Rural Equity Payment Index Reform Extension Act of 2006

Mr. President, I rise to introduce a bill which is sponsored by myself and 20 other Members of the Senate.

The purpose of this bill is to put some control over spending--or at least put procedures in--to allow us as a Congress to begin to control spending.

I think we all recognize that in the short run we are headed toward a budget that looks like it may actually move toward balance. We have seen some very significant, positive gains. A deficit that was supposed to be about $425 billion this year is down to about $300 billion, and it may well go below that. That does not solve our problem even though we have gotten things moving the right way because in the outyears we face a fiscal crisis. That is reflected in this chart.

The fact is, there is facing this country a situation where we have a generation known as the baby boom generation which is such a large generation that it has basically overwhelmed the systems of America at each point in its evolution. It started out in the early 1950s and late 1940s. It overwhelmed the school systems it was so big. As it moved forward in the 1960s, it created the civil rights movement, and in the 1980s and 1990s it created the greatest prosperity in the history of our country as a result of its size and productivity.

But now that generation is beginning to retire. It will start to retire in the year 2008. It will be fully retired by the year 2020. It will be the largest retired generation in the history of our Nation by a factor of two. There will essentially be 70 million people retiring during that period.

What are the implications? The implications are rather severe for our Nation's fiscal policy, and especially for our children. All of our retirement systems in this Nation--Social Security, Medicare, Medicaid--all our major safety nets were built around the concept created by FDR, Franklin Delano Roosevelt, that there would always be many more people working than retiring.

In fact, in the early 1950s there were about 12 people working and paying into the Social Security system for every one person taking it out of Social Security. Today there are about three and a half people working for every one person who is retired. By the years 2020 to 2025, there will only be two people working for every one person taking out of the system. That means this pyramid concept goes to a rectangle, and our children and our grandchildren who will then be the working people in America will not be able to support the benefit structure which is in place for the retired.

This chart reflects the dramatic effect of this situation rather starkly. The blue line represents what percent of gross national product the Federal Government usually spends. Historically, since World War II, the Federal Government has spent about 20 percent of the gross national product. The red line represents three programs in the Federal process: Social Security, Medicare, and Medicaid. The red line grows dramatically beginning in about the year 2008 and proceeds at an exponential rate of growth, so that by the years 2025 to 2028 those three programs alone will actually cost more than 20 percent of the gross national product of America.

What does that mean? It means if we were to spend the historic amount we have spent on the Federal Government, those three programs would use up all that money and there would be no money available for education, for national defense, for laying out roads, for health care for everyone else, other than those who are retired, or for anything else the Federal Government is supposed to do. Everything would have to be spent on Social Security, Medicare, and Medicaid. It does not stop there. It continues up at a rather dramatic movement.

The point, of course, is that our children will have to pay the cost. They will find themselves confronted with a dramatic increase in tax burden unless we address the cost of those programs from the spending side.

The point, also, is we really cannot tax our way out of this problem. We cannot possibly raise taxes high enough to keep up with the cost of these programs and still have a viable country. If we did that, we would eliminate the ability of our children to buy a new home, to send their kids to college, to even buy cars. The lifestyle of an American, our children and our grandchildren, would be dramatically reduced-- their quality of life--were we to raise taxes to try to keep up with this rate of growth of spending.

Again, it is not a revenue problem; it is a spending problem. That is important to stress. In fact, if you look at the revenues over the last few years, this reinforces this point. Revenues dropped precipitously at the beginning of this President's term for two reasons. One, we had the largest bubble in the history of the world, the Internet bubble, back in the late 1990s, where we were essentially producing false income, paper returns through the issuance of stock which wasn't backed up by productive companies. This bubble burst, and it was the biggest bubble in history, bigger than the tulip or south seas bubble. And the effect of it was to cause our economy to retrench.

Then we had the attack of September 11, which dramatically impacted our psyche as a nation. Obviously, it had a horrific effect in the area of loss of lives, but it had a dramatic effect on our economy. Those two back-to-back events basically forced a significant drop in revenues.

