Floor Statements

Yes, it was clearly not the intent of the Senate Finance Committee in adopting this amendment to apply the prohibition to specialty hospitals that already exist. Nor was it the intent of the Committee to apply the prohibition to those facilities which, meeting specified criteria, are under construction currently.

The committee certainly understands that many states will not license a hospital as operational until the facility is constructed. I believe the committee's intent was to ensure that approvals with respect to the construction of the hospital (i.e., building permits, etc.) have been secured by June 12, 2003. The lack of a license to operate would certainly not prohibit a hospital, which is deemed to be ``under development,'' from the purpose of the statute.

Yes, again, in adopting the amendment, it was the understanding of the Senate Finance Committee members that this provision would not apply to facilities which, provided they meet certain criteria, are already under development.

Mr. President, I join with Senator Mikulski in her comments expressing concern about the United States role in Iraq, the safety of our troops in Iraq, and how proud we are of our troops. I urge the administration to do what is necessary to restore morale. The best way is to do the right thing by our troops, make sure they are strongly supported and, even more fundamentally, rethink our position in Iraq: What is our policy? What are we attempting to accomplish? Then encourage many more of our allies, both in the Arab world and other parts of the world, to join the United States.

This is a problem that will only be resolved with more thoughtfulness and more direct candor about the nature of the problem and working closely with our allies, both Arabs and others.

We should also focus a little bit more on terrorism generally rather than get diverted, as we seem to be, in specific countries. It is extremely complex, but there is building concern in the United States about United States policy in Iraq. I join those who believe we should focus more on terrorism around the world. This requires the cooperation of a lot more countries around the world to be successful. I hope we can accomplish that.

Mr. President, I rise today to discuss the Burma sanctions bill. This bill is the result of a collaborative effort between Senators McConnell, Grassley and myself.

When first introduced, the bill would have imposed sanctions without an opportunity for congressional review. I was concerned that Congress would simply pass a bill, and then forget about Burma.

I think that is the wrong approach when it comes to sanctions.

Senator Grassley and I worked hard to ensure that Congress would have the opportunity to revisit this issue every year. The House went even further, by requiring an annual vote, plus a 3-year sunset.

Now, make no mistake about it, the actions by the dictatorship in Burma are unacceptable. The arrests and treatment of Aung San Suu Kyi are deplorable and cannot be tolerated.

Yet as is so often the case when we debate the merits of international sanctions, the question is not whether to punish Burma's ruling regime; the question is how to do so effectively.

We have learned through our own experiences that unilateral sanctions simply don't work. They rarely destabilize the oppressive regime that is the target of the sanctions. Instead, they only hurt the people-- both in the target country and even here in the United States.

Unfortunately, we have also seen how, once a sanctions policy is in place, it is very difficult--no matter how ineffective the policy is, to terminate it and find a better solution.

So, how do we deal with this dilemma?

The answer is found in a simple appeal to common sense.

First, we must actively seek the cooperation of our allies. Multilateral action is essential if the policy is to be effective. Second, we must give ourselves a chance to review and revise the policy if it isn't working.

That is what this bill does with Burma. It imposes sanctions. It also encourages the president to work with our allies in the region to build a collective response. And I understand our allies are considering sanctions.

This bill also requires Congress to revisit the issue every year. If the policy is working, then we can renew it. But if it isn't working, then we can terminate it and try a new policy. This legislation will keep the dictatorship's feet to the fire. It will create regular incentives for them to change.

It is just this sort of common-sense approach that is needed with other U.S. sanctions, particularly against Cuba.

By any honest assessment, our embargo against Cuba--now in its fifth decade--is a total failure. The U.S. is alone in pursuing this failed policy, yet politics prevents us from reassessing it.

Thus, the Cuban embargo has become institutionalized. And the fight to end the embargo, even though ending it makes so much sense, has become a difficult, uphill battle.

We do not want that to happen to the Burma sanctions. We want the people of Burma to enjoy true democracy and freedom. And we want to pursue the policy that will help them achieve this. So we will try sanctions. But if they don't work, and if we are not joined by our allies in this cause, then Congress will revisit this issue in a year.

In the coming weeks, many Members will be pressing for action to reform Cuba sanctions. I hope that today's debate on Burma highlights the inconsistency of our sanctions policy, and that we can apply a common-sense approach as we move forward on other sanctions issues.

I now would like to yield 10 minutes to the Senator from New Jersey.

Mr. President, Montana has been proud to send many of our young men and women over to serve in the Gulf these past few months. As their stories come back to us, we see more clearly the personal side of this war. We see the bravery, the commitment, and the courage of these men and women. Our Armed Forces remain engaged in a complicated, difficult effort, and they continue to carry out their mission with the type of professionalism and compassion that you could expect only from the most dedicated and finely trained individuals.

As I have done before, I would like to take the time this morning to acknowledge a few of the many Montanans we have serving in the Gulf region. It is important that we let them know just how proud of them we are.

I have recently received news that Marine Cpl Chad M. Taylor, of Kalispell, MT, has been awarded the Purple Heart. Chad was wounded last month while serving somewhere between the Iraqi cities of Baghdad and Tikrit. He was riding in an amphibious personnel carrier when it was hit by two rocket-propelled grenades. He has sustained shrapnel wounds in his legs, and he told his folks it would probably take ``a couple of surgeries'' to put him right.

Chad has not been the only member of his family serving over in the Gulf--his twin brother Bobby is also a marine. The brothers joined up the same day, almost 4 years ago now. Before Chad's injury, both of them were stationed for a time in Baghdad, camping in separate Saddam palaces a few blocks apart. We hear they have seen each other fairly regularly, and once, passing in the steets of Baghdad, were able to exchange a high-five.

The boys' father says it is some relief to know that Chad is now safe, though wounded, but with Bobby still in the field, he remains ``on pins and needles.'' We are all praying for Chad's quick recovery and Bobby's safe return. Hopefully, it will not be too long before this strong family can be back together again, celebrating the service and success of their wonderful boys.

LCpl Mike Tobey is also among those who have been wounded in Iraq. Mike's legs were broken in multiple places when a shell struck his troop carrier during the fighting in Baghdad. How's this for bravery and commitment? When interviewed by reporters he said, ``I'd give anything to be back with the squad right now.''

Mike's mother Julie lives in Whitefish, MT, and Mike's bravery has really brought the human side of this war into the lives of local residents. Mike has in fact become quite a local media sensation, indicating just how deeply support for our troops runs in Montana.

Maj Patricia Camel Kelly of Ronan, MT, is currently serving as a surgical nurse in the 86th Combat Area Hospital in Iraq. She is working at an Enemy

Prisoner of War camp, an experience she says will make her more confident as a family nurse practitioner when she returns to civilian life.

Major Kelly was previously a community health nurse with the Indian Health Service in St. Ignatius, and has a masters in community health nursing from Tulane University. She entered the Army in 1987, when her son Richard was a junior in high school, and while I am sure she is correct when she says she is still adding to her skills, it is hard for me to try to picture something this woman couldn't handle.

Major Kelly was one of the first tribal members to graduate from the Montana State University School of Nursing and is now one of many Native Americans serving overseas. She is of Pend Oreille descent and a member of the Confederated Salish and Kootenai Tribes. Her mother Alice Camel is a tribal elder.

After Major Kelly returns from Iraq, she plans to serve out the remainder of her time in the Army in Fort Lewis, WAF, and then move back home to the Flathead Indian Reservation. Her husband Isaac Kelly a retired Army master sergeant and her son Richard Janssen are among those eagerly awaiting her safe return.

Native Americans are probably serving in the highest percentage of any population in the country. Certainly there is strong evidence of this patriotic commitment to service in Montana. A good example is the Rocky Boy Tribe, which has 30 members on active military duty, despite a population of less than 3,000. Among those serving in the Gulf from Rocky Boy are two sisters, Crystal and Tashina Russette, both in the Navy, and Jason Torivio serving aboard the U.S.S. Abraham Lincoln.

Army CPL Angela Duran, mother of two small children and sister to a veteran of the first Gulf war, has now also been deployed. Her mother Linda will care for her two sons, ages 3 and 5, while she is away.

