Pete Stark

Mr. STARK

Mr. STARK. Mr. Speaker, today the House considers whether the information sent to the Congress for consideration in the Independent Counsel Report warrants the start of an impeachment inquiry by the House. The President has admitted that he had an extramarital affair and then lied about it. No one disputes that fact. The President's conduct, while reprehensible, was a betrayal of his vows to his wife but not his oath of office. His actions were personal in nature. If his lies to cover up his conduct amount to perjury, he can and should be held accountable through our judicial system. Our founding fathers had something quite different in mind when they drafted the Constitutional language on impeachment, a political remedy for tyrannical acts. The Federalist papers shed some light on that. George Mason said that the phrase ``high crimes and misdemeanors'' refer to presidential actions that are great and dangerous offenses or attempts to subvert the government. Alexander Hamilton, in the Federalist paper 65, wrote that impeachable offenses relate chiefly to injustices done immediately to society. Ben Franklin spoke of impeachment as an alternative to assassination. When this House voted to proceed with an inquiry to impeach President Nixon in 1974, the offenses in the impeachment resolution contained serious abuses of official power: President Nixon used government agencies to carry out his personal and political vendettas against citizens. Not included in the list of impeachable offenses for President Nixon was his deliberate backdating of a tax document and his false filing under oath of IRS returns by which he sought to fabricate a huge, tax deduction. That conduct was felonious but determined not to be an impeachable offense in 1974 because it did not threaten our form of government; it was personal, reprehensible conduct. I will cast my vote against the Hyde resolution. It leads us into an impeachment inquiry without focus or time limitation. I will support the Democratic motion to recommit because we need to resolve the issue of impeachment this year and then move on with the business of governing. We have serious work to do to resolve the solvency of the Social Security and the Medicare trust funds; we have children in need of heath care and quality child care; our schools are overcrowed. The needs of real people will not be addressed until we bring closure of this issue.

Mr. STARK

Mr. STARK. Mr. Speaker, I am pleased to inform my colleagues today about the completion of an important project in my district. The Friends of San Leandro Creek have completed work on a creek mural located in Root Park in my district. This mural spans more than 19,000 square feet and is the largest of its type in the Western United States. Students participating in the San Leandro High School Art Program created the mural design. The students were presented with information about the history of the creek and a list of items to be included in the final design. The final mural depicts the Creek as it was in the early 18th century, filled with rainbow trout and fished by Native American tribes for food. I would like to point out the hard work of Rick Richards. Rick put this idea together and has been a longtime local activist for environmental causes and a tireless advocate for local community development issues that may impact the San Leandro Creek. Rick is the environmental conscious of the San Leandro community. I would also like to thank Veronica Lacarra Werkmeister for her dedication to this project. She is a nationally renowned muralist and her commitment to teaching children and this project has resulted in the works we commemorate this weekend. I am very proud to share this mural with my colleagues. The Friends of San Leandro Creek and the students at San Leandro High deserve credit for their commitment to this project and their commitment to San Leandro Creek. I look forward to visiting this mural after Congress adjourns and encourage residents of San Leandro to do the same.

Mr. STARK

Mr. STARK. Mr. Speaker, as more Medicare beneficiaries join managed care plans, public fears about the effects of financial incentives to physicians demand renewed attention. Under current regulations. Medicare+Choice plans cannot make more than 25% of physicians' total payment dependent on financial incentives to alter practice behavior. This regulation only catches those organizations at the high end of the spectrum since most incentive plans effect less than 25% of total compensation. A recent editorial in the September 3, 1998 New England Journal of Medicine states that the intensity of incentives in a capitated compensation system clearly affects the extent of physicians' conflict of interest. Bonuses and withheld amounts paid out in lump sums when a specific target is attained can create especially intense conflicts of interest if the physician is close to qualifying for the extra money near the end of a contract period. An article in the August, 1998 issue of the Journal of Health Politics, Policy and Law states that ``more than 60 percent of managed care plans withhold a portion of physicians' salaries to cover expenditures that exceed target projections for use of specialists or hospitals. Furthermore, most plans withhold more than 11 percent of physicians' salaries and some even withhold more than 30 percent''. The Journal advocates precautionary measures to protect and reassure the public trust, including limiting financial incentives. Survey data of HMO managers suggests that physicians' decision making is influenced when financial incentives are between 5-10 percent of income. ``Half of the respondents believed that a bonus of 5-15% would affect ordering behavior,'' according to ``Data Watch: HMO Managers' Views on Financial Incentives and Quality'' by Hillman, Pauly, Kerman, and Martinek in the Winter 1991 issue of Health Affairs. Clearly there is a need to further reduce the allowable percentage of physicians financial incentives. If managed care programs continue to reward physicians who provide fewer services to patients, physicians will fail to be advocates of patients. The bill I am introducing today will reduce provider incentives to limit patient services by diminishing financial rewards to physicians who provide minimal services. This bill seeks to eliminate the current ethical dilemma facing physicians by further reducing from a maximum of 25% to a maximum of 10% the percentage of physicians' salaries that are dependent on financial incentives. The rising number of Medicare HMO's make protecting patients by ensuring quality health care essential

Mr. STARK

Mr. STARK. Mr. Speaker, on behalf of myself, Mr. Dingell, Mr. Matsui, Mr. Brown of Ohio, Mr. Coyne, Mr. Levin, Mr. Cardin, Mr. McDermott, and Mr. McGovern of Massachusetts, I am today introducing a bill to help ameliorate the impact of the home health agency interim payment system and to delay the scheduled 15% cut in home health agency payments scheduled for next fall. Our bill is revenue neutral. It is different from the bill being developed by some of the Republicans on the Ways and Means and Commerce Committees. It does not create huge new tax breaks which will cost far more in out-years than they raise in the near term. It concentrates its relief on those who have been careful, cost- conscious providers and does not throw out money at the agencies which have been abusing Medicare by providing excessive and often questionable visits. Our bill is identical (except for the pay-for) to the bipartisan bill which has been developed by the Senate Finance Committee, and which may pass the Senate at any moment. Our pay-for simply changes the limits on the Medicare Medical Savings Account demonstration project, lowering the number of participants in the early start-up years and raising them in the out-years and extending the life of the demo. Very few people are likely to participate in this program in the early years, yet CBO charges us for the cost of a full-blown program. By starting more realistically, we will not hurt the program, but can be scored for budget savings. Attached is a description of the formula changes our bill makes. This is a small, do-able bill in the last hours of the 105th Congress. It does not waste money on the agencies who have created so much of the fraud, waste, and abuse problem in the home health sector. It is a reponsible pay-for. It is a bill that can quickly and easily be conferenced with the Senate. We urge other Members to join us in supporting this approach. Summary of Formula Changes Reduces state and regional differences for ``old'' agency payments; brings down the per beneficiary limits for the highest cost ``old'' agencies; raises the per beneficiary limits for the lower cost ``old'' agencies and eliminates current 2% discount on per beneficiary limits applicable to new agencies. Raises the separate average cost per visit limits for all agencies. CBO: budget neutral (through FY 2008). Per Beneficiary Limits 1. ``Old'' agencies: payment is 50% BBA policy +50% (50% national mean +50% regional mean); 2. ``New'' agencies: payments are increased by 2% to equal 100% of the national median (about $3,450), (which continues to be regionally adjusted for wages); and Per Visit Limits 3. Increase the per visit limits from 105% to 110%. 4. Delays for 1 year the 15% across-the-board cuts currently scheduled to go into effect on October 1, 1999. CBO: Cost is $1 billion over 5 years.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to share the words of A.G. Newmyer III with my colleagues. Mr. Newmyer is the Chairman of the Fair Care Foundation, a consumer advocacy organization working to protect people's access to affordable, quality health care, and a national board member of the Epilepsy Foundation. This week he participated in an event with Senators Kennedy, Durbin and Torricelli to urge that the Senate quit stalling on the issue on patients' rights. His words bear repeating and so I have attached his statement from that event. I agree with Mr. Newmyer. Passage of federal consumer protection standards for managed care is past due. The leadership's tactics to thwart passage meaningful reform this year are unconscionable. This is not an issue that is going away and I look forward to continuing to work with Mr. Newmyer and other consumer advocates to achieve federal patient protections. Statement of A.G. Newmyer III Good morning. My name is Newmyer and I'm here on behalf of the 2.5 million Americans who have seizure disorders, and their families. Some of these folks are well known to you-- former Congressman Tony Coelho, Representative Neil Abercrombie, Congressman Hoyer's late wife. Others are total strangers--like me. And a couple hundred people on the Hill either have epilepsy or someone in their family does, but you don't know about it because stigma and fear keep these folks in the closet. The Epilepsy Foundation urges passage of strong patients' rights legislation. Today's health insurance system is a mean-spirited, predatory mess. But it's far worse for people with special medical needs. Those of you who cover this debate may recall that Tracy Buccholz from MN was the first public witness before the President's commission on health care. Tracy has epilepsy and led a rather normal life until her health plan started playing games with her life. She explained to the commission, when she came to Washington to testify, that she had been waiting eight months for permission to see her neurologist, despite the literature and promises of her plan. I'd like to make three brief points this morning. First, the member satisfaction statistics are pure nonsense. If I asked each of you how you like your life insurance, you'd think I was nuts. You'd tell me that you think it's fine--you never had to use it. The same thing's true for the 80% of Americans who have no significant medical need in any one year. I urge the press to focus on satisfaction among plan participants who have faced a serious medical need. Second, to those members who say they don't want to interfere in the insurance market, let's be serious. The user isn't the customer. Most patients get insurance at work and have very little choice. When the person making the purchase decision isn't the user of the service, it's not a market. It's an anomaly. And it needs to be fixed. Now. Finally, I know of no other segment of our society where some people elect to engaged in predatory behavior knowing that the victims can't go to court. No patients want more lawsuits. Patients want health plans to stop horsing around. Patients want to fix a system where some people prosper by denying care. The key is ERISA reform, which is why its being fought so hard by for-profit managed care plans. I leave you with this thought. Steve Wiggins, CEO of Oxford, made $29 million the year before he was fired. Last year, with his company \1/2\ way down the toilet, he left with $9 million in severance. The CEO of Aetna-United took home $17,693,000 during the past three years. Do you really think those plans can't afford for people with seizures to have easy access to decent care?

