Pete Stark

Mr. STARK

Mr. STARK. Mr. Speaker, I am today introducing legislation to repeal the option of private fee-for-service plans under Medicare+Choice which was enacted this summer as part of the Balanced Budget Act. These plans make no sense whatsoever. The CBO did not assign any costs to them, because they basically assumed no one would be foolish enough to join one. But the plans hold some potential for further risk segmentation and consumer abuse and should therefore be repealed. This proposal, which came from the Senate, provides an individual with the equivalent of an amount of money equal to the amount that would be spent on them if they joined an HMO in their area and allows them to use that voucher to buy into an unmanaged fee-for-service plan, which has none of Medicare's billing or utilization protections. In terms of out-of-pocket expenses, the sky would be the limit and the insurance nature of Medicare would be gone. Who would be nutty enough to want to buy into one of these plans, you ask? The very, very rich who don't have to think about medical bills might be interested. It could be a sort of boutique status symbol and sold as a plan which attracts the very best doctors who would like to charge more. If this Beverly Hills policy were the only danger, one could look the other way. But there is the danger that salespersons could convince some vulnerable senior to join such a plan without understanding the tremendous extra liability they would face. There is a danger that in certain rural or isolated communities a group of doctors could force patients to accept this plan as the only option-- thus increasing their income while destroying Medicare' protections. This proposal is the brainchild of some in the right-to-life community who believe that Medicare payment rates are so strict that some doctors may not provide adequate care under traditional Medicare. Therefore, to avoid euthanasia one can join one of these plans and let your doctor charge you extra. It is too bad that those who care about killing seniors spend so much time helping the rich find fire escapes, and so little time helping the uninsured and those who are not rich live in a good system. Mr. Speaker, there is no evidence of access or quality problems in the current Medicare system. Indeed, the latest data from the Physician Payment Assessment Commission shows that the major access problem facing seniors is lack of money to pay the 20 percent co-payment--not the fact that we pay doctors on a fee schedule. The private fee-for-service option is a mischievous amendment that does not good and has potential for harm. Repeal would remove a wart from the Medicare Program and ensure that we all--rich and poor--seek to keep the system a quality system.

Mr. STARK

Mr. STARK. Mr. Speaker, I would love to give the preceding speaker, the gentleman from Texas, more time because he is quite right. What he points out, as one of the earlier speakers talked about leadership and innovation, what we do not need is more Republican leadership and innovation on how to screw the average American and give the benefits to the few Republican rich, and that is what this bill does. Mr. Speaker, it is poorly done. The bill is poorly drawn. It is sloppy legislation. For example, do my colleagues think these rich Republicans who qualify for this bill can take the tax qualified education savings and use it to purchase a car for their child? So we have here a tax break to let little kiddies buy cars. I suppose that is good if one is a Mercedes or a Ferrari dealer, but it is not going to help the average American who is going to have about $32 a year in savings, and how is that going to help them decide whether to pay $3,000, $5,000, $9,000 in tuition? I do not think the $32 makes a bupkis' worth of difference to the average American, and I do not think they are going to use this money one way or the other. But the Treasury will lose it to the richest 5 or 6 percent of the Americans who will get all of the savings. It is a tax gimmick for the rich, just like the bills we have been passing out of the Committee on Ways and Means. We have been taking money from the average American taxpayer and shoveling it out the door to the rich Republicans as payoff, I presume, for whatever they think they can do. But it is not helping the average American. Mr. Speaker, this will allow a family to pay one child to tutor another child, and there is no effective income limit on this. This will allow very rich Americans who exceed the income limit to make gifts to their children, who can then invest in these two gimmicks, and it is an absolute dream for the tax attorney and the accountant to create loopholes for the rich who have a lot of assets, arguably enough assets to already send their children to private school. So, Mr. Speaker, I do not think it is going to hurt public education at all. I do not think it is going to help private education at all. It is going to deal with a small group of people in the $90,000 to $160,000 category and create bountiful tax loopholes for them, to the extent that the American taxpayer will lose in the aggregate over $5 billion. So, it is a few hundred dollars here and a few thousand dollars there, Mr. Speaker. But the average American who, at the most, at the absolute most, could get 30 bucks a year out of this, that is all they will get. That will make no difference in the child's education. In no way will it help their child get a better education. It just helps the rich get richer on the backs of the American worker.

Mr. STARK

Mr. STARK. Mr. Speaker, I am today introducing legislation to repeal a provision in the Balanced Budget Act of 1997 that would ``lock'' Medicare beneficiaries into a managed care plan. My bill would continue the present policy which permits continuous open enrollment--and disenrollment--in HMO's by Medicare beneficiaries. The BBA provides that in 2002 Medicare beneficiaries have half a year to get out of a Medicare+Choice plan that they have enrolled in. In 2003 and forever thereafter, they have only 3 months each year to decide to disenroll. Mr. Speaker, many HMO's do a good job making people happy while they are healthy. Like fire engines at the Fourth of July parade, they look good and make people feel safe. The test comes when there is a fire--or in the case of an HMO, when a person gets sick. There is strong evidence that many HMO's do not do well when a person becomes ill, particularly when one faces a chronic illness or disability and needs rehabilitation. Today under Medicare, an HMO enrollee who finds they need help and the HMO is not delivering can on a month-by-month basis leave and seek care in another HMO or in the fee-for-service sector. Beginning in 2002, that right will end. There are good policy reasons for limiting the enrollment and disenrollment of people in HMO's. For example, coordinating periods of open enrollment provides a wonderful chance to compare plans and to encourage more competitive pricing of HMO products as they compete for business during an annual open enrollment period. Further, a bad HMO can make a huge profit by encouraging the disenrollment of people once they become sick and it makes financial sense for Medicare to limit this opportunity for gaming. Mr. Speaker, these good reasons are overridden in my mind by the danger that lock-in creates for people who become seriously ill and who needs treatment that an HMO may refuse to provide. There are good economic reasons for Medicare to limit disenrollment--but those economic reasons are going to kill some of our seniors and disabled. Thus, I support repeal of the BBA lock-in. We simply do not know enough about quality of care in HMO's to justify a lock-in. Perhaps some day when there are much better measurements of outcomes and quality we could put a limit on the timing of enrollment and disenrollment. But that time is not here yet, and I fear the proposed lock-in will be deadly. Friends of the managed care movement should support this amendment, because it will remove a fear that many Medicare beneficiaries will have of joining an HMO and then being stuck in it for most of a year. If there is continuous open enrollment and disenrollment, more people are likely to try managed care without the fear of being stuck in a nonresponsive bureaucracy or assigned to a quack of a gatekeeper. Mr. Speaker, I do not expect this legislation to move in the 105th Congress--but as we get closer to 2002 and the lock in of beneficiaries, I expect that the interest will grow dramatically. I urge my colleagues to support this legislation in the months to come.

Mr. STARK

Mr. STARK. Mr. Speaker, I will be introducing legislation to gradually lower and even eliminate the payroll tax on wages. The tax revenue lost by reducing the payroll tax rates will be replaced by an equal and gradually rising tax on energy and pollutants, thus helping the environment and reducing the disruption that may be caused by global warming. This tax will fall heavily on imported energy and will help gradually reduce our dependence on unstable sources of foreign oil, as America becomes more energy efficient in response to higher energy prices. By lowering the tax on labor, we will encourage full employment and the movement of people off welfare. By raising the price of energy and nonrenewable resources, we will encourage innovation and new products that will help make America the leader in the types of production needed in the 21st century. By phasing in these tax shifts gradually over 20 years, the proposal avoids disruption and gives time for adjustment. Some of the money raised by taxes on energy and pollutants will be returned to the regions of the country that are primary producers or users of energy and nonrenewables, so that those communities will have extra money to transition to new forms of cleaner production or more energy efficient homes and workplaces. Those on fixed retirement income will be kept whole by special attention to ensuring that price increases in energy related items are fully compensated through cost-of-living adjustments. To repeat, under this proposal, there will be no net increase in taxes. There will be a shift in taxes off of things we value--labor-- and onto things we want to discourage--wasteful use of energy and nonrenewable resources. People will see the price of gasoline increase--at the same time they see the tax on their income decline. This proposal is a 3-fer: it lowers the payroll tax; it discourages pollution and helps the United States in its international negotiations on global warming; it increases our national security by reducing our dependence on the Middle East and other unstable regions. I hope that my Republican colleagues who support sales taxes and/or value added type taxes will take a look at this proposal. Their proposals would increase the taxes on energy and nonrenewables along with all the other things sold or manufactured in our society. But rather than set up elaborate new sales tax or VAT collection systems on millions of businesses and production centers, with all the potentials for evasion and abuse, this proposal would concentrate tax collection on just a few thousand sources of production, freeing millions of others from paperwork and IRS hassels. Republican leaders from Texas, who have been proposing various tax reforms, may at first object to concentrating the new system of taxation on energy, because Texas is such a major producer of energy. But I urge them to work with me to return extra amounts of the revenue raised by this proposal to their region to help it transition to a cleaner and higher-paying form of production. I hope to introduce this bill before the recess, and I invite comments and ideas on how to make it a smooth transition for America. To repeat: this is a chance to ensure a cleaner environment for future generations, increase America's security, reduce taxes on employment, and encourage the production of a new generation of products. This is not a tax increase. It is a tax shift from things we don't want to tax onto things we should want to discourage.

