Madam President, the Senator from Georgia and I wish to talk a little bit today about the health care plans coming through. Fundamentally, our position is that we do not want to see another Washington takeover. We are deeply concerned…
Madam President, the Senator from Georgia and I wish to talk a little bit today about the health care plans coming through. Fundamentally, our position is that we do not want to see another Washington takeover. We are deeply concerned about the cuts in Medicare that will affect seniors, about the taxes--both the increase in Federal taxes and State taxes, which we will talk more about--about the trillion dollars in new spending, and about the threats to the health care choices the legislation coming through would pose.
Instead of such a large enterprise as what I have just described, we would propose that we take practical, small steps to reducing costs such as allowing small businesses to pool their resources, reducing junk lawsuits against doctors, allowing consumers to purchase across State lines, and creating health insurance exchanges. There are other steps that could be taken; in other words, instead of scaring the country half to death with new taxes and Washington takeovers and threatening their health care choices, let's don't throw the whole system out. Let's take practical steps to reduce costs and to improve services.
Today we wish to specifically talk more about two government-run programs that already exist. One is Medicaid, which is the program for low-income Americans that today serves about 59 million Americans. About 60 percent is paid for by the Federal Government and about 40 percent by the States. The second is Medicare, which seniors know very well because about 40 million American seniors are dependent upon Medicare. We are concerned because the proposals coming through the Senate Finance Committee would shift costs of Medicaid to the States, causing State budgets to be put in ruin, according to the Governors of those States, and either taxes go up or services are cut. We are concerned because the President and others have said we are going to pay for this big new program by savings in Medicare, not to be put in Medicare for seniors, but for the new program.
A lot of people say it is hard to find opportunities for bipartisanship when we talk about health care, but I think
I have found one. I am on the Senate floor today to say I would like to be a cosponsor of the Reid amendment, the proposal by the majority leader of the Senate--the respected Harry Reid from Nevada. The New York Times reported yesterday that the majority leader had heard from his Governor and from other people in his State, and he was deeply concerned about the legislation that is coming through because it would increase costs in Nevada.
In fact, I have a copy of the letter from the Governor of Nevada to majority leader Harry Reid, and it says: As you know, like the U.S. Constitution, most State constitutions require a balanced budget, including Nevada. Nevada will spend $907 million for programs on Medicaid. This is about 14 percent of our budget. We can't afford more taxes. Revenues are down.
So the majority leader did exactly what I think a Senator would do. He introduced an amendment, or proposed an amendment, to the Senate Finance Committee and said: Take care of Nevada. If the Federal Government is going to expand coverage for Medicaid, then the Federal Government ought to pay for it.
That is exactly what I believe. That is exactly the opinion of all of the Governors. The National Governors Association, of which I used to be chairman, has said to us: If you are going to expand Medicaid, if that is your big idea in Washington, then pay for it.
Nothing irritates Governors and legislators more than Washington politicians who come up with big ideas, announce them, take credit for them, and then send the bill to the Governor and the legislature. I was a Governor. The Senator from Georgia was in the Georgia Legislature for 17 years. He was the leader of the Republicans in the senate for 8 years. He knows a good deal about State budgets and about the Medicaid Program and how it is an integral part and a very difficult problem for State governments.
I am wondering if the Senator from Georgia thinks there might be opportunity for more bipartisan support for Senator Reid's amendment to have the Federal Government pay for 100 percent of Medicaid costs if Medicaid is expanded.
Mr. President, going back to the Senator's point, the thing I think about, those of us who have been a Governor or in the legislature--in fact, I have said to some of my colleagues many times that if we expand Medicaid for low-income Americans--which States have to pay a third or more of--without paying for it, that we Senators ought to be sentenced to go home and serve as Governor for 8 years to see what it is like. I mean that because I can remember as Governor for 8 years balancing budgets, first I would come up with the money for kindergarten through the 12th grade--that was a pretty set amount--then for the highways, and then for the prisons, and I would get down toward the end and there would be a certain amount of money left to either go into higher education or it would go for increasing Medicaid costs. Almost always that was the choice. If I put it into Medicaid, I had to take it out of education, and that would keep the University of Tennessee or Georgia or the community colleges from getting better.
