[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]


                      THE EFFECTS OF THE PRESIDENT'S
                      HEALTH CARE LAW ON INDIANA'S
                       CLASSROOMS AND WORKPLACES

=======================================================================

                                  HEARING

                               BEFORE THE

                         COMMITTEE ON EDUCATION
                           AND THE WORKFORCE
                     U.S. HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

               HEARING HELD IN INDIANA, SEPTEMBER 4, 2014

                               __________

                           Serial No. 113-64

                               __________

  Printed for the use of the Committee on Education and the Workforce
  
  
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                COMMITTEE ON EDUCATION AND THE WORKFORCE

                    JOHN KLINE, Minnesota, Chairman

Thomas E. Petri, Wisconsin           George Miller, California,
Howard P. ``Buck'' McKeon,             Senior Democratic Member
    California                       Robert C. ``Bobby'' Scott, 
Joe Wilson, South Carolina               Virginia
Virginia Foxx, North Carolina        Ruben Hinojosa, Texas
Tom Price, Georgia                   Carolyn McCarthy, New York
Kenny Marchant, Texas                John F. Tierney, Massachusetts
Duncan Hunter, California            Rush Holt, New Jersey
David P. Roe, Tennessee              Susan A. Davis, California
Glenn Thompson, Pennsylvania         Raul M. Grijalva, Arizona
Tim Walberg, Michigan                Timothy H. Bishop, New York
Matt Salmon, Arizona                 David Loebsack, Iowa
Brett Guthrie, Kentucky              Joe Courtney, Connecticut
Scott DesJarlais, Tennessee          Marcia L. Fudge, Ohio
Todd Rokita, Indiana                 Jared Polis, Colorado
Larry Bucshon, Indiana               Gregorio Kilili Camacho Sablan,
Lou Barletta, Pennsylvania             Northern Mariana Islands
Joseph J. Heck, Nevada               Frederica S. Wilson, Florida
Mike Kelly, Pennsylvania             Suzanne Bonamici, Oregon
Susan W. Brooks, Indiana             Mark Pocan, Wisconsin
Richard Hudson, North Carolina       Mark Takano, California
Luke Messer, Indiana
Bradley Byrne, Alabama

                    Juliane Sullivan, Staff Director
                Megan O'Reilly, Minority Staff Director
                                 
                                 ------                                

        SUBCOMMITTEE ON HEALTH, EMPLOYMENT, LABOR, AND PENSIONS

                   DAVID P. ROE, Tennessee, Chairman

Joe Wilson, South Carolina           John F. Tierney, Massachusetts,
Tom Price, Georgia                     Ranking Member
Kenny Marchant, Texas                Rush Holt, New Jersey
Matt Salmon, Arizona                 Mark Pocan, Wisconsin
Brett Guthrie, Kentucky              Robert C. ``Bobby'' Scott, 
Scott DesJarlais, Tennessee              Virginia
Larry Bucshon, Indiana               Ruben Hinojosa, Texas
Lou Barletta, Pennsylvania           David Loebsack, Iowa
Joseph J. Heck, Nevada               Joe Courtney, Connecticut
Mike Kelly, Pennsylvania             Jared Polis, Colorado
Susan W. Brooks, Indiana             Gregorio Kilili Camacho Sablan,
Luke Messer, Indiana                   Northern Mariana Islands
Bradley Byrne, Alabama               Frederica S. Wilson, Florida
                                     Suzanne Bonamici, Oregon
                            
                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on September 4, 2014................................     1

