Chamber Supports Medicare H.R. 1

November 20, 2003

Members of the 108th Congress:

The U.S. Chamber of Commerce, the world's largest business federation representing employers of every size, sector and region, urges you to vote for H.R. 1, the "Medicare Prescription Drug and  Modernization Act of 2003." Giving seniors and the disabled access to a much-needed universal prescription drug benefit, ensuring Medicare's long-term viability for future retirees, and providing more private health plan choices that will enable seniors to select health coverage that best suits their individual needs is a priority for the business community. H.R. 1 begins a long overdue process of restructuring the Medicare program and placing it on a path towards long-term stability for future generations. For these reasons, the Chamber will consider votes on or related to H.R. 1 in its annual "How They Voted" scorecard.

H.R. 1 includes key provisions to ensure that the 12 million seniors who receive retiree health benefits from their former employers will be able to retain those benefits. Largely due to unsustainable rising health care costs, employers have been struggling to maintain retiree health coverage. In just the past two years, retiree health care coverage has decreased 22 percent. This legislation will assist in slowing the trend and stabilizing the availability of health coverage for current retirees by allowing employers to supplement the basic Medicare benefit as they do now for other Medicare-covered services. Additional options that allow employers the flexibility to integrate the new Medicare prescription drug benefit into their existing retiree health plans, as well opportunities to partner with Medicare for more comprehensive coverage, will help ensure continued coverage for current retirees.

In addition, this legislation strengthens Medicare's structure and delivery system by establishing more private health plan choices and encouraging techniques used by the private sector such as disease management and preventive health care services that help control costs and promote effective care. Through the creation of the Medicare Advantage Program, which creates new PPO regional plan options and strengthens the Medicare+Choice program, seniors will have more flexible private health plan choices than are currently available. The Chamber regards the introduction of private plan competition, and movement away from the centralized Medicare payment system, which has failed to reimburse providers adequately and limited private plan options among seniors, as critical to the long-term sustainability of the Medicare program. Moreover, as a result of insufficient reimbursements, providers have shifted costs to those with private health coverage, exacerbating the problem of rising health plan costs for employers and active employees.

Provisions are also included in H.R. 1 that will reward hospitals that voluntarily report certain information relating to quality measures with a higher inflation update. The
Chamber's Board of Directors recently endorsed the "Quality Initiative" effort to gather and report measures relating to acute myocardial infarction, heart failure and pneumonia. Greater disclosure of this information will give health plan sponsors and consumers important information in choosing among available providers in their area.

Finally, the Chamber strongly supports the establishment of Health Savings Accounts ("HSAs"). HSAs offer all employees a health plan option now open only to small businesses. Allowing employers and employees to contribute to tax-favored accounts, in combination with private health plans, will make health coverage and employee cost-sharing more affordable, and enable employees to save for health care expenses that they may incur after leaving their jobs.

For these reasons, the U.S. Chamber of Commerce strongly urges your support for H.R. 1.

Sincerely,

R. Bruce Josten
Executive Vice President, Government Affairs
U.S. Chamber of Commerce