Ninety-one members of the Blackfeet Reservation are serving in the Armed Forces currently, with roughly 40 of them deployed for the Iraq war. Among those representing the Blackfeet Nation in the Gulf are PFC Carl Logan Kipp, part of the Army's Psychological Operations, and PFC Ivan Redhorn, recently deployed to the Gulf. Abe Birdrattler is serving in the Army's 3rd Division as a medic. Two of the Tucker boys, Brian, of the 101st Airborne, and his older brother Ronald, an Army specialist, and PFC Aretha Bullplume are also among those serving from the reservation.

These tribes have a strong history of community support for their members of the military, and they have been continuing that tradition with letters to their soldiers and care for their families. It feels good to know that when these troops come home, they will be receiving the kind of honor and respect from their community that all our troops deserve.

PO3 Travis Woodward of Superior, MT, has been serving aboard the U.S.S. Valley Forge and lending his expertise to an Australian ship as part of a cooperative coalition effort. Prior to this conflict, he has been part of a boarding team searching for drugs aboard foreign ships and enforcing United States sanctions against Saddam Hussein's regime.

Travis's time in the Navy is coming to an end this June, when he will be able to return to his wife and son back home in Montana. It will be a pleasure to see him rejoin his family and the Superior community.

PFC Frank Valenti is serving near Baghdad in the Transportation Division of the Army's 3rd Cavalry Division. He seems to be posterboy of what the Army can do to transform the life of a young man. From the description his mother gives, it seems Frank wasn't up to much after high school, kind of a sleep late, party hard kind of guy, and then he decided to turn his life around.

Joining the Army has really allowed him to start making something of himself. He married his longtime sweetheart and is serving his country and accomplishing things he can be proud of for the rest of his life. It is night and day from a few years ago for him, and it shows you a little bit about what kind of an institution our military is and what it means to become part of something larger than yourself, what it means to serve your country as Frank is doing.

Frank's brother Nathan Valenti is an Army pharmacy specialist serving in Germany, and I know their mother is very proud of both her boys, as she has every right to be. We are proud of them too.

Army CPT David Michael Gercken is a veteran of Operations Desert Shield and Desert Storm of the first Iraq conflict and is now serving in Iraq again. He is the father of three children, with a fourth child due July 1, when David will still be in Iraq.

David was raised in Great Falls and went on to attend college and met his wife at the University of Montana in Missoula. David is a Montanan through and through, and just before his deployment he sent me this statement via his parents. I would like to share it with you:

Montanans have always shown a pioneering spirit and a

dedication to democratic principles and the defense of

freedom. As an Army officer I am very proud to take that same

spirit with me when I deploy next week with the 1st Armored

Division. GO GRIZ!!!!

A father, a veteran, and a proud, dedicated protector of this country and our values.

SSG Neil Bohne of Frenchtown, MT, joined the Air Force in 1998 and was deployed in Turkey in 1999 as part of Operation Northern Watch, which patrolled the no-fly zone in northern Iraq prior to this conflict, and later helped set up the first ever Coalition Life Support Shop in the former Soviet Union. He is now deployed to the 379th Expeditionary Wing in Iraq. His letters home have been reprinted in the Missoulian, and he has developed quite a local following. We know the support of hometown folks is very important to him, as it is to all our troops out their putting their lives on the line so far from home. We want to make sure he knows how proud we are of the job he and the rest of our forces have done and are continuing to do as they work to secure the peace and protect the freedoms we hold so dear.

LT Paul Tripp of the U.S. Navy is another man with a large hometown following. Paul's grandfather, Clarence, moved to Missoula from Minnesota with all nine of this brothers and sisters in the 1940s. The Tripp family has been a large and wonderful part of the community ever since.

Lieutenant Tripp has been serving the war effort as a code-breaker stationed in Saudi Arabia. He holds two master's degrees, in human resources and business management, and is considering pursuing a doctoral degree after he retires from the service. It is no surprise that a man this committed to education would have a tendency to make insightful comments, and I still return to a few lines from e-mail that were printed in the Missoulian, I guess about a month ago now. I would like to share his words with you all because I feel he really is able to articulate that which so many of us feel:

As I travel and talk to people around this region, I want

you to know how absolutely swelled up with gratitude and

pride you should be to call yourselves Americans. There are

men and women from every corner of our country serving you.

There are women who have left their children, married couples

who are at different bases serving at the same time, men who

are single fathers that have left their children, and every

variation in between.

People are sleeping on cots, showering in trailers and

walking in the sand \1/4\ mile to go to the bathroom--all in

the name of freedom. We have such adaptable unselfish willing

citizens over here that at times I am speechless from

humility.

Nickolas Kyle Neilan is currently serving aboard the USS Alonzo, a guided missile Aegis cruiser. Nickolas is a Big Fork and Missoula native who has remained in touch with his home even while nine time zones away, reading the Missoulian online and corresponding with folks back home via e-mail. His service has been filled with long stretches at sea without a chance to dock and escape the confines of the ship, but like so many other of our servicemen and women, he bears these hardships calmly, simply doing his job and doing it well. He is the kind of young person we Montanans are proud to call one of our own.

Another Montanan serving at sea, PO3 Benjamin Taylor, is home now. He and Jason Torivio from Rocky Boy, whom I mentioned earlier, and Joe Keller of Harlowton serve aboard the USS

Abraham Lincoln, part of a battle group that, until this past Friday, had been at sea longer than any other carrier group now on duty. They docked in San Diego briefly and are now on their way back to their homeport in Everett, WA. Joe Keller was able to debark in San Diego and fly home to Billings/Logan Airport, where he was met by his wife and two children and other family members.

Benjamin Taylor is a graduate of Sentinel High School and the University of Montana--he and his family have long been a strong part of the Missoula community, and I understand a large Missoula contingent was planning to make the trip to meet the ship dockside.

As the sailors aboard the Lincoln are arriving home, other Montanans are just arriving in Iraq, ready to pick up the task of security and rebuilding, now that the task of toppling Saddam's regime is done. Many of these newly deployed soldiers are members of the Army Reserves who have been called up to active duty for this conflict. The 495th Transportation Battalion from Kalispell, MT, just shipped out a couple weeks ago, and the 889th Transportation Battalion, also primarily of Kalispell, shipped out last week. The task before them is complex and difficult. It will test their training and their character, but we know they are up to the job. They have our confidence, and they are in our prayers.

Reservists are those who train on weekends a couple weeks a year, remaining ready for duty while still holding down civilian jobs and often raising families. When reservists are called up, they are asked to leave those jobs and families, to drop everything and heed the call to duty. Their employers are also asked to contribute, by granting flexibility to accommodate their training schedule, and of course to accommodate their sudden departure in time of conflict. The 125th Ordnance Battalion from Billings, MT. has contacted me with a short list of soldiers they feel are deserving of special recognition for serving in this special capacity. I hope hearing their stories gives you an idea of what kind of sacrifices so many of our reservists are gladly making in this conflict--the members of the 495th, and the 889th, and members from other companies around the State.

SGT Stacy F. Wright of Billings is enroute to Iraq to serve as a legal NCO. She has served as an active-duty member of the military before, but this time is leaving behind her husband, two children, a ranch, and a job as an administrative assistant in the Internal Revenue Service in order to serve her country.

SGT JJ Hutzenbeiler of Billings is now serving in Uzbekistan as a supply NCO, leaving behind his wife and job as a loan officer at 1st Interstate Bank.

SPEC Jesse C. Ryan is a student at Montana State University in Bozeman and was called up to serve in Iraq as a chemical Specialist.

SGT Jack E. Walker of Billings is enroute to Iraq as a motor sergeant. Jack has also served active duty before, but now must part with his wife, two children and small farm to do so.

SSGT Norman Richey, also experienced as an active-duty soldier, is enroute to New Mexico as a supply NCO. He leaves behind a job as a correctional officer for the New Mexico Department of Corrections.

SGT Chris Alamond is serving in Iraq as a communications NCO, having been called away from his wife and job as a mail handler for the U.S. Postal Service.

CAPT Nadine Elmore of Ekalaka left behind her husband and job with Montana State Human Resources to serve as a finance officer in Kuwait.

LTC Robert E. Brekke of Bozeman is now a provost marshall in Kuwait. When he is home, he serves as the owner/manager of Mountain Motor Supply.

LTC Teresa Otto is serving in Iraq and Kuwait as an anesthesiologist--the same job she has temporarily left at St. Vincent Hospital.

