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Office of the Press Secretary

For Immediate Release January 31, 2000
                     CHIEF OF STAFF JOHN D. PODESTA
                             WASHINGTON, DC
                            January 31, 2000

First, I would like to thank Representative Charlie Rangel for his leadership and lifelong commitment to improving health care for all Americans; Fred Brown, your immediate past chairman; and Gail Warden, your past chairman and invaluable member of the President's Quality Commission.

Dick, thank you for that kind introduction. I have to be honest with you: A year ago, when Dick Davidson first mentioned OPD to me, I really didn't know why he called. Why does Dick care about the Oakland Police Department? Because the only "PD" I had ever heard of growing up in Chicago was the Police Department. And that had nothing do with hospitals or the health care system. Actually that's not entirely true. My mother told me that if she ever received a call from the Chicago PD, I'd wind up in the H-O-S-P-I-T-A-L.

Before I begin, I'd also like to congratulate Carolyn Boone Lewis -- who, as you all know, will be your first African American Chairperson. I've known Carolyn for many, many years and I know that's mostly a testament to Carolyn and to her service to our community here in DC and to the AHA. But it's also a testament to just how far we've come as country and how far the AHA has come in its 101 year history -- and why it is prepared to succeed in its "new century of caring for people."

In his State of the Union Address on Thursday night, President Clinton asked the American people to do what President Teddy Roosevelt, at the dawn of the 20th Century, said every growing nation should do: take "the long look ahead."

Eight years ago, it was not so clear to most Americans there would be much to celebrate in the new century. Then, our nation was gripped by economic distress, social decline, and political gridlock. But today we begin the new century with over 20 million new jobs; the fastest economic growth in more than 30 years; the lowest unemployment rates in 30 years; the lowest poverty rates in 20 years; the first back-to-back budget surpluses in 42 years. And next month, America will achieve the longest period of economic growth in our entire history.

And our economic revolution has been matched by a revival of the American spirit: crime down by 20 percent, to its lowest level in 25 years; teen births down seven years in a row; adoptions up by 30 percent; child immunizations at record levels; welfare rolls cut in half to their lowest levels in 30 years.

And we did all this while passing a balanced budget that pays down the debt, and if we stay on the right path, make the right choices and the right investments, America will by debt-free by 2013 -- for the first time since 1835 when Andrew Jackson was President.

Seldom in our nation's history have we had the opportunity -- and the obligation -- to build on our economic prosperity and our social progress. We must reward work and strengthen families, by giving every parent the tools to succeed at work and at the most important work of all -- raising children. In part, that means making sure every family has quality, affordable health care and the support to care for aging parents.

For seven years now, our Administration has worked with the health care community -- including organizations like the American Hospital Association -- to give families better access to better health care. We passed and are implementing the Children's Health Insurance Program ("CHIP") for uninsured children -- which has already enrolled 2 million children. With you as partners, we are confident that we'll reach our goal of 5 million. We enacted legislation to end drive-through deliveries.

In just the past several years, President Clinton signed the Kennedy-Kassenbaum law to help individuals keep health insurance when they change jobs. The President enacted the Family Medical Leave Act to give workers unpaid leave to care for a new baby or an ailing family member without jeopardizing their job. We've worked to efficiently manage and implement historic legislation that has extended the life of Medicare from 1999 to 2015, and the President signed the landmark Work Incentive Improvement Act for people with disabilities so they don't have to choose between employment and health care.

We fixed the OPD payment rates-- which I joked about but which was no joke to you-- and other excessive payment reductions that were included in the 1997 Balanced Budget Act. And today we are working together to eliminate all preventable medical errors. And on behalf of the President, I thank you for that.

But we have more work to do. That's why the President laid out an ambitious agenda in his State of the Union of the steps we can take in 2000 to address the health care needs of our nation.

There are still more than 40 million Americans without health insurance -- more than there were in 1993. And many of them are forced to rely on emergency room care for basic health needs or require hospitalization for avoidable conditions like pneumonia or uncontrolled diabetes.

