by Dick Castner
Congressional recesses serve a valuable purpose. They provide members of Congress with extended periods back in their states and districts, where they can connect with constituents and find out what’s on their minds.
At no time was this truer than with the recess just ending. Constituents packed town hall meetings in numbers never seen before. Most came to express serious concerns about the direction Congress is headed on health care. There’s plenty to be concerned about.
Before breaking for recess, four of the five committees that handle health care (three in the House, two in the Senate) approved massive reform bills. They acted with remarkable speed, given the importance of the issue and its complicated nature, and they acted with Democratic votes only. The Senate Finance Committee might still produce a bill with some bipartisan support. For months, three of the committee’s Democrats and three Republicans have huddled in marathon negotiations behind closed doors. They’re up against a September 15 deadline; if they don’t have a bipartisan bill by then Democratic leaders are preparing to go it alone.
Among the concerns voiced at town hall meetings across the country were several that the U.S. Chamber strongly shares. To cite the largest:
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Government-run plan. Touted as a way to "keep the insurance companies honest," it would instead put many of them out of the health insurance business. The government can’t and won’t be a fair competitor with private companies. It can bury many of its costs and has no need to make a profit. Three of the four committee bills would allow the government to reimburse providers at or near Medicare rates, which are far below market and would encourage cost shifting to the private sector on a massive scale. Cheap premiums for the government plan could dominate the market, leaving us a short step from just one option for all Americans.
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Employer mandate. In the House versions, employers with payrolls that exceed $250,000 annually would have to provide "qualified health benefits" to their employees and their employees’ dependents. They’d have to pay at least 72.5% of the premium cost for employees, 65% for dependents. If they don’t, they would pay a payroll tax of up to 8% of their total payroll to the government. All of this comes with onerous new record keeping requirements. After five years, a government board would define what a "qualified health plan" must contain, limiting design flexibility for ERISA plans and setting the stage for costly coverage mandates.
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Who pays? Estimates of what all of this would cost, especially covering most of the uninsured, run well north of $1,000,000,000,000 (that’s trillion) in additional spending over ten years. Supporters claim their bills will be "deficit-neutral" when they come to the floor. But the Congressional Budget Office (CBO) says they have a long way to go, with the House piling up $239 billion in additional deficits over the first ten years. That’s after hundreds of billions in unspecified cuts to Medicare providers and hefty income tax surcharges to the highest earners, many of whom are successful small business owners. The administration and Senate leaders have discussed a long list of personal and business tax increases that could hit everything from nonprofit hospitals to sugary drinks. Underlying all of this is the debate over whether to tax employer-provided health benefits. Candidate Obama said he wouldn’t do it but as Willie Sutton said about banks, "that’s where the money is."
The business community has as large a stake in health care reform as anyone. Employers voluntarily pay more than $500 billion annually to provide coverage for nearly 177 million Americans. But soaring premiums make it harder each year for employers to provide these vital benefits. The U.S. Chamber of Commerce is committed to finding ways to make quality health care more affordable and accessible for all.
There is widespread agreement about much of what is being discussed, things that could pass with large bipartisan majorities. We could reform the insurance system by eliminating restrictions based on pre-existing conditions or health status; guaranteeing that anyone can buy a policy and that those policies couldn’t be revoked; placing reasonable limits on rating differences; providing subsidies for those who can’t afford coverage; and requiring everyone to have health care coverage. We could control costs by using health information technology; focusing on wellness and prevention; simplifying administration; combating fraud and abuse; and letting individuals and small businesses deduct health insurance expenses. We could create a vibrant marketplace with a health insurance exchange that connects consumers with insurance options, removing fragmentation and spurring choice and competition. These things needn’t cost a trillion dollars and would make a real difference in people’s lives.
One thing on which opinions differ but that should be on the table if we’re serious about controlling costs: medical liability reform.
What can you do?
Two things: Join the Campaign for Responsible Health Reform to stay informed; and contact your members of Congress as they return from recess to Washington. Urge them to step back from the direction they were headed in July and focus on sensible reforms that will improve the quality and availability of health care while holding the line on costs.