New Direction for Energy Independence, National Security, and Consumer Protection Act and the Renewable Energy and Energy Conservation Tax Act of 2007

Floor Speech

NEW DIRECTION FOR ENERGY INDEPENDENCE, NATIONAL SECURITY, AND CONSUMER PROTECTION ACT AND THE RENEWABLE ENERGY AND ENERGY CONSERVATION TAX ACT OF 2007 -- (Senate - April 09, 2008)

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HEALTH CARE

Mr. THUNE. Mr. President, I would like to take a few moments today to talk about an important topic affecting individuals and families from all across the country, and that is the rising cost of health care. It is an issue that affects every individual, every family's pocketbook. It is an issue that is affecting our small businesses across the country as they try to keep up with the rising cost of health care.

I thank my colleague from Louisiana, Senator Vitter, who last week spearheaded a discussion along with seven of my Senate colleagues on the conservative principles of health care reform. This is a discussion we plan to highlight over the next several weeks and which we will continue to focus on in the future.

I had the privilege of visiting a number of hospitals around South Dakota over the March work period, to hear from providers on issues of concern to them and to discuss health care reform. I was primarily focused on small hospitals, critical access hospitals, providers that deliver health care services in very rural and remote areas of this country.

My State of South Dakota has lots of land and not a big population base. Yet people's expectation out there is they will have access to high-quality health care. As I visited these hospitals and health care providers as I visited my State over the March work period, I heard lots of different messages, and one of them was we have to figure out a way to keep up with these rising costs. Fortunately, for many of the smaller hospitals in the rural areas that are critical access hospitals, they are able to get cost-based reimbursement, and that is something I think has led to the survival of lots of health care providers that otherwise would have had to close their doors.

It is important the American people hear the message of choice and affordability championed by many Republicans in the health care debate. Unfortunately, we are up against an opposing message, which is one of a quick fix or universal plan that Washington will decide for everyone. This message too often sticks in the minds of the media, with health care trade associations, and with many of our constituents.

The goal of universal coverage, or allowing every person in America the opportunity to afford health care insurance, is an important goal. How we work toward this goal is where the debate lies. That is where a Clinton or Obama health care plan differs strikingly from that offered by our colleague from Arizona, Senator John McCain.

I would like to focus today on one of the most basic principles which should guide all our health care reform proposals we debate in the coming years and that is to reject this movement toward more Government-run health insurance. Instead, we ought to make long-lasting reforms to both our tax system and the insurance market to increase access to privately owned health care coverage. That is private insurance you, the individual, can choose and you can keep from job to job.

What we have today is already a mixture of Government-run insurance, including Medicare, which provides coverage to over 40 million seniors, and Medicaid, a program available to the poor and the disabled, and private insurance, usually offered through medium or large employers.

Only about 7 percent of the population in this country actually purchase their insurance on their own directly from an insurance company. In lots of ways, the way people access health insurance today is very limiting when you consider the Government or your employer does not choose other important services in your life, such as the food you eat or the car or the home you buy.

Rising health care costs are also a huge problem, not only for those who have private insurance but also for our Government programs. The Medicare trustees now report that into the future, the trust funds have over $36 trillion in long-term unfunded obligations. By that I mean benefits that are promised but not paid for, which amounts--if you can belief this--to 2 1/2 times the size of the entire U.S. economy. Let me repeat that, $36 trillion in long-term unfunded liabilities or 2 1/2 times the entire U.S. economy.

This is money somebody has to pay, and it is an added burden on future
generations and on our economy. Left unchecked, the Federal Government will be forced to cut benefits or substantially increase taxes. If there is one thing that should be obvious to all of us, it is that a system such as traditional Medicare or Medicaid is not sustainable financially. There are no natural incentives under these programs to control costs. It is not just the cost of these programs that presents a problem. While over 40 million seniors have Medicare coverage, most beneficiaries also have some form of supplemental coverage, or other insurance, that wraps around because traditional Medicare is not enough.

In 2004, only 9.3 percent of Medicare beneficiaries relied solely on the traditional fee-for-service program, and over 60 percent had some form of private supplemental coverage.

Also, for many providers in my State of South Dakota, Medicare's prices and regulations do not account for the challenges patients and providers face in rural areas. Once again, one size fits all, Government-run health insurance is neither financially sustainable nor is it even sufficient for those it is meant to help. For the next several weeks, the Senator from Louisiana, myself, and Senators DeMint, Burr, Coburn, Martinez, Isakson, and Corker will be talking about the alternatives that are out there to our current rules and regulations and how we can achieve affordable coverage for all Americans through expanding access to private insurance.