That's why, as the President outlined in his State of the Union Address, we have to continue to take steps to assure that every American has affordable, quality coverage. While we won't achieve that goal this year, we can make important down payments.

First, it's hard to have healthy children without healthy parents. We know parents who have access to health care themselves are more likely to get care for their children. And children who see their parents getting regular medical care learn good habits that last a lifetime. Yet, most of the parents of the children covered in CHIP are themselves uninsured. That's why we should make low income parents eligible for the insurance that covers their children, which I know you support. We must also work with states to reach every child now eligible for CHIP or for Medicaid. There are still too many children missing out. The President's budget will fund efforts to find them, because there is no reason for any child in America to grow up without basic health care.

Secondly, we have to address the needs of Americans who lose their insurance when they change jobs, something that happens more and more often in our fast-moving economy. That's why we have COBRA benefits, allowing workers to pay to stay enrolled in health insurance. But too many workers cannot pay the full costs themselves. President Clinton has proposed tax credits that make COBRA insurance affordable to more people. This would help workers take advantage of job flexibility without worrying every single day that the may lose their health insurance coverage. We also have to target policies to expand coverage to people between the ages of 55 to 65 - the fastest growing group of uninsured. And we must take steps to help small businesses purchase health care for their employees.

Finally, we must strengthen the network of clinics, hospitals and dedicated professionals who serve the uninsured. They care for families in need and help provide the referrals that get children and parents into insurance programs. And in a marketplace where both private and public payers are constraining reimbursement, these providers are facing unprecedented challenges. That's why the President has asked Congress to make a significant investment in these public facilities next year.

We must also give relief to the record number of American families who are providing long-term care for aging or ailing loved ones at home. It's time to finally pass a long-term care initiative to meet the challenges of our aging population. Last week, the President proposed a $3,000 tax credit for the cost of long-term care -- three times the one proposed in last year's budget. Congress should meet its obligations to those Americans who need it most -- and help ease the burden on those who care for them.

If we take all these steps we will fulfill not only our agenda -- but also much of the American Hospital Association's health care vision.

The President has also challenged Congress to finally pass a real Patients Bill of Rights that ensures critical protections for all Americans in all health plans -- from the right to see a specialist -- to the right to emergency room care -- whenever and wherever you need it, and the enforcement mechanisms necessary to make these rights real. Last fall, over 60 Republicans joined with virtually every Democratic member in the House in passing the bipartisan Norwood-Dingell patients protections bill. The Senate-passed bill, in contrast, leaves 100 million Americans unprotected, does not ensure access to specialists, does not provide an adequate appeals process, and fails to hold plans accountable for actions that harm patients. I hope that the Republican leadership's signals that they are finally ready to pass a strong and enforceable patients bill of rights are on the level. But we must make sure that this legislation does not get watered down in the process or let a "patients bill of rights" turn into a political bill of goods. We plan to reach out to the Republican leadership to help expedite the work of the joint House-Senate Conference Committee. It's long overdue. The American people simply can't afford another year without it.

One of the biggest health care issues facing our country today is the challenge of caring for aging baby boomers. Since virtually everyone in this room is a baby boomer themselves, we all know what burdens we are going to place on the Medicare program when we retire. In fact, the number of Americans over age 65 is going to double in the next thirty years. At the same time, the ratio of workers to retirees will decline by over 40 percent by 2030. As frustrating as Medicare can be, especially to providers, everyone in this room knows that without it, 50 percent of our elderly population would still be uninsured as they were in 1965.

As President Johnson said when he signed the Medicare Bill, "The benefits of the law are as varied and broad as the marvels of modern medicine itself." In the 34 years since then, Medicare has eased the suffering and extended the lives of tens of millions of older and disabled Americans. It has given young families the peace of mind knowing they will not have to mortgage their homes or their children's futures to pay for the health care of their parents and their grandparents. That's why when we have the opportunity and the resources we have today, we must prepare for this challenge so that we do not become a burden on our children.