Guess what happens when the State can't put the money in. The tuition rates go up.
There is an article in the New York Times today which I ask unanimous consent to have printed in the Record.
Mr. President, the headline is ``Rate of Enrollment in Medicaid Rose Rapidly, Report Says.''
The recession is driving up enrollment in Medicaid at
higher than expected rates, threatening gargantuan State
budget gaps--
This is the New York Times; this is not the Republican Party saying this--
even as Congress and the White House seek to expand the
government health insurance program for the poor and
disabled.
It goes on to say:
As unemployment surged, enrollment in State Medicaid
programs grew by an average of 5.4 percent in the previous
fiscal year, the highest rate in 6 years . . . in eight
States, the growth exceeded 10 percent.
Three-fourths of the agency directors of Medicaid said they
already fear their appropriations will not be enough and that
lawmakers will have to find more money or, more likely, cut
benefits or provider payments.
One such State is Nevada.
The home State of the majority leader.
We're seeing the trajectories of our enrollment growth as
well as our revenues all going in the wrong direction--
Said their head of financing. State budgets were buffered from even worse pain by the stimulus package, but the New York Medicaid director said her State would face a $5 billion annual gap and would have to consider deep cuts in home and personal care, and that is before we make any changes or add any costs.
When the Federal Government talks about adding State Medicaid costs:
Three-fourths of the Medicaid directors--
The New York Times said--
said they thought the changes might deepen their budget
holes.
What do you suppose in Georgia--already struggling in the way you have just described--would happen if--and this is why we said we insist on reading the bill before we vote on it and knowing how much it costs before we vote on it. We want to know exactly what the provisions are because I hear that States will be required to pay 5 to 22 percent in the first 5 years of the Medicaid expansion, and then after 5 years they might have to go up to 35 percent or so.
What do you suppose will happen to Georgia if these kinds of costs are added to the State budget?
No, it is not fair or right. The Governors have said, Democratic and Republican Governors--and the Senator raised a second point about this Medicaid expansion: that dumping millions more low-
income Americans into Medicaid is not health care reform because Medicaid, as the Senator just pointed out, so poorly reimburses the doctors and the hospitals that about 40 percent of doctors will not see Medicaid patients.
So when we say to someone: Congratulations, we have just fixed the health care system; we have dumped you into Medicaid, you are giving somebody a bus ticket to a bus system that operates 60 percent of the time. So the first thing we are doing with the proposal as it is coming toward us is we are--and I am not exaggerating--we are potentially bankrupting States.
Speaking of States, let me just share one letter with Senator Isakson from the Governor of California.
This is a State that has really struggled with its budgets. They have a number of problems.
Here is what the ``Terminator'' has to say. He wrote to Senator Reid and to Senator McConnell on the Republican side and Speaker Pelosi. It is a long letter. This is the basic idea. Arnold Schwarzenegger says:
I will be clear on this particular proposal: if Congress
thinks the Medicaid expansion is too expensive for the
federal government, it is absolutely unaffordable for states.
Governor Schwarzenegger goes on to say:
Proposals in the Senate envision passing on more than $8
billion in new costs to California annually--crowding out
other priorities or constitutionally required state spending
and presenting a false choice for all of us. I cannot and
will not support federal health care reform proposals that
impose billions of dollars in new costs on California each
year.
I ask unanimous consent that this letter be printed in the Record.
Madam President, I say to the Senator from Georgia that we are not being clever when we say we would like to be cosponsors of the Harry Reid amendment. The problems of the States are so well documented today. They don't just exist in Nevada or the two or three other States he picked out yesterday; they exist in California, which is now not part of the Reid amendment. I guess that Senators Feinstein and Boxer would be happy to cosponsor the Reid amendment if it included California. I certainly would be if it included Tennessee. I know the Senator from New York and others would be also.
Our States cannot afford to have the Federal Government say: We are going to expand your health care, Mr. and Mrs. Low-Income American. It is not a very good health care program. And then we are going to send 40 percent of the bill to States that are already bankrupt, making it more difficult for them to provide good care.
The Senator is being very sensible. I think most Americans would agree with us that our goal is to reduce the costs of health care--reduce the costs of your health care insurance when you buy it and reduce the costs to your government that is running up a big debt every year.
