, the number of people that have no insurance in this country continues to rise. We know that that was one of the major reasons why President Clinton sought to address the health care crisis, if you will, in the last Congress because the number of people that have no health insurance in this country, and we are talking about all kinds of people, primarily working people, continues to go up. One of the impacts, if you will, of cuts in Medicaid, is that the number of uninsured will go up even more so because Medicaid traditionally, and really progressively over the last 20 years, has been expanded to cover more and more people. One of the major concerns that I have about this Republican proposal that was unveiled today is that by discouraging the States essentially from matching, actually, I think not even allowing them or not expecting them, I should say to match the Federal Medicaid dollars to a 50-50 basis, what you do is actually have the amount of money that is spent on Medicaid decreased significantly, Federal and State dollars. That is going to mean that a lot of children and elderly who are now insured and covered by Medicaid will not be covered anymore, and therefore will increase the ranks of the uninsured. I yield again to the gentleman.

Mr. PALLONE. I thank the gentleman from Ohio [Mr. Brown] for joining in this debate tonight. If I could just inquire, because of the way the time was split, we have approximately 15 minutes left?

Mr. PALLONE

Mr. PALLONE. My time is limited. I have to go with the time I have. I am sorry, I cannot yield. Under the medical savings accounts proposal, basically you are going to get a Medicaid voucher that could be used to buy a catastrophic health insurance policy with a high deductible, it might be as high as $10,000. Any difference between the cost of that policy and the voucher amount would be placed in a tax-favored medical savings account. So if you just want to use your Medicare money, if you will, or a voucher, to have a high deductible account, you can do that. But then if you get sick, of course, you have to pay that out of pocket. But the problem is that only the healthiest and the wealthiest seniors could afford to gamble with this kind of high deductible policy. Those individuals who buy the MSA's, the healthier and wealthier people, will be outside the traditional pool, so we believe the average cots eventually of those remaining in Medicare would increase. Again, these are significant changes, I believe, and I think it is self-evident, in the Medicare program as we know it. So that is what we are hearing from the Republicans. Again, they were talking about these proposals last year, and they are coming up again now in the context of the budget. Let me talk about the changes in the Medicaid program, the program that is primarily for low income individuals. Right now 36 million Americans receive Medicaid Benefits. Twenty-six million of them are poor children and adults. But, again, when you talk about Medicaid, the majority of the money is spent on nursing home coverage for senior citizens. So I want seniors to understand that even though Medicaid is for low income seniors, most of the money goes to pay for nursing home care for seniors, many of whom have spent the amount of money they saved for nursing home coverage and then have to go on to what we call Medicaid coverage to pay for the nursing home care. What we are concerned about here is when you block grant Medicaid under the Republican proposal, and you basically leave it up to the States to decide what to do, large groups of seniors citizens may no longer be eligible for nursing home care, or, if they are eligible for nursing home care, the level of services that is going to be provided to them under Medicaid will be significantly reduced. Basically states could opt to drop the number of patients they cover, which would cause the number of uninsured Americans to swell, and, if that happens, the Urban Institute predicts that 4 to 9 million Americans will lose health insurance coverage, and every American could feel the effect of these cuts as states are forced to raise other taxes or as insurance companies raise premiums to make up for the increased costs. So essentially what we are saying is even though you might say to yourself, what does it matter to me if low income people are no longer eligible for Medicaid, it does not have any impact on me, but it could easily have impact if states decide to continue coverage for those individuals because they feel an obligation to, and, therefore, you state taxes or other taxes could rise as a result of the fact that there is a shortfall in the Federal dollars. I just wanted to read a quote, if I could, because I thought it was such a good one, from the Washington Post back in December, December 12 of last year, when this whole battle over Medicaid was on the floor of the House and was being considered for the last time in a significant way. What the Post said, on Tuesday, December 12, about the Medicaid block grant, they said: The Republicans want to go to a system of block grants, cut projected Federal spending sharply, cut what the States must put up to get their Federal funds, and largely let the States decide how and on whom the money will be spent. This would pretty well eliminate the Federal guarantee that the needy, young, and elderly could count on a certain level of care. Medicaid is not just a major Federal cost and major source of aid to state and local governments. It is an insurer of last resort in the health care system. Medicaid needs to be preserved to protect the vulnerable. The alternative is even more people uninsured. The poor, the States and hospitals and other institutions that serve the poor would all be stranded. This fight is not just about the Federal budget and the Federal role. It is about that. I need to stress that, Mr. Speaker. We are not just talking about the budget here. I bristle every time I hear that Medicare and Medicaid have become the subject of the battle over the Federal budget, because the bottom line is that this whole Republican proposal to cut Medicare and Medicaid is strictly budget-driven. They are not out to preserve and protect Medicare and Medicaid, they are trying to save money, and they are trying to save money primarily to pay for these tax breaks for wealthy Americans. I believe very strongly that the whole Medicare and Medicaid debate and any changes to it, any changes to those programs, should be considered outside of the whole budget debate and should be considered separately, but they are not. The Republican leadership constantly brings it up in the context of the budget debate. I see that my colleague from Ohio, is here and I would certainly like to yield to him.

Mr. PALLONE. You have your time on the Republican side of the aisle, after I am done.