MSG Timothy Stavnes is serving in an undisclosed location as a special operations intelligence chief. Master Sergeant Stavnes has served as a traditional active duty soldier and been called up to active duty from the Reserves several times before. When he is in Billings, he is the assistant fire chief for the city, serving his community when not serving his country.

I would like to conclude my talk this morning by mentioning a Montanan serving overseas who is not a soldier, sailor, airman, or marine. Maggie Bigelow of Columbia Falls is serving in Germany as the financial manager of the enlisted club at Ramstein Airforce Base. She is also the saving grace of wounded Montanans like Chad Taylor and Mike Tobey, who have been flown to Ramstein for treatment. As one of those soldiers' mother's put it, she is an angel without wings. She has been keeping our boys in touch with their families, bringing them pizza, gifts, and most importantly, her smile and company. When one of our Montana servicemen is hurt and a long way from home, it is unbelievably reassuring to know she is there at his bedside, looking after him.

Maggie's father served as a marine in Vietnam, and her mother is a longtime member of the Veterans of Foreign Wars auxiliary. Her sister Brooke Brennan is serving in Kuwait as a staff sergeant in the Air Force. Maggie has grown up in a family dedicated to service, and the size of her heart is an inspiration to us all.

I hope hearing a little bit about these people helps folks understand the depth of commitment we have from our armed services--what they are willing to do in service of their country. It is not easy to drop everything and go out and serve when your country needs you, but these men and women do just that, whenever they are needed. I, for one, am incredibly grateful for that.

Madam President, will the Chair state the regular order?

I thank the Chair.

The Senator from North Carolina.

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

Amendment No. 1092, As Modified

Mr. President, on behalf of Senator Conrad, I ask unanimous consent that a letter from the Congressional Budget Office be printed in the Record.

Madam President, I ask unanimous consent that the order for the quorum call be rescinded.

Madam President, I ask unanimous consent that all pending amendments be set aside so that I might call up amendment No. 1054 on behalf of Senator Feingold, with respect to Medicare beneficiaries.

Madam President, I ask unanimous consent that further reading of the amendment be dispensed with.

Madam President, I suggest the absence of a quorum.

We have looked at this amendment. I agree with Senator Grassley. We accept the amendment.

I move to lay that motion on the table.

The motion to lay on the table was agreed to.

I suggest the absence of a quorum.

Mr. President, I listened quite closely to the Senator from Illinois, as well as to the Senator from North Dakota. They are each offering a separate amendment, but they are both similar in an attempt, generally, to accomplish the same result.

I say to my good friend from Illinois, as well as my good friend from North Dakota, who is presently not in the Chamber, I am very sympathetic. If I had my way, we would be spending this newly found $12 billion very much in the way the Senator suggested. In fact, there are a lot of good ways. It is not only helping those with Alzheimer's, but it is also lowering the premium. There are a lot of ways we could be spending dollars to help get more drug benefits to more seniors. There is no doubt about that. But, unfortunately, we are 100 Senators.

The Senator from Illinois, the Senator from North Dakota, and I have a view of how some of these dollars should be spent in a perfect world, but the world is not perfect. This is a democracy. It is messy. As Winston Churchill once said--I will paraphrase very poorly, but the Senator knows this quote--basically, Winston Churchill said: A democracy, for all its fits and starts and delays and inefficiencies and herky-jerky jolting, and all that, is the world's worst form of government, except for all the others.

Here we are, in a democratic process, trying to figure out how to get prescription drug benefits to seniors. We have 100 Senators. I don't know of very many timid Senators. We don't have many Senators who don't speak their views. I don't know very many Senators who don't have strong views about subjects. I don't know of many Senators who are not thoughtful, articulate, and fighting hard for their constituents. And we have, as it turns out, Senators from two political parties: 51 Republicans, 48 Democrats, and 1 Independent; and at this time we are attempting to finally get prescription drug benefits to seniors.

This issue has been debated for 4 years, at least. It has been a politicized issue for 4 years. There has been a lot of talk for 4 years, a lot of rhetoric on both sides of the aisle for 4 years, and during all the talking there has not been any action; it has been all words, no deeds.

Well, here we are, at a time--after 4 years of just political posturing, to a large degree--where we are on the brink of getting prescription drug benefits passed for our seniors in our country.

Is it the best bill in the world? No. Could it be better? Yes. Do all Senators wish it could be better? Yes. But is it a good start? Is it a beginning? Is it a platform on which we can begin to build? Absolutely.

If we go back and look at the history of health care and assistance by the Government in providing health care to the needy and to Americans generally, it is a history of building, of starting somewhere, building on it, and making it better and better all the time.

Back in the 1930s it was the Wagner-Murray-Dingell legislation that was introduced to provide national health insurance for Americans. That was the idea: We need national health insurance for Americans.

Well, it was debated and debated. Not a lot more really happened. Then suddenly things changed in the 1960s. The idea of Medicare came along: Why not help at least our seniors? If we can't get national health insurance, the very least we can do is help our senior citizens get a break with respect to their health care bills. That is a good place to at least begin--by helping a good, solid segment of the population. And we did, back in 1965, by providing Medicare. And look what has happened since then. We have kept building on Medicare to make it better.

When Medicare was first enacted, 50 percent of a Part B premium was paid by the senior and the Government paid the other 50 percent of the premium for Part B. That is for doctor services. Now it is 25 percent. It has been improved over time. We also have added more benefits, some screening provisions. End-stage renal treatment has been added. There is a list of new additions to help our senior citizens.

Here we are now, on the brink of adding another major benefit: prescription drugs. After all these years, all the years of talking and talking and politicking and giving statements and speeches, we are finally on the brink of getting prescription drug benefits passed.

It has not been easy. Why has it not been easy? It has not been easy because there are two competing philosophies on the floor of the Senate on how to get prescription drug benefits to seniors. Even though the two competing philosophies are very different from each other, Senators on both sides of the aisle--most Senators, maybe even all Senators, but certainly most Senators--still want to work as hard as they can to try to fit these competing philosophies together in order to pass legislation this year to begin finally getting prescription drug benefits to seniors.

Also, these two competing philosophies are very different. One is competition. The argument is: Let private companies, themselves, with assistance from the Government, design how they give prescription drug benefits to our senior citizens, make them available at a big discount for senior citizens. The other philosophy is: Medicare should be the agency that should be the way--traditional Medicare, basically--to provide discounts for senior citizens to get drugs.

Essentially, the competing philosophies are 50-50. You have 51 Republicans, 48 Democrats, and 1 Independent. What are we going to do? Well, all we can do, if we want to get this done, is to just try our best to put these two together in a fair, balanced way--and the private competition model gets a break, gets a fair chance to see the degree to which it might work--so that senior citizens really do get the benefits and are not taken advantage of during our efforts to pass legislation.

It is a balance. It is trying to find the right way to accomplish that balance. It has been extremely difficult. I do not have to tell the Presiding Officer just how hard this has been. But we are right on the brink.

We are limited to $400 billion in providing the drug benefits for seniors over the next 10 years. Why are we limited to $400 billion? Well, this body passed a budget resolution not too long ago--both the House and the Senate--saying we are going to set aside $400 billion for prescription drug benefits for seniors. We never set aside anything like that in the past. So we have an opportunity now to use it. I don't think Senators want to miss this opportunity. I think they want to use the dollars that are there to get prescription drug benefits for seniors.

Well, as it turned out, when the Senate Finance Committee wrote this bill, trying its hardest to be balanced--and it is balanced; the best evidence of that is it passed by a large majority from both parties in the Finance Committee--we found it actually cost only about $388 billion. There was $12 billion remaining.

So the question before us is how we can spend that $12 billion. That is the question. In an attempt to maintain a balance and to work on two competing models and in an attempt to get the legislation passed so we can provide a prescription drug benefit to seniors, we

have decided to split it, 6 and 6; $6 billion to the PPOs, have it available potentially for PPOs, if that is needed for the bidding process, beginning in the year 2009. I don't know how many Senators are going to be here in 2009, but at least beginning then. The other $6 billion, beginning in 2009, will then go, under Medicare fee for services, for disease management, chronic care, to help particularly seniors who really need that disease management and chronic care. It is really needed because there is very little disease management today under traditional Medicare. That is one of its shortcomings. That is what we have done.