So President Bush came in and said: Let's try to get out of this recession--and it was a shallow recession but would have headed a lot deeper--by cutting taxes and giving people an incentive to be more productive. We have heard a lot from the other side about how it is terrible we cut taxes at the beginning of this administration. But what those tax cuts did was create an atmosphere where people who wanted to be entrepreneurial, who wanted to go out and take risks, who were willing to put their own personal efforts and their dollars behind an effort to be productive, and, thus, create jobs, did exactly that.

Then the economy started to recover. We had 39 straight months of recovery. We had one of the largest expansions of the post-World-War II period. The practical effect of that is that we have created more economic activity, created

more jobs, and created more revenue to the Federal Government. So in the last 2 years, the revenue to the Federal Government has actually jumped greater in a 2-year period than at any time in the post-World- War II period. Each of the last 2 years has had historic increases of revenues for the Federal Government.

We are at a point where revenues are essentially at the same place they would be over history as a percent of gross national product. We are essentially generating about the same amount of revenue we have always generated to the Federal Government.

The other side of the aisle says: Let's raise taxes some more. That is not going to help because we are already generating as much revenue as we usually generate. We are doing it the right way, with a fair tax system, telling entrepreneurs to make jobs and create risks. We have created jobs and given revenues to the Federal Government.

The real issue is, you have to be willing to address spending, which is what the chart shows. A group on our side of the aisle said: How do you do this? Probably the way to do it is to put in place a series of processes in the Senate and in the House, which basically forced the Congress to address the public policy issues of reducing the rate of growth and spending for the Federal Government. This is very difficult for an elected body. We know it is a natural tendency of an elected body to spend more money because people come to you and say: We need this for that. Usually the stories are compelling and the purposes are good.

The simple fact is, we cannot afford to spend all the money that people want to spend, and we need to have some mechanisms around here which energize an atmosphere of producing fiscal responsibility, delivering government that is efficient, delivering government that is effective, delivering government that people get what they expect, and, also, get their dollars used efficiently and effectively to produce a government that works.

So we are suggesting a program that basically renews, redesigns; it reforms, it rebuilds the Federal system relative to how we are going to spend money and makes sure we spend it effectively so we give people an affordable government, something that delivers the type of services they need but does it in a way that can be afforded. That is our goal. Our goal, essentially, is to contain spending so that we are able to deliver quality government and still pass on to our children a government that is affordable, a tax burden they can afford that won't overwhelm them and will give them the opportunity to have as good a life as we have had.

The proposal we have come up with has a variety of different elements to accomplish this. First, we follow the ideas put forward by the President, which has eight basic elements. It is a very extensive reform package, renewal package, redesign package, rebuilding package.

The first element is what I call fast-track rescission. I suppose that is too technical. The President calls it the line-item veto. But it says the President has the opportunity to look at bills we have passed in the Senate and say: Listen, we do not need to spend money on that item. That is really an item of earmark, or maybe you might call it pork, or it is just simply not what we need. It is not what the American people have to have their dollars spent on. He gets to put together a package of items, and he sends them to us. He says: These are the items I don't think we need. We think the American people don't need them. We don't think the Government can afford them, and you, the Congress, can take another look at them and vote them up or down. Fast- track rescission. We have to take the vote. It is an opportunity for the executive branch to have a say and for the legislative branch to take a second look. We have done it in a way so neither branch is prejudiced as to our constitutional role which is very important.

The second thing we have done is we have reinstated statutory caps. What is that? It means that we say every year how much the Federal Government is going to spend and we lock it down so that if we spend over that amount we have to go back and cut somewhere else to bring us down to that number.

What has happened around here, we have said we are going to spend X dollars. That is called a cap. But we have not had any enforcement mechanism behind the cap. Those lapsed in 2002. So when we exceed the cap, you get 60 votes and people say: Fine, we will spend the money anyway, even though we said we were not going to spend that much money, and it is ignored. This puts in place a system where we have to be responsible to the number we set out as to what the Federal Government should spend. It is basically truth in budgeting and forces budgeting to be effective and responsive.

The third item we put in, we reduce the deficit so it will move to zero by 2012. This is done by saying essentially this: The deficit today is X percent of gross national product. We are going to say that the deficit should be dropped as a percent of gross national product every year until we get to about 2012 where we expect it to be basically no deficit. If we exceed those numbers--in other words, if the deficit exceeds that percent of gross national product which we set out in the bill--and these numbers are historical numbers and they are obtainable numbers.

