Critical Access Hospital Flexibility Act of 2009

Mr. President, I rise to introduce a bill today. Over the past several years, I have worked to establish greater transparency in the financial relationships and financial disclosure requirements between physicians and manufacturers of drugs, of biologics, and medical devices.

In the last Congress, the 110th, Senator Herb Kohl of Wisconsin and I introduced what is entitled the Physician Payments Sunshine Act, which is intended to bring some much-needed transparency to these relationships between physicians and manufacturers.

To explain why this bill is so important, let me point to a number of investigations I have conducted in the depth and scope of these relationships between physicians on the one hand, and manufacturers of drugs, biologics, and medical devices on the other hand.

My findings to date are troubling and reveal significant undisclosed financial ties between physicians and industry. Some examples: These relationships, at times, resulted in annual incomes of over $1 million to individual physicians from just one company.

Another example. My investigations determined that several prominent physicians at major universities had failed to disclose large sums of money to their research institutions. That was despite institutional as well as Federal requirements that these reportings take place.

This was also despite these physicians' involvement with Federal research study products made by the various drugmakers with whom they have financial relationships.

This Federal research has involved billions of dollars in taxpayers' money to fund this research.

My oversight has confirmed the need for a consistent, easy-to- understand national system of disclosure, as opposed to a patchwork of disclosure requirements at State and institutional levels, although I compliment States that have such laws on the books.

Today I am here to introduce, along with Senator Kohl, the Physician Payment Sunshine Act of 2009. The Physician Payment Sunshine Act would require that manufacturers of drugs, biologics, and medical devices disclose, on an annual basis, any financial relationships that they have with physicians. That information would be posted online by the Secretary of Health and Human Services in a format that is searchable, that would be clear and easy for the public to understand.

Whether the relationship is as simple as buying a doctor's dinner or as complex as a multimillion-dollar consulting arrangement, these relationships may affect prescribing practices and may influence research.

More importantly, they can obscure the most important issue existing between doctors and patients, and that is a question every doctor and patient has to consider: What is best for the patient?

This legislation Senator Kohl and I are introducing today closely parallels the version I circulated last year and follows some recent MedPAC recommendations.

MedPAC recommended a lower annual reporting threshold of $100--in the previous bill, it was higher--no de minimis exceptions for payments and a tighter preemption provision.

MedPAC will publish their final recommendations in their March report to Congress. I will take those recommendations into consideration and intend to continue pursuing policies that go beyond the transparency in health care than even the existing bill does.

There is a greater need for this legislation, and that greater need is demonstrated by a witness testifying at the Finance Committee hearing on health reform last year that industry and physician relationships are pervasive.

Drug and device companies spend billions and billions every year on marketing, product development, and research, and much of this money goes directly to doctors.

Last year, the Des Moines Register wrote:

Your doctor's hand may be in the till of a drug company. So

how can you know whether the prescription he or she writes is

in your interest or the best interest of a drug company?

That is a pretty good question that we all ought to be looking at.

Many of these relationships are beneficial and appropriate. That is why we don't outlaw any of these relationships. What we do is make them be reported. And some of these should be reported on a more regular basis than they are even without this legislation.

Physicians play important roles in inventing and refining new devices or in conducting medical research. They are hired to educate other doctors. We don't do anything in this legislation to end those professional relationships.

But as is often the case, a few bad apples can spoil the whole barrel. It is clear Congress needs to act now to pass disclosure legislation.

Currently, drug and device makers have to comply with a number of State requirements, each State giving its own definition and own rules.

Patients as well as other doctors have no way to learn about these important relationships. This information should not only be available to those few Americans lucky enough to live in a State already requiring some level of disclosure.

Even in the States currently requiring disclosure, most do not apply that law to medical device companies. Some States do not even make public the information they collect, which is of little value to patients who might want to know if their doctors have a relationship with a drug company or a medical device company about which they ought to know.

Now, this bill isn't adding new burdens to the industry. By creating a central reporting system, the legislation actually relieves burdens. In addition, I am hopeful that this bill will enjoy the same wide- ranging support as the prior legislation that Senator Kohl and I put in during the 110th Congress.

I want to be clear--and this is the second time I am being clear on this point--this legislation does not regulate the business of drug and device companies. Let the people in industry do their business since they have the training and the skills to get the job done. But keep the American people apprised of the business you are doing and how you are doing it. After all, what is at risk isn't merely private interest but the health and well-being of all Americans who depend upon the drugs and medical devices to sustain and to improve their lives.

