Table Of ContentS. Hrg. 103-576
HEALTH CARE REFORM
Y4.SM
1/2: S. HRG. 103-576
RINGS
Health Care Reform S.Hrg. 103-576,...
BEFORE THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES SENATE
ONE HUNDRED THIRD CONGRESS
FIRST AND SECOND SESSIONS
ON
FIELD HEARINGS ON HEALTH CARE REFORM
DECEMBER JANUARY AND
9, 1993, 20 21, 1994
Printed for the Committee 6ri fewfoffeiiti&m . j.
U.S. GOVERNMENT PRINTING OFFICE
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78-384 WASHINGTON 1994
:
Forsale by theU.S. Government PrintingOffice
SuperintendentofDocuments,Congressional SalesOffice, Washington, DC 20402
ISBN 0-16-044503-5
S. Hrg. 103-576
HEALTH CARE REFORM
Y 4.SM 1/2: S. HRG. 103-576
RINGS
Health Care Reform S.Hrg. 103-576,...
BEFORE THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES SENATE
ONE HUNDRED THIRD CONGRESS
FIRST AND SECOND SESSIONS
ON
FIELD HEARINGS ON HEALTH CARE REFORM
DECEMBER 9, 1993, JANUARY 20 AND 21, 1994
Printed for the Committee o
AUG
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GOVERNMENT PRINTING OFFICE
U.S.
78-384 -= WASHINGTON : 1994
Forsale by theU.S. GovernmentPrintingOffice
SuperintendentofDocuments,Congressional SalesOffice,Washington, DC 20402
ISBN 0-16-044503-5
COMMITTEE ON SMALL BUSINESS
DALE BUMPERS, of Arkansas, Chairman
SAM NUNN, of Georgia LARRY PRESSLER, of South Dakota
CARL LEVIN, of Michigan MALCOLM WALLOP, Wyoming
TOM HARKIN, of Iowa CHRISTOPHER S. BOND, Missouri
JOHN F. KERRY, of Massachusetts CONRAD BURNS, Montana
JOSEPH I. LIEBERMAN, of Connecticut CONNIE MACK, Florida
PAUL DAVID WELLSTONE, of Minnesota PAUL COVERDELL, of Georgia
HARRIS WOFFORD, of Pennsylvania DIRK KEMPTHORNE, of Idaho
HOWELL HEFLIN, of Alabama ROBERT F. BENNETT, of Utah
FRANK R. LAUTENBERG, of New Jersey JOHN H. CHAFEE, of Rhode Island
HERB KOHL, of Wisconsin KAY BAILEY HUTCHISON, of Texas
CAROL MOSELEY-BRAUN, of Illinois
John W. Ball III, StaffDirector
Thomas G. Hohenthaner, Minority StaffDirector
(II)
CONTENTS
DECEMBER
9, 1993
LITTLE ROCK, AR
Page
Statements of Senators:
Bumpers, Hon. Dale, a U.S. Senator from the State ofArkansas 1
Statements
of:
Miller, John E., Arkansas State Representative, District 67 3
Kumpuris, Dr. Drew, chairman, Governor's Task Force on Health Care
Reform
10
Brown, Greg, chairman and CEO, Union Bancshares of Benton, Incorpo-
rated, Benton, AR 18
Murry, Tom, owner, Kawasaki Sports Center, Incorporated, Little Rock,
AR
24
Abney, Keith, owner operator of McDonald's Restaurants, Little Rock,
AR
26
Nelson, Vernon, president of the Nelson Group, Incorporated, Little Rock,
AR
27
Yukon, Norine, executive director, Prudential Health Care Plans of Ar-
kansas 37
Cabe, Robert, senior vice president, External Services, Arkansas Blue
Cross/Blue Shield 41
Madigan, Stephen, vice president, Seabury and Smith, Little Rock, AR 46
Feild, Dr. Charles, Fellow, American Academy of Pediatrics and Associ-
ate Professor of Pediatrics, chief, Community Pediatrics and Public
Policy, University of Arkansas for Medical Sciences and Arkansas Chil-
dren's Hospital 52
Ward, Dr. Harry, chancellor of the University of Arkansas for Medical
Sciences 56
Fraizer, Lee, executive vice president, St. Vincent Infirmary Medical
Center 59
Busfield, Dr. Roger, Jr., president and CEO, Arkansas Hospital Associa-
tion 61
Kirsch, Nancy, director, Public Health Programs, Arkansas Department
of Health, Little Rock, AR 68
McGrew, Charles, director of Health Facility Services and Systems, Ar-
kansas Department of Health, Little Rock, AR 75
Shuler, Betty Gay, executive director, Mainline Health Systems, Port-
AR
land, 77