Mr. STARK

Mr. STARK. Mr. Speaker, I am introducing a bill which would provide for the revenue neutral payment of self-administered drugs furnished as part of a hospital outpatient department [HOPD] service under the prospective payment system currently being developed for HOPD's The Balanced Budget Act passed this summer starts the slow reform of HOPD payments by establishing a prospective payment system [PPS]. This PPS is designed to bring some control to the rising costs of these services and to ensure that the patient only pays 20 percent of the total cost of the HOPD service. Currently, Medicare beneficiaries are paying about 47 percent of the total cost of these services--far above the normal 20 percent Part B copayment. Unfortunately, the HOPD fix will take over 20 years to achieve. The long phasein was due to the cost of the fix to the Medicare trust fund plus its impact on hospital revenues. PPS system will include most of the costs of seeking treatment in an HOPD. But it will not cover the cost of self-administered pharmaceuticals--such as Tylenol 3--administered in the HOPD, since Medicare generally does not provide insurance against drugs which can be taken without the aid of a doctor or medical staff. Thus in addition to sending the patient a bill for the 20 percent HOPD copayment, the hospital will need to send the patient a separate bill, often for a rather small amount, to collect the charge for the drug. The American Hospital Association has suggested that this is just an extra wave of paperwork and that the cost of such drugs should be included in the total cost of the procedure as determined under the new PPS system. Just as pharmaceutical drugs are covered under a hospital inpatient admission under the DRG PPS payment system, so should HOPD self-administered drugs be covered under the new HOPD PPS system. The legislation provides that this consolidation of bills will not increase the total cost of the procedure. In order words, the hospitals would rather absorb the cost of the drug in the current cost of the procedure than endure the paperwork hassle of separately billing for small amounts. This proposal was sent to the BBA conferees very late in the process, and it was not included because more time was needed to consider it. I think it is a simple, straightforward proposal to simplify the life of patients and hospital accountants, and I hope we can include it in the next Medicare bill that is considered by the Congress.

Mr. STARK

Mr. STARK. Mr. Speaker, I would like to take this opportunity to honor Shirley Sisk, the executive director of the League of Volunteers. Shirley Sisk founded the League of Volunteers in 1979. She served as president until accepting the position of executive director in 1989. For three decades, Shirley has worked in numerous ways to make our community a better place. From 1972 to 1993 Shirley served on the Newark City Council. During that time she was committed to responsible management of the city's policies, programs, and budgets. Her leadership resulted in a range of programs including the Human Relations Element of the General Plan, Music at the Grove, School/City Youth Committee, Volunteer of the Year Recognition, and Newarks of the World. Shirley is the founder and president of the annual Newark Days Celebration. The celebration is a shining example of volunteer support which is enthusiastically anticipated by the community each year. Shirley is also the founder and president of the Bay Area Cable Excellence Awards Program and the Society for the Preservation of Carter Railroad Resources. She is actively affiliated with the Ohlone College Foundation, the Business Leadership Council, and the Fremont Kiwanis. In 1994 the State of California recognized her outstanding service and numerous achievements by naming her Woman of the Year. On October 10, 1997, Shirley will be honored by her friends and colleagues at the Ohlone College Foundation's annual luncheon. I would like to join their commendation of her hard work on behalf of our community.

Mr. STARK

Mr. STARK. Mr. Speaker, I would like to take this opportunity to commend the work of Sister John Marie Samaha of the Sisters of the Holy Family of Nazareth. Sister Samaha entered the Sisters of the Holy Family on July 2, 1943. Sister Samaha began her ministry at a day care center, and soon afterward served as religious instruction teacher at various locations in northern California. In 1960, she became supervisor of religious instruction for the Archdiocese of San Francisco. In 1967 she became supervisor of religious education for the Sister of the Holy Family. From 1970 to 1975, Sister Samaha served as the superior of Holy Family Convent in San Jose, and from 1975 to 1979 she was the vice president of the Sisters of the Holy Family Community. Sister Samaha is currently pastoral associate at St. Joseph Parish in Mission San Jose. She has cared for the sick and visited the terminally ill. She has planned activities for seniors, and helped families deal with the death of loved ones. She has encouraged a spirit of family among parishioners, and assisted the needy with food, rent, and bill payments. Through groups like the Tri-City Homeless Coalition, the Centerville Free Dining Room, Second Chance, SAVE, and CAUS, Sister Samaha has helped supply food, clothing, and a range of support to needy individuals throughout our community. On October 10, 1997, Sister Samaha will be honored by her friends and colleagues at the Ohlone College Foundation's annual luncheon. I join in recognition of her lifetime of giving to the community.