Mr. PALLONE. Mr. Speaker, I know that the hour is late, but I would like to address the Speaker and my colleagues tonight because today, in fact yesterday but we received more information today, the Republican leadership unveiled their budget, their budget for the next fiscal year. Very upsetting to me and I think particularly to senior citizens throughout this country, once again we see that the budget is very heavily dependent on cuts in Medicare and Medicaid, primarily once again to pay for tax breaks for the wealthiest Americans. I think that we know that in 1995, all of last year, we went through a series of efforts with the Republican leadership budget to try to oppose what Speaker Gingrich and the Republican leadership were trying to do to Medicare. They repeatedly came up with budget initiatives that would have cut Medicare and Medicaid severely, again primarily to pay for tax breaks, and again those tax breaks primarily to wealthy Americans. I had hoped because of the battle that ensued, that was largely taken up by Democrats against this proposal, that we would not see it raise its ugly head again. But in fact it has, and yesterday and today and I am sure over the next few weeks we are going to see again an effort to basically use the budget and use the cuts in Medicare and essentially pay for the Republican-proposed tax breaks on the backs of senior citizens. Now, I know I am going to hear over and over again from the Republican side that that is not really what is happening here, what we are really trying to do is somehow protect Medicare, or that somehow the level of cuts that are being proposed by the Republican leadership are not that different from some of the things that the President or some of the Democrats have proposed over the years. But I would point out that there are major changes in the Medicare and Medicaid program that are being proposed by the Republican leadership, so that it is not just a question of dollars, it is also a question of what the Medicare and Medicaid programs are going to be like. I would venture to say that they are going to be radically different from what seniors expect and have seen in Medicare over the last 30 years. In fact, I would say that the every nature of these changes in Medicare basically destroys the Medicare program and makes it into something which is very different and very radical from what we have today. I am not surprised by that, because one of the points that I kept stressing throughout the Medicare debate last year was that the Republican leadership really does not like Medicare, really does not care whether Medicare is changed or negatively impacted because many of them never supported Medicare from the beginning. I would cite a quote that was made by the likely Republican candidate for President, who said, and I quote: ``I was there fighting the fight, voting against Medicare, one out of 12, because we knew it would not work,'' in 1965 when he was then a Congressman here in the House of Representatives. That statement was made by the Republican Presidential candidate just last October 24, 1995. Similarly, we have the Speaker, the Republican Speaker of the House of Representatives. He made another interesting comment which is very similar, if you will, back in October, on October 26, 1995. He said, ``We do not get rid of it,'' referring to Medicare, ``in round one because we do not think that that is politically smart and we do not think that is the right way to go through a transition period. But we believe it is going to wither on the vine because we think people are voluntarily going to leave it.'' Well, that was a statement that was made by Speaker Gingrich again in October of last year. But what we are seeing here, and I think that it is really summed up by the Speaker's statement, is that the changes that are being proposed once again in this budget that we have received over the last couple days, the changes that are being proposed in Medicare by the Republican leadership will ultimately force seniors out of the traditional Medicare program that they are used to. In fact the program, the Medicare as we know it, essentially or eventually does wither on the vine and disappear as an effective and quality health care program for the average American. Mr. Speaker, I could go on and cite some of the other Republican leaders. Representative Dick Armey from Texas, who is the majority leader, made similar types of statements. But I think that I would rather get into the whole issue of what they plan to do it and how they intend to change Medicare and Medicaid so that they are negatively impacted. Before I do that, though, I just wanted to cite several reasons really why massive Medicare and Medicaid cuts are harmful, and it really goes back to the original purpose of the Medicare program. The reason why Medicare was started by President Johnson back in the early 1960's was because of the concern over the fact that many senior citizens simply did not have health care. They were living in poverty. They could not afford private insurance. They could not afford to pay out of pocket for the health care needs that they had. What we did back in the early 1960's was to essentially make sure that all senior citizens would be guaranteed health care, that everyone, when they got older and over 65, would know that they were guaranteed a certain level of health care. That is what Medicare is all about. But the massive Medicaid cuts, the massive Medicare and Medicaid cuts will basically increase old-age poverty and turn this all around. Half of all the senior citizens right now have incomes of less than $17,000 a year. Medicare and Medicaid cuts will increase out-of-pocket health care expenses for seniors, and the result is a massive increase in old-age poverty to the extent that seniors will spend the little money that they have to pay for health care. If it is not covered by Medicare or certain things are not covered by Medicare and they have to spend more out of their pocket, they go further and further into poverty. Mr. Speaker, it is also true that cuts in Medicare and Medicaid will reduce access to health care and result in an increase in sickness and misery. Particularly hard-hit will be Medicaid nursing homes where already minimal staff will be cut back to skeleton crews. I think a lot of us forget that the Medicaid programs, which is primarily a program for poor people, the majority of the money is spent for senior citizens in nursing homes. So if they cut back severely on the Medicaid program, they negatively impact nursing home care. Medicare cuts also mean less access to doctors because Medicare, Medicaid pay less for physician services than private insurance companies. Many doctors are simply refusing to accept more Medicare and Medicaid patients. In rural areas, poor areas and areas with large numbers of senior citizens, access to health care will be further restricted by too steep Medicare and Medicaid cuts. Massive Medicare cuts also mean increased cost shifting to younger people. The elderly use the same nurses, physicians and x-ray machines as everyone else. Right now Medicare is paying health care providers substantially less than the health plans covering the working population. The difference in public and private reimbursement rates has shifted from the elderly to younger patients. So lest any of the young people feel, ``Well, what does it matter to me if Medicare is negatively impacted or Medicaid,'' they need to know that what essentially happens is that the hospitals and the health care providers shift the cost to younger people, so they ultimately will suffer. Medicaid cuts particularly harm poor children. One out of every four children in America is in poverty. Medicaid is the primary health insurance system for America's poor children. Medicaid cuts mean that poor children will have even less access to health care. Medicare cuts also harm the disabled. More than 4.2 million seriously disabled Americans have their health care needs met by the Medicare system. Hundreds of thousands of very seriously disabled Americans are taken care of in