Mr. STARK

Mr. STARK. Mr. Chairman, I rise today in opposition to the Republican National Parks Bill. As former President Reagan once said, ``here we go again.'' It has become a tradition in Congress since the Republicans gained control of the majority to pass a massive end of session bill dealing with the environment. Because the Committee brings up these bills on short notice and with minimal oversight, they are ripe for anti- environmental provisions that would not pass on their own muster. This bill is a desperate attempt to pass legislation prior to hitting the campaign trail and to pass through specific favors to special interests. This ``omnibus'' bill contains many environmental provisions that should be voted upon and should become law. These provisions, if brought to the floor independently, would enjoy broad bipartisan approval. My Republican friends have included pet projects and environmental attacks in the context of this larger package. This bill should be rejected as it is written and Members should have the right to vote on individual parts of this package. Whatever positive environmental effects that part of this bill would help to create is undermined by the backdoor attacks on law that protect our public lands and national parks. I have heard from numerous environmental groups in opposition to this bill. The Sierra Club, the American Lands Alliance, the Wilderness Society, the U.S. Public Interest Research Group, the National Parks and Conservation Association, the League of Conservation Voters, the Defenders of Wildlife, the Environmental Defense Fund, the World Wildlife Fund, the National Trust for Historic Preservation and more than twenty other organizations have gone on record in opposition to H.R. 4570. What is hidden in the midst of this bill? Let's take a quick look. H.R. 4570 exempts certain public bodies from agreements and laws designed to manage public lands wisely. Sections 1351-1357 specifically make exceptions for an irrigation district in Southwestern Arizona from compliance with multiple-species conservation and water use plans now being developed by stakeholders in the Lower Colorado River Basin. Section 1009 is a backdoor assault on standard environmental review procedures for tree removal projects where natural events have happened. These carve-outs set terrible precedent and encourage the selective enforcement of environmental laws. What else is in this bill? Section 208 makes allowances for the development of a commercial airport in the Mojave National Preserve. Even if you are willing to look beyond the environmental and recreational impact this development will have, this provision also exempts the transfer from the Federal Lands Management Policy Act, another horrible precedent. Section 1342 allows for the development of a road through Alaska's Copper River Delta, including a 250-foot easement for logging in this pristine environmental wetlands area. H.R. 4570 paves the way for the privatization of National Park Lands, the transfer of Everglades National Park Land and weakens the Federal Antiquities Act. None of these ideas could garnish a majority vote in Congress on their own. Extreme members of the Republican Party must seek this cloak and dagger approach to get their pet projects before the body. H.R. 4570 incorporates the intent of H.R. 2458, which was introduced by Representative Helen Chenoweth. This provision would allow the U.S. Forest Service to give away $350 million in ``forest health'' credits over the next 5 years to pay for increased logging and grazing on National Forests under the pretension of wildfire reduction. I guess the logic is clear, it is hard to have a wildfire without any trees. I have been working with many Members of Congress to monitor and decrease the invasive use of motorized vehicles in our national parks and public lands. The bill before us today declassifies designated wilderness areas throughout the West to specifically allow motorized access. This dreadful provision could not pass if brought up on its own. But buried in the end of year rush to adjournment, and desperately trying to show their constituents that they have actually passed legislation this year, my colleagues on the other side of the aisle are threatening our natural lands and public areas with irreparable harm. I urge my colleagues to put the public interest ahead of the special interests and vote against this bill.

Mr. STARK

Mr. STARK. Mr. Speaker, I am proud to join with my colleagues today in support of organ donations. As we all know, organs are a gift of life for too many people. This bill today will give federal employees the extra time they need to be organ donors. It is an excellent idea and one that I hope we all will pass and support. I would like to take a minute to discuss a bill that I have introduced to help increase the number of available organs for transplants. H.R. 1605, the Gift of Life Congressional Medal Act will provide recognition for those families who have chosen to make the ultimate gift. The enactment of this legislation, which doesn't cost taxpayers a penny, will not only honor the individual organ donor and their loved ones, but will also heighten the awareness of the organ shortage-- ultimately resulting in more organ donation. There is a major under-supply of available and suitable organ donors. Currently, there are 50,000 individuals waiting for an organ transplant in the United States. The number of people on the list has more than doubled since 1990 and a new name is added to the national patient waiting list approximately every 18 minutes. Despite the numerous problems that organ donation programs have faced and conquered over the years, a major problem still exists. The demand for organs will continue to grow with the improvement of medical technologies. Without expanded efforts to increase the supply of organ donations, the supply of suitable organs will continue to lag behind the need. For the many would-be organ recipients, the consequence of shortage is death. It is clear that expanded efforts are necessary in order to increase the number of organ donors. According to some researchers, it may be possible to increase by 80 percent the number of organ donations in the United States through incentive programs and public education. A Congressional medal recognizing donors and their families can play a very important and effective role in our efforts to encourage such donation. Our proposed Gift of Life Medal Program will be administered by the regional organ procurement organizations (OPOs) and managed by the entity administering the Organ Procurement and Transplantation Network. Once the decision to donate an organ has been made, the donor or the family member of the donor will be asked by the regional OPO whether participation in the Gift of Life Medal Program is desired. The OPO will give each donor or family member the option of receiving a Gift of Life Medal, recognizing that some may not want to participate. If requested, a public presentation will be made to honor the donor. A presentation by a local official, community leader or Member of Congress would be a tremendous opportunity to increase the awareness concerning the desperate need for organ donation. Every action has been taken to insure that the issuance of the Gift of Life Medals results in no net cost to the government. In addition, I am proud to report that the legislation has the strong support of the United Network for Organ Sharing (UNOS) and the Coalition on Donation. Any one of us, or any member of our families, could need a life saving transplant tomorrow. We would then be placed on a waiting list to await our turn--or our death. So, I ask that our colleagues help bring an end to waiting lists and recognize the enormous faith and courage displayed by organ donors and their families. Please join me as a cosponsor of The Gift of Life Congressional Medal Act. These donors offer others a second chance by providing the most precious gift imaginable--the gift of life. Mr. Speaker, I yield back the balance of my time.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to pay tribute to the Park Elementary School in Hayward, California, the oldest year-round school in the nation. Over three decades ago, two elementary school principals, Mr. Barney Moura and Dr. Dan Foster, proposed the idea of an all year-round school schedule. In 1968, Park adopted the first single-trick, 200-day school calendar under provisions of a special seven year pilot program approved by the California State Legislature. Now celebrating its 30th anniversary as a year-round school, Park Elementary has provided a wealth of research and experience to corroborate the original goals of the program. Currently, almost 2 million students in 41 states attend year-round schools and I am proud that Park Elementary has led the way. Park Elementary not only deserves recognition as the original pioneer for year-round school, but it should also be acknowledged as the working model for success. Recent studies have demonstrated that student achievement is significantly higher at schools with a single track schedule than their nine-month counterparts. On November 6, Principal Jeanne Duarte-Armas will join with students and faculty, along with representatives from the Hayward Unified School District, to celebrate Park School's 30th anniversary with an afternoon picnic. I extend my hearty congratulations on their accomplishments and offer my best wishes for continued success. Mr. Speaker, I ask my colleagues to join in honoring those who have helped Park Elementary School reach its 30th year of achievement and excellence.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise to introduce the Medicare+Choice Medical Necessity Protection Act. With passage of the Balanced Budget Act, Congress has opened the Medicare program to a host of private insurance companies that will be competing with each other to get the most Medicare patients while spending the least amount of money. One of the cost-saving mechanisms commonly used to managed care plans today is to interpret ``medical necessity'' on their own terms. In this manner, health plans can avoid paying for services that would be considered normal and appropriate based on the standard medical practice of the day. Using such means, health plans can and do override the medical decisions of treating physicians. The clearest examples of this type of health plan behavior have also been areas where Congress has recently considered specific legislation. In the last Congress, we passed a law to prohibit health plans from requiring a mother who had just given birth to leave the hospital in less than 48 hours after birth. This year, Congress has been considering similar legislation with respect to a two-day stay for women who have undergone mastectomies. It is not good legislative policy to pass such case-by-case fixes to health plan behavior that we find abhorrent. Standard medical practices change on a continual basis. Having requirements for length-of-stay in federal law could become problematic if that medical standard changes. These decisions are best left in the hands of medical professionals. Unfortunately, with the growth of managed care in our country, it is often not medical professionals who are making such treatment decisions. These cases are becoming so blatantly arbitrary and without medical merit that Congress has been forced into action by public outcries. Rather than continue such case-by-case legislating, I support the creation of a medical necessity standard that would eliminate health plans' abilities to manipulate the standard. Under this proposal, medical necessity would be defined as ``a service or a benefit which is consistent with generally accepted principles of professional medical practice.'' This definition was part of the Democratic Patients' Bill of Rights (HR 3605), which created federal consumer protection standards for managed care plans in the private sector. It is also the common definition of medical necessity which has been established in case law over the past century. The Medicare+Choice Medical Necessity Protection Act would add that same definition of medical necessity to the Medicare+Choice program. This change would help ensure that seniors' who join any of the new Medicare+Choice health plan options in Medicare would have the protection of knowing that their private health plan could not manipulate the rules in order to avoid coverage and payment for appropriate medical services. It would put medical decision-making back in the hands of doctors where it belongs--not under the control health plan bureaucrats. Let me emphasize that this amendment would not mean that a health plan would ever be required to cover a service that is clearly not covered by the plan's contract. It only applies to covered services. So, if a health plan does not provide coverage for hearing aids, inclusion of this definition would never require the health plan to make an exception and cover a hearing aid for a particular person. The Medicare+Choice Medical Necessity Protection Act is a simple, sensible bill. It would ensure that all Medicare+Choice plans are playing under a uniform set of rules for coverage determinations and would end the practice of health plans arbitrarily overriding doctors' judgments. Our Medicare beneficiaries deserve no less. I urge my colleagues to join me in support of this important legislation.