Mr. STARK

Mr. STARK. Mr. Speaker, on behalf of Representative Karen Thurman and myself, I am today introducing legislation to reform Medicare's partial hospitalization benefit. The partial hospitalization benefit is an important addition to Medicare, helping people with substantial mental health needs, who in the absence of this service would need to be hospitalized. Unfortunately, Congress' effort to provide this improved benefit has become prey to some unethical and corrupt ``health care providers.'' In some areas, the benefit is being badly abused. I include an article from the Miami Herald of September 2, 1997, which describes the situation in Florida. The bill we are introducing today will deny coverage of services in home and nursing home settings; establish quality standards that will prevent fly-by-night operators from being eligible to participate; establish a prospective payment system for the partial hospitalization benefit, so that costs are brought under control; and provide a demonstration project to determine whether more comprehensive services by quality providers can indeed save Medicare some revenues. The administration proposed most of these changes this summer, but the partial hospitalization problem was new to Congress and we did not have time to consider these proposals in this summer's Balanced Budget Medicare Title. I hope that these provisions can be considered early in the next session of Congress, so that this abuse of the system can be stopped. The situation in Florida indicates that we cannot afford to wait. The partial hospitalization benefit--when done right--is an important and cost-effective tool to reduce the length of stay of an inpatient hospitalization and to prevent the need for inpatient hospitalization altogether. The reforms we are suggesting have the support of the partial hospitalization, who are as anxious as we are to expel the bad actors from this specialty. Why partial hospitalization is a useful service is well described in the following materials provided by the Association of Behavioral Healthcare, Inc. [From the Miami Herald, September 2, 1997] Medicare Abuses Spark Cry for Anti-Fraud Law (By Peggy Rogers) Florida's notorious Medicare cheats have yet another type of record--abusing a special psychiatric program out of all proportion to the rest of the nation. Patient snatching is among the homegrown scams employed in this ``partial hospitalization'' program, which is supposed to provide several hours a day of intensive psychiatric care. The unwitting elderly and mentally ill, often told they are going on recreational outings, are lured from boarding homes each day to be used as patients. The boom is astounding. In 1993, Florida outfits billed federal insurers $2.9 million for partial hospitalization. Last year, Florida's total was $112 million--half of the $220 million Medicare spent nationwide for partial hospitalization, federal anti-fraud authorities say. So ``aberrant'' and ``alarming'' are Florida's numbers that state health-care administrators are proposing a state law to clamp down on abusers. If authorities with the Florida Agency for Health Care Administration secure a sponsor, the law requiring licensure of partial hospitalization programs would be considered during the next legislative session. At the same time, federal authorities in Miami this summer have recommended a moratorium on Medicare billing by new companies. In 1991, Washington expanded partial hospitalization payments to facilities outside of hospitals. It was intended to save mentally disturbed patients from full hospitalization and save taxpayers money. Services include therapy and stabilization, several hours a day, several days a week. While Florida consumes half of the program's entire national budget, the state has 26 percent of the private companies providing the service and only 6 percent of the recipients inapplicable Medicare plans, according to a recent report by a Miami-based Medicare anti-fraud squad, Operation Restore Trust. Eighty percent of the Florida companies are in Dade, Broward and Palm Beach counties. ``We believe that the situation in Florida . . . warrants immediable action,'' warned Dewey Price, leader of Operation Restore Trust's Miami office. A moratorium and other recommended actions ``should be adopted as quickly as possible to protect both the [Medicare] Trust Fund and the beneficiaries who are supposed to receive partial hospitalization services at these facilities.'' Price urged policymakers in this report earlier this summer. Audits in Florida report a ``high incidence'' of kickbacks to boarding homes for use of their residents, as well as other ``wide-spread, fundamental abuses''--including a lack of medical eligibility by most of the people purportedly receiving treatment.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to talk about the hot new job in health care: compliance. I refer my colleagues to a September 18 Wall Street Journal article which describes how hospitals and other providers are hiring and promoting professionals to ensure their compliance with laws and regulations. It's about time; $23 billion per year in Medicare fraud, waste, and abuse reported by the HHS inspector general is proof positive that we need to take compliance more seriously. Together with Mr. Dellums and Mr. Miller of California, I have introduced legislation that would require certain health care providers to fund independent, Federal compliance and financial audits as a condition of participation in the Medicare and Medicaid programs. If providers are willing to foot the bill to fly-in compliance consultants from high profile firms like Coopers & Lybrand, they can surely afford Government audits. The last thing we need is for providers to only retain private sector professionals who can show them how to be sneakier. We've already given the health care industry the benefit of the doubt far too long. The administration also recognizes that audits are needed to ensure financial and regulatory compliance. Health and Human Services [HHS] Secretary Donna Shalala recently announced that home health agencies will have to submit an independent audit of their records and practices every 3 years to receive Medicare funds. In addition, HHS will double the number of home health agency audits it conducts from 900 to 1,800 per year. While home health agencies may be the system's most blatant abusers, they are by no means the only ones worthy of our best efforts to fight fraud. My bill would require audits of hospitals, nursing facilities, hospices, clinical laboratories, and ambulance companies in addition to home health agencies. Yet HHS doesn't have the funding to audit all categories of providers that have abusive track records. Even if it did, taxpayers shouldn't have to foot the bill. The sum of $23 billion says it's time to make Federal audits a cost of doing business with the Nation's largest health care payer, the Federal Government. [From the Wall Street Journal, Sept. 18, 1997] Hot New Job In Health Care: In-House Cop (By George Anders) The hottest new job category in health care doesn't require a medical license or a nursing degree. It's compliance officer, a job borrowed from the defense industry and other businesses under fire from regulators. Now hospitals and medical schools across the country are rushing to hire their own in-house cops, hoping they'll keep them from running afoul of the government's widening crackdown on health-care fraud--or help minimize penalties when infractions are found. Consultants estimate that only 5% of the nation's 5,400 hospitals and medical schools have comprehensive compliance departments now. But they suggest the total could double in the next year. Securities firms in the late 1980s shored up their compliance departments in hopes of averting insider-trading scandals. Defense contractors, thrift institutions and companies worried about pollution regulations have all taken similar steps in the face of greater government scrutiny. The health-care compliance movement got a boost Monday when President Clinton announced wide-ranging initiatives to combat fraud in home health care. Many hospitals operate home-health units that have been financially lucrative. Before the President's speech, hospitals had already been galvanized by the government's massive investigation of Columbia/HCFA Healthcare Corp. This year, in which federal agents with search warrants have swooped into dozens of Columbia-owned hospitals. People familiar with the investigation say the government is looking into a wide range of potential billing abuses. Columbia has said it isn't aware of any systemic wrongdoing. ``I've gotten a lot more respect since the Columbia situation hit the media,'' says Elizabeth Ryan, a compliance consultant who until recently was head of compliance at Valley Baptist Medical Center in Harlington, Texas. ``A year or two ago, when I called on people within the hospital, they said: `What's this all about?' But once they've seen pictures of FBI agents carting away boxes of documents at Columbia, their attitude is: `Fine. No problem. Come talk to us about whatever you want.' '' In Nashville, Tenn., Columbia itself wants to expand its roster of top executives to include a senior vice president, compliance. Until recently, a mid-level aide to the general counsel was in charge of Columbia's compliance program. But as Columbia spokesman Jeff Prescott puts it: ``Compliance issues are, and will continue to be, very important for our company.'' The best way to underscore that message to employees, he says, is to make compliance a much more prominent part of Columbia's management structure. It's unclear how much whistle-blowing the hospital industry really wants from its compliance chiefs. After all, ultra- strict compliance programs can mean higher costs and irritating bureaucracy. Some plump revenue sources could wither away, too, if compliance officers declare them to be off-limits. But most federal fraud-fighters welcome the effort. ``What we're talking about is ensuring that organizations bill appropriately, that they train their staff appropriately, and that they follow good business practices,'' says Eileen Boyd, deputy inspector general at the Department of Health and Human Services. When problems do exist, federal sentencing guidelines treat the existence of a compliance program as a mitigating factor that can reduce civil or criminal penalties. Conversely, hospitals without a compliance program may be told to form one as part of settling a federal fraud investigation. For that reason, Ms. Boyd tells the industry: ``You can pay for compliance now, or you can pay for it later.'' Traditionally, hospitals have counted on low-level internal auditors to catch problems, and report them to senior management. But the new, high-profile compliance chiefs are expected to get involved in potential trouble spots much earlier. They are also expected to flag hospital boards and the government right away if infractions are found. Paul Flanagan got into compliance work 2\1/2\ years ago, after finishing his studies at Creighton Law School in Omaha, Neb. When he asked a local attorney for career tips in health care, the answer amounted to a single word: ``Compliance.'' He soon because chief compliance officer at Alegent Health in Omaha. Six weeks ago, the 31-year-old Mr. Flanagan jumped to a fast-track job at Coopers & Lybrand, where he will travel around the country, helping as many as 60 hospitals set up compliance departments. Currently, the HHS inspector general's office and the American Hospital Association are drafting guidelines for a model compliance program for hospitals. Those standards are expected to be issued this fall. They are likely to be welcomed by a hospital industry fearful that the government's anti-fraud campaign could sweep up not just outright rascals but also people who have been trying to obey laws that they don't understand very well. ``The regulations are so complex that organizations can make errors just because of the complexity,'' says Sister Pat Eck, chairperson of the Bon Secours Health System Inc. chain of Hospitals and nursing homes in Marriottsville, Md. Sister Pat says that Bon Secours has traditionally relied on its internal audit department to catch problems, adding that she is ``comfortable'' with its work to date. But she says her board is encouraging her to consider creating a more formal compliance department, something that could happen as soon as next year. While the most dramatic part of compliance programs may be the detection of wrongdoing, their most important function may be training employees how to follow the rules in the first place, says Ms. Boyd, the deputy inspector general at