Medicaid nursing homes. Cuts in Medicare and Medicaid will do serious harm to the primary health care systems of America's most disabled. I think, most important, the level of Medicare and Medicaid cuts that the Republican leadership has proposed will force many hospitals to close. We made this point during the debate last year in 1995. It is just as true now with the cuts that are being proposed by the Republican leadership now. Hospitals depend on Medicare and Medicaid for approximately 45 percent or more of total revenue. If Medicare and Medicaid are cut back, many hospitals will be forced to close and consolidate their patient base. The result will be less access to American medical care and fewer jobs in areas that may already have depressed economies. Mr. Speaker, I think lastly, and I would like to mention this because I think it goes against what the Republican leadership has said from the beginning, the Republican leadership in the beginning of 1995 talked about and tried to implement their Contract With America. But what we were saying as Democrats throughout that debate is that the Congress cannot make a new Contract With America if it is not willing to make good on the old Contract With America, which is Medicare. The contract said that working Americans would be taxed their entire working lives in exchange for known and specified benefits in old age, and that contract was broken in 1995 by the Republican leadership. I believe it is broken once again today with the level of Medicare cuts and the changes in the programs that are being discussed or being proposed by Speaker Gingrich and the other Republican leaders. Now, let me get into a little analysis of exactly what we received yesterday and today as part of this new Republican budget for 1997. Again, a lot of this is just based on press conferences or press materials. But what was presented by the Republican leadership repeats many of the extreme policies that were proposed in the fiscal year 1996 budget which was vetoed by President Clinton last December. It maintains the skewed priorities of the early Republican budget: large tax cuts paid for by excessive cuts in Medicare and Medicaid. Medicare is cut by $168 billion over 6 years. The numbers have changed slightly, but the impact on people and hospitals is the same as last year's budget. The implications for health care delivery, seniors will have less choice, Many of the hospitals will close, and doctors and hospitals will be able to do balanced billing. That is where they simply charge Medicare recipients more than what Medicare pays. The Republicans claim that their cuts of $123 billion--of this $168, $123 billion is in part A, which primarily pays for hospitals and health care institutions--the Republicans say that these cuts are necessary to preserve the solvency of the Medicare Trust Fund through the year 2006. In fact, the President's budget proposal, which he unveiled earlier this year, extends the life of the trust fund through 2006 without such deep reductions. Republicans are clearly using funds cut from Medicare to pay for part of their tax breaks, just as they did in 1995. Now when you go to Medicaid as opposed to Medicare, Medicare being primarily a program for seniors regardless of income, Medicaid primarily for poor people regardless of age, Medicaid spending in this new Republican budget is cut by $72 billion over 6 years. They block grant Medicaid. It is this idea of sending the money back to the States in a block grant, cutting the amount of money that the States get, because Medicaid, the States have to match what the Federal Government puts up. So if you block grant the money and send the Federal dollars back to the States, you reduce the amount that the States are going to get and you basically say look, you do what you what with it, without any strings attached. What that means is that Medicaid, as we know it, which entitles certain people, certain poor people, to health care benefits, children, pregnant women, certain people were just automatically eligible because of Federal guidelines, well, with this block grant approach, where the States basically get less money but are free to spend the money as they please, essentially you are eliminating the guarantee of coverage to a lot of low income children, to a lot of nursing home residents, because what the States will do is they will say okay, we are getting less money, we cannot afford to pay as much State money as we used to, and, therefore, we will just say that certain categories of people are not eligible for Medicaid, or even if they are we will not provide certain services. So the whole block grant approach to Medicaid essentially means a lot of people will not have coverage who have it now, and if they do have coverage, the types and amounts of services will be severely impacted. In Medicaid, the proposed cuts of the Republican leadership are $18.5 billion deeper than the reductions proposed by President Clinton. But more important, Republicans appear to be proposing a change in the State match rate which could ultimately produce cuts in total Medicaid funding of more than $250 billion through the year 2002. I will get into that a little more, in a little more detail later, but essentially right now, the Medicaid program is whatever Federal dollars are put up, the States have to match them essentially 50-50 to achieve a dollar that is spent on Medicaid patients. What the Republicans are proposing to do is to say we will give you more Federal dollars and you do not have to match as much in State dollars. But the point is that the overall amount of money that would be available for Medicaid patients is less, and hence you get the interest in the States in actually spending less or disqualifying certain people who are now eligible for Medicaid. Now, I wanted to get into a little on Medicare again, what changes are really being made and how radical the Republican changes are to the Medicare program for senior citizens. There are basically three aspects of the current Medicare program for seniors that have existed since it began under President Johnson that are now threatened by the Republican proposal that has been unveiled. Right now, Medicare offers beneficiaries, seniors, unlimited choice of doctors and hospitals. They can go to any hospital or doctor they want. It offers protections against balanced billing, in other words, limitations on what doctors can charge you beyond what Medicare pays, and, third, guarantees coverage of all Medicare benefits for the premium established by law. So if you are eligible for Medicare under current law, you are entitled to certain benefits. Well, all these protections are at risk under the budget and under the proposals the Republicans are putting forward. First of all, let us talk about this unlimited choice of doctors and hospitals. What they are going to do, what the Republicans are proposing to do, is push more and more and eventually most senior citizens into HMO's or managed care systems, where you do not have a choice of doctors or hospitals. The way they do that is through very tight budget caps. They basically put a cap on the overall amount of money that is available in the current fee for service system, where you choose your own doctor. So they say if you go into an HMO or managed care, more money is going to be available for reimbursement to hospitals or to physicians than if you stay in this current system where you choose your own doctor or hospital. So essentially seniors get pushed, if you will, into the HMO's, into the managed care systems, because that is where the money is. The second thing that I mentioned is this existing protections against balanced billing. Under current law, seniors are protected from balanced billing, in other words, where the doctors want to charge more than what Medicare provides, and the same with hospitals. Hospitals under current law may not charge seniors one penny more than their allowed fee. Doctors may not charge beneficiaries more than 50 percent above the fee that Medicare pays. But what they are essentially doing under the Republican plan that is proposed is that doctors and hospitals could charge seniors any amount they want for Medicare services if the senior stays in the traditional fee for service system. So if you want a choice of doctor and hospitals, and you stay in the traditional system, then they can charge you whatever they want over and above Medicare. If you move into the managed care and the HMO, that would not be the case, but again, one more incentive to move to managed care, to HMO, where you do not have your choice of hospital or physician. The last thing, as I said, under current Medicare law there is guaranteed coverage of all Medicare benefits for the premiums, and so if you know you are in Medicare you get certain benefits under the law. But all of a sudden the Republicans have come up with a new idea called medical savings accounts, and what this does is, this is an untested idea, MSA's, essentially what we are doing here is using senior citizens as guinea pigs for this untried new proposal. Under the Medicare savings accounts proposals, the voucher----