Again it is a balance, a start, a beginning. I have a lot of sympathy with my friends on this side of the aisle. If I had my druthers and I were the only one writing this bill, I would take that $12 billion and spend it along the lines they are suggesting. But I am not the only Senator here. I am one of 100. It is my job and that of the chairman of the committee, Senator Grassley, to try to find a balance--not for the sake of balance but for the sake of getting legislation passed so we can finally get prescription drugs to seniors.

If the amendments offered by the Senators from North Dakota or Illinois were to pass, guess what would happen. First of all, those are killer amendments. If those amendments were to pass, that would mean this bill is in jeopardy of passage. That would mean senior citizens may not get the prescription drug benefits we are all trying to get; albeit just a first step, or it could also mean, on the other hand--and this is perhaps even more likely--if that amendment were to pass, I will bet you dollars to donuts--which is not a good phrase to use because we are trying to put dollars in the donut hole--the conservative part of this body, the Republican side of the aisle, would say: We are going to take that $12 billion and spend it our way. And they have the votes. They have the White House. So this amendment puts in jeopardy a very delicate, very balanced kind of deal between competing philosophies, fairly and evenly, so that we can get prescription drug legislation passed, so that we are just not talking about it anymore and finally doing something about it.

If it were to pass or looked like it would pass, the other side, which has more votes than this side has, would say: We will spend it our way.

Then colleagues on my side of the aisle would be quite distressed. They would be forced to ask themselves if they would support on final passage a bill way off to the right for competition instead of the bill which currently exists, particularly with the underlying amendment. I wish we could do more but at least it is a first step. If the history of Medicare is any guide, in future years we will continue to make it better. We will work on that donut hole. We will fill in the gaps. We will make sure premiums are not too high. We will try to help with Alzheimer's and all the other measures we desperately need to pay attention to as the days and years go by.

I implore my colleagues to think a little bit. Resist the siren song of doing something that sounds good but which very well could put the bill in real jeopardy. This is fair. It has $6 billion which may or may not be used for PPOs, depending upon what the bids are. This bill cuts off after a 5-year period; no more $6 billion can be spent. And $6 billion for disease management under traditional Medicare which will be spent. That is the question. Do you want balance or do you want to try to get something else passed right now that you like in the short term but could very well jeopardize the whole bill, which means another year, year 5, Congress is talking about this issue, Congress is not doing anything about it. Rather, we want year 1, we have finally got it done.

We are very close to getting it done. It is not perfect, but we will keep working on it over the years.

Mr. President, on behalf of the Senator from New Jersey, Mr. Corzine, I ask unanimous consent that amendment No. 1037 be modified with the text that I send to the desk.

Mr. President, I ask unanimous consent that the pending amendments be temporarily laid aside.

Mr. President, on behalf of the Senator from Michigan, Mr. Levin, I send an amendment to the desk and ask for its immediate consideration.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, I ask unanimous consent that the pending amendments be set aside so that I may send to the desk on behalf of Senator Levin an amendment to ensure that current retirees who have prescription drug coverage, who will loose their coverage as a result of enactment of this legislation, would have the option of drug coverage under Medicare fallback.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, I ask unanimous consent that time under the quorum call be charged equally against both sides.

I suggest the absence of a quorum.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I ask unanimous consent that the pending amendments be temporarily laid aside and amendments numbered 1027 and 1041 be immediately considered.

Mr. President, I ask unanimous consent that further reading of the amendments be dispensed with.

Mr. President, on behalf of the chairman of the committee, Senator Grassley, I ask unanimous consent that the pending amendments be set aside and that the following amendments be agreed to en bloc, and that the motions to reconsider be laid on the table en bloc: Amendments Nos. 936, 938, 988, 1027, and 1041.

Mr. President, I ask unanimous consent that the time I used be charged equally to both sides.

Mr. President, I suggest the absence of a quorum.

Mr. President, I say to my colleagues, this is the key amendment that will provide for the passage of this legislation and, therefore, prescription drug benefits for seniors. It is the key amendment.

Why do I say key amendment? Very simply because we have $12 billion, and we have to find a way, in an evenhanded, balanced way, to spend that $12 billion. We have to marry two competing philosophies: private competition and Medicare.

We have, therefore, designed the solution that the $12 billion will be evenly divided to keep the balance so that we can get this legislation passed and, more importantly, so seniors get a prescription drug benefit as quickly as possible.

If this amendment is not adopted, we are going to be in the soup. There are going to be Senators from one side of the aisle who are going to want to spend all of it their way; there are going to be Senators on the other side of the aisle who want it all spent their way; and we are going to be nowhere. We are going to be back where we have been the last 4 years, talking about prescription drugs benefits but not doing something about it, not providing the benefits to our seniors.

This is a key amendment. This is the amendment which will allow benefits to go to seniors.

Mr. President, I ask unanimous consent that the Senator from North Dakota be given 2 minutes.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, on behalf of myself and the chairman of the committee, Senator Grassley, I ask unanimous consent that at 5 p.m. today the Senate proceed to a vote in relation to the Sessions amendment, No. 1011, to be followed by a vote in relation to the Rockefeller amendment numbered 975, as modified; to be followed by a vote in relation to the Bingaman amendment numbered 1066; provided further that there be no amendment in order to the amendments prior to the votes, and there be 2 minutes equally divided for debate.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I yield 5 minutes to the Senator from West Virginia.

Mr. President, I yield 5 minutes to the Senator from New Mexico.

Mr. President, I ask unanimous consent that the Senator have 30 additional seconds.

Mr. President, I know we have an agreement that the vote will start at about 5 o'clock. I ask unanimous consent to speak for 2 minutes.

Mr. President, I will divide my 2 minutes between two issues. First is the dual-eligible issue, concerning the amendment offered by the Senator from West Virginia, Mr. Rockefeller. I have a lot of sympathy for what he is trying to do. In fact, my preference would be that low-income senior citizens get benefits under Medicare, not Medicaid.

Regrettably, we tried to strike a balance at this time so that the money spent on the bill, the $400 billion, was spent more on seniors, other beneficiaries, so they get better benefits, rather than spending the money in States to, in effect, bail out the States for their responsibilities under Medicaid. When we go to conference, I plan to do what I can, along with the chairman, to work this issue out. I think the Senator from West Virginia made a very good point.

Amendment No. 1011

On the other issue, the Sessions amendment, this provision is a health care provision, not a welfare provision. It is whether legal immigrants should get Medicaid benefits. That is all it comes down to.

My view is that it is the right policy. It is not neat and tidy, or perhaps not on the right bill, but it is something that should be done. It is the right thing to do. I urge Senators to not vote in favor of the Sessions amendment.

I yield the remainder of my time.

Mr. President, I ask for the yeas and nays.

Mr. President, I ask unanimous consent that the following two votes be 10-minute votes.

Mr. President, I ask for the yeas and nays.

Mr. President, I suggest the absence of a quorum.

Mr. President, I suggest the absence of a quorum and ask unanimous consent that the time be equally charged.

Parliamentary inquiry: Will the Chair inform the Senate as to the time allowable on this amendment?

I wonder if I can get consent to speak for 1 minute on this amendment.

Mr. President, two points: One, this amendment is totally new. We have not seen the language. We have been asking for the language for days. It has been filed in various forms. This is new language. The Senate has no idea what is in this amendment. We saw it for the first time maybe 15, 20, 30 minutes ago. It is impossible to know what this amendment does.

Point No. 2, essentially what we can tell by a cursory glance at the amendment is the amendment enters a whole new concept in Medicare that has not been done before, and that is means testing. It means tests those at the catastrophic levels.

I do not think we want to begin to go down that road tonight. It makes more sense to stay with the underlying bill which essentially gives a 44-percent rate to those beneficiaries with lower income.

The problem is it does not help, as our bill does, up to catastrophic, and then catastrophic is means tested. That is not the right thing to do, certainly at this hour after looking at it 30 minutes ago.

It is my understanding the sponsor, Senator Levin, is in the Chamber.

I ask for the yeas and nays.

Mr. President, the major fatal problem with this amendment is it dispenses with the underlying principle of the underlying bill. That is universality. We are, in the legislation before us, providing for universal benefits.