Mr. STARK

Mr. STARK. Mr. Speaker, I would like to take this opportunity to honor and congratulate Capt. Dale E. Amaral, a dedicated member of the Newark Police Department. After 31 years of outstanding service, Captain Amaral will be retiring from the force. Dale Amaral joined the Newark Police Department on February 20, 1966, and has since served in numerous capacities. He began his career as a police officer, serving as patrol officer, narcotics detective, and robbery/homicide detective. He was promoted to detective sergeant in 1981. After a stint as detective sergeant, Dale worked as a patrol sergeant. He was promoted to the rank of lieutenant in 1986, and served as commander of the investigation division and then commander of the records division. In 1992, Dale was promoted to captain. In 1994, Captain Amaral returned to the patrol division as commander of the investigations division. Captain Amaral was selected as Newark's Officer of the Year in 1971 while assigned as narcotics detective. He was selected as Officer of the Year a second time in 1981 while working as a robbery/homicide detective. Captain Amaral taught several courses in administration of justice at the community college level, and is a charter member of the Newark Optimist Club. His hobbies include travel, real estate, reading, and learning about space exploration. Dale so loves law enforcement that he will begin a second career as a deputy sheriff with the Alameda County Sheriff's Department shortly after his retirement from the Newark Police Department. He will be sorely missed by his fellow officers, city employees, and most of all, the citizens of the city of Newark. The city will be honoring Dale at a retirement dinner on October 3, 1997. I would like to join them in commendation of his hard work and dedication. I wish him much happiness and success in his future endeavors.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to introduce the Arms Surplus Reform Act of 1997. This legislation will bring much needed reform to the sale of military surplus materiel by the Department of Defense. If military surplus were simply a matter of combat boots, camouflage, and fatigues, this legislation would not be necessary. But for those in the know, Pentagon surplus can mean a cheap, nearly untraceable supply of weapons and weapons parts that cost the U.S. Government billions of dollars to purchase. According to the current system, each piece of equipment that the Pentagon designates as surplus is assigned a demilitarization code, or ``demil'' code. Demilitarization represents the work necessary to make surplus materiel fit for sale to civilians: twisting of gun barrels, mutilation of helicopter frames, removal of explosives from bombs, erasing the memory and software from military application computers, et cetera. Equipment is graded on an alphabetical scale. An ``A'' code signifies benign materiel when no demilitarization is necessary. A ``D'' code requires extensive demilitarization before surplus sale. The problem lies in the execution of the process. Equipment is coded incorrectly and almost always too easily. When Pentagon investigators did a random survey of surplus stock, they found missile simulators, bombs, guidance systems for cruise missiles, fully functional automatic weapons, as well as other potentially deadly materiels. Enforcement of procedure is so lax that an Air Force base in Georgia lost track of $39 million worth of surplus materiel. This situation represents more than a fiscal threat to our country. Sophisticated weaponry is finding its way to foreign interests while criminals in the United States rely on military surplus to outfit their operations. A methamphetamine lab run by a national gang was raided by drug enforcement agents in Los Angeles, who found machine guns and flame throwers traceable to arms surplus. One military surplus supplier was outfitting Cobra attack helicopters for resale. According to a story filed in U.S. News and World Report, one such citizen, Ron Garlick of Montana, said, ``Mine was fully armed. I had rockets on it and machine guns. I was out there shooting coyotes with them.'' It's a good thing Mr. Garlick was not shooting at people, the Cobra attack helicopter is one of the deadliest helicopters in the world. The problem extends beyond domestic purchases. The Chinese are the biggest buyers of sensitive electronic surplus materiel. Among the items recovered from Chinese scrap dealers were encryption devices, submarine parts, radar systems, tubes for Patriot missiles, and parts of the Stealth F-117A fighter. Iran and Iraq are also reported to be large purchasers of military surplus. As former Secretary of Defense William Taft wrote during the Reagan administration, ``. . . a U.S. Customs investigation has confirmed that the defense surplus system is a source of supply for arms traffickers.'' The thought of the U.S. Government supplying arms to terrorists, drug runners, and foreign interests is a very disturbing one. It gets worse. Customs officials examined 240 tons of electronic scrap headed for Hong Kong which originated from the Pentagon Defense Reutilization Marketing Organization [DRMO] base in San Antonio, TX. The officials found massive amounts of sensitive communications and encryption equipment--none of which should have been available for civilian purchase. Thirty-seven internal guidance systems for the Stealth bomber--at an original cost of $22 million--were headed for Shanghai, without any demilitarization modifications whatsoever. At Robbins Air Force Base in Macon, GA, the DRMO had adopted a expedited processing program. To speed things up and obtain more sales, a surplus sales manager at Robbins told DRMO investigators she had falsified documents and demilitarization statements, registering weapons and other equipment as scrap that was then made available for sale fully intact. The Pentagon seems unwilling to correct this problem. Perhaps it is a case of misplaced priorities. An internal e-mail message at the Pentagon laid out the priorities of the surplus program as ``1. Profits 2. Profits 3. Profits 4. Profits . . . 6. Accountability''--priority No. 7 was demilitarizing lethal weapons. With the Pentagon unwilling to face the problem, the system needs congressional intervention. This legislation does not outlaw surplus sales. This bill will not infringe on the rights of collectors or enthusiasts. This bill will absolutely be cost effective because we will no longer be selling Stealth fighter parts at 16 a pound. This legislation simply halts sales and gives the Defense Logistics Agency the time necessary to fix the problems in the program. The Arms Surplus Reform Act of 1997 will place a moratorium on all surplus arms sales until the Pentagon gets its house in order. To lift the moratorium, the director of the Defense Logistics Agency must certify to Congress that: the Department of Defense inspector general has completed a full inventory of military surplus stores and stock; the Defense Logistics Agency has reviewed and correctly classified all improper demilitarization codes; and the Comptroller General has reviewed the surplus sales process and made recommendations to the Director of the Defense Logistics Agency concerning improvements to the program. Currently each service Branch codes its own surplus. The legislation would establish a central coding office within the Defense Logistics Agency which would have oversight over all surplus coding. The central coding office would also oversee the demilitarization of equipment before civilian sale. To fight abuses of the surplus sale program, the legislation would create a record of sale for military surplus which contains the following: the Department of Defense source of the item, including the military base where it was demilitarized and sold; the degree of demilitarization required and performed; the name of the person purchasing the item and other such information as the Secretary of Defense deems appropriate. This legislation would also prohibit the Defense Logistics Agency from advertising its available surplus stock on the Internet until the conditions for lifting the moratorium have been met. I would like to thank my colleagues who have joined me as original cosponsors of this bill. I am grateful to them and share their vision of a more peaceful world. I thank Ms. Pelosi of California, Ms. Slaughter of New York, Mr. Lipinski of Illinois, Mr. Filner of California, Ms. Hooley of Oregon, Mrs. Maloney of New York, Mr. Yates of Illinois, Mr. McGovern of Massachusetts, Mr. Sanders of Vermont, Ms. Christian-Green of the Virgin Islands, Mrs. Lowey of New York, Mr. Kucinich of Illinois, Mr. McDermott of Washington, Mr. Miller of California, Mr. Markey of Massachusetts, Mr. Sabo of Minnesota, and Mr. Guiterrez of Illinois for joining me in this effort. There is no excuse for the fraud and abuse in this program-- especially when these problems lead to deadly consequences. To quote William Portanova, an Assistant U.S. Attorney in California, ``On its best day, the military surplus system is morally embarrassing to the government . . . and it never has a best day.'' Let's change that. I urge my colleagues to join me as cosponsors of this legislation.

Mr. STARK

Mr. STARK. Mr. Speaker, there is a lot of talk about fraud, waste, and abuse in health care. One type of fraud that does not get mentioned much--but which cheats the taxpayers and the beneficiaries out of billions of dollars a year--is the overpayment of HMO's under Medicare. I would like to include in the Record a summary of a recent Prospective Payment Assessment Commission meeting, as prepared by Gray & Associates, a health consulting and reporting service. At the ProPAC meeting, the staff of this congressional advisory panel noted that the adjusted community rate data--the data that determines how much extra an HMO must provide its enrollees in benefits and services--is suspect. I also include a letter I have sent to the Acting Medicare Administrator regarding overpayments to HMO's. The recent Denver HMO bidding demonstration--blocked by Congress and the courts--would, if implemented nationwide, save Medicare approximately $2 billion a year while expanding the level of benefits to enrollees. Mr. Speaker, the current system must be reformed, ASAP. Adjusted Community Rates The adjusted community rate (ACR) is used to establish a risk contract's premium for Medicare, as well as the plan's supplemental benefits. The form filled out by plans demonstrates an actuarial equivalence between the plan's benefits and fee for service benefits, and establishes the difference that is to be returned to the Medicare program either through waived premiums, extra benefits, or actual payments back to Medicare (no one does the third option). Staff believes that the forms could be used to glean useful cost information concerning the plans. This information could be used to determine the fairness of Medicare payment rates. However, the current reliability of the data is highly suspect, mainly because the information contained therein is not audited. In fact, staff states that some plans pick their final benefit plans, and make the numbers on the form fit the final plan. Other plans submit forms showing net losses per Medicare patient, which intuitively one knows cannot be accurate otherwise the plans would not be financially able to participate year after year in Medicare. The BBA now requires that the ACRs be audited to ensue the quality of the data contained in them. Staff wants to take the now fairly reliable data and try to reconcile benefits packages with particular ACRs. Staff also hopes its analysis will reveal whether the new auditing requirements effect any major changes in the ACRs, which might, in turn, effect payment changes in the Medicare risk contract program.

Mr. STARK

Mr. STARK. Mr. Speaker, today I am introducing the Abandoned and Derelict Vessel Removal Act of 1997. This act will provide the necessary tools to clean up a long-term public nuisance resulting from abandoned boats and barges found in the navigable waters of many communities. Dozens of abandoned boats and other debris have accumulated along the Guadalupe Channel, which surrounds the community of Alviso, CA. This concern was first brought to my attention by members of the San Jose City Council, the Alviso Master Plan Task Force, and members of the Alviso community. These abandoned vessels are a public health and safety hazard to the community and to users in the adjacent public waterways. Unfortunately, Alviso is not the only community that suffers from this problem. Abandoned vessels do not just sit harmlessly by--these vessels are often used as an illegal dumping ground for hazardous materials. Between January 1988 and September 1991, the Federal Government spent $5.2 million to remove 282 abandoned vessels that blocked waterways. In that same time, Government spent nearly $5.7 million to clean up pollutants from just 96 abandoned vessels. This legislation will establish clear authority to remove vessels left unattended in a public waterway for more than 45 days unless the waterway has been designated as a harbor or marina. Vessels left unattended in an approved harbor or marina for more than 60 days would also be subject to removal. This legislation empowers local authorities to keep public waterways clear while allowing boat or barge owners the opportunity to repair and remove vessels that are not actually abandoned. In addition, the removal of these derelict vessels will alleviate some concerns regarding water quality and its impact on the public health of the local community. This legislation will promote cooperation between interested local citizens, community groups, and government agencies in their joint efforts to preserve and protect the navigable waters of the United States. It will hold boat owners accountable for their vessels. Under this bill, a community can instigate action by petitioning a local elected official to notify the Secretary of the Army. Proceedings to notify the boat owner, and ultimately to remove the boat, would then be taken by the Secretary. Many States and local governments are proposing solutions to the problem of abandoned and derelict vessels. This legislation will not supersede local initiatives with equal or greater cleanup impact. I urge my colleagues to support this legislation.