In this process of what we call transparency, in this process that we call sunshine legislation, I often quote from an opinion of Justice Brandeis, I think in 1914, where he said: ``Sunlight is the best disinfectant.'' And that is what Senator Kohl and I are aiming to accomplish with this Physician Payment Sunshine Act, just a little sunlight so the public is better informed.

Mr. President, I am pleased to be joined today by my colleague Senator Mike Crapo, to introduce this important piece of legislation for America's rural hospitals. I first introduced this legislation in 2007 with Senator Smith, and I am proud to continue our fight for rural hospitals in this Congress. Today, my fellow Oregonian, Representative Greg Walden, is introducing this same bill in the House of Representatives.

The Medicare program is turning rural communities into ``health care sacrifice'' zones. Under current law, critical access hospitals either have to risk their financial viability or their patient's health if a 26th patient walks in their door. Rural hospitals need greater flexibility from the Medicare program to fulfill their obligations to their communities--especially, but not limited to, their veterans--in times of public health emergencies.

The Balanced Budget Act of 1997 merged a Montana initiative, the medical assistance facility demonstration, and the Rural Primary Care Hospital program into a new category of hospitals called critical access hospitals CAH. By design, the Critical Access Hospital program in Medicare ensures that rural communities have access to acute care and emergency services 24 hours a day, 7 days a week.

In order to obtain this designation, hospitals must meet certain requirements, such as being located more than 35 miles from any other hospital, or receiving certification by the state to be a ``necessary provider.'' Critical access hospitals must also provide 24-hour emergency care services.

As a designated critical access hospital, Medicare pays these hospitals based on its reported costs. Each critical access hospital receives 101 percent of its costs for outpatient, inpatient, laboratory, and therapy services. There are nearly 1,300 hospitals across the United States in 47 states that operate under a critical access hospital designation. Twenty-five of them are in Oregon.

One requirement of this program is that there be no more than 25 beds occupied by patients at any one time. This requirement has proven to be too constricting for facilities during times of unexpected need, such as during an influenza outbreak or an influx of tourism to the community.

Critical access hospital administrators in Oregon, especially Dennis Burke from Good Shepherd Medical Center in Hermiston and Jim Mattes at Grande Ronde Hospital in LaGrande, have expressed to me how this restriction has lead to unnecessary risks to patient safety and health. Hospital administrators have been forced to divert the 26th and 27th patient in their hospitals to a hospital much farther from their homes and families.

This legislation makes two important changes to the Medicare Critical Access Hospital Program. First, this bill will provide the flexibility necessary for a critical access hospital to either choose to meet either the 25-bed-per-day limit or work with a limit of 20-beds-per-day averaged throughout the year. During times of spikes in public health need, these hospitals would be able to care for more patients even if the hospital would exceed the use of 25 beds.

Second, this bill exempts beds used by veterans whose care is paid for or coordinated by the Department of Veterans Affairs, VA, from counting against the 25-bed limit or 20-bed yearly average. This change gives CAHs the flexibility they need to treat America's military veterans at a time when the VA has divested in hospital care for our rural veterans, forcing them into these already tightly restricted community hospitals.

This bill also ensures that these hospitals are meeting the requirements under the law without breaking the bank. This new yearly average of 20 beds is set lower than the daily limit, 25 beds, to ensure that Medicare does not inappropriately expand this program. For example, Grande Ronde Hospital would save Medicare an average of $100,000 each year for ambulance transfers of Medicare/Medicaid patients, all of whom could be treated within their facility had it been able to be flexible on counting bed days.

I believe that these simple changes in the current law are critically important to keeping our rural hospitals open and their communities' health care needs served. As we look to expand access to health coverage, this bill will ensure that the nearly 1,300 critical access hospitals in the country have the flexibility they need to remain open for the millions of Americans who depend on them.

I hope my colleagues will join me in supporting this bill, and I look forward to working with Chairman Baucus and Ranking Member Grassley and other members of the Finance Committee to secure passage of this important bill.

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

Mr. President, I am pleased to be joined today by my colleague Senator Mike Crapo, to introduce this important piece of legislation for America's rural hospitals. I first introduced this legislation in 2007 with Senator Smith, and I am proud to continue our fight for rural hospitals in this Congress. Today, my fellow Oregonian, Representative Greg Walden, is introducing this same bill in the House of Representatives.

