Remarks of Senator Charles E. Grassley
Before the American Public Human Services Association (APHSA) and the National Councils of State and Local Human Services Administrators
July 20, 2004
Thank you for that kind introduction.
I appreciate the opportunity to speak with you this morning. I first want to commend you for the good work you do in the states. Working on issues such as child welfare, Medicaid, food stamps, child support and welfare, you face many challenges.
You are the front lines in our human services delivery system. You are where the "rubber meets the road." I hope you know how important the work you do is, and how grateful we are in the Congress for your efforts on behalf of our most vulnerable citizens.
I am happy to update you on welfare and Medicaid issues as well as discuss several initiatives dealing with seniors, children, families and the disabled.
TANF update
First, let me turn to the subject of welfare reform. I understand there are a lot of TANF administrators here today and I welcome the opportunity to update you on where we are regarding the reauthorization of the welfare bill.
As many of you know, last March, Senate Majority Leader Frist devoted a week for consideration of the welfare bill.
During that debate, the Senate passed the first amendment authored by Senator Olympia Snowe, from Maine, to increase child care spending by $6 billion beyond the $1 billion which was in the bill reported by the Senate Finance Committee.
I supported the amendment and it passed overwhelmingly with 78 votes.
After that strongly bipartisan vote, the next amendment offered was a non-germane amendment to increase the minimum wage.
Now, it has been reported by the press that the welfare bill has been stalled over whether there can be a vote on the minimum wage. That is completely inaccurate and I am here to tell you the rest of the story.
The fact is that Republicans offered a vote on the minimum wage as long as there would also be an agreement that we would finish consideration of thewelfare bill and then go to conference on the bill with the House.
But the democratic leadership objected to going to conference with the house, and that is why the welfare bill has been stalled. It is really unprecedented to object to going to conference when the bill has not even been voted on, but that is where we find ourselves today.
I have been told that some Democrats need assurances that the conference with the House will be fair and bipartisan.
Of course, that is not unreasonable. And, I am happy to provide assurances that I will do my very best to make sure that the conference with the House will be fair and bipartisan.
I am told that there are three major policy issues that concern Democrats the most. These three issues are the child care amount, the so-called House-passed "superwaiver" and the 40 hour standard in the Administration's proposal.
I will fight to make sure the final conference report will include the Senate version of the so-called "superwaiver" as well as the Senate structure on hours, which includes the Senate standard hours, as well as a separate standard for parents with children under 6 years of age, as well as the Senate structure on partial credit.
I am confident that the debate on the child care amount will be bipartisan because Senator Hatch, the most senior Republican on the Finance Committee and a likely conferee, a lead cosponsor of the child care amendment and he supports my commitment to try and make that debate bipartisan.
I would think that these assurances would be enough to persuade my Democratic friends to let this bill pass the Senate and go to conference, but so far at any rate, they are not.
I have not thrown in the towel, however; but, if we are to get a bill enacted this year, Democrats must come to the table and let us know what needs to happen to get a bill to conference. Time is of the essence.
Family Opportunity Act
Now, let me talk about the Family Opportunity Act. As many of you know, this has been a key policy priority of mine for many years.
I have been pleased to partner on this issue with my friend and colleague, Senator Edward Kennedy.
Last month we won Senate passage of our bipartisan legislation to help disabled children. This was a huge step forward for the families and children who need this additional help.
Medicaid today works well for a lot of people. The problem is that some families fall through the cracks. Many parents of disabled children have to drop out of the workforce or keep themselves in low-paying jobs just to remain eligible for Medicaid. In effect, the government is forcing parents to choose between near-poverty and their children's health care. We need to fix that.
The Family Opportunity Act allows states to create options for families with disabled children to buy into Medicaid while continuing to work. Parents would pay for Medicaid coverage on a sliding scale.
Medicaid is critical to the well-being of children with multiple medical needs because it covers many services that these children need, including physical therapy and medical equipment. Private health plans often are much more limited in what they cover. And many parents can't afford needed services or multiple co-payments out-of-pocket.
I believe that the Family Opportunity Act is pro-work because it lets parents work without losing their children's health coverage, pro-family because it encourages parents to work and build a better life for their children, and it's pro-taxpayer because it means more parents can continue to earn money, pay taxes and pay their own way for Medicaid coverage for their children.
I hope we can enact the Family Opportunity Act this year. The bill is currently bogged down in the House but I have not given up hope that we can get it done.
New Freedom Initiative
I also want to mention President Bush's New Freedom Initiative, which I support.
Features of the New Freedom Initiative would include:
1.) Demonstrations to allow the federal government to fully reimburse states for one year of Medicaid home and community-based services for individuals who move from institutions into home and community based care.