Statement of Members:
    Roe, Hon. David P., Chairman, Subcommittee on Health, 
      Employment, Labor, and Pensions............................     1
        Prepared statement of....................................     3
Statement of Witnesses:
    Defabis, Mark, President and Chief Executive Officer, 
      Integrated Distribution Services, Plainfield, IN...........    49
        Prepared statement of....................................    51
    Forkner, Tom, President, Anderson Federation of Teachers, AFT 
      Local 519, Anderson, IN....................................    17
        Prepared statement of....................................    19
    Lamar, Nate, International Regional Manager, Draper Inc., 
      Spiceland, IN..............................................    60
        Prepared statement of....................................    62
    Shafer, Mike, Chief Financial Officer, Zionsville Community 
      Schools, Zionsville, IN....................................     5
        Prepared statement of....................................     8
    Stone, Robert, Director of Palliative Care, IU Health 
      Bloomington Hospital, Bloomington, IN......................    54
        Prepared statement of....................................    57
    Snyder, Tom, President, Ivy Tech Community College, 
      Indianapolis, IN...........................................    11
        Prepared statement of....................................    13
    Tanoos, Danny, Superintendent, Vigo County School 
      Corporation, Terre Haute, IN...............................    23
        Prepared statement of....................................    27
    Wolfe, Dan, Owner, Wolfe's Auto Auction, Terre Haute, IN.....    45
        Prepared statement of....................................    47
Additional Submissions:
    Bucshon, Hon. Larry, a Representative in Congress from the 
      State of Indiana:
        Clay Community Schools, letter, dated Aug. 5, 2014.......    34
    Messer, Hon. Luke, a Representative in Congress from the 
      State of Indiana:
        Community School Corporation of Southern Hancock County, 
          letter, dated Sept. 3, 2014............................    78
    Mr. Tanoos:
        Letters to the Internal Revenue Service..................    31

 
                 THE EFFECTS OF THE PRESIDENT'S HEALTH
                  CARE LAW ON INDIANA'S CLASSROOMS AND
                              WORKPLACES

                              ----------                              


                      Thursday, September 4, 2014

                     U.S. House of Representatives

        Subcommittee on Health, Employment, Labor, and Pensions

                Committee on Education and the Workforce

                            Washington, D.C.