Mr. STARK

Mr. STARK. Mr. Speaker, I am pleased to introduce two bills today. The first would modernize Medicare's payment policy for ambulatory care by the year 2000. The second would immediately stop hospitals from egregiously gaming the current, outdated policy. Medicare pays more for ambulatory care provided in a Hospital Outpatient Department [HOPD] than it does for the same care provided in a doctor's office or freestanding ancillary facility. This means that the same medical personnel for the same patients are reimbursed differently based on the name on the door of a clinic that provides ambulatory care. If a hospital owns a clinic, it can call it a HOPD and charge Medicare and its beneficiaries more, no matter where the clinic is actually located. Hospitals are purchasing, leasing, and building doctors' offices and ancillary facilities in farflung locations. They are changing the names on the doors to HOPD to take advantage of Medicare's more generous payment rates. Meanwhile, they are pushing out independent competitors who cost less and provide the same services. Most importantly, beneficiaries pay more, because their copayments are based on what the hospital charges, and not on the amount Medicare ultimately determines is a fair cost. The Balanced Budget Act takes over 20 years to fix this overcharge, so beneficiaries pay much more than the normal 20 percent copayment for HOPD costs. Under current law, a hospital might purchase a physician group practice located 5 miles away from its campus. Before the purchase, services to Medicare beneficiaries were billed as physician office visits and paid according to a fee schedule. Now, the hospital labels the same services, in the same office, by the same physicians, as HOPD visits. It bills Medicare for the fee schedule amount the independent physicians used to get. But in addition, it bills Medicare for hospital overhead costs. Beneficiaries also get bigger bills than before. And, there is one less independent physician practice to compete with the hospital by offering lower-cost services. There are a thousand variations on the theme: chemotherapy clinics, radiology clinics in towns without any hospitals, and new clinics next to retirement homes. You name it--hospitals are acquiring or building whatever freestanding facilities they can and inappropriately labeling them HOPD's. They are driving out the healthy competition and profiting by overcharging Medicare and its beneficiaries. Medicare and its beneficiaries should not pay more for the same services just because they are called something different. The Medicare Hospital Outpatient Payment Fairness Act of 1997 would limit Medicare payments for HOPD services to the amount that Medicare would pay for those services if they were provided in a freestanding clinic or ancillary facility that was not labeled a ``Hospital Outpatient.'' The hospital would receive no additional Medicare payment for overhead costs, and it would not be allowed to charge beneficiaries more than 20 percent of its Medicare reimbursement. In order to give hospitals time to prepare for this change, these provisions would not take effect until January 1, 2000. Hospitals are shifting costs for inpatient and emergency care onto outpatient care. While Medicare reimbursement rates are sufficient to cover hospital costs in most cases, they may not be sufficient to cover costs for emergent care. Since the first bill I am introducing today would prevent hospitals from shifting emergent care costs to the outpatient side, it would also ensure that hospitals are reimbursed sufficiently to cover these emergency services. Specifically, the bill would require that MedPAC report to Congress by January 1, 1999, on whether the payments made for emergency room [ER] cases are adequate to cover the costs of ER use by Medicare patients, and that the Secretary adjust payments to ensure that hospital ER costs of Medicare patients are appropriately covered by January 1, 2000. While giving hospitals time to prepare for a completely overhauled payment policy may be prudent, we should not allow them to continue abusing the current policy. The second bill I am introducing today, the Hospital Outpatient Department Truth-in-Advertising Act of 1997, would reduce hospitals' incentives to build, purchase, and lease freestanding clinics. Specifically, it would define as HOPD's only those facilities that are located on the same campus as an inpatient, acute-care hospital. Facilities reimbursed as HOPD's on or before September 25, 1997, would be exempted. I urge my fellow Members of Congress to join with me in passing these crucial pieces of legislation. Together, we can modernize Medicare payment policy, lower our constituents' health care costs, keep healthy competition alive, and show the Nation that we will not tolerate abuse and waste of Medicare tax dollars.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to acknowledge Ms. Judy Flum, an individual who has provided 10 years of superior service to the San Lorenzo Library. Ms. Flum has consistently provided support for the youth in our community by encouraging them to use the library's resources. She also conducts programs throughout the year such as the summer reading game, pre-school storytime, young adult advisory group, and many programs for senior citizens. Judy has been instrumental in bringing several grants to the San Lorenzo Library. The youth risk grant helped the library become better acquainted with the needs of young people and created a safe environment in which they can learn, study, and grow. The Spanish grant increased the size of the Library's Spanish collection and created a community outreach program for Spanish-speaking families. The learn-a- lot program was developed in conjunction with the San Lorenzo Unified School District to help children between the grades of kindergarten through fourth grade increase their reading potential. Without a doubt, Judy has been a remarkable asset to the growth of the San Lorenzo Library. As a member of the American Library Association, Judy has served on many of its committees dealing with young adults. Her interest in technology has ensured our youth will be better prepared for the challenges of the 21st century. As the library manager, she has worked tirelessly to establish a training program to teach people how to use the Internet. She was also responsible for establishing an Alameda County Library homepage. On September 25, 1997, the friends of the San Lorenzo Library will honor Judy for her many years of service. I join with my neighbors as they thank Judy Flum for her valuable contributions to our community.

Mr. STARK

Mr. STARK. Mr. Speaker, a move is underway to let doctors force patients to give up their Medicare benefits so that a handful of doctors can charge them anything they want--without limit. This is a gift to the greediest doctors in the nation. Ninety-five percent of the Nation's doctors accept new Medicare patients and the Medicare fee schedule. The independent congressional advisory panel known as the Physician Payment Review Commission reports that this is comparable to the rate of doctors who are accepting new private, non-Medicare patients. In other words, there is no noticeable difference in access--ability to see a doctor--between Medicare and non-Medicare patients. Doctors who accept Medicare and its fee schedule understand the Hippocratic Oath and the social compact in which society has paid hundreds of billions of dollars for the education and training and research that make American doctors special and in turn, these doctors accept the Medicare payment system. But Congress is about to cater to the few who want more, more, more from people in their hour of illness. The Employee Benefit Research Institute in its September, 1997 Issue Brief shows what a special gift this legislation will be to a few doctors who are out of step with their colleagues: Recent findings indicate that only between 4 percent and 6 percent of physicians accepting new patients were not accepting new Medicare patients. One survey found that between 1991 and 1992, the proportion of physicians not accepting new Medicare patients increased from 4 percent to 5.9 percent (Lee and Gillis, 1994). The same survey found that between 1992 and 1993 the percentage of physicians not accepting new Medicare patients decreased to 4.7 percent. Surveys by the Physician Payment Review Commission (PPRC) also found that in 1993 less than 5 percent of physicians were not accepting new Medicare patients (Physician Payment Review Commission, 1994). The PPRC study concluded that the implementation of the Medicare fee schedule has not caused physicians to close their practices to Medicare patients.

