Mr. President, I rise to speak on the announcement of a dramatic increase in the Medicare Part B premium for seniors and the concern the people of Michigan have about trying to pay a 17.5-percent…
Mr. President, I rise to speak on the announcement of a dramatic increase in the Medicare Part B premium for seniors and the concern the people of Michigan have about trying to pay a 17.5-percent premium increase for next year. Just a day after President Bush touted his efforts to help our seniors and the disabled cope with increased medical expenses, his administration announced the largest premium increase in Medicare's history, dating back to 1965.
Unfortunately, nothing has been done about record increases in the cost of health care over the last 4 years. Now we see the largest premium increase, a 17.5-percent increase. We have
seen it consistently going up since 2001. It is time to say enough is enough.
Seniors are only going to see about a 3-percent increase in their Social Security cost of living. Yet the Part B premium comes directly out of that track. So instead of getting at least a 3-percent increase to help pay for food and the mortgage and utility bills, prescription drugs and so on, they will actually see a reduction of 14.5 percent in what they receive through Social Security.
This is absolutely unacceptable. Unfortunately, instead of helping, Congress and this administration have pushed through a Medicare plan about which CMS Administrator McClellan has acknowledged that about a sixth of this year's premium increase results from the billions that Medicare is paying private health plans to encourage them to offer private health insurance. So what we see are conscious decisions that we made that have caused this increase to be as high as it is. I believe they were the wrong decisions, the wrong choices.
It doesn't make sense and it is not fair that the millions of seniors who enjoy and want to stay in traditional Medicare--about 89 percent of seniors right now have chosen traditional Medicare over Medicare+Choice or being in an HMO--have to subsidize the big private health insurance companies and HMOs and the 11 percent of the seniors and disabled who have the ability or have the choice, even, to be in an HMO.
Moreover, we have heard time and time again that the private plans are less efficient than traditional Medicare. I have shown charts on the floor as we have debated the Medicare prescription drug bill. We have seen the Congressional Budget Office analysis. In fact, we heard it again last week when the Medicare Payment Advisory Commission reported that CMS pays Medicare private health plans an average of 107 percent of what it costs to care for the same beneficiaries under traditional fee-for-service programs.
At a time when we are looking at great concerns about the long-term solvency of Medicare, looking at these huge increases that have occurred for seniors related to the premiums for Medicare, we are hearing from the Medicare Payment Advisory Commission that CMS is paying private plans an average of 107 percent of what it costs to care for beneficiaries under traditional Medicare.
This makes absolutely no sense, no matter how you look at it. According to the report, Medicare payments to private plans cost 16 percent to 23 percent more than traditional plans. So, basically, we can be spending up to 23 percent more on the approach of privatizing Medicare. That is what it is; this is a strategy to privatize Medicare, which the majority of seniors have not asked for, they have not chosen, and they don't want; and the icing on the cake is it costs up to 23 percent more.
I ask, if HMOs are so much better and more efficient, why do they need the extra dollars? I am certainly not opposed to HMOs. I have participated in the past, as my mother has, when she was on Medicare and when Medicare HMO was available in our community. She got dropped, unfortunately, when they chose to leave. Certainly, this is not a discussion about whether HMOs provide an important service or quality service.
My concern is, within the context of Medicare, why, if they are so much better and more efficient, are we providing them more money? The debate on privatization was that somehow Medicare is going broke, the trust fund is going to run out of money; therefore, we have to privatize Medicare. And exactly the opposite result has occurred as we have begun to privatize Medicare. Premiums for seniors are going up faster than at any other time in our history. We hear from independent reports that it costs anywhere from 16 percent to 23 percent more to privatize Medicare than to keep it the way it is. With higher administrative costs, in fact, private plans are more costly than regular Medicare. So we are told they need subsidies because it costs more to administer them.