The Senator from Georgia mentioned two specific ways we can take steps in the right direction without getting into this business of taking over so much in Washington, with trillions of dollars of debt, passing on big taxes to States, and cutting Medicare and threatening seniors in a whole variety of other ways. One was to allow small businesses to pool their insurance so they could offer more to their employees. That could affect millions of Americans. Another was to sign up more people who are already eligible. Another is to do something about junk lawsuits against doctors that are driving up costs. Another is to create more insurance exchanges in the States. We have proposed these.
People say: Where is the Republican plan? If they are looking for some comprehensive, trillion-dollar, thousand-page bill, they are not going to see it. If they are looking for four or five practical steps to move in the right direction, we talk about that every day, and we are not afraid to warn against the big, thousand-page bill plans. We compliment the Senator from Nevada for recognizing that it would ruin his State if we passed this bill, and we hope we have the opportunity to cosponsor that amendment so it applies to every State.
That is exactly right.
As we think about Senator Reid's amendment and also the step-by-step proposals, one way to describe his amendment is to say to Nevada--and Oregon, Rhode Island, and Michigan--that we are going to pay 100 percent of your Medicaid costs. That is a step in the right direction. I think that is the way I should characterize that. That is not a criticism of the majority leader. That is saying: Mr. Majority Leader, you are going in the right direction, but you didn't include Tennessee, and Tennessee is not expected to recover to the 2008 levels until 2014. State employees won't receive raises for 6 years, the reserves will be depleted, and there will be no new construction projects.
Our Governor, a Democrat, said this proposal is the mother of all unfunded mandates. So I think Tennessee Senators would like to be included in the Reid amendment. I imagine the Texas Senators would too. The Texas Medicaid office says the proposal would cost their State $20 billion over 10 years if we here expand Medicaid there and make them pay for a third or 40 percent of that. The South Carolina Governor says it would cost their State $1.1 billion over 10 years. I imagine those Senators would like to be a part of this. The Alaska Governor says it would cost $140 million in State general funds. I imagine the Alaska Senators would like to cosponsor the amendment. Governor Schwarzenegger--I suppose his Senators would like to be part of this as well. The Nebraska Governor says this could mean higher taxes in Nebraska, cutting State aid to Nebraska school districts as well as State appropriations to universities. This proposal is not in Nebraska's best interest. The South Dakota Governor said so as well.
This is serious business for the States. It is easy, when you come to Washington, to forget about the States. In the States, if you are a Governor or if you are a legislator, as the Senator from Georgia and I have been, you have to put all your responsibilities out there ahead of you. The first one is education. You take the available money and spend it as best you can and you balance your budget. Then
you look up to Washington, and here comes some Congressman or Senator saying: I have a great idea; let's expand health care all over your State and you will pay for it. That is called an unfunded Federal mandate. It is the wrong thing to do. The Senator from Nevada noticed it in his State.
All States would like to be part of that amendment.
That often confuses people. Medicaid is the program we have been talking about, of which States administer and pay a third or 40 percent. That has about 59 million people in it. The proposal is to move it to where one out of four Americans would be on Medicaid. There is also Medicare, which has about 40 million people, all seniors.
That is the way it is with most Americans. It has become a personal issue, and I think that is why so many people are going to townhall meetings.
Yes, and that is not just a casual statement. Those are the Medicare trustees, whose job it is to look over the Medicare money, who are saying it is going broke by 2015 to 2017.
I hear our friends on the other side say: Republicans are trying to scare you about Medicare cuts. We are not trying to scare anybody about Medicare cuts. We just listen, and the President said in his speech to us that the savings for this program--nearly $\1/2\ trillion in savings to pay for the new program is coming from savings in Medicare. That is Medicare cuts. We know the specific proposals are $130 billion in cuts to Medicare Advantage, which one out of four Medicare seniors has; $120 billion in Medicare cuts to hospitals; $40 billion to home health agencies; $8 billion to hospices.
Our point, if I am correct about this--and if I am not, please correct me--of course there could be savings in Medicare, in the growth of it, but if we have savings in Medicare, we ought to put the money into Medicare; we ought not to take it from grandma and spend it on somebody else. That is the problem. The other day, the Senator from Kansas said it is like writing a check on an overdrawn bank account to buy a big, new car. Whatever money we ought to have ought to go in the overdrawn bank account, which is Medicare.