The President's budget includes a comprehensive plan to strengthen and modernize Medicare. The proposal makes the program more efficient and competitive, increases access to preventive care, dedicates nearly $400 billion of our budget surplus to keep Medicare solvent past 2025 and helps to pay for a long overdue voluntary prescription drug benefit. By adequately financing the Medicare program into the future, it will also help avoid excessive cuts in reimbursement to hospitals and other health care providers. It is particularly important for you to understand that if we fail to dedicate the budget surplus to the Medicare program to extend its solvency to 2025, all providers, including hospitals, will inevitably be subject to a 15 to 20 percent cut over the next 10 years.

These proposals represent a significant investment in the health of Americans. I am confident that we can work with Congress to give the American people access to quality health care they deserve. Frankly, that's why we were a little disappointed with the Republican response to the President's address Thursday night. It was riddled with inaccuracies and contradictions. For example, the Republicans criticized the President's proposals to build on the CHIP program and cover parents saying it would lead to new "bloated bureaucracy," while at the same time taking credit for expanding access to "million[s]?" of children who "now have access to health care" under the same program. Come on Dr. Frist, even Harry and Louise have supported this expansion of coverage. It's time to drop the partisan rhetoric and get on board, too.

The Republicans also criticized the President for not endorsing the recommendations of the Breaux-Thomas Commission set up by the 1997 Balanced Budget Act. In reality, the Commission did not achieve enough votes for a formal recommendation -- and there was good reason for that. Specifically, the proposal:
1) increased premiums between 10 and 30 percent for those beneficiaries who choose to stay in the traditional fee for service Medicare program; 2) raised the eligibility age for the Medicare program without a proposal to provide an affordable alternative -- inevitably increasing the number of uninsured Americans;
3) failed to moderate the impact of the Balanced Budget Act's Medicare provider reimbursement changes, and in fact assumed their extension into the future;
4) provided an inadequate, means-tested drug benefit that would only be available to those below 135 percent of the poverty line; and 5) did not dedicate one red cent from the surplus to extend the life of the Medicare program.

For all of these reasons, the Breaux-Thomas approach fell short. Therefore, it is not surprising that this proposal failed to win approval in Congress last year.

But the President simply didn't reject this work -- he's offered constructive alternatives on each and every point.

The President's plan would make Medicare more efficient and competitive, but would also:

  1. Not increase premiums in traditional Medicare.
  2. Not raise the eligibility age, and in fact offers a new insurance option to the most rapidly increasing population of the uninsured -- those between the ages of 55-65.
  3. Offer an affordable voluntary prescription drug benefit for all Medicare beneficiaries.
  4. Devote nearly $400 billion to extend the life of the Medicare trust fund to at least 2025 and to help pay for the new prescription drug option.

Some have suggested that this is a prescription for deadlock. Far from it. Senator Breaux and Congressman Thomas have indicated a willingness to alter their approach. The Pharmaceutical industry ceased their fire of attack ads on the President's drug benefit. The Congressional Leadership on both sides of the aisle have named Medicare and a prescription drug benefit as a top agenda item.

I strongly believe we can work with the Republicans to put progress over partisanship. Even in an election year, we can and we must get our work done for the American people. We shouldn't forget that Kennedy-Kassenbaum and Welfare reform were both passed in election years. And even as we speak, the Patients Bill of Rights legislation has passed both houses and is now in conference awaiting final approval. The Republicans have also indicated their interest in adopting tax benefits this year, like the one proposed for long-term care. Senator Roth, the Chair of the Finance Committee, has already pledged to hold hearings on Medicare and prescription drugs as his first order of business. And tomorrow, at the White House, the President is meeting with the congressional leadership --Democrats and Republicans -- to discuss plans for legislative progress in the coming session, including health care reform.

I know your next speaker, Congressman Bill Thomas is someone who also wants to see progress on the health care front. We've worked together before to strengthen Medicare -- to provide important insurance protections. I hope we can all work together in a constructive manner, step by step, to meet our responsibilities to all American citizens, including supporting seniors, empowering people with disabilities, and helping make our children ready for the future. And I look forward to working with you to help secure America's health care future. Thank you.