This amendment violates that principle by saying no, not across the board for Americans but, rather, it introduces a whole new means testing provision for catastrophic. I just think it fatally violates the spirit of the legislation we are about to pass.

Amendment No. 1041.

Mr. President, this side agrees.

Mr. President, will the Chair state the regular order?

Mr. President, is that the Nickles-Feinstein amendment?

Mr. President, I move to table the Nickles-Feinstein amendment, and I ask for the yeas and nays.

Mr. President, I suggest the absence of a quorum.

Mr. President, will the Chair identify the sponsors of that amendment?

Mr. President, the Senate is ready to vote.

I move to reconsider the vote.

Mr. President, I suggest the absence of a quorum.

Mr. President, I want to take a few moments to return to the basics of what this bill is all about. Let's keep our eyes on the ball.

We are working here to make a meaningful improvement in health care for seniors. We are working to bring prescription drug coverage to Medicare beneficiaries.

Too many seniors do without drug coverage. The Congressional Budget Office reports that roughly a quarter of Medicare beneficiaries have no drug coverage. Ten million people. They have to pay all of their drug costs out of their own pockets. They pay full price.

Lack of coverage means poorer health. Seniors who get along without drug coverage get fewer of the healing benefits that prescription drugs provide. CBO reports that when seniors do not have drug coverage, they fill about a quarter fewer prescriptions, on average, than do those who have coverage.

But whether seniors have coverage or not, they still need a significant amount of prescription drugs. CBO says that in 1999, Medicare beneficiaries who had coverage filled an average of 32 prescriptions a year. Those without coverage still filled an average of 25 prescriptions a year.

These prescriptions cost seniors a good deal of money. The average Medicare beneficiary spends about $2,500 a year on prescription drugs. That's a big number--especially as the median income for all elderly households in 2001 was less than $19,000.

Those costs are rising fast. CBO projects that the average Medicare beneficiary's drug costs will rise at a

rate of more than 10 percent a year over the next decade. That is far faster than the cost of living. That means that without this legislation, seniors will need to devote larger and larger shares of their income to paying prescription drug bills.

So we are here to try to make prescription drugs more affordable for seniors. And we are here to extend coverage to the roughly 10 million seniors who have no prescription drug coverage at all.

We are here to try to end seniors' painful choice between filling prescriptions and buying food. Seniors should not have to choose among the necessities to maintain their health. We are here to do something about that today.

Let me review what this bill would do.

This bill would make available prescription drug insurance to all seniors.

This bill would ensure that 44 percent of Medicare beneficiaries-- those with the lowest incomes--would have truly affordable prescription drug coverage with minimal out-of-pocket costs. For these lower-income seniors, with incomes up to 160 percent of the poverty level, copayments would never exceed 20 percent of the cost of drugs.

Let me take some examples. Let's look at what this bill would do for beneficiaries with what will likely be average drug spending of $3,155 in 2006.

For seniors with average drug expenses, even with higher incomes, this bill would save them $1,677. That is a 40 percent savings in out- of-pocket costs.

The savings would be greater for lower income seniors. For an individual making $14,000 or a couple making $19,000 a year, with average drug spending, they would save $2,842. That is a 90 percent savings in out-of-pocket costs.

For an individual making $12,000 or couple making $16,000 a year with average drug spending, they would save $2,842 in out-of-pocket costs. That would be a savings of 96 percent in out-of-pocket costs.

This bill would thus ensure that those who have been least able to receive the healing benefits of prescription drugs would now be able to do so. Millions of people would have a better quality of life. Lives would be saved.

This bill would create a strong Government fallback. Seniors would have access to at least two private plans for a prescription drug benefit, or the Government would provide a standard fallback plan. If there is not true competition, then traditional Medicare would provide a fallback.

The Department of Health and Human Services would continue to oversee these plans. The plans would operate within tightly controlled limits. This bill includes strong consumer protections.

And this bill does not tilt the playing field. This bill does not make private plans a better deal than traditional Medicare.

This bill would make a nearly $400 billion expansion of a major entitlement program. This is a historic opportunity to make a fundamental change for the better for millions of Americans.

In so doing, this bill would finally do something that the overwhelming majority of industrialized nations have already done.

This is a broad compromise. This is not a bill of the left or a bill of the right. This is a weaving together of approaches, in the finest American tradition.

This is a historic opportunity. Let us finally seize that opportunity, and improve health care for our seniors. Let us finally seize the opportunity, and bring prescription drug coverage to all.

Mr. President, we are about to vote. I want to thank all Senators for their tremendous patience. It is not an easy task. I particularly thank the chairman of the committee but also all Senators.

Second, I thank the staff who have not had any sleep in the last two or three weeks. I don't know how they are still standing. A lot of people have been working on this bill. My thanks. I know I speak for all the Senators in thanking all the staff that worked so hard to help achieve this end.

I agree with the chairman and look forward to moving on these issues. My home State of Montana is currently operating under a waiver that expires on December 31st of this year. I know that Montana, like Oregon, has been able to craft a successful TANF program because of its waiver, and I look foward to working with my distinguished colleagues to see that it is retained.

Mr. President, I rise today in celebration of a great Montanan and American, Anthony J. Preite.

Today, Mr. Preite, the director of the Denver Regional Office of the U.S. Department of Commerce Economic Development Administration is retiring. I have known Tony Preite for about 30 years. He was raised on Montana's ``High Line'' in Havre, MT. After a short time as a high school teacher and coach, he was lured by the Bear Paw Development Corporation, an EDA designated economic development district, to come to work for them in 1968. A year later, he became the executive director of that fledgling organization and thus began a career in economic development that is virtually unparalleled today. Under Tony's leadership, Bear Paw Development Corporation quickly developed a reputation as one of this Nation's premiere economic development organizations. Tony spearheaded literally hundreds of economic and community development projects and programs in that part of northern Montana. These projects resulted in hundreds of jobs, scores of infrastructure improvements, and other activities that have improved the lives of people in that area. Among his other accomplishments at Bear Paw, he was a founding member of the Montana Economic Developer's Association, served on the Montana Private Industry Council, and was chairman of the Governor's Economic Development Council.

Tony's work at Bear Paw Development Corporation was so successful that I felt the need to bring the benefit of his expertise and enthusiasm to more Montanans. That is why, in 1993, I recommended his appointment by President Clinton as State Director of the Montana Farmers Home administration. Through a reorganization at the U.S. Department of Agriculture, Tony led a successful transformation of the Farmers Home Administration Agency to the current Rural Development agency. While at the U.S. Department of Agriculture, Tony served on many national committees within the rural Development Agency, helping to guide the agency during its formative years. The success of the Rural Development Agency and the value of its programs today are largely due to the efforts that Tony made during his tenure there.

In December 1999, Tony accepted the position as Regional Director for the economic Development Administration. In this position, Tony has continued to impart his expertise and enthusiasm to a 10 State region. In his professional life, Tony has received accolades and awards too numerous to mention here. Instead, let me say that I have not met anyone as dedicated to public service as Tony Preite. Tony does not leave his work at the office. He lives and breathes ``public service'' every day, all day. It's immediately apparent to anyone who meets him that he always cares about the people he serves. His works has made an enormous difference for Montana and for all of us who work and play there.

While Tony's retirement is a sad occasion to all of us who work with him, it is well deserved. I can take comfort that he will be returning to Montana and that he will find some other way to continue to serve his State. I wish Tony and his wife Betty all the best and I thank him for more than 35 years of public service. Good luck, Tony, and welcome back to Montana!

Mr. President, I ask unanimous consent that the time for the next two votes be limited to 10 minutes.

Mr. President, I ask unanimous consent that the pending amendments be set aside.

Mr. President, on behalf of Senators Feinstein and Nickles, I send an amendment to the desk regarding an income-related increase in Part B premiums and ask for its immediate consideration.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, I ask unanimous consent that all pending amendments be set aside.

Mr. President, on behalf of Senator Akaka, I send an amendment to the desk regarding the treatment of Hawaii as a low-DSH State and ask for its immediate consideration.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, I suggest the absence of a quorum.

Mr. President, I would like to speak about the underlying bill.

Mr. President, I think one of the greatest achievements of the Medicare bill that has been reported out by the Senate Finance Committee is the compromise Senator Grassley and I worked out on the issue of private prescription drug plans.