Mr. PALLONE. I yield to the gentleman from Ohio.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, the senior citizens of this country better beware again, because the Republicans once again have unveiled their budget resolution for this year, and it cuts Medicare and Medicaid drastically in order to once again provide tax breaks for the wealthiest in this country. Even worse, it actually changes the Medicare and Medicaid programs so much that we would not even recognize them. Seniors are going to be forced into managed care systems because of balanced billing provisions. We expect that they will also be paying a lot more money out of their own pockets in order to pay for Medicare. The cuts in the Medicare Part A Program that finances hospitals and health care institutions are even more severe essentially than previously suggested, and what that means is a lot of hospitals not only in urban areas but in rural areas and throughout the country will actually be forced to close because they will not be getting the money from the Federal Government that they need in order to continue to operate. What we are seeing here again is the Republican agenda, which is essentially to destroy Medicare as we know it and create a second-class health care system for senior citizens.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, on May 7, 1996, the Borough of Milltown, NJ, will commemorate its 100th anniversary under its present form of government and incorporation. This occasion will be marked by the borough council at its public meeting on that date. It is a great honor and pleasure to pay tribute to this beautiful, historic community, located in the heart of Middlesex County in the Sixth Congressional District. Mr. Speaker, the community of Milltown essentially started in 1816 with Jacob Beyer, who had a local grist mill. The industrial era came to the community 27 years later. On October 9, 1888, residents met to discuss secession from the larger area of North Brunswick, and 2 weeks later a special election was held to form a borough commission and establish boundaries. On March 1889, the board of commissioners was chosen and they were sworn in on March 16 of that year. In 1896, the State legislature repealed the act relating to the commission form of government. On May 7, 1896, the new borough council was formed. Mr. Speaker, as the Congressional Representative of Milltown, I salute the mayor and governing body, all of today's residents, and all of the men and women over the past century who have helped to build this lovely, tight-knit community into a great place to live, work, and raise a family.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, today I have the distinct honor of recognizing the activities of caregivers throughout the State of New Jersey. Sunday, May 5 marks the third annual ``Loyal Heart Award Celebration.'' In my home State of New Jersey, Governor Whitman has designated May 5 as ``Loyal Heart Award Day.'' The Loyal Heart Award is sponsored by the Middlesex County Chapter of the New Jersey Coalition on Women and Disabilities. The award was initiated in 1994 by Elayne Hyman Risley to recognize the contributions made by individuals who provide care for persons with disabilities. Those recognized on Loyal Heart Award Day represent the wide range of caregivers; they are friends, relatives, nurses or assistants to a person with a disability. Those we honor today embody the qualities of faithfulness, dedication, and commitment. Their efforts are tireless and dependable. Ms. Risley, inspired by the quality of care she had received from her daughter Robyn, son Ryan and her assistant, Nancy Namowicz; became determined to establish a formal day of tribute to caregivers. This is truly a grassroots effort; I was contacted first by New Jersey Assemblyman, John Wisniewski. The role of caregivers is varied and significant. Caregivers may provide personal care or help around the house or furnish transportation which makes possible participation in community programs. This care may be temporary or extend over a lifetime. Whatever assistance the caregiver is providing, it is of great importance to the individual with disabilities. But to express it most succinctly, I will use the words of Ms. Risley: ``Through caregivers'' efforts, individuals with disabilities are able to reach their fullest potential.'' Many of us have a personal connection to individuals with disabilities. Perhaps we are one of million of people in the United States with a disability. Perhaps we are a family member, advocate or one of the very special people, a caregiver, whom we honor today. Individuals with disabilities and their caregivers deserve our acknowledgement, our support, our appreciation and our respect. In my own district, we are trying to reach out to individuals with disabilities, their families, caregivers and advocates for the purposes of keeping them informed about issues of importance to this exceptional community. I encourage my congressional colleagues to remember that these groups of persons need information so that they can be in the best position to know about issues of significance to individual with disabilities. I also encourage other Members of Congress to join me in support and recognition of the humanitarian efforts of the loyal hearts. In addition, I have sponsored or cosponsored legislation that I believe is of importance to individuals with disabilities and their families. Potentially, any of us could become a person with a disability. If I were ever to face that situation, it is my hope that I would be blessed by support and care equal to that provided by one of the selfless individuals we recognize here today.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, as health insurance reform goes to conference between the House and the Senate, I want to stress again tonight in the 5 minutes that I have that the Republican leadership needs to drop controversial provisions that I think are likely to scuttle this very important health insurance reform. Of course, the most important aspect of this, the most controversial provision, the one that I think really needs to be dropped, is what we call medical savings accounts; the tax breaks, if you will, for the wealthy and the healthy. Mr. Speaker, last week the Senate passed the Kennedy-Kassebaum health insurance reform bill unanimously, 100 to zero. But the Senate bill, unlike the House bill, does not include these divisive provisions that doom the chances of this very important health insurance reform from becoming law. The so-called medical savings accounts are essentially tax-free savings accounts from which participants could pay for everything but catastrophic health care costs. The problem with these accounts is that they would be a good deal, again, only for the healthiest and wealthiest people in our health care system, those who do not have high health care costs on a regular basis. But health insurance costs would then increase for the average American, because essentially when we talk about health insurance, it all involves