In fact, in the first 2 years, the numbers we have set out are basically above where the actual deficit looks like it will hit, and it is about the third and fourth year we may have some issues to keep the deficit moving down--but if the deficit is not moving down, we put in place a process called reconciliation, directed at entitlement spending.

The problem we have as a Federal Government isn't the discretionary side of the ledger. That is spending that occurs every year. Every year you have to spend X dollars on defense, X dollars on education, and you can make a choice regarding how much you will spend here, how much you spend there. Nondefense spending in those accounts has been flat for the last few years, essentially flat if you factor in inflation. The real growth of the Federal Government has been in these accounts that are entitlement accounts, mandatory accounts which I had on the first chart, three of the major ones. They represent, along with the Federal debt, about 60 percent of Federal spending.

What this bill says is that essentially you have to go back and take a look at those accounts if we are not meeting our deficit targets and bring them into line so we will meet those deficit targets.

Now, in order to help accomplish this, this proposal also includes an entitlement commission. There have been a lot of commissions around here and everyone is a little tired of commissions. This commission is different. This commission says take a look at the entitlement accounts of the Federal Government, report back to the Congress, and Congress must act on your proposal. We actually put in place a policy procedure to try to correct the entitlement issue. Then we put in place a budgeting procedure which allows us to legislate changes if the entitlement improvements are not accomplishing our goals.

The purpose is to make these entitlement programs affordable for our children while they still maintain a quality lifestyle for those who are retired. That can be and should be able to be accomplished. But it takes a Congress being willing to step up to the plate and doing it. So far, we have not been willing to do that. We have been burying our head in the sand on that issue.

Another element in this proposal is a BRAC commission, a proposal from Senator Brownback, which essentially looks at the whole Government, independent of the Defense Department, which was looked at under its own BRAC commission. And if you recall, it looked at the entire Defense Department and decided what the Defense Department needed and didn't need and set up a package and we voted on it as a package.

This is a ``BRAC Commission'' for the Government with very strong, thoughtful people being appointed to the Commission, the same way the BRAC Commission was set up relative to the Defense Department. We will be able to take a look at functions of the Government which maybe should be eliminated or reduced or significantly changed.

It is a good proposal. It is also a proposal that includes biennial budgeting--an idea that is strongly supported by the Senator from Alabama, Mr. Sessions, who is managing the bill on the floor right now, and the Senator

from New Mexico--so we can have a budget process where we are not always looking at the budget every year and everybody spinning their wheels around the budget but, rather, having a year where we develop a budget and a year where we do a lot more oversight. That is the theory behind that, so we can become more efficient.

Finally, it has reforms to what is known as the reconciliation process. The reconciliation process is the teeth under which we accomplish savings in the budget process. But it can also, unfortunately, be used for expanding spending if it is not handled properly. So these reforms make it clear that reconciliation is primarily for the purposes of controlling spending, not of expanding spending.

So the goal is simple. The goal is to put in place a package which will allow us as a Congress to step up and address the issue of overspending. That is why we call it SOS, ``stop overspending.'' The purpose of that goal is to be able to pass on to our children a government that is affordable, that continues to deliver the services people expect, continues to give high-quality services but does it in an affordable way so our children's quality of life is not overwhelmed by the burden of a government that is trying to support a retired generation that is huge.

Again, I must stress, that you cannot do this on the tax side. You cannot solve the issues of the deficit, you cannot solve the issues of entitlement concerns on the tax side. There is simply too much programmatic commitment in the pipeline to accomplish that.

Let me give you a couple numbers to highlight that fact. The General Accounting Office--the comptroller of the Government--has told us there is presently pending relative to entitlement responsibility for retired people an obligation which we don't know how we are going to pay for-- that is called an unfunded liability--of $46 trillion; and that is ``trillion'' with a ``T.'' So that is $46 trillion of responsibility that we have put on the books in costs that we don't really know how we are going to pay for.