Over the course of this 4-year debate over prescription drugs--and I might add, it has been very frustrating for a lot of Senators. We have been trying to find a way to get prescription drug benefits passed for seniors but have been at loggerheads the last 4 years. Both sides wanted their view and neither was willing to compromise. But I think, finally, it is clear we have reached an agreement.

I commend the chairman of the committee, Senator Grassley, and all those who helped to work to make this possible. Frankly, a lot of people are to be complimented--everybody from Senator Breaux to Senator Kennedy. And the list is just endless. Senator Snowe, for example, has been a great advocate, tirelessly trying to get a compromise agreement over the years.

We finally agreed private entities should administer a Medicare prescription drug program. I know that is something that many, particularly on the Republican side of the aisle, are very interested in.

Both sides of the aisle envision these entities might include pharmacy benefit managers, so-called PBMs. They could include insurance companies, chain store pharmacies, or partnerships among these entities. Any one of those groups would contract with HHS and be the private entity or the contracting company that would contract out the prescription drug benefits to beneficiaries.

The main disagreement was whether these private plans should be required to bear insurance risk for the prescription drug benefit. Without being too arcane, there is a question of performance risk and insurance risk. Performance risk has traditionally been borne by the pharmacy benefits manager. But the performance risk means the administrative risk and the cost of doing a good job just administratively; that is, without addressing the question of insurance risk as to whether people are going to buy these prescription drugs and how much the subsidy is or is not.

Now, some argue if plans are required to bear insurance risk in addition to the performance risk, they will be more efficient and prudent managers of prescription drug costs, the argument clearly being if you are a company or a PBM, and you have to bear the entire cost, the entire risk, including not only performance risk but insurance risk, you are probably going to be more efficient and probably a more prudent manager than you otherwise might be.

Plans will have stronger incentives, if they have that risk, to negotiate better prices and implement cost-containment strategies to minimize unnecessary utilization, the argument goes, if these plans bear at least some level of insurance risk.

Now, there have been critics of this model. Those critics argue if plans are required to bear insurance risk, they would structure their benefit design to discourage high-cost patients from enrolling in their plans; that is, they would cherry pick. We would be in the unfortunate world of adverse selection, where some plans would model their program they would offer to seniors in a way to discourage high-cost patients and encourage lower cost patients, and they therefore would be more profitable, leaving some of the higher cost patients, that is, those who really need drugs, out in the cold.

The health insurance industry has not been exactly rushing to the table to offer these benefits. The insurance industry does not seem willing to offer prescription drug benefits to seniors, even with the subsidies they would get if they are required to bear all of the risk.

Without a strong commitment from the health insurance industry, many fear that the insurance risk structure would lead to an unstable benefit. There would be a lot more instability because we don't know whether companies would be participating by offering plans. After all, this is something that is new. Plans would come in and out at will, forcing seniors to switch plans and possibly their medication.

In writing this bill, one of the greatest challenges Senator Grassley and I faced was how to find the right balance between efficiency and plan stability. There have been several major prescription drug benefit bills and approaches. One we hear a lot about is the tripartisan bill of last year. Another one which explains this phenomenon was the so- called Graham or Kennedy bill of last year. The tripartisan model, in trying to resolve the dilemma between efficiency and stability, tilted more toward efficiency and away from stability. It had many more competitive components in it to

allow companies to be more efficient and cut costs and be more likely to participate. On the other hand, it was more unstable from the point of view of beneficiaries, probably more unstable from the point of view of the company as well, and that was a problem that many on the Democratic side had with that benefit design, particularly that model.

On the other hand, last year a major bill that was considered by the Senate was the so-called Graham-Kennedy bill. That bill tilted much more toward stability at the expense of efficiency. It was more expensive. More than $400 billion had been allocated over 10 years, and seniors would have had more predictability. They would know what they were getting because there was more money for companies. On the other hand, companies would not be able to compete among themselves, and there was much less competition and, therefore, under that model, much less efficiency.

One of the main merits of this bill is that it is in the middle. It is between the so-called tripartisan bill and the Graham bill. In trying to find the right balance between efficiency and stability, we are pretty much in the middle. We have found that balance. We both agreed that we needed to create strong incentives to keep prescription drug prices low. We also agreed that we needed stronger assurances that private plans would be ready and willing to enroll beneficiaries come January 1, 2006, when the benefit begins.

We have found that balance in this bill. This bill was passed out of the Finance Committee by a large bipartisan margin, which is some indication that we found the balance.

There are several important elements of this compromise I would like to highlight. First, our proposal would phase in insurance risk carefully over time through the use of reinsurance payments and risk corridors. Those are pretty big terms. What do they mean? Plans would receive Federal reinsurance payments for 80 percent of their enrollees' costs above the stop-loss level. These payments are intended to ensure that plans have strong incentives to enroll high-cost beneficiaries. That is, Federal reinsurance payments would cover 80 percent of the enrollees' costs above the stop-loss levels contained in the bill.

In addition, our proposal added another component to moderate risk through the use of what we call risk corridors. What in the world is a risk corridor? Simply put, it would limit a plan's loss if the plan sustained substantial financial losses. And by the same token, risk corridors would limit a plan's gains if it earned potential profits. We phase in risk over the first couple of years so that the private plans would have a little cushion, a little better opportunity to know how well their plan is working, and that errs a little bit more on stability at the expense of efficiency. But after a couple years, the tilt is a little more toward efficiency, having gained a couple years of experience, hopefully, of more stability.

During the first couple years the bill would establish a narrow corridor of risk. Over time the risk corridor would be expanded, thereby shifting a greater share of the risk on to the health plan. By phasing in risk over time, this bill addresses one of the biggest concerns plans had in considering whether to participate in the new program. That is, the uncertainty during the first couple years of the benefit.

This uncertainty takes many forms. For example, who will sign up for the benefit? That is a big question. Very few people know. Second, will drug costs increase faster than Congressional Budget Office projections? That is a big question. Moreover, will beneficiaries consume more prescription drugs once the benefit has been implemented?

That is another big question. It is hard to know. That is why we believe it is important to phase in risk rather than just cold turkey, 100 percent insurance risk the first day of the first year.

So during this period of uncertainty, we will ask the plans to bear a minimal level of insurance risk. As plans develop more experience, we will require them to assume more risk.

I am more confident than I was last year that private drug plans will provide a stable delivery system for Medicare beneficiaries under this new plan both in urban and rural areas. I remain concerned that not all seniors will have a choice of two or more prescription drug plans in the region. Plans may simply, given all the provisions we have added to this bill to help give them a little bit of reassurance, not be willing to participate in some parts of the country. After all, it is their choice whether plans want to participate.

This concern is why I insisted that any private plan delivery system must offer all beneficiaries the choice of at least two private plans, and if any part of the country does not have at least two choices, the Secretary would be required to contract with a plan that is a Federal fallback or a backup plan that would offer the standard benefit at the national average premium. Some might argue this delivery model does not provide enough efficiency and cost management. Others might argue that this will prove to be too unstable, too much efficiency, too much instability, despite the changes we have made. Plans may come and go. Worse, they may not even appear and seniors will be confused. That is a concern, and it is a legitimate concern, believe me.

Nevertheless, I believe that given the competing forces of efficiency on the one hand--competition and cost containment--and stability on the other--making sure that seniors have the prescription drugs they want-- we have found a balance between these two fairly legitimate concerns.

I am not here to say it is the perfect balance. Clearly, others have better ideas how to address the question of where the balance is. I do believe the provisions of this bill are pretty close to it.

As we implement this benefit, we will have to carefully monitor the new delivery system very closely to ensure that, in fact, it is fair to our seniors and also fair to our taxpayers and to our private sector partners.

There are a lot of concerns here. One surely is making sure the senior citizens get the prescription drug benefit. But then equally important is that the American taxpayers' concerns are respected, and that we get savings, where we can honestly get savings, not at the expense of beneficiaries. That is why I believe an inclusion of private competition is important. It is very important.

Health care in our country is evolving, as you know, very quickly, and into areas we can hardly even imagine. I believe that in the next 10 to 20 years, when we are also faced with the problem of the baby boomers, there are going to be dramatic changes. What are the three areas going to be?