a health insurance risk pool which has all kinds of people in it. If we take out all the healthiest and the wealthiest people, we are essentially leaving in the pool the people that are the highest risk, that need the most attention or health care, so we destroy the whole basis for the health insurance pool and drive up the costs, essentially, for those who are left after those have been taken out of the pool. Mr. Speaker, some people have asked me, why is this happening? Why is Speaker Gingrich, why is the Republican Presidential candidate, talking and so insistent about including the medical savings accounts? Basically, it is a financial windfall for the Golden Rule Insurance Co., whose top executive has given Republican political committees over $1 million in contributions in the last 4 years. What I am saying, Mr. Speaker, is let us forget about the political contributions. Let us forget about Golden Rule Insurance Co. Let us do what is right for the average American. Mr. Speaker, again, I wanted to point out that medical savings accounts are designed to accompany the purchase of very high-deductible catastrophic insurance policies. They offer a myriad of tax breaks for those who can afford to save up money to pay the vastly increased out- of-pocket costs caused by an out-of-reach deductible. I think that three questions have to be asked. Every American basically should ask the Republican leadership or every Republican lawmaker three questions with regard to these medical savings accounts: First of all, who wins if they are incorporated in this insurance reform; who loses; and why the Republican leadership insists on continuing to push for the medical savings accounts. Who wins? The answer is simple. The wealthy win. They are the only ones who can afford to contribute thousands of dollars to a savings account. In fact, less than 1 percent of all people who might use medical savings accounts earn less than $30,000 a year, even though these families account for nearly half of all American taxpayers. Who loses? Everyone else who relies on standard insurance. In fact, if medical savings accounts are available, some businesses could make it impossible for many families to even afford adequate health insurance. The cost for premiums of regular health insurance could increase by more than 60 percent. Our goal at all times should be to try to increase the amount of Americans that have health insurance and to try to make health insurance more affordable. We will do exactly the opposite with these medical savings accounts. We are creating tax breaks for the wealthiest and the healthiest among us and we are making costs less affordable, and we are probably making it so that fewer people in the long run would have health insurance. It makes no sense. The only thing I can say is that I have to hope that over the next few weeks, it was mentioned earlier this evening by the gentleman from Texas [Mr. DeLay] that we may go to conference on the Kennedy-Kassebaum bill later next week. The conference has been held up essentially because there has been an effort to appoint a lot of conferees on the part of the Republican leadership who would favor these tax breaks for the wealthiest and the healthiest among us. What I hope is that that position will change over the next week, that we can appoint conferees, and that this conference will quickly accede to the Senate version of the bill which does not include these tax breaks for the wealthiest and healthiest among us. What we need is a clean Kennedy-Kassebaum bill. Why? Because it will provide for portability and it will provide coverage for those with preexisting conditions. The whole point of this health care reform this year, and it was stated by President Clinton in his State of the Union address, is that we must get to those people who change a job, who lose their insurance because they change jobs or become self-employed, and we must get health insurance for those people who have preexisting medical conditions. Let us deal with those problems now. Let us forget these other controversial provisions.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I really differ strongly with the previous speaker on this issue. First of all, I would say that I do not believe the minimum wage is a partisan issue. There are a lot of Republicans who support an increase in the minimum wage. The problem here is the Republican leadership, Speaker Gingrich and the others, who do not want to bring this to the floor, because they know that if it comes to the floor, the majority of Democrats and enough Republicans will vote for it that it will actually pass this House, the Senate, and be signed by the President. Let us bring it up. What do I care what President Clinton said or what whoever said in the previous Congress? The fact of the matter is now we know that this minimum wage is not keeping up with inflation, and with the people's ability or need and the purchasing power. So it should be passed now. The reason the Democrats are doing this as often as we are on the previous question or on the rule or whatever, is because we are in the minority and we have no other way to bring it up. We have to keep raising it, so eventually this Republican leadership will wake up and recognize that even its own Members, even a lot of the Republicans, are willing and want this passed and want it brought to the floor. The time has come. In my home State of New Jersey, we have raised the minimum wage, and it has been a success and it has not affected unemployment.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, this evening I would like to talk about health care reform, and particularly the effort that has been put into legislation and has been passed now in both houses that was sponsored in the Senate by Senators Kassebaum and Kennedy on a bipartisan basis and here in the House by the gentlewoman from New Jersey, Congresswoman Roukema, who is a Republican, as well as a number of Democrats. This reform was essentially put into motion, I believe earlier this year, when President Clinton, in his State of the Union Address, called upon both the House of Representatives and the Senate to pass the Kennedy-Kassebaum bill, as it has come to be called, in order to achieve incremental health care reform, particularly as it deals with what we call portability; that is the ability for someone to take their insurance with them if they change jobs or if they lose their job or become self-employed, and also with regard to preexisting conditions. As many of my colleagues, I am sure, are aware, right now if one has a debilitating condition or some sort of health condition that would probably result in a greater amount of health care, many insurance companies in many States will simply not provide insurance to such an individual, even when they are willing to pay for it. So President Clinton, who, as many of us know, was instrumental in trying to raise the attention of the American public and the Congress a few years ago to the need for health care reform and the need to provide more Americans with health insurance coverage, acknowledged in his State of the Union Address that although he had not been able to achieve a system of universal health care coverage, that did not mean that we should not try to move in an incremental way, in a small way, toward some health insurance reform. He called upon the Congress to pass the Kennedy-Kassebaum bill this session and indicated that he would sign it once it passed both the House and the Senate. If I could just say very briefly the Kennedy- Kassebaum bill essentially would make it easier for workers who lose or change jobs to buy health coverage, and it would limit the length of time that insurers could refuse to cover an applicant's preexisting medical problem. Hence, again, the main purpose of it is to increase portability for health insurance and to abolish the situation with those with preexisting conditions who would not be able to get health insurance. Now, the Senate last week passed the Kennedy-Kassebaum health insurance reform bill unanimously, 100 to 0. Unfortunately, here in the House