Mr. STARK

Mr. STARK. Mr. Speaker, together with Mr. Dellums and Mr. Miller of California, I am pleased to introduce the Medicare and Medicaid Provider Review Act of 1997. The HHS inspector general reports that an estimated 14 percent of Medicare payments overall, and 40 percent of home health payments, are made inappropriately each year. Much of this $23 billion per year of fraud, waste and abuse occurs because providers do not comply with Medicare rules about medical necessity, and about how services and supplies should be coded and documented. In some cases, providers don't comply because they don't understand the rules. But in many other cases, providers understand the rules so well that they are able to flout them without being detected. The recent indictments of three Columbia/HCA executives for overbilling Medicare are a glaring example of provider's ability to game the system. In addition, the inspector general recently reported that 25 percent of home health agencies it investigated have ``abused or defrauded Medicare or misappropriated Medicare funds.'' \1\ --------------------------------------------------------------------------- Footnotes appear at end of speech. --------------------------------------------------------------------------- Unfortunately, it's relatively easy for fraudulent operators to escape detection because the Health Care Financing Administration [HCFA], which oversees the Medicare and Medicaid programs, is woefully lacking in resources to provide adequate oversight and to track down abusers. Over the past 7 years, the number of Medicare claims processed rose 70 percent while HCFA's budget for reviewing claims grew less than 11 percent. Adjusting for claims growth and inflation, funding for review dropped from 74 cents to 48 cents per claim. As a result, the proportion of claims reviewed dropped from 17 percent to 9 percent. In the especially problematic home health area, reviews plummeted from 62 percent in 1987 to a target of 3 percent in 1996.\2\ In many industries, it is standard operating procedure for businesses to fund independent audits of their compliance with Federal laws and regulations. For example, banks have paid for independent government financial and compliance audits since the 1800's. In fact, the Office of the Comptroller of the Currency is a special branch of the Treasury Department that is fully funded through fees it assesses for conducting bank audits. This legislation would require all hospitals, skilled nursing facilities, home health agencies, hospices, clinical laboratories, and ambulance companies to fund annual, federal financial and compliance audits as a Condition of Participation in the Medicare and Medicaid programs. Other businesses they own in whole or in part would be included in the audits, which would ensure, for example, that providers are furnishing only services that are covered and medically necessary, that they are actually delivering the services for which they bill HCFA and that their cost reports are correct. To ensure audit quality and consistency, specially trained Federal Medicare/Medicaid examiners, analogous to bank examiners in the banking industry, would conduct the audits. One home health agency owner convicted of Medicare fraud testified before Congress about the inadequacy of the few audits that the government currently conducts: ``the auditors were not always sufficiently knowledgeable about Medicare reimbursement and areas of concern to be able to identify improper reimbursement practices * * * the audit teams seemed to change from year to year so there was no real continuity or consistency. The better the auditors understand a provider, the better they will be able to know where to look * * * the auditors need to look not just at the [core business of the provider], but at the overall structure.'' \3\ Audits would be paid for through hourly fees charged to providers. Thus, provider liability would depend on both the size of the provider and on how well they keep their books and records. A small agency that follows the rules and documents correctly would be charged very little. To further ease the burden on small businesses, the Secretary would have the authority to exempt providers from audits based on their volume of Medicare and Medicaid business. To minimize the administrative burden on all health care providers, the bill would require the Secretary to conduct a study of all the examining and accrediting agencies and organizations that perform audits or inspections of the providers covered under this bill. Based on the study, the Secretary would make recommendations to Congress by June 1, 1999 on how to coordinate and consolidate these audits and inspections in order to reduce related costs to providers and government agencies. Annual rather than initial one-time audits are needed because businesses may start out honestly, but gradually creep into abusing the system as they gain experience and test the waters. Annual audits would also serve an educational purpose, thus reducing waste that occurs because providers don't understand the system. Health care spending consumes an ever-increasing portion of the Federal budget--now at least 20 percent. And the Federal Government pays a third of our Nation's health care bills--more than any other single source.\4\ We are the largest purchaser--isn't it time we become a wiser purchaser? And isn't it imperative that we have tighter reins on an area that consumes so many of our tax dollars? Banks have for many decades borne the financial responsibility for demonstrating their legitimacy. It is an accepted cost of the privilege of keeping other people's money. Medicare and Medicaid providers are being given the privilege of taking taxpayers' money, without the corresponding responsibility for proving their legitimacy. The appalling level of fraud, waste and abuse in the programs is the unfortunate result. Banks are audited as a matter of public trust to ensure our Nation's economic security. Please join Mr. Dellums, Mr. Miller and me in demanding provider audits to help ensure its health security. FOOTNOTES***NOTE***\1\ Testimony of George F. Grob, Deputy Inspector General for Evaluation and Inspections, HHS Office of Inspector General, before the Senate Special Committee on Aging, 7/28/ 97.***NOTE***\2\ Testimony of Leslie G. Aronovitz, Associate Director, Health Financing and Systems Issues, Health, Education, and Human Services Division, General Accounting Office, before the Senate Government Affairs Investigations Subcommittee, 6/26/97.***NOTE***\3\ Testimony of Jeanette G. Garrison before the Senate Committee on Aging, 7/28/97.***NOTE***\4\ Congressional Research Service, Ways and Means Health Subcommittee Chartbook, 1997.

Mr. STARK

Mr. STARK. Mr. Speaker, the Medicare agency tells me that in 1995, Medicare paid 393 doctors more than $1 million for services; 3,152 doctors received between $500,000 and $1,000,000. Now a Greedy Few want more. Despite the ability of doctors to make a fortune from Medicare by providing lots of services to beneficiaries, a few doctors are pushing an amendment by Senator Kyl to let doctors privately contract with Medicare benefits. Strip away the rhetoric, and a private contract is a contract between a doctor who holds his life in your hands in which he demands that your give up your Medicare benefits and that you promise not to file a claim with Medicare. Instead, you agree to let him charge you anything he wants--because you are desperate for your health. We like to think of contracts between equals, negotiated fairy. There is no equality, there is no fairness in these contracts. Want an example of a private contract? Look at today's Washington Post, page B-3, where a doctor in Manassas, VA is being investigated for charging a Medicare-eligible patient $12,000 for the injection of a massive dose of aloe vera into the stomach in order to combat lung cancer. The investigation is due to the fact the man died in the doctor's office after the injection. Medicare does not cover quackery. It does not pay $12,000 for an injection. But this man and this doctor had a private contract. There will be a lot more of this murderous nonsense if the Kyl amendment succeeds. [From the Washington Post, Sept. 23, 1997] Va. Doctor's Treatment of Man Who Died Is Scrutinized (By Leef Smith) A Texas man who had lung cancer died in the spring in the office of a Manassas physician to whom he had gone for a costly intravenous treatment that is not officially sanctioned but that he hoped would save his life, according to Virginia State Police. The man, Clarence Holland Lander, 83, became ``violently ill'' shortly after the $12,000 treatment was administered, and he died May 17, according to records in Prince William County Circuit Court. The physician, Donald L. MacNay, an orthopedic surgeon, is under investigation in connection with Lander's death and with the treatment allegedly employed--intravenous administration of ``a concentrated form of aloe vera and other substances,'' police said. Aloe vera, a cactus-like member of the lily family, is known to have some healing properties. Police said that their investigation is continuing and that MacNay has not been charged with any offense. MacNay, who investigators said still is licensed to practice medicine, did not return phone calls to his Manassas office yesterday. An assistant to MacNay, Ronald Ragan Sheetz, 41, of Manassas, was arrested Thursday and charged with nursing without a license. According to an affidavit that accompanied the request for the arrest warrant, MacNay ordered Sheetz to give Lander the aloe vera injection. ``This procedure was carried out by the subject believed to be Ronald Sheetz who has no medical license of file, under Dr. MacNay's direction and presence,'' the warrant states. State Police spokeswoman Lucy Caldwell said MacNay also is under investigation in connection with Sheetz's action. ``We're looking into questionable medical practices, drug transactions and suspicious cancer treatments of this doctor's office,'' Caldwell said. ``At this time we're trying to determine how wide-reaching the practice here may be. It's still too early to say.'' A spokeswoman for the U.S. Food and Drug Administration said that the intravenous aloe vera treatment has not been approved by the agency and that officials with the National Cancer Institute said they are not studying aloe in connection with cancer treatment. At the same time, the healing properties of aloe are being studied by researchers exploring alternative medicines to treat diseases, and papers and advertisements about oral aloe-based concentrates are found easily on the Internet. Experts say that as many as 50 percent of the cancer patients in the United States try some kind of therapy that is not officially sanctioned. Such treatments include special diets, vitamins, mental imagery, wearing magnets, coffee enemas and consuming cartilage and oil from sharks. Lander's son, James Lander, said that his father was in excellent health before the terminal cancer was diagnosed and that he jumped at the chance to beat the disease. He said his father learned about the aloe treatment from reading an article and found MacNay through word-of-mouth referrals. ``The treatment gave him hope,'' James Lander said. ``He completely brightened up. You could just see it. I'm sure he thought it would cure him or he wouldn't have gone to Virginia'' from his home in Waco, Tex. In a search warrant affidavit filed Friday in Circuit Court, investigators said they were seeking ``patient files and other records related to appointments and [the] treatment of other patients who have received this treatment and have both lived and died.'' An affidavit was filed yesterday in Fairfax County Circuit Court to obtain a search warrant for an office in Annandale that police said MacNay opened in July. Sheetz was released from jail on personal recognizance. If convicted of the felony charge, he could be sentenced to up to five years in prison.

Mr. STARK

Mr. STARK. Mr. Speaker, today I rise to commend Keith and Anne Medeiros for their distinguished careers of service to the community of Fremont, California. For 42 years, Keith and Anne lived in the Fremont area. In that time, they consistently worked to make our community a better place. Both have been dedicated to the field of education as elementary school teachers. Keith Medeiros also served as school principal, and as a member of the Alameda County Board of Education. Anne Medeiros taught English as a second language. Their service to the community has been diverse. Keith Medeiros worked as an Indian Guide Dad, a Pathfinder Toastmaster, a Chamber of Commerce activist, a Fremont Rotarian, an on and off stage actor and toastmaster, and a Washington Township Men's Club member. Anne Medeiros served the community as a representative for Congressman Don Edwards, and as a board member for the Serra Center and the Committee to Restore the Mission. They shared their talents as members of the Fremont Gourmet Club, the Fremont Dance Club, and the Fremont Kite Flyers. They have been world-wide travelers, goodwill ambassadors, and advocates for historic Mission San Jose. Keith and Anne Medeiros set a new standard as innkeepers for those whose travels took them to the Bay Area. Their hospitality was a welcome respite for travelers. On September 22, 1997 the friends and colleagues of Keith and Anne Medeiros will honor their many years of community service. I join my neighbors as they extend a thank you to Keith and Anne for all they have done for Fremont.