I don't know what $1 trillion is. It is very hard to comprehend $1 trillion. But just to put it in some sort of context, since the beginning of this country, since our Revolution, we have paid something like $43 trillion in taxes. So all the taxes paid since this country started would not pay for the bills we have on the books for our upcoming retired generation. Or to put it in another context, if you took all the assets owned in America today--all the cars, all the homes, all the stock, all the small businesses, all the big businesses--and totaled them up, their total is about $47 trillion in net value. So we have on the books a liability that is essentially the same as the net worth of our Nation. That is a serious problem, and you cannot deal with that problem by simply raising taxes.

The other side of the aisle has not put forward any substantive ideas in this area relative to spending. They have suggested a proposal called pay-go, which is a stalking-horse for tax increases. Fine. That is their position: We should raise taxes to address all problems. But we know from the numbers that are now coming in at the Treasury that we are already taxing Americans at a level which is at our historic level, our traditional level, and that revenues to the Federal Government are jumping significantly because of the good tax policies we have in place, the fair tax policies we have in place.

So we know you cannot solve this problem by continuing to raise taxes on the American people. The total tax burden to the American people today, including State, local, and Federal, is almost at a historic high. How much higher can you put that tax burden on the American people? No, you cannot do it on that side of the ledger. In fact, what we have proven is you generate more revenues by giving people an incentive to be productive and to go out and create jobs by having a fair and reasonable tax rate rather than jumping tax rates to the point where people have a disincentive to be productive and thus start to reduce revenues to the Federal Government.

That was proven by John Kennedy, confirmed by Ronald Reagan, and now confirmed again by George W. Bush. It should be accepted policy around here, but it is rejected by the other side of the aisle, which still subscribes to this 1930s philosophy of governance, which is that you can always raise taxes to meet any problem. No. The problem is that we need to be willing to step up and address spending.

This package, if it were to pass in its entirety--I hope the other side will not obstruct it coming to the floor. We hope to mark it up in Budget next week and report it out, and hope the other side will let us take it up. Let's have a free-flowing debate out here on the floor about how you address this issue.

The outyear threat to our children--which is a function of the fact there is a baby boom generation floating around here that is huge--is not going to go away and is going to demand significant services which will cost a dramatic amount of money.

Our proposal is comprehensive and extensive. It is a rebuilding, retooling approach toward how we manage this Congress and especially our budgets. It is a constructive approach, one that is committed toward delivering an affordable and effective government and a government that does not overburden our children and our grandchildren with taxes. So it will lead to a balanced budget, and it will lead to a government that is affordable.

I thank all my colleagues who have joined me in this effort, and I do hope we can move it forward.

Mr. President, I yield to the Senator from Alabama.

Absolutely not. In fact, under most scenarios, the current rate of spending on almost all of these major programs--such as Medicare, Social Security, and Medicaid--would rise significantly; they just would not rise as fast. Medicare, for example, would probably, over this 5-year period, rise by about 40 percent, instead of 43 percent--something like that. Those are numbers off the top of my head, but those are the types of numbers we are talking about. You are talking about increased spending but at a slower rate and affordable.

Mr. President, the Senator from Alabama is absolutely right. We do not have to cut anywhere. All we have to do is slow the rate of growth so it is an affordable rate of growth because the compounding effect of slowing these rates of growth is huge.

Mr. President, the Senator from Alabama is correct. The rate

of growth of revenues to the Federal Government last year was about 14 percent. This year, through the first 6 months, it was about 11 percent and continues to grow dramatically. That is a function of the fact that we now have a tax policy which encourages people to go out and take risks and create jobs, which creates revenue.

Mr. President, I am pleased today to introduce the Heroes

at Home Act of 2006. This legislation would take several important steps toward assisting our brave men and women in uniform in transitioning back home to their families, workplaces, and communities after deployment in Iraq and Afghanistan.

Hundreds of thousands of troops have rotated through Iraq and Afghanistan as part of Operation Iraqi Freedom, OIF, and Operation Enduring Freedom, OEF, including thousands of courageous men and women from New York. More military service members than ever are surviving these conflicts because of better body armor and helmets and improved battlefield medicine.