Mr. STARK

Mr. STARK. Mr. Speaker, in the $80 billion tax bill the House voted last week, the Republicans proposed to provide immediate, 100% deductibility for the self-employed (but not their workers!) to purchase health insurance. The issue is now before the Senate. Democrats have proposed this type of tax relief before, but have tried to ensure it includes both the boss and the worker. It would be a little step toward helping people meet the costs of health insurance-- but it would do almost zilch to reduce the number of America's 43 million uninsured. Most uninsured either don't file tax returns, are in the zero tax bracket or, at most, the 15% bracket. We should admit that deductions will do little or nothing to make affordable individual health insurance policies bought at retail. Today, the law allows a 45% deduction--scheduled to increase to 100% by 2007--for the self-employed (but not their workers) who buy health insurance. An immediate deduction for the purchase of insurance will help folks in the 36% and 39.6% bracket and make insurance more affordable for them--but these are taxpayers with incomes above $121,300 ($147,700 if a family) who almost certainly already have health insurance. In June, the U.S. General Accounting Office issued a report showing how useless tax deductions are for helping the overwhelming number of uninsured. First, the GAO pointed out that a tax deduction is good only if you itemize your deductions. But in 1995, only 29% of all tax filers itemized. Lower income people, of course, are less likely to itemize. Only 5% of those with adjusted gross incomes of less than $20,000 itemized that year. Second, deductions are useful only if you pay taxes. Yet of the uninsured, about 13 million--more than the population of Virginia, Maryland and Delaware combined--were in the zero tax bracket and six million others didn't even have to file a return. A deduction is totally meaningless for them. Third, deductions don't do much for the lower income--and it doesn't take a Sherlock Holmes to figure out that the lower income are the people who are uninsured. Twenty-plus million uninsured were in the 15% bracket and would be helped if they itemized--but not much. This tax bracket is for those individuals with taxable incomes of $24,000 or less, or if married and filing a joint return, $40,100 or less. As the GAO points out, ``The value to a single tax filer in the 15-percent bracket who had paid $2,100 in premiums for single coverage would have been about $315 while the value to an individual in the highest bracket could have been $832 for this same premium amount. For a $5,664 premium for a family of four, the value to a family in the 15-percent bracket could have been about $850 compared to $2,243 for a family in the highest tax bracket.'' Think of it: a family with taxable income below $40,100 is going to spend $4,832 out-of-pocket for health insurance, because they got a tax deduction of $850? I sincerely doubt it. The Congressional Joint Committee on Taxation has estimated that the benefits of a similar Senate bill would go 95% to the already insured; only 5% would go to benefit people previously uninsured. Tax deductions will make little difference for those in need, but will provide additional savings for the already-insured upper income. What we really need are tax credits--including refundable credits-- that would be equal for all individuals and families to buy into reasonably priced, ``wholesale'' health insurance plans--plans that would be group health plans, such as Medicare or the Federal Employee Health plans. Because credits would actually do something to help the 43 million uninsured, they will be expensive. We will need to talk about tobacco taxes and other revenue sources to pay for them. It will be tough. But if America want to really do something about the uninsured, let's be honest: Deductions won't do it. Credits will.

Mr. STARK

Mr. STARK. Mr. Speaker, I thank the gentleman for yielding time to me. Mr. Speaker, I must say that the gentleman from Texas (Chairman Archer) has crafted a good tax bill. I rise in support of the Democratic substitute, because that would pay for it. I think the issue, and the gentleman from New York (Mr. Houghton) touched on it a little bit, is that this is an issue of priorities. There are no more cuts to be made that are easy politically. So they are pushing us into basically deficit spending; reducing the surplus, if you will. The question is, why this tax cut, then? Why not Medicare? The other day we tried to find $1,200,000,000 to fix home health care. They are unwilling to ask for a waiver. This bill breaks the budget law. They had to get special permission to void the budget bill to get this bill to the floor. Otherwise, a point of order could knock it out. Why were they not willing to do that with home health care, which they promised us would be paid for, but we have not seen it paid for yet? Why are we not fixing Medicare? Perhaps we should be having the debate that Medicare is more important than cutting the inheritance tax. Some people may not think so, but that is a worthy debate. They are not willing to cut defense. They are not willing to cut the fat pork out of the transportation bill. Somehow, my Republican colleagues are doing it out of the surplus without identifying what they are willing to give up. They are not making a hard choice. They are making a political statement in an attempt to win back some votes from people who turned their backs on the Republicans, rightly so, years ago. They are trying to avoid the discussion that this will harm, well, let us say it another way, will not fix Social Security. It will not fix Medicare. It will not help education. Is it the right thing to do? It is not a bad tax bill. It is not paid for. It is bad economic policy, and it is irresponsible.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today in opposition to H.R. 2621, a bill to allow fast track procedures for trade agreements. NAFTA is a recent example of why Congress should not approve this fast track authority. NAFTA proves that trade agreements do not necessarily beneift all workers. Our experience with NAFTA demonstrates that ``side agreements'' are not enforceable and labor, the environment and public safety are all at risk. Large corporations benefit from trade agreements like NAFTA. NAFTA enables these companies to exploit our most valuable resources for their own bottom line. For these reasons, I vehemently oppose granting fast track negotiating authority to the president. In any trade agreement, the people deserve to know--and have us debate--the terms of trade expension. I am not satisfied that the terms before us in this fast track authority are satisfactory and I am certain that the benefit doesn't go to the workers in my district. Estimates show that the number of jobs foregone in the U.S. because of NAFTA-induced imports is over 400,000. In my home state of California, 38,406 jobs were lost directly because of NAFTA, according to a narrow Commerce Department formula. This is nearly 10 percent of the total U.S. jobs lost because of NAFTA. Workers in California qualify for a significant portion of the Trade Adjustment Assistance (TAA)--California is one of the top six states where the most workers are certified for TAA. Multinational corporations export not only products but also business operations cross the border; they exploit Mexican workers for a fraction of the United States labor costs. American workers lose decent paying jobs. Mexican workers get work with subsistence wages. The corporations benefit at the expense of human labor. There are 981,302 Mexicans working in abhorrent conditions in Maquiladoras, making an average wage of $30-$35 for a 48 hour week as a direct result of NAFTA. These workers live in shacks made of cardboard and wood. I cannot grant a fast track trade negotiating authority if fair labor practices will not be protected. The environmental loses through NAFTA as well. The Administration promised greater environmental protections along the border regions where industry was expected to grow as a result of NAFTA. Well, we have experienced greater industry growth along the Southern borbers, but as far as environmental protection goes, it was just another promise broken. Hazardous waste coming into the United States increased 30 percent in 1995. In that same year, well water in U.S. border communities had sulfate concentrations of nearly twice what is considered safe for drinking water. Not only does the U.S. laborer lose through NAFTA, but so does the vulnerable child and grandparent who drinks polluted well water. NAFTA does not ensure inspection standards for produce, agriculture and livistock. NAFTA has crippled border inspections and the U.S. does not have the manpower to inspect everything that comes across its borders. Frozen fruit imports have increased by 45 percent and frozen vegetable by 31 percent since NAFTA, but there has been no increase in inspection. A 1997 GAO report shows that commercial passenger vehicles from Mexico are not being inspected regularly. The ones that have been inspected have been placed out of service for serious safety violations such as steering or brake problems, according to the Federal Highway Administration. Fifty-four percent of the commercial passenger vehicles that pass through our southern borders do so through California. These unsafe vehicles are endangering the passengers as well as the safety of those on the streets and highways of California. Negotiating authority with the right terms-allowing US workers to share in the benefit and promoting economic growth in environmentally sound ways worldwide--is my bottom line. Without that before us, I will vote ``no'' on the Reciprocal Trade Agreement Authorities Act of 1997.