First of all, with the massive computational power that is developing, nanotechnology, married with the biotechnology, we will be able to, in not too many years from now--10, 12, 15 years--predict, with the human genome project, the interaction of systems in our bodies and the effect of DNA and predict what maladies or illnesses people are going to have in the future. We will develop machines that will detect things at a molecular level, with thousands of tests, that will be able to predict what will happen to each individual, or whether some of us are more inclined to get cancer or to have coronary disease--you name it. We are going to be able to predict very precisely in not too many years from now.

In addition, we will then be able to take actions to prevent illnesses with much greater certainty than we can today. We will be able to prevent it, since we know better what will happen to each of us with respect to our health, by deciding whether to take this pill or that pill or that new medicine that addresses a potential coronary disease that may occur with absolute certainty, or near certainty, 30 years later, or a cancer disease that may, with almost near certainty, occur 20 years later. That is where we will be in Medicare. It is changing so much.

Then, basically, health care will change from remedial care to personal wellness care. That is, doctors and people in the health care industry will be working with individuals to determine what illnesses they may or may not get and things they can do right now to prevent those illnesses from occurring. It will be a big shift from remedial care, which is about 90 percent of today's health care, to wellness and preventive care.

What else will happen? Seniors are going to live a lot longer. The quality

of our lives will be a lot better. It will change the demographics of the country and the health care in our country. The main point is that there are going to be a lot of changes in health care in the not-too- distant future.

What we are passing today on prescription drug benefits will also change. It is almost impossible for us to predict what the legislation should be in the years 2009, 2014, as this bill does. Yet we are doing the very best we can.

My point is that, given where we are today, in June 2003, I think this is a very good and aggressive attempt to try to find the right balance given all the different considerations we face. We can be very sure--and the chairman and I will give it utmost vigilance and oversight to make sure--that this delivers what is being promised to all our Medicare beneficiaries, the seniors of our country.

I respectfully urge my colleagues to closely evaluate the provisions and the merits of this compromise proposal. I have mentioned components that I think some Senators haven't had time to look at yet. I am talking about the balance between efficiency and stability. I am talking about phasing in risks, the risk corridors, as a good-faith effort to try to help make competition work--if it does work. If it does not work, we will know after a period of time. If it does not work, the bill provides a safety backup plan so that seniors are protected.

As I said, with all of the health care changes and the changes in the medical care that will happen over the years, we will probably revisit this in the not-too-distant future to address current conditions and the provisions of this bill.

As Senators study it more closely, they will realize there is a little more good in this bill than a lot of Senators originally thought. A lot of people have just not had an opportunity to focus on this.

I yield the floor.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I address an issue that many of my colleagues have asked me about over the past 2 weeks. It is an issue of great concern to many, particularly on my side of the aisle. That is, if this bill is enacted, how much will premiums vary and what will the actual effect of premium variation be for seniors?

Now, we have had a couple of votes already on this subject. I have not had a chance to address it directly and I would like to do so at this point. The issue again is the extent to which benefits and premiums may vary under this new Medicare drug benefit.

My Democratic colleagues are concerned that if benefits and premiums for participating drug plans are allowed to vary seniors will be confused and they will be unable to make informed choices, that is, the premiums seniors would pay, the monthly amounts they would pay for prescription drug coverage, should they volunteer to participate--that is, if they volunteer to participate, because it is an entirely voluntary program. It is not mandatory like the old catastrophic coverage bill was--in 1989 I think it was. This is voluntary. Seniors have a choice of whether they want to sign up for this new prescription drug benefit plan. If they do sign up, they pay a monthly premium of $35 a month for participating in the prescription drug plan.

Then the question is: How much can premiums vary and how much confusion might that cause among people trying to figure out the various merits of the various plans?

I might say they will not be able to make an apples-to-apples comparison between plans that are available in their own area. That is their concern; they just will not be able to compare fairly. As I said, these concerns are legitimate.

Certainly, those who believe in competition believe choice should be based on price and on quality. It should not be based on a plan's effort to select the healthiest beneficiaries and jettison the sickest. It should also not be based on distortions in the market. That is, we want fairness. We want equity. We do not want so-called cherry picking. We do not want to have certain plans pick the healthiest seniors, adjust premiums to get the healthiest, and leave out other seniors who require more prescription drugs that are not as healthy. That would just not be fair.

At the same time, we want to have some competition, and this bill does provide for private plans to provide a drug delivery benefit. The reason for relying on the competitive delivery system rather than the Government-based program is to allow for innovation and benefit design, to let companies look to try to find a better way of doing things, that is, of containing costs, and be more efficient, without sacrificing quality and stability to our seniors.

I think most of us believe that kind of innovation will lead to efficiency. The attempt is to design it in a way that does not lead to a risk in selection because that would be very unfair. So the question is: How can we ensure that choice is in fact based on the right factors, that is on price and on quality? How can we make sure there is enough flexibility so plans can adapt to changing needs and to a marketplace innovation, without providing so much flexibility that seniors have a difficult time choosing among plans? That is the challenge. That is what we are trying to resolve in this bill.

I think the proposal before us, the legislation reported out of the Finance Committee that has come to the floor, does a pretty good job of constructing that balance, and I will explain why I believe that is true.

First, on benefit variation--that is different benefits seniors may get because of different plans--the Grassley-Baucus bill limits benefits variation at several levels. First, the $275 deductible and the $3,700 out-of-pocket limit are fixed in the statute. Those two figures cannot vary. So plans are permitted to improve the benefit, but they cannot go higher than the deductible outlined in the law, and they cannot raise the stop loss beyond the level specified in the law. So that is one check. It does leave some potential variation on the premium and copay, but at least two components--deductible and stop loss--are fixed in the law.

All plans, whatever the benefit design is, whatever they offer, have to have those two provisions as prescribed in the statute.

Now, a benefit variation is also constrained through various limitations in what the Congressional Budget Office calls actuarial value or expected cost of the benefit. In plain English, that means the value of the benefit must be roughly equal to the standard benefit package outlined in the legislation.

We have all heard about the standard benefit package, the deductible, the stop loss, the premium, and what the copays are, so that the value of the benefit of any plan any company offers must be roughly equal to the standard benefit package outlined in the legislation.

As I understand from actuaries who spend their time thinking about these things, the practical effect of these provisions combined is there will not be significant variation in benefit packages. There just cannot be. All companies are going to know pretty much what they can charge. The actuaries do not predict much variation.

The bill also, however, attempts to minimize premium variation. How? Well, the bill includes various provisions that are intended to control variation in the premiums so beneficiaries will not be faced with widely varying premiums within their own region or across different parts of the country.

For example, if my mother learned her friends in Florida were paying far less in monthly premiums than she was paying in Montana, I believe I would get an earful. I would hear from my

mother. She would wonder whether the system we created is fair. And she would be right; it probably would not be fair.

What do we try to do about this? It is not perfect, but I think it is a major effort, and I think it is a good effort.

First, all Medicare beneficiaries who are enrolled in the new drug program will be combined for purposes of calculating premiums and payments to plans, regardless of whether those beneficiaries are in fee for service, enrolled in a drug-only plan, or whether they are enrolled in a private PPO or HMO. All senior citizens who are enrolled in Medicare will be combined for the purposes of calculating premiums and payments to plans, regardless.

Mr. President, I yield 1 minute to the Senator from Virginia.

We are very honored to have our guest. I don't know how long he wants to stay. There are so many transatlantic issues we can address.

I see my very good colleague from Iowa in the Chamber, and we have lots of agricultural issues. We would also like to learn from Europe about European health care systems. I am sure there are provisions in Europe we could look at and adopt. No country has a monopoly on good ideas and no region of the country has a monopoly on good ideas.

I urge our guest to stay as long as he possibly can and hopefully have time to converse over some of these issues so we can get a better idea of how we can resolve some of these huge issues, including agricultural and other trade issues. We all know the more we work together, the better we will be on both sides of the Atlantic.

I have been explaining various provisions in the bill that I think largely address concerns that some on the Democrat side have and I suppose on the Republican side of the aisle, too; namely, potential premium variation. Premiums that seniors pay might vary. Much confusion might occur for seniors and anyone else involved in prescription drug benefits that would be distributed under this legislation.