But surviving these wars and transitioning home can be an uphill battle. Many OIF and OEF service members, including the unprecedented number of National Guard and Reserve members, face readjustment challenges after war, such as medical, mental health, relationship, and work problems. Family members also are affected by the transition as they struggle to reconnect with their war heroes, some who may be deployed two, three, if not more times.

As I meet with returning service members and their families around the State of New York and the country, I hear about the real hardships they battle after deployment--just how difficult it can be to adjust back to life at home.

Several articles and reports have highlighted these struggles. According to a March 2006 study, 19 percent of Iraq veterans and 11 percent of Afghanistan veterans reported mental health problems. Among the OIF and OEF veterans seeking care at Department of Veterans Affairs, VA, hospitals, nearly a third have been diagnosed with mental disorders, with over 40 percent of those posttraumatic stress disorder, PTSD. Another report found that 10 to 30 percent of National Guard members come home from Iraq searching for work. Others return to civilian jobs dissatisfied with old tasks that pale in comparison to wartime responsibilities.

In addition to these challenges, a large number of service members are coming home from Iraq and Afghanistan with life-threatening brain injuries from roadside blasts that can cause brain damage. It is estimated that traumatic brain injuries, TBI, affect more than 25 percent of bomb blast survivors--a percentage thought to be higher than in any other past U.S. conflict, making TBI the ``signature'' injury of Iraq. The diffuse but debilitating symptoms of TBI can leave service members with cognitive and emotional problems, including the inability to adapt to civilian life. However, TBI frequently goes undiagnosed because returning troops may show no visible wounds or may not realize they suffered a concussion.

Lessons from past wars have taught us that identifying and dealing with problems like PTSD and TBI right away is vital for overcoming them. Yet just last month, a GAO report found that only 22 percent of OIF and OEF service members who may have been at risk for developing PTSD based on post deployment screenings were referred on for further mental health evaluations. In another report from May 2005, the GAO identified that, despite DOD efforts, the needs of demobilizing Reserve and National Guard members for transition assistance were still unmet.

We must do more today to reach out and help our newest generation of war heroes as they transition home after serving bravely in Iraq and Afghanistan. And we must do more to shore up their families, who have courageously maintained family life on the home front during their deployment. That is why I am introducing this legislation today. The Heroes at Home Act would help address returning service members' readjustment to work, PTSD, TBI, and other problems, as well as provide support to their family members.

This bill would involve partnerships with employers and community organizations because--despite more services and resources offered at DOD facilities, VA hospitals, and Vet Centers--returning service members are often reluctant to go to traditional mental health clinics due to stigma and concerns about confidentiality and their military careers. Only 29 percent of the approximately 500,000 separated OIF and OEF veterans have sought VA health care services, including mental health services.

This legislation would identify ways to better assist National Guard and Reserve members in returning to civilian jobs, who are often hurled from civilian life into combat with less preparation and are then expected to reenter the civilian workforce. It would develop an assistance center for employers, employee assistance programs, and other organizations to provide them with best practices and education for ensuring the success of Guard and Reserve members in resuming civilian work after deployment, a win for our businesses, our employers, and our troops.

Under this legislation, demonstration grants would be awarded to organizations in community setting for providing mental health education and assistance to National Guard and Reserve members and their families. Since many of these troops return to local communities scattered across the country far away from military bases and VA hospitals, these pilot projects would help reach them and their loved ones in more convenient places like community colleges, public schools, community mental health clinics, and family support organizations.

With more and more troops injured by improvised explosive devices, IEDs, and bombs in Iraq, we must do more to understand the effects of these blasts on those impacted by them. That is why this legislation also calls for a study on the long-term physical and mental health consequences and rehabilitation needs of traumatic brain injured service members of OIF and OEF. This study would examine ways to help prevent future generations of service members from sustaining such injuries while assessing what types of programs and services are available to treat those who have already been injured in the years ahead.

To further assist the mushrooming number of traumatic brain injured service members and their families, this legislation would establish a TBI family caregiver training curricula. Health professionals at DOD and VA hospitals would use this training to teach family members how to care for traumatic brain injured service members after they leave the hospital. It is crucial that we give family members the tools they need to effectively assist their loved ones at home in their communities.