Madam President, how much time do we have remaining?
Two minutes fifty-four seconds. If the Senator from Georgia will permit me, I ask unanimous consent to put in the Record the following----
I thought you said 2 minutes 54 seconds. We will continue. I remember former Senator Warner once said when he first came to the Senate, he was sitting there wondering what to do. One of the older Senators came over and said to him: Son, you will have no trouble getting used to this. All you have to do is stand up and start talking and eventually you will think of something to say.
I think we have something of considerable importance to say. What we are saying is we need health care reform and the focus should be on reducing costs and we ought to go step by step toward those costs. That is our proposal, instead of these big, comprehensive, trillion-dollar, 1,000-page bills with all these unintended consequences.
We are talking about one of those unintended consequences, which is a very severe consequence for the States. The idea that Senators and Congressmen would decide to expand a program that is going to cover one out of four Americans, called Medicaid, and just send the bill to the States which, according to today's Wall Street Journal: ``plunging state revenues noted that the second quarter was the worst performance for state taxes since at least the 1960s.'' This is not just Nevada and Michigan and Oregon and Rhode Island, which are the four States that were in the majority leader's amendment. This is virtually all the States.
If the Senator from Georgia will indulge me for a moment, I have several letters from Governors to Senators that I ask unanimous consent to have printed in the Record at the end of our remarks.
Madam President, here is a letter to Mr. Bill Nelson, a Senator from Florida, from Gov. Charlie Crist, talking about enrollment in Florida's Medicaid Program increasing and how the State of Florida cannot afford to spend more.
I have a letter from Governor Otter of Idaho to Senator Crapo: ``It has been estimated that combined federal-state Medicaid costs in Idaho could increase by $501 million.''
I have a letter from Governor Daniel of Indiana to Senator Lugar which says: ``We have estimated that the price for Indiana could reach upwards of $724 million annually.''
We talk about big numbers in Washington so much that maybe this doesn't sound like much. But I did an estimate of what it would cost, I say to Senator Isakson, in Tennessee if we expanded Medicaid in the way it is proposed here and we increase the reimbursement rate so patients in Medicaid will actually have somebody to go see, a doctor or a hospital to go see. I said it equaled about a new 10-percent State income tax. Some group in Tennessee said: The Senator is wrong, it is only
about a 3-percent new State income tax. Well, either one, we don't want elected representatives in Washington deciding for us whether we want a new 10-percent or 3-percent State income tax.
There are just a few more I wish to include. I have a letter to Senator Reed from the Governor of Rhode Island. Of course, Rhode Island was included in the majority leader's amendment. They should feel pretty good. They are going to get 100 percent of their Medicaid paid.
The Governor of Arizona has written to Senator McCain and Senator Kyl to point out that ``Arizona is facing one of the worst financial deficits in the nation. . . .'' If Arizona is facing one of the worst financial deficits in the Nation, why is it left out of the majority leader's amendment? It seems to me the citizens of Arizona deserve just as much attention. I imagine their Senators would like to cosponsor it as well.
I have a letter from the Governor of Louisiana talking about an unprecedented fiscal situation and the Governor of Mississippi saying:
In Mississippi, the issue of Medicaid expansion hits close
to home, since our state's share of the Medicaid is currently
$707 million. . . .
``According to the National Association of State Budget Officers, Governor Barbour said, Medicaid expenses . . . were $336 billion'' for State and local government and a third of that is State money, and we are just going to up it. We don't raise that money, we just send them an edict from Washington and say: We have decided that a good thing to do is to increase the number of low-income Americans in your Medicaid Program and you pay for it, you take it out of this road, you take it out of this teacher's salary, you raise the tuition at the University of Tennessee or Georgia and you cut their State funds. That is up to you, but we are going to pass the program.
Here is a letter to the Senator from Nebraska saying this new unfunded Federal Medicaid mandate could result in higher taxes in Nebraska or in cutting State aid to Nebraska school districts. I imagine the Senators from Nebraska, both of whom were Governors, would be happy to be cosponsors of the Reid amendment.