                              ----------                              

    The subcommittee met, pursuant to call, at 10:00 a.m., in 
Greenfield City Hall, 10 South State Street, Hon. David P. Roe, 
[chairman of the subcommittee] presiding.
    Present: Representatives Roe, Bucshon, Brooks, Messer, and 
Rokita.
    Staff Present: Janelle Belland, Coalitions and Members 
Services Coordinator; Molly Conway, Professional Staff Member; 
Zachary McHenry, Legislative Assistant; Brian Newell, 
Communications Director; Eunice Ikene, Minority Labor Policy 
Associate; Amy Peake, Minority Labor Policy Advisor.
    Chairman Roe. A quorum being present, the Subcommittee on 
Health, Employment, Labor, and Pensions will come to order.
    Good morning, everyone, and welcome to today's hearing. I 
would first like to take a moment to thank our witnesses for 
joining us here to discuss this important issue. I would also 
like to extend our appreciation to the members and staff of the 
Greenfield City Government for hosting our hearing and thank 
the citizens of this great city for their hospitality, 
especially Mayor Fewell. The mayor and I had an opportunity to 
speak beforehand.
    Phil Roe is my name, from northeast Tennessee, and I was 
the mayor of a small town, a little bit larger than Greenfield, 
about 60,000 people, Johnson City, Tennessee, and I feel very 
at home in City Chambers. I spent 10 years on the planning 
commission. I spent six years as a city commissioner and was 
also mayor of the city. You have a beautiful city here.
    Just let me explain to you, it is not usual that we have 
field hearings outside Washington. But this is the fifth one of 
these that I have chaired, and I believe it is very important. 
Being a local official, I think the best government brings the 
government to the people, and I have made a real effort, and 
you should be honored, as I am honored to be here, to have this 
in your community, to have an official hearing of the U.S. 
Congress. I want to thank all of you all for being here today.
    Before I joined the Congress, I spent more than 30 years 
practicing medicine in rural Appalachia. As a physician, I have 
experienced firsthand a health care system that is the envy of 
the world and one that has helped improve the lives of 
countless men, women, and children, but I also learned our 
health care system isn't perfect.
    One of the problems with the American health care system is 
it costs too much, it is too bureaucratic, and there are far 
too many families that lack access to the care they need. 
Health care reform has long been an urgent national priority. 
It is one of the reasons I decided to run for Congress. 
Unfortunately, the President's health care law is not the right 
prescription for reform. In fact, it is making many of these 
challenges worse.
    Under the President's plan, health care costs are going up, 
not down, and full-time jobs are being destroyed, not created. 
One of the things that struck me when I was preparing for this 
hearing, I have been in Congress, this is my sixth year, and 
the committee prepares a hearing memo for us. As I was reading 
the first paragraph of this hearing memo it said employer-
sponsored health insurance is the predominant source of 
coverage for individuals and families.
    According to the Kaiser Family Foundation, approximately 
150 million Americans and 66 percent of workers are covered by 
employer-provided health plans. When I started in Congress six 
years ago, that number was 160 million of our friends and 
neighbors and 62 percent. So we have lost--10 million of our 
citizens have lost--health insurance coverage in the last six 
years. It is unbelievable. The harmful consequences are playing 
out in communities across the country.
    The Federal Reserve Bank of Philadelphia recently surveyed 
area businesses to learn how the law is affecting their 
workplaces. Approximately 18 percent of businesses said they 
are cutting jobs and employees, and another 18 percent said 
they were shifting more workers to part-time hours. 
Additionally, a majority of employers are changing their health 