Those who have proudly served our Nation in OIF and OEF have made extraordinary sacrifices in the battlefield in defense of democracy and freedom. Back home, these heroes deserve our best resources and support to make sure they once again are vibrant and welcomed members in our neighborhoods, our towns, and our cities, at our work sites, and in our families. None of our returning service members should suffer alone in silence. Nor should their families. We all must do our part. I look forward to working with all of my colleagues to ensure passage of this bill that champions the successful transition of our newly returning heroes to their families, workplaces and communities.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I am introducing legislation today with Senators Snowe, Cochran, Cantwell, Domenici, Lincoln, Jeffords, Collins, Murray, Harkin, Landrieu, Obama, Salazar, and Sessions entitled the ``Rural Equity Payment Index Reform Extension Act of 2006.'' The legislation would extend a provision that was included as part of the Medicare Modernization Act of 2003 and came from my original legislation, S. 881 in the 108th Congress, with Congressman Doug Bereuter of Nebraska to ensure that the work component of the Medicare physician payment formula is set to ensure that no geographic region is paid less than the national average.

The Medicare physician payment formula, known as the Medicare Resource-Based Relative Value Scale, or RBRVS, is based on three components of each service: work, practice expense, and professional liability insurance. The relative value of each service is then multiplied by a geographic adjuster for each Medicare locality, which is known as the Geographic Practice Cost Indices, or GPCIs.

Prior to the enactment of this provision as part of the Medicare Modernization Act of 2003, the physicians in States that have the worst workforce shortages were being paid far less than their counterparts in States with adequate or even an oversupply of physicians due to the GPCI adjustment. For the ``work component'' in particular, which accounts for about 55 percent of the total Medicare physician payment, an adjustment based on geographic adjustments made little sense. An office visit to a rural physician is no different in time, effort, or workload compared to an office visit to an urban physician.

As National Rural Health Association president Dr. Wayne Myers said on January 7, 2003, prior to the legislation's passage, ``An office visit to a rural physician is no different than an office visit to an urban physician. The idea that physicians are reimbursed for their work and their skills at a lower rate simply on the basis that they choose to practice in a rural area and serve our rural communities is completely ludicrous.''

In addition, since Medicare beneficiaries pay the same premium for all Part B services, inequitable physician fee payments result in substantial cross-subsidization from people living in low payment States to people living in higher payment States.

Congress determined that such extensive geographic disparities were unfair and, as part of the Medicare Modernization Act of 2003, language from my bill was included that brought all geographic areas up to the national average for the calculation of this piece of the Medicare physician payment formula.

It is important to highlight that the importance of this formula extends well beyond Medicare. According to the American Academy of Pediatrics in its February 8, 2006, update on the Medicare payment formula, ``. . . over 74 percent of public and private payors, including state Medicaid programs, have adopted components of the Medicare RBRVS to reimburse physicians, while many other payors are exploring its implementation.''

Furthermore, Medicare Advantage plan payments are based in large part on fee-for-service payments made in various geographic locations. Disparities in Medicare Advantage payments are also caused, in part, by such geographic adjustments made to physician payments.

Unfortunately, these disparities will increase if the ``work component'' in the physician payment rate is allowed to once again fully adjust based on geography. The provision bringing payment levels up to the national average for every geographic area was in effect for 2004-2006 and is set to expire at the end of this calendar year. As a result, physicians, who already face a potential reduction in their overall Medicare payment rate, might also see their payment rates further reduced unless this legislative extension is passed.

According to the November 21, 2005, Federal Register notice, if payment rates were not brought up to the national average, there would be reductions in physician payments to the following States: Alabama, Arizona, Arkansas, Colorado, Florida, Georgia outside of Atlanta, Idaho, parts of Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland outside of Baltimore region, Michigan outside of Detroit, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, most of New York outside of New York City and suburbs, North Carolina, North Dakota, Ohio, Oklahoma, Oregon outside of Portland, Pennsylvania outside of Philadelphia, Puerto Rico, South Carolina, South Dakota, Tennessee, Texas outside of Houston, Dallas, and Brazoria, Utah, Vermont, Virginia, Washington outside of Seattle, West Virginia, Wisconsin, and Wyoming.