Mr. STARK

Mr. STARK. Mr. Speaker, I must say I am confused by some of the discussions here. I had assumed that the Republicans were pushing to privatize Social Security and invest in things like the long-term capital corporation on Wall Street, but they are sending conflicting messages. They have been for Social Security since 1973, but none of them were around when it came into being, voted for it, and now they want to privatize it, and all I have got to do this morning is convince my mother that her Social Security benefits will continue. Mr. Speaker, the only thing I can tell her is to not vote Republican, because the record of the Republicans has been to dismantle Social Security since 1935 when they opposed it, and they still do. But the real issue that we are here debating today is how we are going to pay for the tax cut that we are going to debate tomorrow. And the only way that the Republicans could pay for their tax cut that they want to bring up tomorrow is to endanger the Social Security moneys today. They have got to take 10 percent. Let us forget about the 90 percent, and let us assume that is safe. Let us assume that nobody is going to steal that money. But the 10 percent we are talking about is going out for a tax cut. Now between now and tomorrow, with the way Republicans write bills in secret and pass them out of the Committee on Rules, they could increase that to 20 percent. Would not make any difference how we vote today, unless my colleagues support the substitute of the gentleman from New York who would lock away that money and take it out of the reach of these spending-crazed Republicans who would like to take this money and have a huge tax cut and increase the deficit even further than their 10 percent will do. So let us try and not confuse the public with whether we are better off having the Federal Reserve buy government bonds, which are indeed supported by Federal Reserve activities so that they are better investments, or whether we should leave them in a lower interest rate account at the Treasury, which has a fixed maturity value. I think that is splitting hairs. The truth is, the Republican plan gives us no protection beyond today. They say they are going to save 90 percent, but there is nothing in their bill that prevents them from changing their mind the very next day and spending 20 percent instead of 10 percent. And there is nothing in their past history of actions that would give us any confidence that that is not exactly what they will do. So what I am suggesting to my mom is that if she is worried about Social Security is to support the Rangel amendment which will limit the Republicans, at least, to only spending 10 percent for the tax cut that they want tomorrow, unlike the Democrats who would say, ``Let's wait, eat your spinach first, and then get your desert until there is a true surplus, and then we'll all support the tax bill.'' So please support the Rangel substitute so that the seniors can be secure that their old age retirement will be there and that my mother's grandchildren can also be secure in the knowledge that when they pay their taxes out of each paycheck there will be a retirement plan for them as well.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise in support of H.R. 4558, the Noncitizen Benefit Clarification and Other Technical Amendments Act of 1998. H.R. 4558 will extend Supplemental Security Income (SSI) benefits for nonqualified aliens who were receiving benefits before the enactment of welfare reform. This group of about 12,000 aliens, all of whom are elderly or disabled or both, will lose SSI and Medicaid on October 1 of this year unless Congress votes to permanently extend their benefits. The vast majority of affected recipients reside in California. The Federal Government has a responsibility to set guidelines that protect the vulnerable in this country. As a society, we have an obligation to support the elderly, the disabled and the poor. By gouging our food stamp program and denying benefits to legal immigrants, welfare reform doesn't even come close to those standards. Welfare reform pushes more children into poverty and leaves more of the poor without the health care they need. I support this correction and believe we should be doing more to give the needy a helping hand.

Mr. STARK

Mr. STARK. Madam Chairman, I rise today in opposition to the so- called ``Dollars to the Classroom'' Act. This sham bill is a public relations ploy for election year votes and a policy nightmare for our children. This bill sounds like a good idea--who could resist sending dollars to our schools? But calling the bill one thing does not make it so. We might as well have the Budweiser frogs pitching this bill because you would have to be a sucker for marketing to believe this bill will do anything to put more dollars into the classroom. H.R. 3248 attempts to redistribute federal education dollars. It claims to be an increase, but in reality would provide less funds to the classroom. In addition, it assumes a funding level that is not included in the House Appropriations Committee reported Labor-HHS- Education bill. So, even if H.R. 3248 becomes law, the funds won't be available to finance it. Let's review the Republican education agenda for a moment. We've debated a bill to allow prayer in schools--a right that is already protected by current law--we've discussed taking public education dollars and putting them into private voucher accounts for private schools, and my Republican colleagues have introduced legislation to eliminate the Department of Education. We have also defeated attempts to eliminate bilingual education, and defeated a bill to eliminate affirmative action programs in place at colleges and universities. As if that weren't enough, the Majority has refused to include any of the President's education proposals in the FY '99 Labor, HHS and Education Appropriations bill. Rather than putting dollars into education, the Majority's plan would cut Head Start by 50%, prevent much needed dollars to update and modernize school facilities and eliminate funding for GOALS 2000. The Department of Education shows that this bill, if enacted, would have a devastating impact on funds available for classrooms. In some states, the reduction of funds will exceed 60% of current funding levels. All states will lose dollars to the classroom. I am submitting for the record an analysis by the U.S. Department of Education which shows the impact on education funding if this bill were to become law. Who opposes this legislation? The organizations and schools on the front lines of teaching. The very classroom workers this bill claims to be helping. The National Parent Teacher Association, the American Federation of Teachers, the American Association of School Administrators, the American Association of University Women, the Council of Chief State School Officers, the National Association of Elementary School Principals, the National Association of Secondary School Principals, the National Association of State Boards of Education, and the National Education Association all oppose this legislation. It is clear where the Republicans stand on education. I urge my colleagues to take a real stand for our children and make a real commitment to our schools. Vote against H.R. 3248 and support effort to put real dollars into real classrooms.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today with Representative Ben Cardin (D-MD) to introduce the Medicare Home Health Case Manager Act of 1998. The Medicare home health benefit has received much attention this year. The reason for that attention has been the dramatic growth of home health services over the past decade. The Balanced Budget Act of 1997 (BBA) made a number of changes to the home health benefit to help stem that growth. However, much more needs to be done. The Medicare Home Health Case Manager Act is a double winner. It would simultaneously reduce Medicare spending on home health while improving the quality of the benefit. It does this by introducing a new component to the benefit: an independent case manager. Today, home health care is prescribed by a patient's physician, but then the actual plan of care is executed by the home health agency treating the patient. This creates incentives that have nothing to do with quality or appropriateness of care. Under the cost-based reimbursement system that existed before passage of BBA, the incentive to home health agencies was to over-utilize services for patients because that is how the agency made more money. In the BBA's prospective payment system (PPS) of the future, the incentive will be the opposite and there are real concerns about potential under- utilization of services. The Medicare Home Health Case Manager Act would ensure that home health care decisions for long-stay patients were being made by an independent case manager who in no way financially benefited by the length or type of home care provided to a patient. They would be paid by a Medicare fee-schedule that would in no way be influenced by the amount or type of care they recommend. This idea is endorsed by the Medicare Payment Advisory Commission (MEDPAC), a Commission appointed by Congress to provide expert advice on Medicare and Medicaid policy. In their March 1998 report to Congress they recommended that such a case manager be adopted for the home health benefit. Their report states: Such an assessment would help to minimize the provision of services of marginal clinical value, while ensuring that patients receive appropriate care. Requiring case management of long-term home health users could improve outcomes for individuals with long-term home health needs and at the same time slow the growth of Medicare home health expenditures. (emphasis added) There are also real-life examples of case management systems saving money and improving care. For example, Maryland's Medicaid program has a high cost user initiative which in FY 96 saved the state $3.30 for each $1 spent--a savings of 230%. The Health Insurance Association of America also commissioned a study of its member plans and found that rehabiltation/case management programs return an investment of $30 for every $1 spent. History has shown us that simply throwing more money into home health is not the answer for assuring that patients receive appropriate care. Let's use this opportunity to make a real, tangible improvement in the quality of care obtained by Medicare patients and simultaneously save Medicare spending by reducing inappropriate visits. I look forward to working with my colleagues for passage of this important legislation.