of Representatives, much earlier, a few weeks earlier, perhaps a month earlier, we passed a bill that included and added to the Kennedy- Kassebaum measure a number of controversial provisions that, I believe and I think are almost universally recognized, would doom the chances of this legislation becoming law. Among the special interest provisions in the House bill are the so- called medical savings accounts, tax-free savings accounts from which participants could pay for everything but catastrophic health care costs. The problem with such accounts, although they may seem like a good idea on their surface, is that they would be a good deal only for the healthiest, wealthiest people in our health care system, those who do not have the high health care costs that they have to incur on a regular basis. But health insurance would increase for the average American because insurance companies would be left with only sicker and more costly enrollees in their health insurance plans. Mr. Speaker, so basically what the medical savings accounts do is provide a tax break, if you will, for the healthiest and wealthiest among us. That means that by dividing the insurance pool so that the healthiest and wealthiest Americans are taken out of the insurance pool, which relies on having all types of people in it, would be divided. The sicker and the poorer people would remain, which would result in the insurance companies having to raise their premiums. Most important, though, in terms of what I believe the Republican leadership here in the House was trying to accomplish by adding these provisions, the medical savings accounts, to the Kennedy-Kassebaum bill, was essentially that they were trying to pay off, if you will, or provide a financial windfall for the Golden Rule Insurance Company, whose top executive has given Republican political committees over $1 million in contributions in the last 4 years. Now, Democrats in the House offered a straightforward health insurance reform bill as a substitute for this more controversial bill with these added provisions. The Democratic substitute would have prohibited many of the current unfair insurance practices which fail to protect individuals and families with significant health problems and make it difficult for small businesses to obtain quality coverage for their employees. The Democratic substitute would have made it easier for people who change or lose their jobs to maintain adequate health insurance coverage, just like the original Kennedy-Kassebaum bill. It also included a provision whereby the self-employed could deduct 80 percent of their health insurance costs. Now, of course, when a bill passes the House and a different bill passes the Senate, they have to go to conference, and in the conference they come up with an agreement on what bill would finally come back to both House of Congress and be considered before it goes to the President. What we have to hope is that when this conference occurs that the conference committee will drop the controversial House provisions and send a bipartisan bill to the House or Senate floor for final approval that can pass. Mr. Speaker, I wanted to go into, in the time that I have tonight, a little more detail about some of the differences between this House and the bill and why I believe very strongly that we must bring something very similar to the Senate bill, in other words the original Kennedy- Kassebaum bill, to the floor if we are ever going to see health insurance reform this year. Let me comment a little bit on the politics, if you will, of the Republican leadership in the House basically would profit because of the insurer, the Golden Rule Insurance Company that has ties with the Republican Party. Again, I do this not because I want to say terrible things about the Republican leadership but because I hope that by exposing what really is happening here, and that is to provide this big windfall to this particular insurance company, we will then allow that provision on the medical savings accounts to be dropped and will not come to the floor again and will essentially disappear. But let me talk to you a little bit about this Golden Rule Insurance Company that basically will profit from the medical savings account provision. Now, this is a health insurance company, as I said, with close political and financial ties to Republican leaders, OK? The company, the Golden Rule Insurance Company, sells a special type of health insurance that would have to be purchased by people with these tax-free accounts, the medical savings accounts. Many of the Democrats of course have denounced this as bad health policy. Essentially what we are saying is that the Republicans are doing this to reward the Golden Rule Insurance Company. Its former chairman, J. Patrick Rooney, basically his father founded the company. His family still controls it. If I could just make some comments about or take some quotations from a New York Times article Sunday, April 14 of this year that talked about the Golden Rule Insurance Company. I will specifically make reference to one of my colleagues, Representative Cynthia McKinney, a Democrat of Georgia, who asked on the House floor when this bill came up why medical savings accounts were included. She said: You just follow the money. The Golden Rule Insurance Co. has given more than $1.4 million to the GOP, and, coincidentally, Golden Rule just happens to be the premier company peddling medical savings accounts. Common Cause, the public affairs lobby, said that Mr. Rooney and John M. Whalen, the Golden Rule's president, had given more than $117,000 to GOPAC, the political action committee that helped Mr. Gingrich take control of the House. And Golden Rule, interestingly enough, has resisted efforts by several States to require the sale of health insurance to all applicants and to limit premium variations. Although we are trying to accomplish certain goals with health insurance reform here in the House on the Federal level, the bottom line is and in many States, including my own State of New Jersey, there have been efforts to try to eliminate preexisting conditions as a means for health insurance and also to encourage portability. But Golden Rule has resisted efforts by several States to require the sale of health insurance to all applicants. In fact, when New Hampshire was considering such legislation in 1993, State Senator Jean Shaheen, a Democrat, issued a news release saying that Golden Rule represents everything that is wrong with health care in America. She asserted that the company had resorted to lies and half-truths, telling policymakers their premiums would soar. In Kentucky, another State that was considering this legislation, State Representative Ernest Scorzone, a Democrat, said the Golden Rule had run a campaign of disinformation, misinformation, and outright deception. Mr. Speaker, what we are trying to point out is that Golden Rule, not only on a Federal level but also on a State level, has not been helpful in terms of the whole issue of health care reform, particularly as it pertains to the issues of portability and trying to abolish preexisting conditions, which are the hallmark, if you will, of the Kennedy- Kassebaum bill. Now, one of the main reasons why I and others are concerned about these extra provisions that have been added to the House version of this health care reform is because we are totally convinced that these additions will imperil any possibility of getting health care reform or health insurance reform passed this year. I think my colleagues understand that, in order to get something passed through the House and the Senate and finally passed by the Senate, signed by the President, you have to have a consensus. You have to have agreement. If you have some basic provisions, like we are trying to make it easier for people to transfer their insurance between jobs, or that we do not want preexisting conditions to be a basis for whether or not you get coverage, it is fairly easy to get a consensus on those provisions in the Kennedy-Kassebaum bill. But if you start loading this legislation up with the medical