Lack of equitable reimbursement is a critical factor leading to the shortage of physicians in many rural areas, including the State of New Mexico. The extension of the Rural Equity Payment Index Reform Extension Act of 2006 will ensure that the disparity in physician payments between states such as New Mexico and other geographic areas does not once again widen.

I urge prompt passage of this important legislation and ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I am introducing legislation today with Senators Snowe, Cochran, Cantwell, Domenici, Lincoln, Jeffords, Collins, Murray, Harkin, Landrieu, Obama, Salazar, and Sessions entitled the ``Rural Equity Payment Index Reform Extension Act of 2006.'' The legislation would extend a provision that was included as part of the Medicare Modernization Act of 2003 and came from my original legislation, S. 881 in the 108th Congress, with Congressman Doug Bereuter of Nebraska to ensure that the work component of the Medicare physician payment formula is set to ensure that no geographic region is paid less than the national average.

The Medicare physician payment formula, known as the Medicare Resource-Based Relative Value Scale, or RBRVS, is based on three components of each service: work, practice expense, and professional liability insurance. The relative value of each service is then multiplied by a geographic adjuster for each Medicare locality, which is known as the Geographic Practice Cost Indices, or GPCIs.

Prior to the enactment of this provision as part of the Medicare Modernization Act of 2003, the physicians in States that have the worst workforce shortages were being paid far less than their counterparts in States with adequate or even an oversupply of physicians due to the GPCI adjustment. For the ``work component'' in particular, which accounts for about 55 percent of the total Medicare physician payment, an adjustment based on geographic adjustments made little sense. An office visit to a rural physician is no different in time, effort, or workload compared to an office visit to an urban physician.

As National Rural Health Association president Dr. Wayne Myers said on January 7, 2003, prior to the legislation's passage, ``An office visit to a rural physician is no different than an office visit to an urban physician. The idea that physicians are reimbursed for their work and their skills at a lower rate simply on the basis that they choose to practice in a rural area and serve our rural communities is completely ludicrous.''

In addition, since Medicare beneficiaries pay the same premium for all Part B services, inequitable physician fee payments result in substantial cross-subsidization from people living in low payment States to people living in higher payment States.

Congress determined that such extensive geographic disparities were unfair and, as part of the Medicare Modernization Act of 2003, language from my bill was included that brought all geographic areas up to the national average for the calculation of this piece of the Medicare physician payment formula.

It is important to highlight that the importance of this formula extends well beyond Medicare. According to the American Academy of Pediatrics in its February 8, 2006, update on the Medicare payment formula, ``. . . over 74 percent of public and private payors, including state Medicaid programs, have adopted components of the Medicare RBRVS to reimburse physicians, while many other payors are exploring its implementation.''

Furthermore, Medicare Advantage plan payments are based in large part on fee-for-service payments made in various geographic locations. Disparities in Medicare Advantage payments are also caused, in part, by such geographic adjustments made to physician payments.

Unfortunately, these disparities will increase if the ``work component'' in the physician payment rate is allowed to once again fully adjust based on geography. The provision bringing payment levels up to the national average for every geographic area was in effect for 2004-2006 and is set to expire at the end of this calendar year. As a result, physicians, who already face a potential reduction in their overall Medicare payment rate, might also see their payment rates further reduced unless this legislative extension is passed.

According to the November 21, 2005, Federal Register notice, if payment rates were not brought up to the national average, there would be reductions in physician payments to the following States: Alabama, Arizona, Arkansas, Colorado, Florida, Georgia outside of Atlanta, Idaho, parts of Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland outside of Baltimore region, Michigan outside of Detroit, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, New Mexico, most of New York outside of New York City and suburbs, North Carolina, North Dakota, Ohio, Oklahoma, Oregon outside of Portland, Pennsylvania outside of Philadelphia, Puerto Rico, South Carolina, South Dakota, Tennessee, Texas outside of Houston, Dallas, and Brazoria, Utah, Vermont, Virginia, Washington outside of Seattle, West Virginia, Wisconsin, and Wyoming.

Lack of equitable reimbursement is a critical factor leading to the shortage of physicians in many rural areas, including the State of New Mexico. The extension of the Rural Equity Payment Index Reform Extension Act of 2006 will ensure that the disparity in physician payments between states such as New Mexico and other geographic areas does not once again widen.

