Iowans who tuned in to the State of the Union address heard the president make the case for protecting our national security from international threats and defending the homeland from future acts of terrorism. Since 9/11, I know many Iowans are troubled with unease and anxiety about what troubles may lie ahead. Now the possibility of war with Iraq weighs heavily on the minds of many as well. We are living in uncertain times.
In his speech before a joint session of Congress, the president charted a straightforward course rooted in his vision for peace and prosperity in America. That includes defeating terrorism, getting the economy rolling and addressing looming shortfalls in entitlement spending.
In the first half of his speech, the president devoted his time primarily to the health of the economy and the health of the American people. As chairman of the Senate Finance Committee, I will steer roughly three-quarters of the president’s proposals through the sausage machine on Capitol Hill. Just as I navigated through Congress in 2001 the largest tax relief package in a generation, I am in charge of his economic growth and job-creation package getting off the ground in a narrowly divided Senate. I will focus on policies that would deliver the most immediate bang for the buck by enhancing consumer demand and triggering investment to make the economy grow.
The president also set the stage for action on another key matter of public policy. And that is the need to strengthen and improve the 37-year old Medicare program. Roughly 41 million older and disabled Americans currently depend on Medicare to pay for health care services. But the traditional fee-for-service program does not reflect the way medicine is practiced today. Medicare should cover prescription drugs. It should include preventive services and provide better protection against catastrophic illness. As lawmakers, we must bring 20th century Medicare in-line with the 21st century practice of medicine.
The absence of a prescription drug benefit is not the only shortcoming facing the health care entitlement program. Even without a drug benefit, the tax revenue generated under current law cannot sustain the medical costs projected after the retirement of the baby boomer generation. We must strengthen Medicare so that it will be available not only for this generation but generations to come.
Congress must identify greater efficiencies and do a better job overseeing the program for fraudulent and improper spending. The annual audit by the internal watchdog at the Department of Health and Human Service released in January the findings from 2002. The audit projected a 6.3 percent improper payment rate which represents an estimated $13.3 billion. While that figure does not measure fraud, $13 billion improperly paid out by Medicare is unacceptable. The good news is the Centers for Medicare and Medicaid Services is making good progress to make sure patients get the care that Medicare pays for. Six years ago the improper payment rate was nearly double at 13.8 percent.
As a lawmaker for Iowa, I’m keenly aware of another glaring problem. It involves Medicare’s complex funding formula. It penalizes Iowa for practicing cost-effective medicine with an inequitable reimbursement rate. Iowa’s health care providers and hospitals get less money back from Medicare for the same procedure performed in Florida or New York. This creates a disincentive for good physicians to practice medicine in Iowa and pinches an already razor-thin operating margin for our most vulnerable hospitals. This adversely affects the quality of care available in our communities. In a nutshell, the current funding formula shortchanges Iowans who pay the same Medicare payroll tax as every worker in the country.
I’m glad the president is on board to get prescription drug coverage for seniors done this year. As chairman of the Senate Finance Committee, I’m committed to retiring prescription drugs as an election issue and making it a public policy issue so lawmakers will get busy doing the people’s business. That’s why I’m working across party lines to pass out of committee a comprehensive Medicare bill that offers all seniors a voluntary, affordable drug benefit. And I’m not talking pie-in-the-sky coverage that promises seniors the moon. That kind of unrealistic head-in-the-clouds approach is a prescription to return the issue to the campaign trail instead of one that will fill seniors’ medicine cabinets.