Here is the letter to Senator Graham from the Governor of South Carolina. Another from the Governor of Alabama; a letter from the Governor of Alaska and the Governor of Guam.
I say to Senator Isakson, we have been fairly specific on one point. I heard on the television this morning someone said this is so confusing to the American people; they don't understand it. I think they can understand an unfunded Federal mandate. I think they can understand the Governor has to raise taxes unless Congress pays 100 percent of it. I think they can understand it when the majority leader picks out four States and says we will pay 100 percent of ours and the rest want to be part of that as well.
Madam President, I thank the Senator from Georgia for his experience in State government and for his comments today. We want the majority leader to know our comments yesterday were not to be critical of him, just to say we think he is on the right track. He said to four States: If we expand your Medicaid, we are going to pay for it. We would like to include all States.
I yield the floor.
Exhibit 1
State of Arizona,
Phoenix, AZ, July 16, 2009.
Senator John McCain,
U.S. Senate,
Washington DC.
Senator Jon Kyl,
U.S. Senate,
Washington, DC.
Dear Senator McCain and Senator Kyl: Thank you for the
opportunity to provide information about Arizona's Medicaid
program, the Arizona Health Care Cost Containment System
(AHCCCS).
As you know, Arizona is facing one of the worst financial
deficits in the nation and projections show that the State is
expected to make a slow recovery. In the meantime,
unemployment has continued to increase and counter-cyclical
programs like AHCCCS have continued to experience record-
breaking enrollment. In the last four months alone, AHCCCS
has grown by more than 100,000 new enrollees, and July 2009
enrollment is almost 17 percent above the same month in 2008.
Total enrollment, including our Title XXI KidsCare program,
in July reached 1,275,109 members, which is almost 19 percent
of the state's total population.
I am proud that AHCCCS program has served as a model for
other state Medicaid programs across the country in terms of
cost containment. This is due, in large part, to the fact
that AHCCCS is a capitated managed care model and 65 percent
of its long-term care members receive home and community
based services rather than institutional care. According to
the Kaiser Family Foundation, AHCCCS has the lowest per
member per year (PMPY) cost among Medicaid programs in the
country. The average PMPY costs are: 1) $5,645.52 for acute
care; 2) $45,960.72 for long-term care, which is a blended
average of our elderly and physically disabled and
developmentally disabled programs. The weighted average PMPY
cost across all Title XIX groups is $7,182.60.
I am concerned that the Medicaid expansion proposals being
discussed at the federal level do not consider the fiscal
difficulties states are facing and are likely to continue to
face over the next few years. At the same time as Congress is
considering prohibiting states from changing their Medicaid
eligibility standards, there have been discussions about
establishing a federal floor for Medicaid provider rates,
which even further limits state flexibility in setting
funding levels. State flexibility has been key to Arizona's
success in developing and efficiently managing a Medicaid
program that provides high quality care at a low cost.
Even with our strong cost containment measures, I remain
concerned about Arizona's ability to sustain the existing
AHCCCS model, let alone a mandatory expansion to 150 percent,
regardless of whether the federal government provides full
financing of the expansion for the first five years. Medicaid
is already an increasing share of state budgets--Arizona's
General Fund spending on AHCCCS has increased by 230% over
the past ten years, and has risen from 8 percent of General
Fund spending in FY 1999 to an estimated 16 percent in FY
2009. Maintaining this level of spending increases will be
difficult, especially given that Medicaid enrollment and
costs continue to rise. Moreover, Arizona's revenues are not
expected to turn around for several years and, even when they
do rebound, we would require significant revenue growth in
order to sustain rising expenditures for the existing
Medicaid program.
Attached, please find data responsive to your requests.
There is a summary sheet that provides an overview of the
information requested, along with several other sheets that
provide additional detail. As you know, there are many
unanswered questions regarding the proposals. This analysis
includes the assumptions that were used to develop the
figures, which will obviously change as the proposals are
refined.
Please do not hesitate to contact my office if you have
questions or should require additional information. I share
your concern regarding Arizona's ability to expand its
Medicaid program and what the long-term fiscal implications
will be for Arizona, and I hope you find this information
useful as you consider the various proposals that are before
you.
Sincerely,
Janice K. Brewer,
Governor.