Jackson, Dr. John, associate director, Family Medicine and director of
Obstetrics, Mainline Health Systems, Eudora, AR 83
Corbitt, Dr. Mary Louise, neurologist and cofounder of the Neurology
Group and the Arkansas Headache Clinic 87
Baker, Dr. Glenn, president, Arkansas Medical Society, Little Rock, AR.... 93
Weber, Dr. Jim, president-elect, American Academy of Family Physi-
AR
cians, Jacksonville, 95
Bingaman, Herb, president, Arkansas Seniors Organized for Progress,
AR
Little Rock, 99
Malone, Cecil, State director, AARP, Little Rock, AR 102
Pugh, Johnnie, State chair, Association of Communities Organized for
Reform Now (ACORN) 114
(Hi)
Page
JANUARY
20, 1994
JONESBORO, AR
Statements of Senators:
Bumpers, Hon. Dale, a U.S. Senator from the State of Arkansas..... 121
Statements of:
Rose, L.D., owner, Pocahontas Aluminum, Pocahontas, AR 126
AR
Scurlock, James, owner, Jonesboro Concrete Pipe, Jonesboro, 127
Stanley, Penny and David, farmers, Augusta, AR 136
Yates, Robert, M.D., Obstetrics-Gynecologist, Northeast Arkansas
Women's Clinic, P.A., Jonesboro, AR 143
McDaniel, Marion A., M.D., family practitioner, Helena, AR 146
McBride, Mike, administrator, Randolph County Medical Center, Poca-
hontas, AR 154
Taylor, Ramona, administrator, Crittenden County Health Unit, West
Memphis, AR 166
Eason, John, director, Lee Co-op Clinic, Marianna, AR 169
Hogue, Wanda R., area XI area manager, area XI health office, Walnut
Ridge, AR 175
JANUARY
21, 1994
FAYETTEVILLE, AR
Statements of Senators:
Bumpers, Hon. Dale, a U.S. Senator from the State of Arkansas 191
Statements of:
Vining, Robert, owner, Ozark Imports, Springdale, AR 193
AR
Phillips, Kanna, owner, 1st Choice Realty, Clarksville, 194
Cole, Jason, co-owner, Professional Therapy Services & Razorback Sports
and Therapy Clinic, Fayetteville, AR 196
AR
Kelley, Jo, CEO, Razorback Federal Credit Union, Fayetteville, 198
Keith, Sister Judith Marie, CEO, St. Edward Mercy Medical Center, Fort
Smith, AR 207
Klepper, Dr. Charles, internist, Harrison, AR 209
Hall, Dr. Ben, family practitioner, Lincoln, AR 212
Johnson, Dr. Dan, Fort Smith Rehabilitation Hospital, Fort Smith, AR 217
Proffitt, Dr. Danny, AHEC physician, Public Health Medical Consultant,
Fayetteville, AR 224
Jaggers, Kathy, RNP, Women's Health Practitioner, Area 3 Health
Office, Russellville, AR 228
Marsh, Nancy, RN, administrator, Madison County Health Unit, Hunts-
AR 233
ville,
Williams, David, administrator, Ozark Guidance Center, Inc., Fayette-
AR 237
ville,
ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD
Letter to Senator Bumpers, from David W. Dubbell, president, Pel-Freez, Inc.
with enclosure 250
(IV)
HEALTH CARE REFORM
THURSDAY, DECEMBER
9, 1993
U.S. Senate,
Committee on Small Business,
Little Rock, AR.
The Committee met, pursuant to notice, at 9 a.m. in the Hershel
Friday Courtroom, University of Little Rock Law School, Little
Rock, AR, Hon. Dale Bumpers (chairman of the Committee), presid-
ing.
OPENING STATEMENT OF HON. DALE BUMPERS, A SENATOR
U.S.
FROM THE STATE OF ARKANSAS
The Chairman. Good morning. I am going to keep this hearing
on time today. We have enough witnesses to take us well into the
afternoon, and maybe even evening. So it is important to other wit-
nesses who will be coming to testify later that we be ready for
them when they get here. First I want to thank all the witnesses. I
apologize for my voice, but it is much better than it was. I thought
for awhile I was going to have to cancel this hearing. I want to
thank all our witnesses for the time they spent on their state-
ments, and more importantly for their concerns about health care
and health care reform.
