October 30, 1995 CONGRESSIONAL RECORD Ð Extensions of Remarks E 2063 EXTENSIONS OF REMARKS THE NEW MEDICARE a more limited choice of health care providers. torial by Thomas Friedman in the New York Beneficiaries would get detailed information in Times. Mr. Friedman summarizes portions of HON. VERNON J. EHLERS the mail each year about types of plans avail- the World Bank study which show that in 1960 OF MICHIGAN able in their area. the Middle East had a per capita income high- Three, medical savings accounts: Bene- IN THE HOUSE OF REPRESENTATIVES er than Asia, but in 1990, even with oil wealth, ficiaries could also choose coverage through a the Middle East per-capita income had only Monday, October 30, 1995 medical savings account [MSA]. This option doubled while that of Asia had more than Mr. EHLERS. Mr. Speaker, after months of would require beneficiaries to choose a high- quadrupled. Economic reform, privatization, debate and thousands of meetings across the deductible insurance policy paid by Medicare. and development have eluded the Middle East country, the House passed the Medicare Pres- The savings achieved through this policy will to a larger extent. ervation Act [MPA] on October 19. Crafting the be placed in an individual MSA, which will be These problems are acute in Egypt. The legislation, which generated strong feelings on used to pay for health care expenses within need for economic restructuring is enormous. all sides of the issue, was by no means an the deductible, or to purchase long-term care Egypt and the entire Middle East region will easy task. I am pleased with the hard work insurance. need to focus on economic issues if the region and sincere effort that was put forth by many The reforms don't stop there. The new Med- is to catch up with the rest of the world. Egypt people in developing a better Medicare sys- icare Program will also make significant re- and the Middle East need economic reform if tem. forms in payments for doctors, hospitals, and they are to generate jobs for the burgeoning Reforming Medicare is an urgent matter that other health care providers, in order to control youth population now entering the job market. must be addressed. Because of the complex- costs. Government-funded Medicare coverage The excellent New York Times editorial fol- ity of the issue and its widespread effect on for the wealthy will be phased out, starting lows: our Nation, it is important to understand why with couples with incomes above $125,000 [From the New York Times, Oct. 18, 1995] and individuals with incomes above $75,000. the system needs to be reformed and what EGYPT RUNS FOR THE TRAIN A special commission will be created to study our reform proposal involves. In April the (By Thomas L. Friedman) board of trustees of the Social Security funds the effects of the retirement of the large baby John Page, the World Bank's chief Middle reported that the Medicare part A trust fund, boom generation, when there will be only two workers to support every retiree. Mechanisms East economist, likes to say that the dif- which pays for hospital-related services, will ference between the global economy of the be bankrupt in 7 years. The part B trust fund, to detect fraud and abuse will be strength- 1950's and the 1990's is the difference between which pays for outpatient services, is not in ened, and beneficiaries who detect any wrong- two trains. The global economy of the 1950's danger of bankruptcy, because almost 70 per- doing in their bills will be rewarded. Finally, he says, ``was like the old train from Heliop- cent of part B premiums is paid by the Federal the plan will install a failsafe mechanism to olis [a Cairo suburb] to Cairo. That train Government, and the rest is paid by bene- monitor the reforms and ensure that they are stopped at every station, and if you missed ficiaries who choose this coverage. In 1996, achieving the savings necessary to protect the one, you could always catch another. It was so slow that if you missed the last one, you for the first time since its creation, the part A system. Unfortunately, during the long debate about could ride your bike and catch up at the next trust fund will be paying out more in benefits station. If you couldn't afford a ticket, you than it collects in taxes. Why? Mainly because the MPA some groups and individuals gen- could always ride on the roof. The global the costs of providing Medicare benefits have erated misinformation about the proposal. It is economy of the 1990's by contrast is like the grown at more than double the growth of pri- important to understand that these reforms