Remarks to Commonwealth North

*** As Prepared for Delivery ***

"Hello and thank you for inviting me to speak with you all today. It's great to be here in Anchorage to provide you with an update on health care reform, an issue that has dominated the national and local headlines this summer. And as many of you have seen, this issue is causing very emotionally heated town-hall meetings and debates across the country. 

"But before we delve into health care reform, I'd like to take a step back and look at the health of the economy and spending by Congress in the last 19 months. 

"This February, we passed a $737 billion stimulus bill; last October, $700 billion in TARP funds (Troubled Asset Relief Program), over the course of 2008, $323 billion in AIG and Fannie Mae/Freddie Mac bailouts, in February 2008, and $168 billion in stimulus funds. And now, we are looking at adding another $900 billion or more in new spending to create a government health insurance plan. 

"What this means is that, excluding the 2010 annual appropriations and budget resolution, we have already spent over $2 trillion in emergency funds, while the economy has shed more than 2 million jobs since February and unemployment has increased from 8 to 9.5 percent, the highest in more than a quarter century. It's safe to say that the trillions in emergency spending has not only resulted in a less stable economy with a rising number of job losses, but in fact, we are now looking at the possibility of third stimulus bill and adding emergency funding for unemployment benefits. 

"One of the reasons I did not support the second stimulus bill was because of the trillions being spent, that produced little, if any, tangible results. In my press statement explaining why I voted against the stimulus bill, I said that based on the spending record by the leadership in Congress, [quote] "I believe that it will only be a matter of months before the president looks to Congress for yet another trillion dollar spending bill." 

"Well, less than six months later, Members of Congress were aggressively being pushed to vote on a $1 trillion health care spending bill before the August recess. The concerns and angst by many within the Democratic Party and in particular among the Blue Dog Democrats forced the President and leaders in Congress to put the brakes on the health care bill and postpone votes to sometime this fall or later. 

"On the stimulus bill, I said, [quote] "We have not taken the time to ensure that this quickly passed bill actually gets the job done, and the stakes are too high for us not to get this right." Today, I echo these same reservations about this health care bill. 

"I do believe that we are moving too quickly and the American people expect their representatives in Congress roll up their sleeves and give serious thought and deliberation to reforming our nation's health care system that is comprises 1/5 or 17% of our economy. 

"What concerns Americans about the "rush request" with health care is that, unlike the stimulus, this bill is not just about spending money; this bill makes long term policy changes to the way health care is delivered in America; according to the Lewin Group's analysis, the House bill creates a government health plan that will potentially shift 88 million Americans from private coverage to a government run plan; according to the non-partisan Congressional Budget Office, the legislation raises the costs curve and does not reduce overall health care spending; it does not meet the President's promise that you can keep the health care you have; and it will cause businesses to either lower wages, cut jobs or outsource workers through a penalizing tax on employers who don't provide health care benefits. 

"The House and Senate health reform bills do nothing to address the issues Alaskans write to me about every day. For example, the rising premium costs in the private health insurance markets that affect some 177 million Americans; improvements to the VA health system that is cash strapped and in need of more federal money for the medical and mental health needs of our returning veterans; increased funding for the Indian Health Service that provides health care to 20% of our state's population; and the Medicare program that this legislation does nothing to help improve access to primary care for the 44 million seniors and disabled Americans who are on the benefit program. Oddly enough during the health care debate, Medicare celebrated its 44th birthday in July, but according to experts, the program has only eight more to celebrate before it is completely insolvent. These are the health care changes that are critical to the health needs of Alaskans and nationwide, but are not being addressed in the health care reform legislation before Congress. 

"In the Senate HELP Committee, of which I am a member, Republicans were handed a bill that was drafted by the Democrats. Senator Dodd, sitting in for Chairman Kennedy, allowed Republicans to offer amendments. Republicans offered several amendments that were both technical and substantive in nature such as the reimbursement rates set by the government plan and funding for comparative effectiveness research. 

"I offered many amendments, 19 of which ensured that native health groups could be a part of the grant programs available in this legislation. Senator Dodd claimed that accepting these and other technical amendments made the HELP bill a "bi-partisan" bill but accepting amendments to expand eligibility of the grant programs does not make this a bi-partisan bill - it makes it a better bill. 

"The substantive amendments that changed the underlying policies in the bill were nearly all rejected on a party-line 13-10 vote. For example, I offered a simple amendment that would set a "floor" on how low the Secretary could set reimbursement rates for the government run plan. This was to ensure that rates could not be set at Medicare rates, which we know, would limit access to primary care doctors in Alaska and other parts of the country. While my amendment was given sufficient time for discussion, much like nearly every other Republican amendment, it was defeated on a party-line vote.

"I offered another amendment to exclude the smallest of our small businesses from being penalized if they did not provide health insurance. This amendment was rejected, again on a party-line vote.  

"Imposing additional taxes and penalties on the backbone of our small businesses, particularly during a downturn in the economy, is what Congress ought not to be doing if we are spending trillions in stimulus to get our economy going and have more Americans back to work. As Jack Kemp used to say, you can't love jobs and hate job creators," but to many of us, the HELP Committee bill seemed to do just that. 