Mr. STARK

Mr. STARK. Mr. Speaker, the just-enacted Balanced Budget Act includes a provision that allows doctors not to participate in Medicare for 2 years at a time, but instead to private contract with patients so that they can charge these patients much more than the Medicare fee schedule. There is now a move underway to strike the 2-year requirement and let doctors do wallet biopsies--decide on a patient-by-patient basis whether they are going to ask patients to give up their Medicare rights and insurance and pay the extra in an individual private contract. I can think of nothing that will encourage patients to move into HMO's faster, so that they are protected against the fear of this type of doctor extortion. The American Medical Association supports the proposal, but it is an idea that must have been deviously planted in their association by a mole from the HMO lobby--the American Association of Health Plans. The proposal is pure greed wrapped in the flag of freedom. Before the Congress is drowned in the rhetoric of this issue, we should note the facts. To the extent that Medicare beneficiaries have trouble seeing doctors, it is almost totally due to the fact that the cost is too much for the beneficiaries--not that Medicare doesn't pay the doctor enough to allow the doctor to see patients. The latest data from the independent congressional advisory panel-- the Physician Payment Assessment Commission--shows that only 4 percent of all Medicare beneficiaries reported having trouble getting health care in the last year. About 11 percent had a medical problem, but failed to see a physician, while 12 percent did not have a physician's office as a usual source of care. Roughly 10 percent of Medicare beneficiaries delayed care due to cost. Considering all four access measures, about 26 percent of Medicare beneficiaries cited experiencing at least one of these problems. PhysPRC reports that from their surveys of those who failed to see a physician for their serious medical problem, 43 cited cost as the reason. About 8 percent of those who failed to see a physician could not get an appointment or find an available physician. For another 8 percent, transportation was the problem, 13 percent felt there was nothing a doctor could do, and 11 percent were afraid of finding out what was wrong. In another words, Congress is preparing to let doctors charge patients infinitely higher fees because less than 1 percent of all Medicare beneficiaries had trouble finding a doctor--perhaps they lived in a rural area, etc. Yet over 5 percent of Medicare's nearly 40 million beneficiaries could not get to a doctor because they didn't have enough money--and Congress is silent. Mr. Speaker, a humane Congress, a compassionate Congress, a logical, rational Congress would put five times as much effort into addressing the problem of doctors costing too much as it would in addressing what may be a 1-percent problem of a few doctors wanting to get paid more. Where are our priorities, Mr. Speaker? A vote to let doctors, the richest 1-percent income group in our Nation, charge the sky's the limit, while ignoring the needs nearly 2 million seniors who find doctors already too expensive is a shameful vote.

Mr. STARK

Mr. STARK. Mr. Speaker, how many studies do we need before we act to correct a gross taxpayer overpayment of many health maintenance organizations? The GAO has just issued another report in the long line of papers demonstrating that the public is paying HMO's too much for the Medicare beneficiaries that they enroll. In its report entitled ``Fewer and Lower Cost Beneficiaries with Chronic Conditions enroll in HMOs'' (GAO/ HEHS-97-160) prepared for Ways and Means Health Subcommittee Chairman Bill Thomas, the GAO examined the mature California HMO market and found: About one in six 1992 California fee for service (FFS) Medicare beneficiaries enrolled in an HMO in 1993 and 1994. HMO enrollment rates differed significantly for beneficiaries with selected chronic conditions compared with other beneficiaries. Among those with none of the selected [5 chronic] conditions, 18.4% elected to enroll in an HMO compared with 14.9% of beneficiaries with a single chronic condition and 13.4% of those with two or more conditions. Moreover, we found that prior to enrolling in an HMO a substantial cost difference, 29%, existed between new HMO enrollees and those remaining in FFS because HMOs attracted the least costly enrollees within each health status group. Even among beneficiaries belonging to either of the groups with chronic conditions, HMOs attracted those with less severe conditions as measured by their 1992 average monthly costs. Furthermore, we found that rates of early disenrollment from HMOs to FFS were substantially higher among those with chronic conditions. While only 6% of all new enrollees returned to FFS within 6 months, the rates ranged from 4.5% for beneficiaries without a chronic condition to 10.2% for those with two or more chronic conditions. Also, disenrollees who returned to FFS had substantially higher costs prior to enrollment compared to those who remained in their HMO. These data indicated that favorable selection still exists in California Medicare HMOs because they attract and retain the least costly beneficiaries in each health status group. Since we pay Medicare managed care risk contractors [HMO's] 95 percent of the average cost of treating Medicare patients in an area, it is obvious that if they do not sign up the average type of Medicare beneficiary, but sign up healthier people, then the taxpayer will end up paying the HMO's too much. Many HMO's, of course, make a fine art of finding the healthier people to enroll--and encouraging the unhealthy to disenroll. Because we do not adjust the payments to HMO's to reflect the true risk they face of providing needed health care services, risk adjustment, we overpay. We overpay HMO's billions of dollars--and as enrollment grows, the Medicare trust fund will lose an escalating amount. At the end of my statement I would like to include in the Record a recent summary from the Physician Payment Review Commission, a congressional advisory panel, that further documents the problem. The just-passed Balanced Budget Act requires HHS to begin to collect data to correct this problem and in the year 2000, implement a risk adjustment system to stop the abuse and overpayment that plagues the current program. The GAO report is just further proof that we need to move faster--and that even a partial risk adjustment program, which can be refined later, is better than the current hemorrhage of Medicare trust fund moneys. Therefore, I am introducing today--as part of our efforts to stop Medicare waste, and in some cases fraud, a bill to require that the risk adjustment changes be implemented January 1, 1999. This amendment will easily save $1 billion and probably more--and it will help force an end to the outrageous overpayment of those HMO's who have, for whatever reason, managed to avoid the average Medicare beneficiary.

Mr. STARK

Mr. STARK. Mr. Speaker, today I am introducing the Medicare and Medicaid Recovery Act of 1997. Under current law, providers and suppliers are using the Bankruptcy Code as a vehicle to defeat the Secretary's efforts to battle fraud and abuse involving Medicare and Medicaid payments. Specifically, providers and suppliers who have acted improperly or have been overpaid by Medicare, are using the protections afforded by the Bankruptcy Code to stop short the imposition of administrative sanctions or recoupment of Medicare overpayments. Providers can make strategic use of two devices--the automatic stay and the discharge of all pre-bankruptcy obligations. Under the Bankruptcy Code, the provider can respond to the threat or imposition of an administrative sanction by filing a petition in bankruptcy and then asserting that the automatic stay bars any further sanction activity. Regarding discharge, the provider can assert that any overpayment or civil monetary penalty due to the Medicare program is discharged and does not survive the bankruptcy proceeding. The Federal Government has long enjoyed a priority for taxes, duties and related penalties. However, it does not have a priority for nontax claims, such as Medicare and Medicaid overpayments to providers. The Government's priority for nontax claims was abolished in 1979. A 1992 report issued by the Office of Inspector General (OIG), entitled ``Federal Recovery of Overpayments from Bankrupt Providers,'' found that as of March 1991, the Medicare Trust Fund lost $109 million due to the ability of providers and suppliers to discharge their outstanding overpayments. While the report recommends giving Medicare claims a priority status in bankruptcy, better cost savings would be achieved by excepting these claims from discharge. Surely, we should favor the path that leads to greater cost savings. The U.S. taxpayer spends $191 billion each year to fund Medicare programs. However, an estimated $20 billion, or 10 percent, is lost to fraud. Too many health providers are putting their hands into the public trough. Mr. Speaker, this bill holds fraudulent providers accountable. It would amend the Social Security Act to specify that an administrative sanction imposed by the OIG on a health care provider, whether a civil monetary penalty or program exclusion, is not subject to the automatic stay provisions of the Bankruptcy Code. Second, this bill would also amend the Social Security Act to specify that any overpayment or civil monetary penalty amounts due to the Medicare program are not dischargeable under the Bankruptcy Code. The Medicare Trust Fund has suffered losses from the bankruptcy discharge of providers' obligations to repay Medicare overpayments. The drafters of the Bankruptcy Code could not have foreseen or intended that the protections they afforded under the Code would be used to support and sustain Medicare fraud and abuse. Allowing medical professionals to use such loopholes as those discussed above only makes it more difficult for the Government to provide the types of programs that Americans deserve. With this bill we can force providers and suppliers to take responsibility for their actions while putting money back into the Medicare Trust Fund where it is desperately needed.