plans because the law is passing more costs onto employees. 
Federal Reserve authorities in Atlanta and New York report 
similar findings.
    The law is hurting not only our businesses, but our 
classrooms as well. Higher costs, fewer full-time jobs, lost 
wages--these are problems that are plaguing schools nationwide. 
A survey by the College and University Professional Association 
for Human Resources found many institutions are passing more 
health care costs onto their employees. Students will 
ultimately lose as schools grapple with the law's added costs 
and burdensome mandates.
    Our children and working families deserve better. It is 
clear that we need to set aside the President's health care law 
and start over with real reform that will lower costs and 
expand access. I want to do a shout-out for Todd, Mr. Rokita, 
who is sitting to my right. He served on a committee with me 
formed by the Republican Study Committee, which I chaired, to 
write the American Health Care Reform Act, which he was very 
instrumental in, and I want to thank you for the work that you 
did, the Republican alternative.
    In the meantime, we need to take responsible steps that 
will provide relief to schools and workplaces. That is 
precisely what the House of Representatives is determined to 
do. I want to thank my colleague, Representative Luke Messer, 
for helping lead this important effort.
    Before I turn it over to Luke, I want to just do an 
introduction to the panel. I feel really fortunate to work with 
these four great men and women that are on this panel.
    Dr. Larry Bucshon is a good friend, a fellow physician from 
Evansville, Indiana. I have been to his community for a 
hearing.
    Susan Brooks, I have now been to Indianapolis to meet with 
the Indiana Medical Society. I feel like I ought to be a 
property owner there.
    [Laughter.]
    Chairman Roe. But, she is a terrific addition. And 
obviously Luke Messer, who I have just mentioned, and Mr. 
Rokita. We all work on the Education and the Workforce 
Committee. We all have a passion for education. I personally am 
a 23-year public school attendee. I have never been to a 
private school, and for some young guy like me who was raised 
on a farm in rural Tennessee to be able to go to college and 
medical school, it was because of a great public education 
system, and I absolutely am committed to that. That is the 
opportunity that most of us have.
    I now yield the remainder of my time to Mr. Messer, and I 
will say I have great respect for him because he married a 
lovely young woman from my district, Greenville, Tennessee.
    [Laughter.]
    Chairman Roe. Mr. Messer?
    Mr. Messer. Everybody in this crowd that knows Jennifer 
knows I over-achieved in that department, no question about it.
    [Laughter.]
    Mr. Messer. Thank you, Mr. Chairman. I want to thank all my 
Indiana colleagues for being here today. I want to welcome you 
all to Greenfield. It is great to look out in the crowd and see 
so many friends out there. I knew when we were looking for a 
location to have this hearing, Greenfield was going to be a 
great place to do it. Thanks to everyone for taking time out of 
your busy schedules to participate in today's hearing.
    I want to especially thank Mayor Chuck Fewell and the Town 
of Greenfield for hosting this event today. On behalf of 
everyone here, witnesses too, I thank Chuck for bringing 
doughnuts.
    This hearing will allow school leaders and business owners 
to share their perspectives about how the President's health 
care law is impacting them.
    I want to thank Chairman Roe again for convening the 
hearing and for leading the effort, with Committee Chairman 
Kline, to highlight the negative impact of the President's 
health care law.
    Congress needs to hear directly from those who have been 
forced to make difficult decisions as a result of the law's 
employer mandate, which requires employers to provide expensive 
government-approved health care or face steep fines. Put 
simply, the Federal Government should not be taxing schools and 
small businesses to pay for the President's health care law. It 