The primary purpose of this hearing is to hear the concerns of
small business owners about the impact the various health care
plans will have on them and their ability to continue in business.
But we would be remiss if the Committee did not also hear from
providers, consumers, the insurance industry and others, simply be-
cause we cannot evaluate the small business impact in a vacuum.
We need to know more about how the plan is going to affect ordi-
nary citizens, the States, those presently self-insuring their employ-
ees, the public health clinics and myriad other questions.
Is the present definition of small business, 75 employees, a
proper level or should it be higher? Should every citizen have a
right to a doctor of his choice? The health care costs have skyrock-
eted to the point that we now know that in the past 25 years it has
consistently doubled and quadrupled the inflation rate.
A
few statistics to illustrate a point. In 1980 health care spending
represented nine percent of our gross domestic product. By 1992
that number had increased to 14 percent and it is expected to rise
to 18 percent by the year 2000, almost one out of every five dollars
we spend in this country by the year 2000, if we do nothing, will be
for health care. No other country in the world spends more than 10
percent of their gross domestic product for health care. We could
(1)
very conceivably be spending twice as much per capita or a per-
centage of our GDP as any other nation on earth.
This year the United States will spend as much on health care as
we spend on the combined cost of all fuel oil, natural gas, electrici-
ty, gasoline, transportation, including all new and used car pur-
chases, furniture and household equipment. Health care spending
for each worker in America will cost over $7,000 in 1994. Without
reform the cost per worker will increase to $12,386 or 25 percent of
their total compensation by the year 2000.
Insurance premiums and Worker's Compensation payments by
employers have increased over 200 percent after inflation over the
past 20 years, and for many small business employers, the cost of
coverage is now beyond their means.
One item proposed in the administration's plan and universally
applauded is to cover the medical portion of Worker's Compensa-
tion under the new plan.
The President deserves a lot of credit for taking on this very dif-
ficult task of reforming the system. It is universally agreed that
this has to be done.
Next year the Congress will consider essentially four proposals,
there will be many on the table, which represent widely different
approaches to expanding health care coverage and controlling
costs. Some will simply provide for tax incentives to encourage pri-
vate coverage, others, notably the Clinton plan, will mandate that
employers provide benefits. I might add that this is an item that
drives small business up the wall. Some will institute a single
payer national insurance system, similar to Canada's.
I cosponsor the President's bill with the clear understanding that
it will have to be amended extensively before final passage. While I
support the goals of the administration's proposal, I also recognize
that there are many different ways to achieve those goals. No ap-
proach will be painless. There is no magic bullet. Our challenge is
to find the right balance between short-term pain and long-term
benefits.
Because this issue is so important, I want to stay in close touch
with the people of our state as the Congress begins this work.
Today is the first of a series of hearings I plan to hold throughout
the state. Because of the large number of witnesses, I have asked
them to limit their testimony to 5 minutes so we will have more
time for questions and answers. I recognize that given the complex-
ity of the health care issue, 5 minutes is woefully inadequate and I
appreciate the effort all of you have taken to prepare very thought-
ful statements, most of which I understand. The President's propos-
al alone is over 1,300 pages long. Four other comprehensive bills
have been introduced just during this past session. So, I do not
expect anyone to be a consummate expert on these reform propos-
als. All of us simply use our deep and abiding concern for what is
best, not just for each of us, but for our country and for the people
of Arkansas. In doing so, we need only use our common sense,
based on our practical experience in arriving at our conclusions.
Finally, I would like to point out that 85 percent of the people in
this country have health care coverage of one extent or another.
Roughly 37 million have no coverage. They represent about 15 per-
cent of our population who have no coverage. Of the 85 percent
who do have health care coverage, a vast majority of them are un-
happy with the system. Many of them are apprehensive because
even though they may have a quarter million dollars in the bank,
they know that even in the best of circumstances, that could be
wiped out under today's system.
In addition to that, they are not always satisfied with the effi-
ciency of the system. There is this fear, and everybody champions
what the President is trying to do but it is the President's and Con-
gress' responsibility to convince these people that what they are
going to get is better than what they have got. Unless we are able
to do that, this reform is going nowhere. You cannot ask people to
give up a known quality and a known quantity for something they
do not really understand. When you look at the 1,300 pages of this
proposal with as yet no real summary with illustrations answering
the thousands of questions that people have, obviously we have our
work cut out for ourselves. Not only from a substantive standpoint
in drafting a really substantive new health reform bill, but also in
convincing the American people that they are going to be better off
with
it.
