[Congressional Record (Bound Edition), Volume 145 (1999), Part 6] [Extensions of Remarks] [Page 8952] [From the U.S. Government Publishing Office, www.gpo.gov]PRIVATIZATION: THE WRONG PRESCRIPTION FOR MEDICARE ______ HON. FORTNEY PETE STARK of california in the house of representatives Thursday, May 6, 1999 Mr. STARK. Mr. Speaker, several Members have touted the idea that Medicare should be turned over to the private sector. Although they say that privatization will save the program, their true motivation is to irreparably damage Medicare to the point that there is nothing left to salvage. In the words of former speaker Newt Gingrich, they want Medicare to ``wither on the vine.'' Republicans have always intended to destroy Medicare. While they have found new ways to disguise their message over the years, their intention remains the same: get government out of health care no matter what the cost. ``Privatization'' is just another one of their ploys. The truth is that the private sector cannot provide high quality health services to disabled and elderly Americans. Especially not at a lower cost. Medicare was originally created to fill in the gap of health insurance coverage for older Americans, and later the disabled. Before Medicare, the private sector either refused to provide insurance coverage to the elderly, or made the coverage so expensive that seniors could not afford to pay the premiums. Lack of health coverage meant having to pay for health care out of their limited retirement incomes. This left many elderly poverty stricken. Today the health coverage problem for older Americans is getting worse, not better. The fastest growing number of uninsured are people age 55-62, an even younger group than when Medicare was first established. Rather than extending coverage to this uninsurable group, Republicans insist on doing nothing, even though the President's Medicare early-buy proposal would have cost nothing. Why should we believe that private sector insurers will put their financial interests aside and compete to provide coverage for an older, sicker population when evidence suggests that they will not? Especially as costs for the chronically ill continue to rise. Republicans have also claimed that the private sector will save money for Medicare. This is simply not true. Over the past thirty years, Medicare's costs have mirrored those of FEHBP and the private sector, even though Medicare covers an older, sicker population. Recent evidence shows that private sector costs are now rising faster than Medicare's. Last fall Medicare+Choice plans abandoned 400,000 Medicare beneficiaries claiming that the Medicare rates were too low to cover this population. This suggest that health plans will charge ever more than we currently pay them, not less. Privatizing Medicare will not improve quality, either. Paul Ellwood, the ``father of managed care,'' recently stated that the private sector is incapable of improving quality or correcting for the extreme variation in health services across the country and that government intervention is necessary and inevitable. In his words, ``Market forces will never work to improve quality, nor will voluntary efforts by doctors and health plans. . . . Ultimately this thing is going to require government intervention.'' Why would we want to encourage more people to enroll in private health plans given the managed care abuses igniting the Patient's Bill of Rights debate? Medicare is the primary payer for the oldest elderly, chronically ill, disabled, and ESRD patients--all very complex and expensive groups to care for. Private managed care plans, which primarily control costs by restricting access to providers and services, simply do not meet the health care needs of everyone in this population. For the most part, Medicare+Choice plans have enrolled only the healthiest beneficiaries, while avoiding those most in need of care. There is no way of knowing whether or not private health plans are able to provide quality care to the sickest population. Medicare beneficiaries will have significant difficulties making decisions in a market-based system. This is potentially the most disastrous consequence of moving to a fully privatized Medicare program. Many Medicare beneficiaries are cognitively impaired. Thirty percent of Medicare beneficiaries currently enrolled in managed care plans have low health literacy. That is they have difficulty understanding simple health information such as appointment slips and prescription labels. Now we're discovered that health plans often fail to provide critical information to potential enrollees. How can we expect senior citizens and the disabled to participate as empowered consumers in a free-market health care system, especially without essential information? Medicare reform cannot be based solely on private sector involvement. More than 11 million Medicare beneficiaries--30% of the population-- live in areas where private health plans are not available, and because of the limited number of providers probably never will be available. A comprehensive, viable, nationally-based fee-for-service program must be maintained for people who either cannot afford to limit their access to services in private managed care plans, or who are incapable of participating in a free market environment. Unfortunately the debate surrounding privatizing Medicare is grounded in ideology, not fact. While I understand the need to improve and expand the choices available to Medicare beneficiaries--the Medicare+Choice program was created in recognition of this--we also have an obligation to preserve the promise of guaranteed, affordable health insurance for the people who need it most. The private sector is not a panacea for our problems. Historical experience proves that alternative solutions are necessary for our elderly and disabled citizens. Before we move to an entirely new system, we should attempt to improve the existing infrastructure, one that has served elderly and disabled citizens effectively for over thirty years. ____________________