The Medicare program is turning rural communities into ``health care sacrifice'' zones. Under current law, critical access hospitals either have to risk their financial viability or their patient's health if a 26th patient walks in their door. Rural hospitals need greater flexibility from the Medicare program to fulfill their obligations to their communities--especially, but not limited to, their veterans--in times of public health emergencies.

The Balanced Budget Act of 1997 merged a Montana initiative, the medical assistance facility demonstration, and the Rural Primary Care Hospital program into a new category of hospitals called critical access hospitals CAH. By design, the Critical Access Hospital program in Medicare ensures that rural communities have access to acute care and emergency services 24 hours a day, 7 days a week.

In order to obtain this designation, hospitals must meet certain requirements, such as being located more than 35 miles from any other hospital, or receiving certification by the state to be a ``necessary provider.'' Critical access hospitals must also provide 24-hour emergency care services.

As a designated critical access hospital, Medicare pays these hospitals based on its reported costs. Each critical access hospital receives 101 percent of its costs for outpatient, inpatient, laboratory, and therapy services. There are nearly 1,300 hospitals across the United States in 47 states that operate under a critical access hospital designation. Twenty-five of them are in Oregon.

One requirement of this program is that there be no more than 25 beds occupied by patients at any one time. This requirement has proven to be too constricting for facilities during times of unexpected need, such as during an influenza outbreak or an influx of tourism to the community.

Critical access hospital administrators in Oregon, especially Dennis Burke from Good Shepherd Medical Center in Hermiston and Jim Mattes at Grande Ronde Hospital in LaGrande, have expressed to me how this restriction has lead to unnecessary risks to patient safety and health. Hospital administrators have been forced to divert the 26th and 27th patient in their hospitals to a hospital much farther from their homes and families.

This legislation makes two important changes to the Medicare Critical Access Hospital Program. First, this bill will provide the flexibility necessary for a critical access hospital to either choose to meet either the 25-bed-per-day limit or work with a limit of 20-beds-per-day averaged throughout the year. During times of spikes in public health need, these hospitals would be able to care for more patients even if the hospital would exceed the use of 25 beds.

Second, this bill exempts beds used by veterans whose care is paid for or coordinated by the Department of Veterans Affairs, VA, from counting against the 25-bed limit or 20-bed yearly average. This change gives CAHs the flexibility they need to treat America's military veterans at a time when the VA has divested in hospital care for our rural veterans, forcing them into these already tightly restricted community hospitals.

This bill also ensures that these hospitals are meeting the requirements under the law without breaking the bank. This new yearly average of 20 beds is set lower than the daily limit, 25 beds, to ensure that Medicare does not inappropriately expand this program. For example, Grande Ronde Hospital would save Medicare an average of $100,000 each year for ambulance transfers of Medicare/Medicaid patients, all of whom could be treated within their facility had it been able to be flexible on counting bed days.

I believe that these simple changes in the current law are critically important to keeping our rural hospitals open and their communities' health care needs served. As we look to expand access to health coverage, this bill will ensure that the nearly 1,300 critical access hospitals in the country have the flexibility they need to remain open for the millions of Americans who depend on them.

I hope my colleagues will join me in supporting this bill, and I look forward to working with Chairman Baucus and Ranking Member Grassley and other members of the Finance Committee to secure passage of this important bill.

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

Mr. President, today I am introducing legislation called the Main Street Recovery Act to boost business investment and help jumpstart the ailing U.S. economy. We are facing our most serious financial challenge since the Great Depression and we must respond aggressively. Our financial services sector is in shambles and other business sectors are suffering.

Employers have been slashing jobs at an alarming rate--including 2.6 million jobs last year--to reduce operating costs. Some economists are predicting that the unemployment rate could jump to 10-percent or more this year in many parts of the country.

The manufacturing and construction sectors have been particularly hard hit during this downturn. The manufacturing sector laid off 791,000 workers in 2008. The unemployment rate among construction workers in December was 15.3 percent, eight percentage points higher than for the economy as a whole. More than 1.4 million experienced construction workers are currently unemployed.

I believe immediate action is needed to prevent our economy from sliding into a deeper recession that would lead to more bankrupt businesses and massive layoffs of workers across the country. That is why I will support a stimulus program that will create jobs by investing in infrastructure projects such as roads, bridges, water projects and more.