Mr. STARK

Mr. STARK. Mr. Speaker, I will not vote for this resolution because I have grave reservations about the process under this House resolution that provides no check for the relevance or veracity of the information contained in the Starr report, and which denies the President the fairness that the House has afforded its own Members. This report is a prosecutor's version of a case, no more and no less. It evolves from a grand jury investigation that affords witnesses no opportunity for representation by counsel and no rebuttal for witnesses. If the accused were a House Member, He would have been afforded time to review the report and prepare a response. Our own Speaker Gingrich was given five days to read and respond to the Ethics report detailing his wrong doing; the Speaker's response was included in the document made available to the public by the Ethics Committee. Speaker Gingrich forgets that fairness he was afforded as he casts the first stone today at the President. As we vote today, we do not know where the truth will take us. But we must not plunge into McCarthy era demagoguery in which salacious slander replaces responsible governing.

Mr. STARK

Mr. STARK. Mr. Speaker, attached are two important articles that spotlight a significant problem with the rampant mergers, acquisitions, and conversions going on throughout our health care system today. Recently, the two Blue Cross plans in Washington and Maryland combined into one plan. There was, at the time, and continues to be, great concern within the consumer community--lead by A.G. Newmyer of the Fair Care Foundation--with this merger. He makes a strong case that the eventual goal of this merger was not to provide better quality health care to the plans' members--as both health plans proclaim. Instead, it was to line the pockets of health plan executives and pave the way to convert the bigger, stronger plan into a for-profit entity. Under both of these scenarios the community loses. The attached articles outline Mr. Newmyer's perspective on this merger quite well and I encourage everyone to read them. [From the Daily Record, Aug. 10, 1998] Did Blues Execs Pad Their Pockets? (By Bob Keaveney) On May 23, 1997 at 12:30 p.m., over lunch at a Washington- area restaurant, A.G. Newmyer III says his friend, at the time a director of Blue Cross Blue Shield of the National Capital Area, made a shocking admission. Newmyer says the director, whom he will not name, told him that Larry Glasscock, then-president of the D.C. Blues, would leave the company after its combination with Maryland's Blue Cross plan was complete. Newmyer said he was complaining to his friend about the way the D.C. Blues treats its members generally, and about Glasscock specifically, when the director ``smiled and said, `After the merger, he'll be gone.''' Last March, two months after the deal was complete, Glasscock did leave for a job in Indianapolis, taking with him nearly $3 million in severance. Several other members of the D.C. Blues' senior management team left, too, taking with them another $3.7 million combined. Newmyer's story, if corroborated, would supply the smoking gun he said he needs to prove his contention that the Blues' year-long effort to gain regulatory approval for its merger was a sham from the beginning. That's because Glasscock told regulators that he had no immediate plans to leave, even though Glasscock's employment contract permitted him to do so--taking the severance pay with him--should the merger be consummated. The insurance commissioners of Maryland and the District each have said they would not have approved the merger had it appeared to be a deal designed to allow executives to profit personally. The story also would support Newmyer's view of the merger as a cynical power grab, orchestrated by a handful of top executives harboring a quiet agenda to one day convert the new, combined Blues into a for-profit health insurance powerhouse. But there is no evidence that the meeting ever took place, much less any proof that the anonymous director ever made such a foolhardy utterance. And Newmyer is an admitted mortal enemy of Blue Cross plans locally and nationally. A loud and frequent critic of what he views as shabby treatment of policy holders, he is chairman of the Fair Care Foundation, a Washington-based Blues' watchdog group correctly suing the Blues in the District of Columbia in a long-shot bid to force them to unmerge. Newmyer says he won't reveal his lunch companion's identity because Fair Care has sued him for breach of fiduciary responsibility, ``and I don't want to torment him further, personally.'' Still, Newmyer, a Northern Virginia businessman, isn't the only one who finds the circumstances surrounding the Blues deal curious. Some eight months after its closing, consumer groups and Blue Cross-watchers in other parts of the country are eying the deal here with skepticism. And there are several peculiarities to the deal, which may lend credence to their view. The deal All sorts of level-headed business reasons exist that a merger made sense between Owings Mills-based Blue Cross Blue Shield of Maryland and Washington-based Blue Cross Blue Shield of the National Capital Area. At the time of the deal's closing, the D.C. Blues had 760,000 members in the District and its highly mobile suburbs in Maryland and Northern Virginia. The Maryland Blues had 1.5 million members in and around Baltimore. The companies figured that by combining, each would expand its network of providers, allowing members living in Montgomery County (D.C. Blues'-territory) but working in the Maryland Blues' Howard County, to see a doctor in either place. And by getting bigger--the combined Blues would have more than 2.2 million members and $3 billion in revenue--officials said the company could compete better against its heavily muscled for-profit peers, offer more products and enhance its customer service. ``Affiliating our two contiguous Blue Cross Blue Shield plans is a logical business decision that will allow us to offer our members the most comprehensive health care services available and operate more efficiently over time,'' said William Jews, president of the Maryland Blues, in a statement in January. Under terms of the deal, a new holding company would be formed, called CareFirst, based in Owings Mills. CareFirst would operate both Blues' plans as subsidiary companies. Jews would become president and CEO of CareFirst, as well as CEO of both Blues. Glasscock would be chief operating officer of CareFirst and both Blues, as well as president of both Blues. But as it turned out, that organizational structure lasted only a few weeks. Quiet exit On March 27, Indianapolis-based Anthem Inc., an owner of for-profit Blue Cross plans in four states, said that Glasscock would join the company in a new position, senior executive vice president and COO. Anthem, however, did not make that announcement to the Baltimore or Washington press, and it wasn't known here until May 19, when several newspapers, including The Daily Record, discovered the departure and reported it. Then and now, Blues officials have insisted that the $6.5 million in severance payments made to Glasscock and 25 other departing executives was proper, legal and in line with what high-ranking executives at other, similarly sized Blues plans have received upon departure. Glasscock repeatedly has refused to speak to the Baltimore media since his departure and declined, again, to comment for this story. ``He only wants to talk about his future with this company,'' said Patty Coyle, an Anthem spokeswoman. Others have criticized his golden parachute as a typical example of what happens when state regulators don't monitor the assets of Blues plans--assets built up, in part, by tax breaks granted the Blues because of nonprofit status. Indeed, the circumstances surrounding Glasscock's departure are at the root of one of the fundamental charges levied against the Maryland and D.C. Blues by Fair Care. Golden parachute The organization claims that officials not only knew Glasscock would leave after the merger, but that the merger was contingent upon his agreement to go. After Glasscock's departure, Jews took over his former jobs, becoming president and CEO of CareFirst and both Blue Cross plans. ``Bill Jews gave Larry Glasscock a $3 million `tip' to get out of town,'' Newmyer said. There is no hard evidence of that, and the Blues deny it vehemently. Dwane House, a director of the D.C. Blues until the merger was completed and a high-ranking executive at Anthem until retiring in recent months, said Newmyer's assertion is false. ``To the best of my knowledge, he hadn't made a decision to leave'' until after the merger was final, House said from his South Carolina home. But in support of their contention, merger opponents point to changes that were made to Glasscock's contract with the D.C. Blues in the days leading up to the merger--changes that ensured Glasscock's golden parachute would safely open after the deal closed. The golden parachute clause in Glasscock's contract allowed him to collect the severance payment should he ever find himself in a job lower than the top position at the D.C. Blues, or any company controlling the D.C. Blues. The so-called change-in-control clause was altered slightly--but critically--in 1997, while the D.C. and Maryland Blues were seeking regulatory approval for their merger. To exercise the clause, two things had to happen: The change in control needed to take place leaving Glasscock as the less-than-senior official, and he needed to be terminated, according to a consultant's analysis of the contract prior to the merger. Although the Blues have maintained that Glasscock resigned his position--and was not fired--Blues spokeswoman Linda Wilfong said he was able to satisfy the latter requirement, because his contract allowed him to