Mr. STARK

Mr. STARK. Mr. Speaker, I rise today to introduce the Military Selective Service Repeal Act, to repeal in its entirety what I believe to be a wasteful cold war relic that should be extinct. From 1948 until 1973, during both peacetime and periods of conflict, men were drafted to fill vacancies in the Armed Forces which could not be filled through voluntary means. Suspended in April 1975, it was resumed in 1980 by President Carter in response to the Soviet invasion of Afghanistan. However, as any American knows, the conditions for the draft have changed since the days of Vietnam and the threat of Soviet invasion. Still, registration continues as a supposed hedge against underestimating the number of servicemen needed in a future conflict. The Department of Defense has concluded that we live in a time that projects no war--not even the worst case scenario of two simultaneous regional conflicts--that would require drafting combat troop replacements. Suspension of peacetime registration could be accomplished with little risk to national security, considering the low probability of the need for conscription. The fact is that peacetime draft registration could be suspended with no effect on military mobilization requirements, little effect on the time it would take to mobilize, and no measurable effect on military recruitment, according to the Secretary of Defense in his 1993 report to the President and Congress. In addition, ample alternatives to peacetime draft registration are already in place. The Selective Service System maintains an on-the- shelf system which would provide for a post-mobilization registration of up to 3.5 million health care personnel in more than 60 specialties. The Pentagon reports that mass registration would occur in 13 days after notice to mobilize, with induction orders to follow 3 weeks later. Likewise, we have stockpiled our Armed Forces, so that over 1 million trained Selected Reserve units and another 750,000 individual Ready Reserve personnel exist to augment Active Forces during the early days of a major conflict. Clearly, Mr. Speaker, we've no shortfall of resources. More importantly, the draft registration fails to provide legal relief measures to conscientious objectors who cannot register, thus violating our freedom of religion. For 17 years now, youth have been required to register for a military draft that does not exist. The penalties for nonregistration, such as the denial of admission to colleges and universities and disqualification for student loans and grants, are an unjustifiable limitation on the civil rights of our youth. If that's not enough to convince my colleagues, Mr. Speaker, they should consider the bottom line. Peacetime draft registration has cost taxpayers over $400 million since its reinstitution in 1980. According to present budget estimates, Selective Service registration will cost an additional $75 million by the year 2000. As we rest on the laurels of what many consider to be a successful budget deal, let's remember the children and legal immigrants we've deserted to allow the Selective Service System to continue. Finally, the real impetus for terminating draft registration comes from the Selective Service System itself. A scathing evaluation was recently released by the U.S. Army Force Integration and Support Agency [USAFISA] documenting severe problems of waste and mismanagement within the Selective Service System. The problems discovered--a grossly overpaid staff and duplication of services--revealed the Selective Service System to be a bloated, inept Federal bureaucracy. Current registrants and volunteers are abundant and stand ready to defend our country should the need arise. The time has come to do away with our outdated and unnecessary system. Clearly, if there is no need for draftees, there is no need for a Federal agency to conscript them-- and certainly not one that costs over $23 million a year.

Mr. STARK

Mr. STARK. Mr. Speaker, today, I am introducing legislation that incorporates the Supplemental Security Income's presumptive disability system into the Social Security Disability Insurance [SSDI] program. The Social Security Administration [SSA] is still confronted with a backlog of nearly 1 million cases waiting for disability determination. In fiscal years 1994-96, administration requested additional funds for disability investment funding in order to help SSA handle the exorbitant amount of disability claims. The administration requested $534 million for disability investment funding as part of the regular administrative budget for fiscal year 1996. These funds were specifically earmarked for processing disability related workloads. Congress appropriated disability investment funding in the amount of $387.5 million for fiscal year 1996. I supported these past efforts, but we must do more to help these people in their time of urgent need. Social Security currently has over almost 1 million pending applications for disability benefits. Social Security realizes the challenge it faces in processing an overwhelming number of disability cases. It has made efforts within the past 2 years to reengineer the disability determination process. In 1995, a disability applicant had to wait an average of 5 months to get an initial decision. Today, a disability applicant can expect to wait an average of 3.5 months. I commend the Social Security Administration for their work in reducing the time a needy person must wait for a determination. However, there is still the need to deliver assistance quickly. In recent years, Congress has heard complaints of deserving applicants waiting months before receiving desperately needed funds, and in some cases, dying before a decision is made. For example, in Arizona a disability applicant was forced to leave her secretarial job due to injuries resulting from a serious auto accident. She applied to the Social Security Administration for disability benefits to offset the loss of her income. She did not realize that she was venturing into an understaffed, underfunded Federal program that often forces disabled people to wait months to learn whether they qualify for benefits. After a year wait, she was successful in obtaining the benefits to which she was entitled only after hiring an attorney who specialized in such cases. These kinds of long delays are repeated in anecdote after anecdote. The SSI Program makes an initial determination that presumes a person to be disabled if they fit certain severe disability criteria. These people begin to receive SSI benefits immediately and the SSA then has a 6-month period to make the final determination of eligibility using the SSA's definition of disability. Being able to receive SSI benefits on the basis of a presumptive disability determination provides the disabled person with much needed money immediately. However, for a worker who has paid into Social Security and becomes disabled, there is no comparable process to identify the people that would most likely qualify for DI benefits. My legislation would remedy this problem by providing for determinations of presumptive disability under Title II of the Social Security Act in the same manner and to the same extent as is currently applicable under title XVI of such act. This means that if a person is found to be presumptively disabled under title II and meets the requirements for entitlement benefits, the person will begin to receive benefits, after the initial 5 month waiting period required before DI benefits can be paid, for up to 6 months while the final determination is being made. If the person is presumed eligible to receive DI benefits, then their dependents shall also begin to receive benefits. If however, in the final determination, a claimant's impairment does not meet SSA's definition of disability, they and their dependents shall not be responsible for returning the money they received during the presumptive eligibility determination period. In some instances, a person may be presumed eligible for SSI benefits before being found to be presumptively disabled under title II. In this case, the person will still be entitled to only 6 months of presumptive disability benefits. In most States, while receiving SSI benefits, a person is eligible for Medicaid. Under this proposal, claimants who would have been eligible for SSI benefits, were it not for their receipt of DI presumptive disability benefits, would be deemed eligible for SSI, making them eligible for Medicaid in those States where SSI eligibility triggers Medicaid eligibility. When the final determination for DI benefits is made, the claimant loses the Medicaid eligibility. Medicare will be provided to disabled workers and their dependents after they have been receiving disability benefits for 24 months, including the time they were receiving presumptive disability payments.

Mr. STARK

Mr. STARK. Mr. Chairman, it is with great concern that I express my opposition to the Foreign Operations Appropriations Act for Fiscal Year [FY] 1998. Nations around the world look to the United States to set the stage for the foreign affairs arena. U.S. citizens look to Congress to set the stage for domestic priorities. This measure sets a poor example for other nations to follow and demonstrates that we care very little for the people in our own country. H.R. 2159 calls for a $33 million decrease from fiscal year 1997 for the nonproliferation, anti-terrorism, demining and related programs account. China continues the proliferation of nuclear weapons by providing information and materials to rogue nations. The United States must continue to make a concerted global effort to assist foreign countries to combat this threat of nuclear destruction. It is clear that we are making progress toward nuclear nonproliferation but until weapons of mass destruction have been eradicated, we cannot accept cutbacks to these programs. Meanwhile, we are giving a combined total of $5.2 billion to Israel and Egypt. Of this amount, $1.8 billion is allocated for Foreign Military Finance which can be used for advanced weapons systems. Another $475 million is made available for procurement of defense- related goods and services, including research and development in Israel. Egypt is provided with $1.3 billion with which to purchase a tactical command and control system for its army. It is incomprehensible how we propose to send billions of dollars overseas for foreign defense, yet we expect our elderly to prolong receipt of Medicare benefits until they are sixty-seven. Five billion dollars for defense does not help the people of Israel, Egypt, or the United States when they are sick and in need of health services. H.R. 2159 fails to provide a separate account for population development assistance. Instead, this measure allows up to $385 million to be provided for international family planning through various accounts, including the child survival account. The Child Survival and Disease Programs fund was established to reduce infant mortality and improve the health and nutrition of children, especially in the poorest nations. It is counterproductive to appropriate funds for one program so that it can support another. If children's health is a priority, then we should treat it as such and leave its funding alone. If women's health is a priority, then we should reinstate a separate account for international family planning activities. Each year the majority party touts its platform of family values, yet cuts funds and puts restrictions on international family planning. Given that women are the primary caretakers and household managers throughout much of the developing world, their health and well-being undeniably determines how their children will fare in life. According to a 1996 report from the United Nations Children's Fund [UNICEF] almost 600,000 women die during pregnancy and childbirth each year. Of these tragedies, 75,000 die attempting to abort an unwanted pregnancy themselves or with the help of an untrained and unsafe provider. These deaths render at least 1 million children motherless every year. The United States is hypocritical in its message of promoting family values, but limiting assistance for women's health in developing nations. I will not support a measure that cannot lead by example. I will not support a measure that seeks to limit efforts to end the threat of nuclear destruction yet builds military defenses in foreign lands. I will not support a measure that restricts medical resources from women worldwide. I will not support the Foreign Operations Appropriations Act for Fiscal Year 1998.