bullet train from Tokyo to Osaka. If you vate-sector health care costs. If we fail to ad- were not introduced in order to offset tax cuts miss it it's goneÐgoodbyeÐand you can't dress this problem and control its excessive or balance the budget. If these reforms are not catch up.'' costs, Medicare will collapse. It is critical, adopted, the system will simply collapse. This That's a useful image to keep in mind when visiting Cairo these days because the therefore, that we make reforms to save Medi- is not a quick fix; these changes are needed to protect and preserve the long-term health of Arab world in general, and Egypt in particu- care because there are thousands of bene- lar, is in real danger of missing the train, ficiaries who depend on it. Medicare has the system. and the consequences could be catastrophic. served us well for 30 years, but its failure to As is the case with any change, glitches Consider some startling statistics from a incorporate private-sector innovations and to may occur as the plan is implemented. While new World Bank study of Middle East econo- end waste, inefficiency, and fraud requires us it would be ideal if the reforms were perfect, mies entitled ``Claiming the Future,'' which to develop a better system. it is likely some may need correction. There- will be released next month. In 1960, the The MPA will expand the types of coverage fore Congress will monitor the implementation seven leading Arab economies had an aver- Medicare offers: process and correct any mistakes that may age per-capita income of $1,521, while the occur. seven East Asian ``tigers''ÐTaiwan, South One, current Medicare coverage: A bene- Korea, Hong Kong, Singapore, Thailand, Ma- ficiary can choose to continue the same Medi- Now that the House has given its approval, the MPA has been incorporated into a larger laysia and IndonesiaÐhad a per capita in- care coverage they have now. If they choose come of only $1,456. The Arabs were slightly to do this, their copayments and deductibles budget package. It will now move on to the ahead. By 1991, however, the per-capita in- will not be increased. They will also continue Senate before it is sent to the President for his come of the Arab countries was only $3,342, to pay the same percentage of part B pre- signature. while the Asian tigers were up to 58,000 per miums, 31.5 percent, with the Government f person. paying the remainder of the premium. Today the Arab Middle East attracts 3 per- EGYPT'S ECONOMIC BIND cent of global foreign investment, while East Two, MedicarePlus: A beneficiary is given Asia attracts 58 percent. Egypt exported and choices from a new category of coverage, imported more goods and services 20 years MedicarePlus. This option will allow bene- HON. LEE H. HAMILTON OF INDIANA ago than it does today, relative to the size of ficiaries to choose the same types of health its economy. In other words, Egypt was more IN THE HOUSE OF REPRESENTATIVES coverage available in the private sector, such integrated with the world economy in 1970, as HMO's and other types of coordinated Monday, October 30, 1995 under Gamal Abdel Nasser, than in 1990, care, instead of traditional Medicare coverage. Mr. HAMILTON. Mr. Speaker, I would like to under Hosni Mubarak. The Arab world lags These plans will likely offer full health care bring to the attention of my colleagues a re- far behind East Asia in spending on edu- cation, in the number of women in the work coverage to beneficiaries, perhaps eliminating cent World Bank study which highlights the force and in every measure of productivity. the need to purchase costly supplementary in- economies of the Middle East in general and Why the difference? One explanation is surance plans. These plans might also involve Egypt as a leader in that region in particular. that in East Asia leaders usually based their coverage of additional services, such as pre- The study entitled ``Claiming the Future'' political appeal on economicsÐ``Have I made scription drugs and eye care, in exchange for was the subject of an October 18, 1995 edi- you better off today than four years ago?''Ð · This ``bullet'' symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. E 2064 CONGRESSIONAL RECORD Ð Extensions of Remarks October 30, 1995 while Arab leaders based their political ap- Wallace served with this unit in the Battle of Kathwari did not forget his origins. He enthu- peal on fighting colonialism or Zionism, or the Bulge and Operation Varsity, the largest siastically undertook a variety of projects sup- on ethnic and religious bonds, or on sheer airborne operation of the war.