terminate himself. Question of self-dealing For merger opponents, the objectionable contract change made it clear that accepting a position as the less-than- senior official in the new merged Blues was not a forfeiture of Glasscock's right to exercise the change-in-control clause. The provision was added last year, as the companies were jockeying for regulatory approval of the merger. Many executive compensation packages include change-of- control provisions not unlike Glasscock's--and this one, in fact, did not alarm Sibson & Co., the New Jersey-based analyst hired to review the contract. Maryland Insurance Commissioner Steven Larsen said he asked for the independent analysis, because he wanted to be sure that the changes made to Glassocck's contract in 1997 would not entitle him to additional severance pay. He said he was satisfied with the Sibson report's conclusion. But the Glasscock change took the unusual step of making it clear that he could exercise his change-in-control clause, even though he was helping to engineer the change in control. In other words, by allowing Glasscock to demote himself through his work in brokering the merger, the change gave him cause to effectively fire himself after the merger was complete, allowing him to collect a $2.8 million severance. ``When you say, `What did they do? What happened?' They caused that to happen,'' Newmyer said. ``He [Jews] had to get his hand on the [Blues'] assets, and to do that, he had to get Larry Glasscock out of the way.'' No comment Both Jews and John Piccioto, the Blues' in-house counsel, declined interview requests to explain why the Blues thought it necessary to alter Glasscock's change-in-control clause, when they say they saw no reason to believe he would be leaving after the merger. ``I think what you're trying to get at is a little too close to the litigation,'' said Wilfong. At least one regulatory who reviewed the proposed merger, Dana Sheppard of the District's Office of Corporation Counsel, raised objections to Glasscock's golden parachute on Nov. 24, 1997, two months before the merger closed. ``Mr. Glasscock, as the senior official at [the D.C. Blues], deserves the closest scrutiny, because he entered into the proposed business combination agreement with [the Maryland Blues] knowing that he would not retain his current position in the controlling organization,'' Sheppard wrote in his proposed conditions to the merger's approval. ``Accordingly, he has positioned himself, intentionally or unintentionally, to leave [the D.C. Blues] with substantial charitable assets.'' Given that, Sheppard recommended that the District's insurance commissioner, Patrick Kelly, block the merger unless Glasscock and other executives with change-of-control provisions in their contracts ``take appropriate action to immediately render the provision null and void.'' On Dec. 23, Kelly approved the merger with a series of conditions--but none required Glasscock to give up the golden parachute. Overdrive What happened in the 29 days between Nov. 24 and Dec. 23 to cause Kelly to reject the suggestion of one of the District's own lawyers advising him on the matter? Newmyer thinks he knows exactly what happened. ``I am 99.9 percent convinced that because Dana Sheppard had raised an issue that truly went at the heart of this matter . . . the lobbyists from Blue Cross went into overdrive,'' he said. He believes Blues' lawyers met with Kelly in the days prior to his approval of the merger to convince him to drop Sheppard's suggestion to cut Glasscock's golden parachute. Kelly did not return a call seeking comment. Sheppard declined to speak for the record, citing Fair Care's pending litigation. Bob Hunter, director of insurance for the Consumer Federation of America (CFA) and the former Texas insurance commissioner, said he believes there was an inappropriate meeting. ``Blue Cross got to look at the proposed order and propose changes [when others did not],'' Hunter said. ``A public process shouldn't happen that way. . . . The District of Columbia should have reorganized the hearing, and as parties, we should have been invited.'' The CFA is supporting Fair Care's suit. Secret meetings? Tim Law, an attorney with the Philadelphia law firm handling Fair Care's case, said the group did not know that Sheppard's proposed conditions existed until after the merger was complete. They never received them. ``That's one of the weird things,'' Law said. ``It gets put in the record, but it doesn't get served to everyone. So sometimes, we didn't know about things. Important things, like that.'' Wilfong refused to answer any questions related to allegations of secret ex-parte meetings between regulators and Blues' officials, which are at the heart of Fair Care's lawsuit. The case now is awaiting a decision on an appeal of a District of Columbia judge's ruling that the group does not have standing to sue. In addition to the alleged meeting between Kelly and Blues' lawyers Nov. 24 and Dec. 23, Fair Care contends that Kelly and Maryland Insurance Commissioner Larsen, in separate Jan. 16 letters, changed their own approvals of the merger after having private meetings with Blues' lawyers. Kelly and Larsen approved the merger on Dec. 23. Among other things, the group is angry that both commissioners agreed to make it clear that portions of executive contracts dealing with severance payments negotiated prior to 1997 were not subject to their approval, as both orders had required. Larsen acknowledges there was a meeting with Blues lawyers prior to the Jan. 16 letter, and that he issued the letter at the Blues' request. But he insists that there was nothing inappropriate about the meeting or the letter. The purpose of both, he said, was to clarify his order--not to change it. ``That meeting was about as routine as you could have in the context of a very significant order being issued,'' he said. ``I don't know what else to say, other than to not be able to have that meeting is absolutely absurd. I have a responsibility to the entities I regulate to explain the meanings of the orders I issue,'' he added. Charitable? Along with questions about Glasscock's contract, an ongoing debate questions whether Blue Cross plans, both locally and in other parts of the country, are, in fact, charitable organizations. Certainly, at first glance, it would appear that they are not. Although nonprofit, they act as insurance companies. They charge premiums like any insurer and expect to be in the black at year's end. The local Blues long has insisted that it is not a charity, and made that position clear last year to the insurance commissioners. ``I know what the criteria for a charity are,'' Larsen said. ``Blue Cross is not a charity in my view. . . . Blue Cross is'' an insurance company.'' Maryland Attorney General J. Joseph Curran disagrees. His office long has held that Blue Cross of Maryland is indeed a charitable organization and always has been. This is not just an academic debate among lawyers, however. Nationwide, as nonprofit Blues plans have converted themselves into for-profit companies, the answer to the charity question has been crucial to deciding whether the Blues must set aside a portion of assets in public trust, to be used for charitable health purposes. Just last month, a group of small charities in Georgia settled a lawsuit with that state's Blues in which the now for-profit company agreed to set aside $64 million in trust. In California in 1994, California's Blues was forced by the state attorney general to set aside $3.2 billion in two trusts, said Frank McLoughlin, staff attorney for Community Catalyst, a Boston-based consumer group that monitors nonprofit to for-profit conversions. ``There's a difference between a charity--like a soup kitchen. . . . and a charitable organization,'' said McLoughlin. ``A lot of Blue Cross officials think that because they look like a regular health insurance company and because they act like a regular health insurance company, they're no longer bound by legal doctrine.'' Change in identity The Maryland Blues has tried twice--in 1994 and 1995--to convert to for-profit status, but has been thwarted both times. it has made no secret that it may try again. Locally, the Blues has suffered two setbacks in its attempt to distance itself from that doctrine in the last year. Last fall, the D.C. Blues tried unsuccessfully to drop its federal charter--which established the company in 1934 as a ``charitable and benevolent organization''--in favor of a charter with the District, where the law is vague on the question. Under a D.C. charter, the Washington Blues would no longer have been identified as a ``charitable and benevolent'' organization. Consumer groups that lobbied Congress to block the charter switch, said the language defines its tax-exempt, nonprofit status, as well as its obligation to serve the public. ``To change their identity in the context of what's going on around the country is a harbinger of things to come in the for-profit sector,'' said Julie Silas, staff attorney with Consumer's Union, which first drew attention to the issue. And during the 1998 General Assembly session, lobbyists from the Maryland Blues tried to attach an amendment to a bill making it harder for nonprofit health care entities to convert to for-profit. Curran said the amendment would have made it easier for the Blues to convert without a public set-aside. The rider seemed innocuous enough. It merely stated that the Blues exist to serve policy holders, not the general public. But when lawmakers sponsoring the bill learned that such arguments have been made in other states to attempt to establish Blues' plans as non-charitable, they were furious. ``It's sad and embarrassing,'' said Del. Dan Morhaim, D- Balto. City, one of the sponsors for the legislation, at the time. ``Its a slap in the face of Maryland taxpayers.''