is just not right. And if we really care about our economy and 
our nation's future, we will do something about it.
    Dave Adams, the Superintendent of Shelbyville Central 
Schools, first brought this issue to my attention early last 
year. He said the employer mandate will cost his schools 
$794,000 annually. Bob Yoder, Assistant Superintendent of 
Southern Hancock School Corporation, estimated its price tag at 
$450,000 per year. Unfortunately, their stories are not unique, 
and you will hear some of those stories today.
    That is why I have introduced legislation to exempt schools 
from this onerous provision. We can't fund the President's 
health care law at the expense of education.
    Small businesses are being harmed, too. Businesses 
statewide have been forced to reduce worker hours and scale 
back their workforce to balance new budget constraints imposed 
by the law. That is why I have introduced legislation that will 
exempt most small businesses from this tax, too. It is also why 
I support legislation that would restore the full-time employee 
equivalent to the traditional 40-hour threshold as well.
    Nate LaMar, the International Regional Manager of Draper, 
Incorporated, in Spiceland, rightly notes that the law's fees 
and taxes don't stop with the employer mandate.
    There are strong feelings about the President's health care 
law on both sides of the aisle. I respect those views, and I 
respect the views of those who believe deeply that it is the 
best way to address the challenges in our health care system. I 
would hope that most would agree, however, that our nation's 
school children and hourly workers should not be forced to pay 
the price of this law.
    Thank you, Mr. Chairman, and I yield back the balance of my 
time.
    Chairman Roe. I thank the gentleman for yielding.
    Pursuant to Committee Rule 7(c), all members will be 
permitted to submit written statements to be included in the 
permanent hearing record. Without objection, the hearing record 
will remain open for 14 days to allow such statements and other 
extraneous material referenced during the hearing to be 
submitted for the official hearing record.
    It is now my pleasure to introduce our first panel of 
distinguished witnesses.
    Mr. Mike Shafer is a Certified Public Accountant and 
currently serves as the Chief Financial Officer for Zionsville 
Community Schools in Zionsville, Indiana. Mr. Shafer has been 
CFO of the Zionsville Community Schools since April of 1998.
    Welcome, Mr. Shafer.
    Mr. Tom Snyder is President of Ivy Tech Community College 
in Indianapolis, Indiana. Ivy Tech is the largest institution 
of higher education in Indiana and the nation's largest singly 
accredited statewide community college system.
    Welcome, Mr. Snyder.
    Mr. Tom Forkner is the President of Anderson Federation of 
Teachers, AFT Local 519 AFL-CIO of Anderson, Indiana. Mr. 
Forkner has been teaching at Anderson Community Schools since 
1976 and has been President of Anderson Federation of Teachers 
since 2010.
    Welcome, Mr. Forkner.
    And Mr. Danny Tanoos is a Superintendent of Vigo County 
School Corporation in Terre Haute, Indiana. Mr. Tanoos has been 
an employee of the Vigo County School Corporation for 35 years 
and has served as Superintendent of the Schools for the last 17 
years, and that must be a record because I think the average 
school superintendent in America is three years.
    [Laughter.]
    Chairman Roe. So my congratulations, or condolences, I am 
not sure which.
    [Laughter.]
    Chairman Roe. Before I recognize you to provide your 
testimony, let me briefly explain our lighting system. You have 
five minutes to present your testimony. When you begin, the 
light in front of you will turn green. With one minute left, 
the light will turn yellow. When your time has expired, the 
light will turn red. At that point, I will ask you to wrap up 
your remarks as best you are able. We won't cut you off, but 
try to wrap up your thoughts. And after everyone has testified, 
members will each have five minutes to ask questions.
    Mr. Shafer, you are recognized for five minutes.