As I mentioned, the actuaries say there should not be much change. Also, the risk pool will include all Medicare beneficiaries, ensuring an adequate number of low-drug-cost beneficiaries will be able to subsidize the few beneficiaries with the high drug costs. Already, there is a huge risk pool. There is kind of a cross subsidization. Those with very low drug costs will help pay for those much higher costs of other seniors. The larger risk pool will prevent premium variation because we use the whole pool.

In addition, the bill will calculate Federal contributions toward plan premiums based on the national average of all plan bids. This contribution is then adjusted geographically for differences in prices. This is a so-called geographic adjustor. We want to make sure one part of the country is not discriminated against compared to another part of the country or vice versa, and we included the geographic adjustment on prices.

We have not included so far, because it is difficult to calculate, geographic adjustment based on utilization. As we know, in some parts of the country there is more utilization. That is a fancy term for saying there is a lot more care given to people than in other parts of the country. More care, the greater utilization, tends to be in parts of the country with more hospitals, more specialty health care providers.

There is an interesting study I urge my colleagues to read by Dr. Wennberg. I have not found anyone who refutes it. Looking at the country as a whole, there are parts of the country where utilization is twice as high and more than twice as high as other parts of the country. People, because of where they live, get twice as much health care in some parts of the country than in other parts of the country. This is adjusted for age, for race, for gender. It is adjusted for all the factors that can possibly be thought of.

The more interesting part of this study, even though some parts of the country get twice as much health care as other parts of the country--and it is because there are twice as many doctors or hospitals in some parts of the country as in others--the interesting part of the study is, the actual care given is no better, and in fact in some cases it is worse. That is, if you get twice as much health care, that is, twice as many visits to the doctor or the hospital, particularly for chronic diseases, you will not be twice as healthy; you will not be any healthier, on average, than you will be in parts of the country where there is less utilization.

The point is that we are trying to adjust, as I mentioned earlier, and have a geographic adjustment based on the costs. We have not yet figured out a way to adjust for different utilization mainly because, when it comes to prescription drug benefits for seniors, there is virtually no data because we have not had prescription drug benefits for seniors yet. Obviously, it is hard to get the data if we have not had the program.

There are other provisions in the bill that enable us to get more data, so fairly quickly we can get better utilization data and therefore have a geographic adjustment based not only on price but also on utilization. That will go a long way to address some of the concerns people have about potential premium variation and complexity. When we get that data, as I said, we will have a lot more information, but there is enough information already to have the effect of minimizing concern about premium variations.

There is another provision in the bill to help address this potential problem. That is, we have included in this bill a provision based on the Federal Employees Health Benefits Program--otherwise known as FEHBP--that prohibits plans from changing premiums that are unreasonably higher than the costs of the benefits provider. In other words, plans are prohibited from price gouging. That standard currently is in the law with respect to the FEHBP plan. That is in the law. There is a provision in current law that prohibits the FEHBP plans from charging premiums that are unreasonably higher than the cost that has been provided. I believe that same provision as applied to prescription drug pricing is an additional guarantee against gouging and certainly against unconscionable premium variation.

Finally, this bill allows the Secretary to refuse to contract with the plan. That is in the bill. Maybe a plan leans toward enrolling healthier beneficiaries. Maybe the Secretary determines that this plan is not a good actor; this plan is price gouging; this plan is engaging in cherrypicking; it is engaging in adverse selection at the expense of an American; or maybe it seems less committed to staying in the program; maybe there is a shady operation; who knows, maybe it seems more likely to drop out fairly quickly

and it is not solvent or financially healthy; maybe the premiums seem inconsistent with others in the region.

For any of these reasons and reasons not contemplated at this time, the Secretary can decide, at his discretion, not to contract with a drug plan that has submitted a bid to participate in Medicare. That option is still there as a protection for our senior citizens. It is my hope that this discretion will help assure better plan choices for seniors and the benefits and premiums will, in fact, be fair and reasonable.

In short, in developing this compromise bill, Senator Grassley and I have tried to allow a level of variation in premiums and benefits so as to foster innovation and to foster efficiency but not so much variation that seniors will be confused or plans will game the system.

I think we have done a pretty good job of ending confusion and a pretty good job of preventing plans from gaming the system. I hope my colleagues will agree this proposal strikes at that.

Madam President, I yield the floor.

Amendment No. 1040

(Purpose: To provide for equitable reimbursement rates in 2004 and 2005

for Medicare+Choice organizations making the transition to

MedicareAdvantage organizations)

I ask unanimous consent the order for the quorum call be rescinded.

On behalf of the Senator from Michigan, Ms. Stabenow, I ask unanimous consent amendment No. 992 be withdrawn.

I suggest the absence of a quorum.

Mr. President, on behalf of Senator Mikulski, I send four amendments to the desk and ask unanimous consent that the pending amendments be set aside so that the amendments might be offered. I don't know whether it is permissible to get consent to offer all four or we have to do it individually?

I send to the desk the four amendments en bloc and ask that the pending amendments be set aside. The amendments, for the purposes of consent, are to provide equal or equitable treatment for children's hospitals. Another is on the same subject. The third is to permit direct payment under the Medicare Program for clinical social worker

services provided to residents of skilled nursing facilities. And the fourth is to extend certain municipal health service demonstration projects.

I suggest the absence of a quorum.

I suggest the absence of a quorum.

Mr. President, first, I thank my good friend and colleague, the chairman of the committee, Senator Grassley, for his Job-like patience, as we have worked extremely hard with various Senators to try to come up with--and I think we have--a compromise, balanced solution as to how we spend the newly discovered $12 billion.

I have a couple of points. The intent of this amendment and the language of this amendment accomplish a couple of purposes: No. 1, to evenly divide the $12 billion--$6 billion and $6 billion--to be available to be potentially used by PPOs in areas designated by the Secretary, and the other $6 billion to be spent in additional Medicare Programs for disease management, chronic care, and other ways to help particularly address the lack of coordination services for the chronically ill and those seniors who particularly need disease management.

The amendment also has a couple other provisions, and to maintain the balance, maintain the symmetry is so important. I will remind my colleagues that in an attempt to get prescription drug benefits to seniors--something we all want to do--we are faced with two competing ideas. One is competition and the other is traditional Medicare. So the underlying bill is an attempt to work those two concepts together. This amendment follows on that tradition. It follows the same spirit, the same symmetry.

I mentioned the $6 billion and $6 billion. In addition, the amendment provides the authority to continue in the applicable number of years-- beginning in 2009 through 2013--and the $12 billion is not available until then anyway. That is the problem we have. It doesn't start until 2009. But it is $6 billion available for potential PPO use and $6 billion for disease management, starting in 2009, for a 5-year period. In addition, the authority for both under this amendment continues into the future beyond the 5-year period.

In addition, the language is written so it is an absolutely clear, ironclad guarantee that after the 5-year period no further dollars will be spent on either side, either the $6 billion available for PPOs or the $6 billion to be available for disease management, et cetera. It is very important to maintain that symmetry and balance in order to accomplish the spirit of cooperation so that we get this program started, get the prescription drug program that we want delivered and on its way.

This is not perfect, but I can tell you that many hours have been devoted by many Senators on both sides of the aisle to come up with this solution, which does achieve that balance.

I urge Senators to support this. This is going to break the logjam. This is the key amendment which has been topic A. Many Senators are wondering about this as they are thinking about other amendments they may or may not offer.

I hope with the passage of this amendment we will be able to take up other amendments Senators have tomorrow and debate them and finally, hopefully, by sometime tomorrow and Thursday--perhaps at a late time on Thursday--pass this legislation and send it to conference.

I yield the floor.

Mr. President, I ask that all pending amendments be temporarily laid aside so the Senator from Arkansas can offer an amendment.

Mr. President, it is unfortunate we did not get the score on the Senator's amendment until just recently. The chairman and I have been in constant contact. I have called several times today the CBO Director in order to get the scores in time for amendments. The good news is Senators have come to us so we are able to prioritize amendments and therefore calls to CBO are on amendments that will be sequenced so we can help them get the scores. We are trying our best to get CBO scores. The Senators can help us and help CBO get the scores by getting amendments to us early so we can sequence them.

On the other hand, it is very helpful if CBO can work as diligently as possible themselves and live up to their side of the bargain and get the scores to us. I hope we do not face this situation again where we get the score moments before an amendment is voted on, even though CBO knew this amendment was coming up; they had at least 24 hours' advance notice.