Statements on Introduced Bills and Joint Resolutions

Floor Speech

Mr. WYDEN. Mr. President, I rise today to advocate for increasing Medicare efficiency and effectiveness by introducing the Strengthening Medicare and Repaying Taxpayers, SMART, Act of 2011 with my colleagues, Senators Portman, Ben Nelson, and Burr.

The SMART Act initiates common sense changes to the Medicare Secondary Payer, MSP, system, as a means of achieving that efficiency and effectiveness. This system kicks in whenever a Medicare beneficiary is injured and another party accepts responsibility to pay for the costs associated with that injury, making Medicare the ``secondary payer.'' For example, if a Medicare beneficiary is injured when she slips in a store the store reimburses her for the costs of the injury. In this scenario the store becomes the party responsible for paying the costs associated with the injury, and if Medicare pays any of the costs associated with the injury, it has to be reimbursed. The purpose of this system is to ensure that Medicare does not pay claims that a third party is liable for. Although seemingly obvious, the system currently on the books is set up in manner that is unnecessarily burdensome to all parties involved in these claims.

At the heart of the problem is the lack of financial disclosure by the Center for Medicare and Medicaid Services, CMS. Under the current MSP system, CMS does not calculate the MSP amount owed to the Trust Fund until after a claim has settled, making it impossible for the parties to factor that amount into the settlement process. Even after the claim has been settled and reported to Medicare, it can take months for the parties to find out how much money is actually owed in reimbursement.

Does this make any sense at all? Of course not. The beneficiary has no idea what portion of the settlement will be left after the payment is made to Medicare, the third party responsible for the bill has no way of knowing whether or not the amount settled upon will be sufficient to fully reimburse Medicare, and the Medicare Trust Fund is denied much needed funds because of the uncertain settlement process.

It is clear that the repercussions of our inefficient MSP system are widespread. Individual beneficiaries and businesses large and small are left in the dark. On top of that, State and local governments that settle personal injury and worker compensation claims also fall victim to these long, drawn out settlements which costs a significant amount of money at a time when budgets are especially tight.

The legislation my colleagues and I are introducing today provides a straightforward and commonsense solution. The SMART Act would create a more effective and efficient MSP process for all parties involved, while speeding the return of Medicare Trust Fund dollars. This legislation will improve the flow of information so that beneficiaries and companies may determine how much money is owed to the Trust Fund before they settle a claim. This change will enable parties to calculate the MSP amount they owe and reimburse Medicare directly, and it will provide CMS with tools to ensure that Medicare is fully reimbursed.

Medicare beneficiaries and businesses will no longer be forced to play this real life version of ``Price is Right,'' where Medicare plays the Bob Barker/Drew Carey role and the other parties are forced to guess at how much is owed.

The SMART Act will also preserve taxpayer resources by ensuring that Medicare does not spend more money pursuing these cases than the claim is actually worth. There have been reports of MSP demands as low as $2--CMS should not be spending more money on postage than the Medicare Trust Fund will receive in reimbursement. Surely we can create a sensible threshold that will protect Medicare's interest and prevent parties from gaming the system without wasting government money chasing down elderly beneficiaries to collect a handful of quarters.

In addition to streamlining the MSP system the SMART Act will protect consumers by eliminating the requirement for businesses to collect Social Security Numbers or Medicare numbers during the claims process. This is in line with a recently launched Medicare campaign which encourages beneficiaries not to give out these numbers as an important tool in fighting health care fraud and identity theft. We should not be sending seniors mixed messages or punishing businesses that are unable to obtain this information, despite their best efforts, from understandably reticent seniors.

The SMART Act will provide much needed clarity to the MSP system and will relieve the burden that is currently placed on all parties involved in the process.

I urge my colleagues to join us in cosponsoring this important legislation.

Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

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