 STATEMENT OF MIKE SHAFER, CHIEF FINANCIAL OFFICER, ZIONSVILLE 
             COMMUNITY SCHOOLS, ZIONSVILLE, INDIANA

    Mr. Shafer. Thank you, sir, and thank you to all the 
distinguished congressmen and congresswomen--
    Chairman Roe. Mr. Shafer, could you move that mic a little 
bit closer to you?
    Mr. Shafer. Yes, sir. Thank you to the Chairman and to all 
the distinguished congressmen and Congresswoman Brooks for the 
opportunity to testify today about the effects of the 
President's health care law in Indiana's classrooms.
    My name is Mike Shafer. I am the Chief Financial Officer 
for Zionsville Community Schools in Zionsville, Indiana. 
Zionsville Community Schools is a suburban school district of 
some 6,200 students located in Boone County, Indiana, on the 
northwest corner of the Indianapolis metropolitan area. Our 
school district is a perennial leader in academic achievement 
in the State of Indiana, consistently ranking in the top three 
public school districts in the state as measured by various 
standardized test scores, graduation rates, college placement 
rates, and all other objective measures of student performance.
    However, our academic successes do not equate to the level 
of funding our schools receive. In fact, Zionsville Community 
Schools receives one of the lowest amounts of funding per pupil 
of any public school district in the state. As a result, the 
Patient Protection and Affordable Health Care Act has had and 
continues to have a severe and disproportionately disruptive 
effect on our high performing school district.
    We have identified three categories in which these negative 
effects have occurred in our school district. There is the 
impact on our students, the impact on our employees, and the 
impact on the school district itself. These intertwined and 
interactive effects, taken together, are serious and now appear 
to be increasing in their severity over time.
    In 2013, as the provisions of the PPACA became better known 
and their ramifications started to become clear, we grew 
concerned about the impacts on our schools. Public school 
districts, including ours, commonly employ instructional aides, 
cafeteria workers, non-licensed substitute teachers, sports 
coaches, and various other categories of support positions for 
30 hours or more per week during the school year.
    Bluntly stated, public school districts across the nation 
commonly did not then and do not now offer health insurance 
coverage to the employees in those categories because the cost 
of offering coverage is beyond the budgetary means of most 
school districts to do so. School districts, including ours, 
realized then that the effect of the PPACA would be to choose 
between paying enormous amounts of excise taxes to the IRS 
under the provisions laid down in Section 4980H of the Internal 
Revenue Code for employer responsibility payments or incurring 
budget-busting costs to provide highly subsidized affordable 
health insurance for these employee groups, or be forced to 
reduce the work hours allowed for each of these employees to 
less than 30 hours per week.
    For Zionsville Community Schools, we found that the cost we 
would incur should we fail the eligibility tests of the law and 
incur the excise tax penalty would be between $1.25 million and 
$1.6 million, with these amounts increasing in the future. The 
alternative of providing the coverage and subsidizing it for 
the employees to the degree required to meet the 9.5 percent 
affordability test would cost approximately $1.17 million in 
insurance premiums. All of these amounts would have fallen 
directly on our already overly strained general fund budget. In 
the end, we concluded that making a choice between these 
alternatives was no choice at all but in reality was a Hobson's 
Choice. We could only ensure the financial viability of the 
school district and the continued ability of the school 
district to deliver quality education to children if we reduced 
our support staff hours of work.
    This is why we are compelled to say today that the PPACA is 
directly affecting our students. The employees of the school 
district are there to serve our students. The services provided 
by these employees to school children has been reduced because 
we were forced to reduce the number of hours of services of our 
classroom aides, who actively supplement the instruction 
provided by our teachers.
    If you are a six-year-old learning to read in Zionsville 
and you need extra help, you will still get help, but the 
school personnel providing that help will be busier and will go 
home sooner than was the case in the past, and realistically 
you may not get quite as much help as you would have.
    If you play on the girls' softball team at the middle 
school, you got a new coach. The former coach was successful, 
respected, and a great role model, but he wasn't allowed to 
coach anymore because that would put him over 29 hours per 
week.
    If you are a special needs student, for whom stability is 
an important part of maintaining your success at school, we can 
no longer guarantee the continuity for many of you that we once 
had. As workers find they cannot survive on 29 hours per week, 
our turnover rate has increased dramatically.
    The PPACA's effects on our employees should be obvious at 
this point. Reducing the affected employee groups' hours 
decreased their pay by 10 to 20 percent. This worked a real 
economic hardship on these hard-working Indiana taxpayers. 
Given that approximately 150 employees had their hours cut, and 
not-to-exceed caps were placed on over 200 others, the impact 
on the employees is one which is felt throughout the homes and 
businesses of our community.
    In terms of the effects on the school district itself, the 
effects have been far reaching. In addition to the concerns 
about the effects on our students and our employees, we have 
found we are now facing major issues with employee recruitment 
and retention in affected employee groups. We also have 
incurred significant new costs. For a handful of our most 
severe special needs students, we found that having aides or 
attendants with reduced hours just did not and could not work. 
As a result, we did create one new employee group for those 
cases. This new group, because of the number of hours they were 
needed, is being offered insurance subsidized by the school 
district, with an annual cost for this coverage of nearly 
$70,000 for this group.
    While the bulk of the negative effects of the PPACA on our 
school corporation are generated by the IRS' ``30 hours is 
full-time'' rule, there are certainly other negative effects 
that the school district is experiencing. Last July, we were 
required to file an IRS form and pay the PCORI fee. Later this 
year we will be paying the reinsurance fee. Together, these 
fees will exceed $65,000 for us.
    Frankly, the idea that public school districts should use 
tax dollars to pay fees to subsidize big insurance companies is 
wrong. In our case, $65,000 is more than the cost of a teacher 
for a year.
    With our growing enrollment, we needed more teachers. We 
struggled and scraped to come up with enough money for the 
number of teachers we could. When we look at a class of 
students in, say, second grade, we find that class size could 
have been lower in at least one of our elementary schools by a 
significant number if we could have afforded one more teacher, 
but the money for that one more teacher instead is going to pay 
the fees under the PPACA.
    I will also mention that although the 30-hour rule is our 
primary concern, we also have future concerns about the record-
keeping and reporting requirements. We are concerned about 
whether or not the staff we have is adequate for that. We do 
not want to hire more clerical help or bookkeepers, more 
accountants, more consultants, and take money out of the 
classrooms to do so.
    Thank you for your time and kind attention today, and for 
your service to our nation.
    [The statement of Mr. Shafer follows:]
    