Again, the whole point is to be more efficient, stretch the dollars farther, lower costs, so we can provide better prescription drug coverage for seniors and other kinds of preventive care they need, and that Medicare remains solvent and healthy for the future. Older Americans are staggering under the relentless increases in the cost of their health care and prescription drugs. We have all heard the stories. More older Americans will face harsh choices in meeting basic needs of health, food, housing, and paying utility bills. Meeting those challenges will be even more difficult as percentage increases in Medicare premiums greatly outpace the increases for Social Security. The increase will be especially painful because Social Security payments again are expected to rise less than 3 percent. I say ``expected'' because we don't know how much or how little Social Security payments will be yet.
Yet, this year, this administration decided to release the Medicare numbers the Friday right before Labor Day, right before the weekend when the news was focused on a hurricane. That is some holiday for millions of seniors who have labored their whole lives. We learned the OMB moved up the release of this huge increase by 6 weeks. In fact, we hear today in an article that the internal administration memo reveals that the unprecedented 17-percent increase in Medicare premiums seniors will pay in 2005 was scheduled for release October 22. It was scheduled for release on October 22, along with Social Security COLA payments.
Obviously, somebody looked at this and said: This is the largest increase in the history of the program. We want to make sure it is done as quietly as possible. So they chose the Friday before the Labor Day weekend, late in the afternoon, in the middle of a hurricane, to release the numbers.
OMB received the premium notice from HHS on September 1 and cleared it for release only 2 days later. As I said, for the last at least 10 years, they have done it in October along with Social Security.
We are not going to only talk about premium increases here today. We have the ability to do something about it. I am proud to be doing something about this, saying enough is enough; the portion of this that comes from privatizing Medicare needs to be removed and we need to put these premiums back in line with Social Security.
We know health care costs are going up for everyone--every family and every business. In a larger sense, we need to be addressing that as well, which we can do with the cost of prescription drugs. We can bring it to the floor and pass an effort to open the border and lower the costs in half by allowing pharmacists to do business safely with pharmacists in Canada and other places. There are other strategies. There are things we can do to address the broader issue of health care and we need to be doing them.
But while this is happening, we should not be saying to our seniors, saying to someone on Medicare, that instead of addressing these issues, we are going to require you to pay an extra-large increase because of a policy made here to privatize Medicare that, in the face of all evidence, shows the administrative costs are higher and the costs of providing the kinds of care are higher. We now have one more report saying that. In the face of all objective evidence, the Congress and the President have moved forward to want to privatize Medicare, anyway, saying it will lower prices, when in fact it has resulted in the largest premium increase for seniors and the disabled in the history of the Medicare Program.
I believe this is wrong. So I have introduced S. 2780, Keeping the Promise of Medicare Act, with 11 of my colleagues. My bill would cap the Part B premium at the same level as the cost-of-living adjustment so that seniors do not see real cuts in their Social Security benefits. In other words, we would at least keep seniors whole, moving in the right direction while we deal with these other issues, in terms of rising health care costs that need to be and must be addressed.
We need a sense of urgency about this issue. Health care is not optional. This is one of the most urgent issues a family addresses. It is the most urgent cost right now that businesses across the country are facing. Yet we do not see that sense of urgency, even though I know colleagues on both sides of the aisle have concerns, have knowledge about this, and want to see something happen. We can do better than that. We can do better for our seniors through
Medicare. We can do better for businesses that are desperately asking us for help. We can do better for our families, for every worker being asked to pay more for health care, or losing their job because the company cannot keep their health care plan and their jobs. There is more we can do, much more. I urge my colleagues to join with me in one step, S. 2780, Keeping the Promise of Medicare Act. We can, at minimum, start by saying to our seniors we are going to make sure you are not burdened with the costs of paying for these policies to privatize. We will keep you whole by capping this increase at the same level as the cost of living for Social Security. I hope we will vote on this bill before we leave and have the same sense of urgency about it that those paying their bills have every day.
I yield the floor.
Sen. Debbie Stabenow (D-MI)