I urge prompt passage of this important legislation and ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I am pleased to be joined today by Senator Gordon Smith, Senator Larry Craig and Senator Patty Murray in introducing the Fisheries Restoration and Irrigation Mitigation Act of 2006--or FRIMA. Our legislation extends a homegrown, commonsense program that has a proven track record in helping restore Northwestern salmon runs. Dollar-for-dollar, the fish screening and fish passage facilities funded by our legislation are among the most cost-effective uses of public and private restoration dollars. These projects protect fish while producing significant benefits. That is why it is important that this program be reauthorized and funding be appropriated now.

Since 2001, when the original Fisheries Restoration and Irrigation Mitigation Act of 2000, FRIMA, was enacted, more than $9 million in Federal funds has leveraged nearly $20 million in private, local funding. This money has been used to protect, enhance, and restore more than 550 river miles of important fish habitat and species throughout Oregon, Washington, Idaho, and western Montana. For decades, State, tribal and Federal fishery agencies in the Pacific Northwest have identified the screening of irrigation and other water diversions, and improved fish passage, as critically important for the survival of salmon and other fish populations.

This program is very popular and has the support of a wide range of constituents, including community leaders, environmental organizations, and agricultural producers. Senator Smith and I are proud of the successful collaborative projects that irrigators and members of the Oregon Water Resources Congress have completed while putting this program to work in our home State. Our program also has the support of Oregon Governor Ted Kulongoski, irrigators throughout the Northwestern States, Oregon Trout, American Rivers and the National Audubon Society.

FRIMA authorizes the Secretary of the Interior to establish a program to plan, design, and construct fish screens, fish passage devices, and related features. It also authorizes inventories to provide the information needed for planning and making decisions about the survival and propagation of all Northwestern fish species. The program is currently carried out by the U.S. Fish and Wildlife Service on behalf of the Interior Secretary.

FRIMA provides benefits by: keeping fish out of places where they should not be--such as in an irrigation system; easing upstream and downstream fish passage; improving the protection, survival, and restoration of native fish species; helping avoid new endangered species listings by protecting and enhancing the fish populations not yet listed; making progress toward the de-listing of listed species; utilizing a positive, win/win, public-private partnership; and, assisting in achieving both sustainable agriculture and fisheries. Since FRIMA's enactment in 2001, 103 projects have been installed. This is a true partnership and fine example of how our fisheries and farmers can work together to protect fish species throughout the Northwest.

While he was Governor of Idaho, Interior Secretary Dirk Kempthorne said, ``. . . the FRIMA program serves as an excellent example of government and private land owners working together to promote conservation. The screening of irrigation diversions plays a key role in Idaho's efforts to restore salmon populations while protecting rural economies.'' [from ``Fisheries Restoration and Irrigation Mitigation Programs, FY 2002-2004'', U.S. Fish & Wildlife Service, Washington, D.C., July, 2005, p. 13]

The bill that we are introducing today specifically extends the authorization for this program through 2012; gives priority to projects costing less than $2.5 million--a reduction in a targeted project's cost from $5,000,000 to $2,500,000; clarifies that projects funded under the act are viewed as recipients of a ``pass through program'' and not a ``grant'' program; that any Bonneville Power Administration, BPA, funds provided either directly or through a grant to another entity shall be considered non-Federal matching funds--because BPA's funding comes from ratepayers; requires an inventory report describing funded projects and their benefits; and changes the administrative expenses formula used by the Fish & Wildlife Service and the States of Oregon, Washington, Montana and Idaho, so that administrative costs are scaled in proportion to the amount of funds appropriated for the program each year.

Ultimately, it will take the combined efforts of all interests in our region to recover our salmon. State, Tribal and local governments, local watershed councils, private landowners and the Federal Government need to continue working together. Initiatives such as the bill I am introducing today help to sustain the partnerships upon which successful salmon recovery will be based.

I look forward to working with my colleagues to see this legislation pass.

I ask unanimous consent that the text of the bill and a letter of support from Oregon Governor Kulongoski be printed in the Record.