While some of my colleagues in this body would like to expand Medicare to cover everyone to achieve the goal of universal coverage, or to expand Medicaid and SCHIP to cover many more Americans, I strongly oppose the expansion of Government insurance at the expense of choice, quality, and affordability.

Frankly, I want much more for my constituents back home in South Dakota and others across the country. I don't want the next President to push through a health care plan that will put more families on Government insurance, simply so we can say we have provided coverage.

As we were having the SCHIP debate last year, this point came up. Expanding SCHIP, which is essentially Medicaid in my State and in most other States, to families making as much as $80,000 per year, would have made it harder to attract good physicians to South Dakota, something we struggle with constantly in rural States. At a time when as many as 50 percent of physicians nationwide are limiting or dropping Medicaid patients because it simply does not cover their costs, why would we want to expand this program even further?

There is a better way. In my State, most of the uninsured are employees of small businesses. These are individuals capable of owning their own insurance, but it is simply not affordable or is not offered through their place of employment. What Senator McCain has proposed--and even one Senator from the other party, Senator Wyden from Oregon--is to reform the tax incentives in place now that only benefit large employers, CEOs and their employees, in purchasing health insurance, and level the playing field for everyone else. This can be accomplished by eliminating the tax benefit employers receive when offering insurance to their employees, which equals more than $200 billion over 1 year, and instead taking that money and offering it in the form of a tax credit or standard tax deduction to every American toward the purchase of health insurance.

With a tax credit proposal, we would be able to give every American a credit--$2,000 for an individual or $4,500 or $5,000 for a family--which is advanceable and refundable toward the purchase of insurance.

You could still choose to get your insurance through your employer or keep it, if that is the best option for you. But for anyone else, they would also have a substantial tax benefit to be able to choose their own plan that fits their needs and which is not tied to their employer. This would allow individuals and families to keep their insurance when moving from job to job.

By giving all Americans the option of a tax credit, we would empower millions of families who normally could not afford to buy insurance on their own to do so on the individual market, putting millions of consumers in the driver's seat, demanding more personalized, convenient, and affordable insurance plans. Right now, it is simply not possible for families or individuals in most States to afford their own insurance plan. But by redirecting this tax incentive and creating a more vibrant market, quality insurance plans will become more affordable and more accessible. This will drive down the cost of insurance for everyone.

Finally, by giving individuals a tax credit toward the purchase of insurance, we allow people to choose their own health insurance and the type of plan they desire. They could choose the plan that fits their needs, rather than having their employer do it for them. In many cases, their employer is only going to offer a very limited number of options--perhaps doesn't know the health care needs from one person in the plan to the next. More people will know what they are purchasing and will know what their premiums are going toward each and every single month, making us all better consumers of health care services.

Now, more than ever, words and phases such as Washington bureaucracy, Government-run health care, wage garnishment, and mandates describe the direction many in this Congress wish to take. I believe that is the wrong direction, and I will continue to support health care reforms which expand choices and which give people more freedom to access the health care that is right for them.

This is a debate that needs to be joined in the days and weeks and months ahead. My hope is it will get underway this year. My expectation is anything done this year will probably be very incremental because I think the big, bold decisions that need to be made regarding America's health care system will probably, regrettably, get punted into next year, after the Presidential election. But the debate needs to begin.

What I and my colleagues I mentioned have decided is, we need to start that dialog now. We need to get the American people engaged in this debate in a way that allows them to see what the options are, what the alternatives are, what their choices are. I believe a majority of constituents in my State of South Dakota, and I would daresay across this country, will chose a system that is based in the market, that gives them more choices, more alternatives, that creates competition--a competitive model, and, yes, that covers more Americans who, today, do not have access to health insurance.

I believe that is a goal that is achievable. I believe the debate needs to start now. I also believe that whoever the next President of the United States is, needs to work together with this Congress, we need to work together as Democrats and Republicans on a health care plan that is based on these very simple principles.

It is the principles that have served this country and this American economy so well for so many years--freedom, choice, competition, quality--that ought to be the model for the health care of the future. I look forward to continuing this discussion throughout the coming months.

I yield the floor.

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