Mr. STARK

Mr. STARK. Mr. Speaker, various Members of Congress frequently say that one of the ways to save Medicare is to require the patient to pay a higher share of the cost--thus making the patient a more careful consumer and reducing the demand for care. Following is a portion of a 1997 study published by the World Health Organization entitled, ``European Health Care Reform,'' which shows why such an approach will save little, but of course will greatly increase the burden on the poorest and sickest in our society. This portion of the study is also interesting in that it shows that in most foreign countries, patients have much more time with their doctor and have much longer hospital length of stays than Americans--yet those foreign societies spend about 30 to 40% less than we do on health care. Before Americans push more of the burden of Medicare onto the poor and sick, we should look to the lessons from abroad. The Effects of Cost Sharing total health expenditure Evidence suggests that cost sharing reduces utilization but does not contain costs. Overall costs are not contained because cost sharing is a set of demand-side policies, and costs are primarily driven by supply-side factors. Intercountry comparisons indicate that the United States has lower rates of contact with physicians and beddays per head of population than many other countries, including Canada, France, Germany, Japan and the United Kingdom, but costs in the United States are much higher relative to GDP than in these other countries. This strongly suggests that it is the intensity of care provided per contact in the United States that is responsible for this apparent paradox (198). The United States has the highest out-of-pocket expenses, mostly to meet cost-sharing obligations; it also has the highest overall costs. Other countries have lower cost-sharing and higher utilization rates, but lower costs. This does not mean that cost sharing causes higher costs; it means that measures other than cost sharing (supply-side measures such as budgetary controls) are much more effective mechanisms for cost-containment. The Rand Study (199,200) suggests that cost sharing is associated with a decrease in total health spending, but the design of the experiment does not really permit strong conclusions to be drawn about the consequences for total expenditure of the broad implementation of cost sharing within a retrospective reimbursement system. The reason is that providers may compensate for a reduction in consumer- initiated demand by inducing increases in service volume or intensity. Table 9, which shows intercountry data (198) on contacts with physicians, hospital days and health expenditure as a percentage of GDP, suggests that consumer- initiated demand is not the major factor driving health care costs. Rather, it appears to be the intensity of services provided. Since intensity is largely provider initiated, there is little scope for cost sharing to make much of an impact on the overall level of spending. . . .

Mr. STARK

Mr. STARK. Mr. Speaker, Congress should enact legislation to allow Medicare to concentrate certain difficult surgical procedures in hospitals of special excellence in those procedures. If we did this, we would certainly save lives because the data is overwhelming that some hospitals do difficult procedures better than other hospitals. Better patient outcomes also means savings to Medicare by the avoidance of complications and repeat surgery. It also offers the chance for Medicare to negotiate a bundled, lower payment: Medicare will guarantee a higher volume of patients in exchange for volume price discounts. I've introduced legislation to establish a Centers of Excellence program, HR 2726, which I hope can be enacted in the next Congress. The Annals of Surgery's July 1998 issue contains an article which proves, once-again, what a life-saver this type of program can be. Following is the abstract of the article, describing using centers of excellence for pancreaticoduodenectomy--a ``complex, high-risk general surgical procedure usually performed for malignancies of the pancreas'' and duodenum area: Statewide Regionalization of Pancreaticoduodenectomy and its Effect on In-Hospital Mortality Objective This study examined a statewide trend in Maryland toward regionalization of pancreaticoduodenectomy over a 12-year period and its effect on statewide in-hospital mortality rates for this procedure. Summary Background Data Previous studies have demonstrated that the best outcomes are achieved in centers performing large numbers of pancreaticoduodenectomies, which suggests that regionalization could lower the overall in-hospital mortality rate for this procedure. Methods Maryland state hospital discharge data were used to select records of patients undergoing a pancreaticoduodenectomy between 1984 and 1995. Hospital is were classified into high- volume and low-volume provider groups. Trends in surgical volume and mortality rates were examined by provider groups and for the entire state. Regression analyses were used to examine whether hospital share of pancreaticoduodenectomies was a significant predictor of the in-hospital mortality rate, adjusting for study year and patient characteristics. The portion of the decline in the statewide in-hospital mortality rate for this procedure attributable to the high- volume provider's increasing share was determined. Results A total of 795 pancreaticoduodenectomies were performed in Maryland at 43 hospitals from 1984 to 1995 (Maryland residents only). During this period, one institution increased its yearly share of pancreaticoduodenectomies from 20.7% to 58.5%, and the statewide in-hospital mortality rate for the procedure decreased from 17.2% to 4.9%. After adjustment for patient characteristics and study year, hospital share remained a significant predictor of mortality. An estimated 61% of the decline in the statewide in-hospital mortality rate for the procedure was attributable to the increase in share of discharges at the high-volume provider. Conclusions A trend toward regionalization of pancreaticoduodenectomy over a 12-year period in Maryland was associated with significant decrease in the statewide in-hospital mortality rate for this procedure, demonstrating the effectiveness of regionalization for high-risk surgery.

Mr. STARK

Mr. STARK. Mr. Speaker, I am introducing legislation today to close a loophole in the way Medicare pays long-term care hospitals--hospitals which treat people with severe problems and which have an average length of stay (ALOS) of more than 25 days. Some so-called TEFRA hospitals establish extremely high patient costs in the first year or two of operation, which establishes the rate at which they will be paid under Medicare in future years. Once that rate is established, they immediately go to a much lower cost mix of patients, but get paid as if they still had a very sick, expensive patient caseload. The bill I am introducing would help curb this gaming of the system.

Mr. STARK

Mr. STARK. Mr. Speaker, I am pleased to introduce the Medicare Rehabilitation Benefit Equity Act of 1998. This bill will ameliorate the impacts on seniors needing outpatient rehabilitation services of coverage limits on those services imposed by the Balanced Budget Act of 1997 (BBA). Dollar limitations on services will be replaced by a patient classification system effective July 1, 2000. Between 1990 and 1996 Medicare expenditures for outpatient rehabilitation therapy rose 18 percent annually, totaling $962 million in 1996. During that time, outpatient rehabilitation spending shifted substantially away from hospitals and toward rehabilitation agencies and comprehensive outpatient rehabilitation facilities (CORFs). Payments to agencies and CORFs rose at an average annual rate of 23 percent and 35 percent, respectively. The BBA enacted substantial changes in Medicare's payment policies for outpatient rehabilitation services. Two limits are imposed on outpatient rehabilitation services--coverage for physical and speech therapy is capped at $1,500 per beneficiary per year; coverage for occupational therapy is subject to a separate cap of $1,500. The limits will become effective for services rendered after January 1, 1999. Rehabilitation services furnished in hospital outpatient departments are excluded from the caps. Unfortunately, these dollar limits do not take into account patient characteristics such as diagnosis or prior use of inpatient and outpatient services. Implementation of the limits will have a disproportionate effect on the most vulnerable Medicare beneficiaries and may place a financial burden on some beneficiaries. The Medicare Payment Advisory Commission recently examined the potential impact of the coverage limits and found that some patients were more likely to exceed the dollar limits than others. The Commission found that hip fracture patients had the highest median payments and stroke patients incurred the next highest payments. While Medicare spent, on average, about $700 per outpatient rehabilitation patient in 1996, half of all stroke patients exceeded the $1,500 physical and speech therapy limit. In contrast, less than 20 percent of patients with back disorders exceeded the physical and speech therapy limit. In 1996 about one-third of patients treated in non-hospital settings (rehabilitation agencies and CORFs) incurred payments in excess of $1,500 for outpatient physical and speech therapy or $1,500 for occupational therapy. Half of the patients affected by the limits exceeded them by $1,000 or more. The Medicare Rehabilitation Benefit Equity Act will minimize the inequity and disruption of the BBA limits without affecting the program savings. It requires the Department of Health and Human Services to develop and implement an alternative coverage policy of outpatient physical therapy services and outpatient occupational therapy services. Instead of uniform, but arbitrary, dollar limitations, the alternative policy would be based on classification of individuals by diagnostic category and prior use of services, in both inpatient and outpatient settings. The Medicare Rehabilitation Benefit Equity Act also requires that the revised coverage policy of setting durational limits on outpatient physical therapy and occupational therapy services by diagnostic category be implemented in a budget-neutral manner. The payment methodology will be designed so as to result in neither an increase nor decrease in fiscal year expenditures for these services. Current law provisions to adjust the annual coverage limits on outpatient rehabilitation therapy services by the medical economic index (MEI), beginning in 2002, are retained. The Medicare Rehabilitation Benefit Equity Act recognizes that the Department of Health and Human Services' Health Care Financing Administration currently lacks the data necessary to implement a coverage policy based on a patient classification system on January 1, 1999. It further recognizes that assuring services for Medicare beneficiaries in the year 2000 is HCFA's number one priority. For these reasons, a phased transition to a patient classification coverage policy is necessary. I urge my fellow Members of Congress to join me in support of the Medicare Rehabilitation Benefit Act of 1998. Together we can ensure that implementation of the BBA dollar limits on outpatient rehabilitation services will not disproportionately affect our most vulnerable Medicare beneficiaries.