2.) Demonstrations to provide respite care to the caregivers of adults with disabilities and children with severe disabilities.
3.) The New Freedom Initiative would focus on increasing the recruitment and retention of direct care workers.
I am hopeful that as we work through issues relating to the Family Opportunity Act, that provisions from the New Freedom Initiative can be incorporated into a final bill.
Medicare Modernization Act (MMA)
Now I'd also like to take this opportunity to talk about the Medicare Modernization Act (MMA). For the first time in Medicare's history, beneficiaries will have a voluntary prescription drug benefit. This is a major step forward for the Medicare program. Beneficiaries also will receive coordinated disease management and better coverage of preventive screenings.
Since President Bush signed the MMA last December 8th, the Centers for Medicare and Medicaid Services (CMS) has worked diligently to implement numerous aspects of the MMA.
Just a week after the signing, CMS issued the rule for the Medicare-Approved Drug Discount Card program, which is designed to provide interim assistance to those who do not have any drug coverage at all and to provide even greater assistance to those with low incomes.
After just two months, nearly four million beneficiaries -- over fifty percent of the 7.6 million beneficiaries who were estimated to benefit from the program -- have enrolled. And they are realizing savings of ten to twenty-five percent - and in many cases more - off retail prices. In fact, combined with additional discounts from drug makers, low income beneficiaries who qualify for the $600 in assistance are seeing savings as high as eighty to ninety-five percent off their annual drug costs.
CMS also has issued rules on payments to physicians, hospitals, and for certain drugs. The proposed regulations for the Part D drug benefit and the Medicare Advantage program are expected in the near future. CMS deserves credit for its effort to complete this much work in a very short time.
I am looking forward to working with CMS and all stakeholders to ensure the MMA's successful implementation for our nation's Medicare beneficiaries.
Intergovernmental Transfers (IGTs)
Now, let me turn to the subject of Intergovernmental Transfers (IGTs) and state waivers.
As many of you know, CMS is attempting to curtail what they argue are improper intergovernmental transfers through the state amendment process.
I am very aware of the fiscal implications to the states if all current IGTs were eliminated and I would not support that. Legitimate IGTs should be permitted just as they have been for many years.
At the same time, I hope that everyone agrees that , if states are transferring dollars in order to exceed their allowable federal share of funding then clearly this practice should stop. IGTs should not be used as a back door way to raid the federal treasury.
While inappropriate IGTs should be phased out, CMS needs to go about this task in the right way. I have communicated to Administrator McClellan my concern about the lack of transparency and official public notification to the states.
The states have a right to expect to be treated fairly in that process. Now I have no evidence to suggest that states are being treated unfairly but I think that an open and transparent process in dealing with the states will help deal with questions about whether some states are getting better deals than others.
However, there is still a great deal of ambiguity and uncertainty over what the current statute allows as well as what constitutes an "improper" or "illegal" IGT.
This issue deserves more debate, but I want to assure you that I strongly support a consistent, transparent and fair process regarding both the state plan amendment approval process and the IGT matter.
State waivers
Now on to the subject of Medicaid waivers. The Medicaid program is nearly 40 years old and it has not kept pace with changes in health care delivery. The program that states must administer is outdated and it is failing to meet new health care challenges
States are finding creative ways to address today's challenges in the Medicaid program and that is good. At the same time, it is important that these experiments in Medicaid delivery are subject to public debate and scrutiny.
Beginning during the Clinton Administration and continuing today, the 1115 waiver process has been increasingly used to enact wide ranging changes in the program.
States are to be commended for attempting to find creative and innovative solutions to the health care needs of vulnerable populations through the waiver process.
I am committed to getting Medicaid to individuals who otherwise would be lacking coverage, while at the same time, asserting the appropriate oversight responsibility my position as Chairman of the authorizing committee requires. Congress has a right and a responsibility to oversee the 1115 waiver process.
Closing Remarks
In closing let me again communicate to you my appreciation of the good work you do in your states.
We in Congress are working towards enacting legislation and promoting policies to help you serve the needy families and vulnerable populations with whom you work.
I will be honest with you - as we approach the upcoming elections, it will be more and more difficult to enact any of the reforms I have discussed with you today.
However, I will be working hard to see what we can accomplished in the limited amount of time we have left in this session.
I would urge each and every one of you to contact your Senators and Representatives and tell them to put partisanship aside and help get welfare reauthorized, pass the Family Opportunity Act and the New Freedom Initiative. These are all good, strong proposals that will help fragile families and help you do your jobs even better that you are doing them now.
I thank you again for inviting me to speak to you today.
I have deliberately left time for questions or comments from you.