NEWS RELEASE
Committee on Energy and Commerce Democrats
Congressman John D. Dingell, Ranking Member

Clinton and Dingell Announce Legislation
to Rescind Republican Giveaway
to Insurance Companies

Washington, DC – Senator Hillary Rodham Clinton (NY) and Representative John Dingell (MI) announced they will introduce legislation in both chambers of Congress if the Republican Congress passes and President Bush signs into law a giveaway to insurance companies inserted by Republicans behind closed doors into the budget reconciliation bill. The Clinton-Dingell bill would roll back a Republican measure preserving a loophole in Medicare payment policy that allows insurance companies to receive excess payments from Medicare. The Clinton-Dingell bill will also eliminate a slush fund for insurance companies in the law that created the Medicare prescription drug benefit.

This Republican effort to protect a windfall for insurance companies came as Republicans in Congress drastically cut Medicaid benefits and took away medically necessary care for children and seniors to offset their budget. Clinton and Dingell announced that their bill will use the funding that would have gone to insurance companies to restore funding to children's health care and Medicaid cut by the Republican budget.

“Republicans in Congress are cutting Medicaid for children and seniors so they can protect huge giveaways to insurance companies. This is just the latest example of Republicans in Congress taking care of special interests at the expense of the American people. We have to stop the Republican culture of corruption that is poisoning our legislative process and we have to make our health care system more accountable. We are going to stop this giveaway,” said Senator Clinton.

"There are nearly 46 million uninsured in our nation, yet the Republican Congress is poised to pass legislation that would add more to that number, particularly vulnerable children and people with disabilities, in order to protect the insurance industry's ability to profit at the expense of Medicare. Once again, Republicans are moving forward with legislation that benefits a favored industry to the detriment of ordinary Americans," said Representative Dingell.

The measure, included by the Republican-only conference committee that reconciled the House and Senate budget reconciliation bills, allows insurance companies to game Medicare payments. This loophole had been eliminated in the Senate version of the bill but the Republican conference committee secretly struck the good-government provision that would have kept insurance companies from bilking Medicare inappropriately. The Medicare Payment Advisory Committee, the independent group tasked by Congress to oversee and report on Medicare payments has called for the elimination of these excessive payments, calling them duplicative and excessive.

In addition, the Republican conference committee struck a provision that would have eliminated a slush fund for insurance companies included in the law that created the Medicare prescription drug program. The slush fund provides $10 billion over 10 years to encourage participation in the Medicare program by insurance companies called Preferred Provider Organizations. The Senate version of the budget reconciliation bill would have eliminated this slush fund, but Republicans saved it in conference, again preserving an unnecessary windfall for insurance companies at a time when Republicans were slashing the health care safety net for our most vulnerable Americans. The Medicare Payment Advisory Commission also criticized this giveaway, calling it unnecessary and unwarranted.

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