But I also think we need to provide some targeted tax incentives to encourage the business community to consider making capital investments even during the economic slowdown. The legislation I am introducing today includes the following tax incentives that I believe can stimulate business investment: a temporary 15-percent investment tax credit. To encourage manufacturers and producers not to wait on making crucial equipment and machinery purchases, we should give them every incentive to make these purchases now or in the near future when these investments will most benefit the economy.

We can accomplish this by offering a temporary, 15-percent tax credit through June 30, 2010 for businesses that purchase new equipment and machinery that is used as an integral part of manufacturing or production. Investment tax credits have been proven to work and will help generate growth and jobs in the nation's manufacturing and construction sectors.

Enhanced 50-percent bonus depreciation. To promote business investment now, when the economy needs it most,

we should extend the expiring 50-percent bonus depreciation for eligible assets placed in service over the next 18 months. This will help businesses make capital investments during the economic downturn by allowing businesses to write-off a larger share of their eligible business investments more quickly from their federal income taxes.

Increased $250,000 small business expensing. To help small businesses buy the equipment and machinery they need to weather this economic storm and begin to grow again, we should extend the expiring expensing provision that allows small businesses to expense, i.e. immediately deduct, up to $250,000 of their equipment and machinery purchases over the next year and a half.

In addition, there are many business owners that do not require new equipment or machinery but instead want to build a new business--maybe a restaurant, perhaps a retail shop or make interior and other improvements to such properties. Expanding the bonus depreciation and small business expensing provisions outlined above to cover investments in commercial real property will help provide business owners with the financial assistance they need to build that building or make long overdue improvements.

I am very pleased to have the support of the U.S. Chamber of Commerce and the National Restaurant Association for my proposals as part of a robust economic stimulus package.

The Senate is working on a large economic recovery package and I am optimistic that the package will include these important provisions. I am told that the Senate Finance Committee plans to mark up the tax portion of this package next week, and I am pleased that Chairman Baucus has recognized the need to help our Main Street businesses. In my judgment, including the tax incentives I have proposed will help stimulate much-needed economic activity and get our economy growing and creating jobs once again.

Mr. President, I rise today to introduce the Federal Financial Assistance Management Improvement Act of 2009 with Senator Lieberman and Senator Carper.

When I came to the Senate in 1999, I introduced the Federal Financial Assistance Management Improvement Act of 1999 with Senators Lieberman, Thompson and Durbin because as a former mayor and governor, I had seen first-hand the problems and complications that existed in the federal grant making process.

Congress enacted our legislation to improve the effectiveness and performance of Federal financial assistance programs, simplify Federal financial assistance application and reporting requirements, improve the delivery of services to the public and coordinate the delivery of those services, and progress was made under the law, which is commonly known as ``P.L. 106-107.'' A 2005 Government Accountability Office, GAO, report noted that ``[m]ore than 5 years after passage of P.L. 106- 107, cross-agency work groups have made some progress in streamlining aspects of the early phases of the grants life cycle and in some specific aspects of overall grants management . . . .'' However, GAO also noted that work remained to be done and in 2006 suggested that Congress consider reauthorizing the Federal Financial Assistance Management Improvement Act of 1999, which expired in 2007.

I believe that Congress should heed GAO's advice and reauthorize this important law, so last year I introduced S. 3341 with Senator Lieberman to reauthorize the Federal Financial Assistance Management Improvement Act and make improvements to that Act based on the 2005 and 2006 recommendations of GAO. The bill passed the Senate in September 2008.

Today we are reintroducing that legislation, which requires the Director of the Office of Management and Budget, OMB, to improve the grants.gov website or develop another public website that allows grant applicants to search and apply for grants, report on the use of grants, and provide required certifications and assurances for grants. I believe such a website will enhance the transparency required by the Federal Funding Accountability and Transparency Act that Congress enacted in 2007.

The bill also requires the Director of OMB to develop a strategic plan for an end-to-end electronic capability for non-Federal entities to manage the Federal financial assistance they receive and requires each Federal agency to plan actions to implement that strategic plan. Each federal agency would be required to report to OMB on progress made in achieving its objectives under the OMB strategic plan, and the Director of OMB would be required to report to Congress biennially on progress made in implementing the Federal Financial Assistance Management Improvement Act.

In 1999 I said the Federal Financial Assistance Management Improvement Act was an important step toward detangling the web of duplicative Federal grants available to States, localities and community organizations. Last year I said that while some progress was made under that law to detangle the web, work remained to be done. I hope that Congress will quickly reauthorize this law so that OMB and Federal agencies continue their efforts to simplify and streamline the Federal grant process.

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