savings accounts, with malpractice reforms, with myriad other things, many of which have been included in the House version, then you will never get the health reform insurance passed in time. Mr. Speaker, we only have another probably 6 months before the election and the new Congress. This is one thing that we can get passed on a bipartisan basis, and we should try to do so. Senator Kassebaum, a Republican from Kansas, has repeatedly warned that, if House Republicans are successful in getting MSA's, the medical savings accounts, approved in the final conference report, the result could devastate health insurance. She said, and I quote: ``I would hate to see them included by design to a certain extent to take down the legislation.'' Again, we know that, if these controversial provisions are added, that there is a real possibility we will not have health care reform passed in this Congress. Let me also point out that it was not just the medical savings accounts that were added in the House. There were other provisions as well. In the New York Times, an editorial just in the last week on April 23, 1996, said that there were three unfortunate provisions, that the conference committee should strike three provisions in the House version, that the conference committee should not include if this bill is eventually to become law. First, they mentioned it imposes arbitrary caps on financial rewards for malpractice suits, thereby protecting doctors from patients who have been needlessly disfigured or worse. Whether or not you agree with malpractice reform, it should not be in this bill because it makes it more difficult for this bill to pass. Second, it would provide a tax break for medical savings accounts, and again the New York Times is critical of the medical savings accounts because they say that it will basically give tax breaks to the wealthy and healthy, divide the insurance pool and increase premiums for everyone else. The third flaw they mentioned in the House then is a provision to encourage small employers to band together into purchasing cooperatives that would be allowed to steer clear of chronically ill applicants. The Senate bill on the other hand encourages small employers to form purchasing cooperatives but under rules that would prohibit discrimination. What the New York Times said is the conference committee should essentially adopt the Senate bill, and that would accomplish a lot because it would make it possible to get this bill finally passed. Now, lest my colleagues think that we do not have anything to worry about and that in fact the conference committee, when it meets, is going to report out a clean bill, like the Senate version without the medical saving accounts and these other riders that would make it more difficult to pass, let me assure you that there are a number of forces out there that are working very hard to get the medical savings accounts, these tax breaks, if you will, for the healthy and the wealthy, included. First of all, in today's Wall Street Journal there was an editorial that strongly urged Presidential candidate Dole to move ahead and insist that the conference include medical savings accounts. He, the Republican Presidential candidate, has sworn that he will back MSA's, the medical savings accounts, in the health bill. In fact, it has been very difficult for the other body to actually appoint conferees to this conference committee because the Republican Presidential candidate is in fact trying to assure that proponents of medical savings accounts are included in larger numbers in the conference committee. So clearly, clearly there is an effort not only in the media or certain media but also amongst the Republican Presidential candidate and his supporters to try to get these medical savings accounts, these tax breaks, as I said, for the healthy and the wealthy included in the Kennedy-Kassebaum bill which would ultimately make it impossible to pass any health care reform. Mr. Speaker, I just wanted to point out, if I could, in some of the time that I have remaining, that for those who say, well, this is only a small reform, this does not address the larger issue of affordability for health insurance or the fact that so many millions of Americans now have no health insurance, well, that is true. And I would be the first to recognize the fact that we continue to have a problem with fewer and fewer people able to afford health insurance, and as a consequence more and more people do not have any health insurance. In fact, the Democratic Party, my colleagues on the Democratic side in the House, formed a health care task force, which I happen to be one of the cochairmen of last year. We put forward a set of Democratic principles on health care reform. Our two major principles are that we want to achieve more affordable health insurance and we want to expand the number of people in this country that have health insurance. I would maintain that the Kennedy-Kassebaum bill in its pure form or in the form that passed the Senate does help in an incremental way to provide more Americans with health insurance, maybe 20, 25 million Americans who will be positively impacted by it. So, while we see the numbers of people who are uninsured continue to go up, we know that this bill, although modest, would help in the effort to try to cover more Americans and provide more Americans with health insurance. Mr. Speaker, we also know that, if it is passed in its clean form and the way the Senate passed it without the medical savings accounts, that it certainly would not make health insurance less affordable. If in fact you include the medical savings accounts, in fact, that is what would happen. Health insurance would become less affordable for the average American. Just in case, again just to give you an idea about the magnitude of the problem that we face in trying to achieve more coverage for Americans, just in my own home State of New Jersey within the last 2 weeks a new report came out, 124-page Healthy New Jersey 2000 report, that actually was released last month, and if I could just summarize some of the information that shows that the percentage of uninsured New Jersey workers, and I am talking about working Americans, working new Jerseyans, actually doubled in the last 4 years. This latest report statistically shows that 14.6 percent of New Jersey's full-time employed workers had no health insurance coverage in 1993, twice the percentage that was uninsured in 1989. About 15.5 percent of the overall population under the age of 65 was without insurance in 1993, working or not, up from 11.7 percent in 1989. That is about 1.1 million New Jerseyans. Now, you take that across the country. You will probably find about 40 million Americans now who do not have health insurance coverage, and the number continues to grow. The statistics are even more significant when you look at minorities. The rate of insurance coverage is worse for blacks, among whom one in five is without coverage, insurance, and for Hispanics, among whom one in three is uninsured. And these figures take into account the fact that Medicaid covers the poorest families and the disabled, so we are primarily talking about working Americans because if you are below a certain income, you are eligible for Medicaid. But many people are not, and of course those are primarily working people. I only mentioned that because again I feel very strongly that even though in the Kennedy-Kassebaum bill we are talking about a modest effort to try to increase the availability of health insurance to Americans, I think even that modest effort needs to be moved forward, and it is very wrong for the Republican leadership here in the House of Representatives to stop that reform from moving forward just because they want to include these medical savings accounts for special interests that support them. And even if they honestly believe that that is the way to go, they should drop the effort because it is going to make it virtually impossible for us to get this health insurance reform passed in this session of Congress. In conclusion, Mr. Speaker and my colleagues, if I could just say as this health insurance reform, as the Kennedy-Kassebaum bill, goes to conference, the Republicans need to drop these controversial provisions and stop dragging their feet so we can get a bill passed this year, this Congress. I urge the House Republican leadership to follow the Senate lead and strike the special-interest tax-free accounts for the healthy and the wealthy. The Republican leadership needs to quit stalling and pass bipartisan health insurance now so it can go to the President's desk and he can sign it, and we can all declare victory for the average American and help those people who find it more and more difficult to buy health insurance.