On our first panel we have Representative John Miller, my long
time friend and chief aide when I was Governor of the State of Ar-
kansas. He is a co-vice chair of Arkansas Health Resources Com-
mission. And Dr. Drew Kumpuris, chairman of the Governor's
Task Force on Health Care Reform. If someone were to introduce
my
one of sons as Senator Bumper's son, he would be offended, but
he is Frank Kumpuris' son. We welcome both of you and we thank
you very much. John, since your name is first on my list, would
you please proceed?
STATEMENT OF ARKANSAS STATE REPRESENTATIVE JOHN
E.
MILLER, DISTRICT 67
Mr. Miller. Senator Bumpers, thank you very much. It is a real
honor and a privilege to be here and to attempt to advise you on
things that you know much more about than I do or ever will know
about, so do not take what I say as trying to tell you that I am the
authority on this issue.
The Chairman. There are no authorities, John, do not apologize.
Mr. Miller. But, as you know, I am deeply concerned about pro-
viding adequate health care. I remember very well that the first
time I met you was when you were signing up in the Secretary of
State's office to become our Governor.
The Chairman. Do not say how long ago that has been, John.
Mr. Miller. I am not going to talk about that, because I had al-
ready been in politics awhile. So I sure do not want to let that get
out.
The next time I really visited with you at any length was in my
family's store in Melbourne when you were up there campaigning,
and I was impressed and have always been of the depth that you go
to try to learn about the needs of people all over this state, particu-
larly in the rural areas. One of the subjects that we discussed that
afternoon in Melbourne, Arkansas was the need for doctors out in
the rural areas, and you have been a champion of that ever since I
have known you. I do not know what your ideas were before I
learned of you. I have always been impressed with your wife and
the efforts that Betty has made in the immunization of children. I
guess if we are talking about trying to save money and deliver
quality health care, the first thing we have to do is try to prevent
illnesses and try to prevent disease.
The Chairman. John, let me interrupt you just a moment to pay
tribute to Betty since you mentioned her. She is more deeply in-
volved in immunizations now than she has ever been.
Mr. Miller. I do not know how she could be, hardly.
The Chairman. And she has been attending seminars all week.
As you know, in the last 2 years, she and Rosalyn Carter have had
a program called Every Child by Two. Children cannot start school
until they are immunized, and there is no problem immunizing
children before they start to school. That is not the problem. The
problem is how do you get these infants immunized? She and Rosa-
lyn thought they had an idea. They did have a good idea. It is not
just their efforts, there is a national awareness.
Yesterday morning at breakfast she told me we have not had a
measles case in 3 weeks. Unprecedented, unheard of. So far this
year, I do not believe we have had a single death due to measles,
and the incidents of measles is going to be by far the lowest in this
year in the history of this country. In 1990, we had 27,600 cases of
measles and 32 deaths. Absolutely every one of them was prevent-
able. But you think of the cost of treating those children, you think
of the man hours lost with parents staying home with sick chil-
dren. And the only reason I mention that, John, is to pay tribute to
Betty because she has worked so hard on it. I will also say most of
these problems are solvable, we have the determination to attack. I
apologize for interrupting. Please proceed.
Mr. Miller. Well, I am glad you did because I feel so strongly
about that issue that I was talking to the executive director of the
Arkansas Health Care Resources Commission, and told her about
Betty's activities regarding immunization. And it has distressed me
the last few years because there have been times that we have said
the money was not available to buy the shots to immunize these
children. We all know that that has to be our number one priority.
Another thing that is very important, and you addressed it when
you were Governor, in fact, you addressed about all the issues that
I know of when you were Governor, so I am not telling you some-
thing that you do not already know and that you have not already
addressed. I am only trying to remind you of those things and let
you know that there i—s support out here for these kind of things.
And in the early 1940s is that a time limit?
The Chairman. That is a Washington system, John.
Mr. Miller. Okay. We were admitting 89 and 90 students to
medical school, which was on this ground here, this was the
campus of the medical school. And that continued on at least until
your administration, when we addressed that program and Senator
Howell, myself, others and you tried to educate more doctors, to
make doctors more available. We now have that program up to 150.
And that is one of the things that I think that we must do in order
to make health care available to our citizenry.
We
Another issue is the nursing program. have established the
One Plus One program. I do not know how familiar you are with