"The House bill, which has jurisdiction by three committees, Education and Labor; Ways and Means and Energy and Commerce, used the Senate HELP Committee's model to build their bill. What concerns me about their bill is that they set the government plan reimbursement rates at Medicare rates plus 5% if a provider participates in both Medicare and the government plan. If not, it is simply the Medicare rate. 

"In Alaska, we know that even with the 35% increase in Medicare reimbursements that Senator Stevens and I were able to secure last year, we were able to get a few doctors to accept new Medicare patients. We were successful in having doctors keep patients who aged into Medicare, but not for doctors who take on new Medicare patients. A Medicare plus 5% increase will result in diminished access under the government plan, much like we have seen with Medicare. 

"On the House bill, the most vocal opposition came from the Blue Dog Democrats on the House Energy and Commerce Committee. They were concerned with the $1.6 trillion price tag, and the Medicare modeled government program. The Blue Dogs concerns and the in-fighting within the President's own party caused the Energy and Commerce Committee Chairman to delay the vote for nearly a week before the Committee was able to get a divided group of Blue Dog members who could support the bill and ultimately pass it out of Committee. 

"While the three House Committees of jurisdiction passed health care bills in the waning hours before adjourning for August recess and the Senate HELP Committee passed their bill, all eyes are firmly fixed on the Senate Finance Committee where, my colleague and Chairman of the Committee, Senator Max Baucus, has taken the path not taken by the HELP or House Committees, to work with Republicans to craft a bi-partisan bill that will pass not by a slim majority, but rather with 80-90 Senators. 

"The top three health care concerns I hear the most from Alaskans are the restrictions on access to primary care among Medicare patients; the double digit increases in health insurance premiums; and the insurance denials of coverage to patients with pre-existing conditions. As the HELP Committee bill presented a bill with over $1.2 trillion in government spending, a government plan that would set low reimbursement rates and did nothing to ensure a downward trajectory on health care spending, I did not support the HELP Committee's health care legislation. 

"While I have very grave concerns about how much of your tax dollars and that of future generations are being spent on bailouts and rushed emergency spending, I do believe that it is critically important that we bring health care costs under control and on a downward trajectory. I am committed to working on legislation that will contain spending, particularly on the individuals driving 75% of all health care costs. These uninsured individuals with chronic disease conditions need care but they don't get it in time and are often sent to the ER or rushed out of the state because their care becomes so severe, and you and I end up paying for the uncompensated care they receive in these emergency settings.  

"We can't afford to ignore the exponentially rising costs of health care that are pricing American families and small businesses out of the market. It is estimated that we will spend $2.9 trillion this year on health care, rising to $4.4 trillion by 2019. This is unsustainable and will only further drive more Americans away from being able to afford health insurance.  

"We must reform the way medical providers are reimbursed, ensuring that we reward for quality and not quantity; by allowing nurses, dietitians and other mid-level providers to take a more active role in health care management by reimbursing their services under a medical home concept, as we have seen the successes of the SouthCentral Foundation. This will allow patients to get lower cost primary care services instead of high cost, late stage emergency room and specialty care. 

"Another critical way to reduce costs is by enacting tort reform legislation so that doctors can stop the practice of defensive medicine which is costing the average American family an  additional $1,700 to $2,000 every year in unnecessary health care spending, according to a Stanford University study. This results in $100 billion and $178 billion per year, with almost $1 trillion in savings over ten years. This would pay for the cost of health care reform.  

"I will support legislation that makes meaningful reforms to the private health insurance market, particularly with patients who have preexisting conditions such as diabetes, heart disease or mental illness and ensures that the people who currently have health insurance coverage that they like will be able to keep it. 

"We need guarantees that important health care decisions will be made by you and your doctor and not federal bureaucrats; and that we are not financing health care reform on the backs of America's small business owners by imposing onerous tax penalties through an employer mandate. These are the things 1need to see in the health care reform package that comes out of Congress. 

"What I cannot support are measures that will create a government program that will shift millions of Americans from private to government coverage and ultimately eliminate the private health insurance system as we know it. 

"More and more we hear that Democrats in Congress like Congressman Barney Frank (D-MA) and Congresswoman Jan Schakowsky (D-IL), who are talking about how a government health plan will lead to socialized health care and that is a good thing. This is a major concern for me and something that I am opposed to if it is included in a health care reform bill. A government plan that copies Medicare rates will undoubtedly have a significant adverse impact on states like Alaska where we struggle to keep primary care doctors in the Medicare program.

"The Senate bill allows reimbursement rates to be set by the Secretary at no more than the market rate, placing a price "ceiling" but allows for the rate to be set as low as the Secretary wants to set it, leaving out of the legislation a price "floor" on reimbursement. According to the Congressional Budget Office, there will be no cost savings from the government plan if the rates are set at private market rates. Therefore, government plan reimbursement rates, likely to be set at or below Medicare rates, are a serious concern for Alaska and not something I will support. 

"I look forward to returning to Washington in the fall and gelling back to advancing a bold and responsible health care bill and that the President will sign before the end of the year. 

"Also, I will be holding four town-hall meetings with Alaskans this month that will take place in Fairbanks, Anchorage, the Valley and on the Kenai. I look forward to answering questions about the health care bills in Congress. 

"Now I'd like to open the floor to any questions you all have on health care."


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