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I would urge Speaker Gingrich and the Republican leadership to let us vote on an increase in the minimum wage. In my State of New Jersey the minimum wage was increased to $5.05 an hour, two Princeton University economists, David Card and Alan Kruger, surveyed patterns in fast food restaurants in New Jersey and Pennsylvania after the minimum wage went into effect. The result suggested a moderate hike, much like the one President Clinton is proposing, has actually increased total employment. The reason is that minimum wage earners do not have the ability to save. They spend their money on basic necessities, and raising the minimum wage put more money into our local economy. The money was spent to purchase more goods, adding eventually to an increase in profits for our local businesses. The fast food industry that Card and Kruger studied found most of the people earning the minimum wage were the same people who used that increase to in fact buy more fast food. So the bottom line is a higher minimum wage increased economic activities in New Jersey. It is supported by the President and supported by most Members in both the House and the Senate, and the leadership of the Republican Party should bring it up for a vote now.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, many of us have heard from our constituents regarding the plight of cancer patients under the care of Dr. Stainislaw Burzynski of Houston, TX. My office has received many letters and phone calls concerning this matter, which is why I am on the floor today. Recently, the House Committee on Commerce, of which I am a sitting member, held a compelling hearing into the difficulty patients have in getting his experimental Antineoplaston therapy due to the FDA. Whatever the FDA's concerns are, the problem remains they are denying patents with life-threatening diseases access to this therapy. Many only have a few months to a year to live and this treatment is essentially their last hope. Following those Commerce hearings, the FDA met with members of the committee and assurances were given that Dr. Burzynski's patients and those seeking his treatment would be accommodated. Unfortunately, his patients on clinical trials are on hold and dozens of terminally ill cancer patients who want his lifesaving therapy cannot get it. For whatever reasons the FDA claims to defend this situation, they fail to recognize that people's lives and rights are being trampled in this process. I do not see how the FDA is serving the public when, by its actions it prevents a child with a brain tumor or a young woman with non-Hodgkin's lumphoma, from getting a treatment these individuals and their families have been informed about and have freely chosen to pursue. In essence, the FDA is telling someone battling a disease like cancer that they cannot have a potential life-saving treatment. For many of these patients, this treatment is their last resort after being told to get their affairs in order and essentially wait to die. Legislation has been introduced with wide bipartisan support by Mr. DeFazio of Oregon, to address this problem, called the Access to Medical Treatment Act (H.R. 2019). It has 40 Members in the House cosponsoring this legislation and has both Senate Minority Leader Daschle along with Senate Majority Leader Dole and a dozen Senate cosponsors on a similar bill in the Senate. Mr. Speaker. I just want to say that as we continue down the path toward FDA reform, let us be mindful of patients with life-threatening diseases who are grasping at their last hopes to continue to live.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, again I do not understand what the argument is about which Congress tried or did not try to raise the minimum wage. The bottom line is we know now we have a majority in both Houses, mostly Democrats, but also enough Republicans, so that we could pass the minimum wage if it was only brought up for a vote on the floor right now. The problem is that the Republican leadership, Speaker Gingrich and the others, do not want to bring it up for a vote. They had a meeting yesterday and all the newspapers today say they refuse to bring it up for a simple up or down vote. The reason they will not bring it up is because they know it will pass. The American people favor this, four out of five in all the recent polls, and the majority in the House of Representatives and the Senate and the President of the United States. So why not bring it up? Very simple: They do not want to do it. Instead, they have come up with some bureaucratic cockamamie proposal to essentially use a government subsidy to help certain families, but not everyone. Why in the world are we talking about a government subsidy to employers so that they do not have to pay a higher wage, a living wage? It makes no sense.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I just wanted to point out that from the very beginning when we were dealing with the appropriations spending bills this year, Democrats were making the point very vividly that it was possible to keep spending down, balance the budget and at the same time protect the priorities that we cared about, education, the environment, Medicare, Medicaid and some of the other concerns like the 100,000 cops program that President Clinton had supported and put together for the last couple years. I think that today shows the vindication, if you will, of the Democratic point of view. We are moving an appropriation bill that will save significant amounts of money, billions of dollars, but at the same time it protects those priorities. With respect to the environment, which is one of my major concerns, although the amount of money is less than what the President asked for and what the President thought was necessary, we are almost back to what we wanted. And most importantly, we have eliminated those terrible anti-environmental riders that the Republican leadership had been touting for so many months. So I think this is a good compromise, but it is a vindication of our Democratic principles.

Mr. PALLONE

Mr. PALLONE. Mr. Speaker, I must say that the gentleman from Colorado has made a very valiant effort to try to justify why this should not be brought to the floor, but the bottom line is we have no choice. We know that the Republican leadership in this Congress will not schedule the minimum wage for a vote. ``It is not my intention to schedule a vote on the minimum wage,'' said the House Republican leader, the gentleman from Texas, Dick Armey. This is the only way we can bring this up to the floor for a vote. We are talking about real people and real lives here. Minimum wage workers have a very difficult time paying for groceries, paying for housing, paying for the utility bills. I think that the budget we are going to pass today is a great thing, and I will commend every one involved in it. But the bottom line is when we are talking about a minimum wage worker, that budget may be something that helps them in the long run, but they need help right now to raise their living, the amount of money they take in so they can buy food, housing, and the basic necessities of life. Let me just say, very briefly, in my home State of New Jersey we have raised the minimum wage. It is now $5.05 an hour. This increase has been a complete success. We have increased the purchasing power of minimum wage workers and we have improved our economy with it.