Mr. STARK

Mr. STARK. Mr. Speaker, on August 6, the Ways and Means Health Subcommittee held a hearing on the problems facing home health agencies because of payment changes made in the Balanced Budget Act of 1997. In theory, for good and honest agencies, the BBA should not have created problems. It simply asks home health agencies (HHAs) to practice the type of care they practiced in 1994, before many HHAs greatly increased their number of visits per patient and their costs per visit. The theory assumed, of course, that HHAs are serving the same kind of patients they received in 1994. But between 1990 and 1996, the number of HHAs owned by hospitals nearly doubled, and today, about half the nation's hospitals own HHAs. So what, you say? At the August 6 hearing, one independent HHA testified, saying what several HHAs have told me privately: As a freestanding agency, Great Rivers Home Care receives few referrals from hospitals since most have their own home health agencies. Our experience is that the hospitals refer the short term, less complex cases to their own agencies and the sicker, more costly, long term patients are then cared for by agencies like ours. I do not know the quality of care provided by Great Rivers, but I do know they dared say what others are only saying privately. Before we casually throw more money at the home health sector, we should ask whether there is a self-referral abuse that is causing serious distortions in this part of Medicare.

Mr. STARK

Mr. STARK. Mr. Chairman, I am opposed to the Republican District of Columbia School Vouchers Act. It was brought to the floor on false logic and ignores the real problems in public education. Let's take the Republican argument at face value for a minute. If public schools in the District of Columbia are unable to educate our children, as my colleagues claim, is the solution to remove 2,000 of them and place them in private schools? What do we do for the 76,000 students left behind? In fact, these 76,000 will have to do with less funds available to help their education. It will cost $7 million to educate these 2,000 students in private schools--but this bill does not allow for additional funds to help the remaining children. How else could this $7 million be spent? The money could pay for after-school programs in each and every D.C. public school, 368 new boilers, could rewire 65 schools, upgrade plumbing in 102 schools, or buy 460,000 new textbooks. The people who live in the District of Columbia do not want this bill. The people of the District of Columbia did get the chance to vote on vouchers when the issue was placed on the ballot. It was defeated by a margin of eight to one. The residents of our host city do not deserve to be experiments for right-wing think tanks that promote ideas favored by the Christian Coalition and the religious right. If my colleagues on the other side are truly interested in helping students enrolled in public schools, I offer some suggestions for them. Why don't we increase the funds available for teacher salaries? How about holding teachers to educational standards of their own to make sure that those who teach our children are actually qualified to do so? What about providing a textbook in every core subject for every school child in America? What about adopting the President's plan to improve our educational infrastructure? We need to make sure that school classrooms are not falling apart and students have the resources they need, whether they be textbooks or access to the Internet, to be able to succeed in today's world. My Republican friends could make a strong stand for education by adopting these policies. Instead they shower us with rhetoric about helping children, when this is really an attack on public education across the country. The schoolchildren of the District of Columbia deserve our help and need our assistance. This is the wrong move, the wrong idea, and the wrong time and place. I urge my colleagues to take a real and meaningful stand for children and education. Vote against the Armey Amendment to the FY '99 District of Columbia Appropriations Act.

Mr. STARK

Mr. STARK. Mr. Speaker, I am pleased to rise with my colleagues Representatives Cardin, Kleczka, and Lewis with whom I serve on the Ways and Means Health Subcommittee, to introduce The Medicare Substitute Adult Day Care Services Act. This bill would update the Medicare home health benefit to incorporate modern setting for rehabilitation. While the home had been the only setting in which a homebound person could reasonably be expected to receive therapy, that is no longer always the case. This legislation would allow patients and their families to choose the best setting for their individual needs. This new choice would be provided at no additional cost to the Medicare program. Adult day care centers (ADCs) are proving to be effective--often preferable--alternatives to complete confinement in the home. Homebound people can utilize these centers because they provide door-to-door services for their patients. ADCs send special vehicles and trained personnel to a patient's home and will go so far as to get the patient out of bed and transport them to the ADC site in specially-equipped vehicles. Without this transportation component, homebound patients would be not able to utilize such a service. For certain patients, the ADC setting is far preferable to traditional home health care. The ADC can provide skilled therapy like the home health provider, but also provide therapeutic activities and meals for the patients. These centers provide a social setting within a therapeutic environment to serve patients with a variety of needs. Thus, patients have the opportunity to interact with a broad array of people and to participate in organized group activities that promote better physical and mental health. Rehabilitation can be enhanced in such a setting. It is also important to note that ADC care provides an added benefit to the caregivers for frail seniors. When a Medicare beneficiary receives home health services in the home, these providers are not in the home all day. They provide the service they are paid for and then leave. Many frail seniors cannot be left alone for long periods of time and this restriction prevents their caregivers from being able to maintain employment outside of the home. If the senior were receiving ADC services, they would receive supervised care for the whole day and the primary care giver would be able to maintain a job and/or be able to leave the home for longer periods of time. From a cost perspective, an ADC setting can provide savings as well. In the home care arena, a skilled nurse, a physical therapist, or any home health provider must travel from home to home providing services to one patient per site. There are significant transportation costs and time costs associated with that method of care. In an ADC, the patients are brought to the providers so that a provider can see a larger number of patients in a shorter period of time. That means that payments per patient for skilled therapies can be reduced in the ADC setting compared to the home health setting. The Medicare Substitute Adult Day Care Services Act would incorporate the adult day care setting into the current Medicare home health benefit. It would do so by allowing beneficiaries to substitute some, or all, of their Medicare home health services in the home for care in an adult day care center (ADC). To achieve cost-savings, the ADC would be paid a flat rate of 95% of the rate that would have been paid for the service had it been delivered in the patient's home. The ADC would be required, with that one payment, to provide a full day of care to the patient. That care would include the home health benefit and transportation, meals and therapeutic activities. It is especially important to note that this bill is not an expansion of the home health benefit. It would not make any new people eligible for the Medicare home health benefit. Nor would it expand the definition of what qualifies for reimbursement by Medicare for home health services. In order to qualify for the ADC option, a patient would still need to qualify for Medicare home health benefits just like they do today. They would need to be homebound and they would need to have a certification from a doctor for skilled therapy in the home. All the bill would do is recognize that ADCs can provide the same services, at lower costs, and include the benefits of social interaction, activities, meals, and a therapeutic environment in which trained professionals can treat, monitor and support Medicare beneficiaries who would otherwise be at home without professional help. All of these things aid the rehabilitation process of patients. In order to participate in the Medicare home care program, adult day care centers would need to meet the same standards that are required of home health agencies. The only exception to this rule is that the ADCs would not be required to be ``primarily'' involved in the provision skilled nursing services and therapy services. They would be required to provide those services, but because ADCs provide services to an array of patients, skilled nursing services and therapy services may not always be their primary activity. Otherwise, all the home health requirements would apply to ADCs. Here is an example of how the system would work if this bill were law. A patient is prescribed home care by his or her doctor. At that time the patient and his or her family decide how to arrange for the services. They could choose to receive all services through the home, or could choose to substitute some adult day care services. So, if the patient had 3 physical therapy visits and 2 home health aide visits, they could decide to take the home health aide visits at home, but substitute three days of ADC services for the physical therapy visits. On those days, the patient would be picked up from home, taken to the ADC, receive the physical therapy, and receive the additional benefits of the ADC setting (group therapy, meals, socialization, and transportation). All of these services would be incorporated into the payment rate of 95% of the home setting rate for the physical therapy service. It is a savings for Medicare and an improved benefit to the patient--a winning solution for everyone. While we believe this bill would create savings for Medicare without any additional protections, to make sure that that is the case, we have included a budget neutrality provision in the bill. This provision would allow the Secretary of Health and Human Services to change the percentage of the payment rate for ADC services if growth in those services were to be greater than current projections under the traditional home health program. This is a small step forward for rehabilitation therapy for seniors. Eligibility for the home health benefit is not changed so it is not an expansion of the benefit. We believe that patients would greatly benefit from the option of an adult day care setting for the provision of home health services and look forward to working with our colleagues to enact this incremental, important Medicare improvement.