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Thank you, Mr. Shafer.
    Mr. Snyder, you are recognized for five minutes.

STATEMENT OF TOM SNYDER, PRESIDENT, IVY TECH COMMUNITY COLLEGE, 
                     INDIANAPOLIS, INDIANA

    Mr. Snyder. Thank you, Mr. Chairman, for the opportunity to 
speak on behalf of Ivy Tech Community College, its 200,000 
students, and its nearly 8,000 faculty and staff. And thank you 
for continuing the discussion on the effect of the current 
health care law and its impact on the classroom.
    Our focus at Ivy Tech, as it is for the 1,000 community 
colleges across the country, is to employ faculty and to 
educate tens of thousands of students for future careers. The 
community college structure, unique to the United States, is 
also our country's most affordable and accessible option for 
higher education. The U.S. is behind in educational attainment. 
If we are to close the gap, we need community colleges more 
than ever.
    Let me be specific about Indiana. We have one statewide 
community college. We are the largest such college in the U.S., 
serving those 200,000 students at over 100 locations. We are 
open admissions, serving a very complex student body, some 
entering college for the first time one year after high school, 
sometimes 20 years after high school, some seeking a career 
change, and others starting at the community college and then 
transferring to a four-year school.
    Among Indiana's public higher education institutions, Ivy 
Tech has more than half of all Pell Grant recipients and more 
than half of the African American students. For many of our 
students, Ivy Tech may be their best chance in life to get the 
education needed for today's workforce.
    One of the keys to our success is our adjunct faculty team 
of more than 4,000. Most are practitioners in their field who 
bring real-life, real-time experience into the classroom. It 
helps our students to be truly career-ready when they complete. 
Adjunct faculty also expose local business and industry to the 
community college. Moreover, most of these adjuncts are often 
the very individuals we consider when we have full-time 
positions to fill. In fact, in the last four years, we have 
placed more than 500 adjuncts into our 1,500 full-time 
positions.
    Let us reaffirm that Ivy Tech is a supporter of quality 
health care for all citizens, but we do need to highlight some 
of the serious concerns that we have with respect to certain 
provisions of the new law.
    A key part of our strategy to keep tuition affordable is to 
operate within a model that utilizes adjunct faculty for over 
50 percent of our instruction. The Affordable Care Act has 
caused us to carefully manage the hours of teaching that we can 
offer. We now limit classroom time to 12 hours to provide an 
additional 15 hours of preparation for the in-classroom work. 
Our funding is very limited. This does not allow us to absorb 
this unfunded mandate such as health care for the employee if 
they do reach the 30-hour limit. We would have to put such 
costs on the backs of students by increasing tuition. And as a 
result, many of those who are at the lowest income levels would 
not be able to afford college.
    Another alternative suggested is to find more adjunct 
faculty, but this creates another problem. There is clearly a 
lack of additional credentialed faculty with Master's degrees 
in English, Master's degrees in Math, and Master's degrees in 
Advanced Manufacturing. We are, in fact, canceling classes 
because of this. And despite having qualified adjuncts who 
could step in and teach another course or two, we are not in a 
position to allow them to do that.
    Because of the unique role of the adjunct in the community 
college, the end result may mean less access for students 
nationwide.
    The 30-hour rule impacts us in two other ways. We had 
planned to expand the advising role for adjuncts, critical to 
retention. However, the new law has made this very difficult to 
implement. And professional development for adjuncts is on hold 
until we create a new IT system, a costly statewide system that 
would track these 4,000 adjuncts statewide across all of our 
locations.
    We at Ivy Tech are about ensuring we are able to provide 
the best educational product and at the same time protect the 
jobs of our adjuncts. The goal is to increase educational 
attainment across our nation, but I fear the reverse. These 
changes will only increase the cost of higher education and 
decrease attainment.
    In closing, the 30-hour rule puts the burden on a segment 
least able to benefit from it or afford it. We hope you will 
give careful consideration to its revision. We thank you for 
the opportunity to present our case.
    [The statement of Mr. Snyder follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Thank you, Mr. Snyder.
    Mr. Forkner, you are recognized for five minutes.

  STATEMENT OF TOM FORKNER, PRESIDENT, ANDERSON FEDERATION OF 
           TEACHERS, AFT LOCAL 519, ANDERSON, INDIANA

    Mr. Forkner. Thank you. Good morning, Mr. Chairman and 
members of the subcommittee. My name is Tom Forkner. I am the 
president of the Anderson Federation of Teachers, an affiliate 
of the American Federation of Teachers, AFL-CIO.
    Thank you for this opportunity to discuss the many positive 
effects of the President's health care law on our state. First 
and foremost, I am pleased that more than 132,000 Hoosiers have 
already enrolled in a Marketplace plan and now have access to 
affordable, accessible, and high-quality health care.
    Our local represents about 450 certified teachers and about 
100 noncertified custodians, school secretaries and maintenance 
workers in the Anderson Community Schools. All of our members 
are provided health insurance through our collective bargaining 
agreement.
    There are about 100 classroom aides and 100 food service 
workers who work in the school system, but are not part of our 
local. Many of the classroom aides work in special needs 
classrooms, where they help the teacher by working one-on-one 
with special needs students. Sadly, neither the classroom aides 
nor the food service workers are offered health insurance by 
the school system.
    Prior to the implementation of the Affordable Care Act, or 
ACA, classroom aides and food service employees worked about 33 
hours per week. In the fall of 2013, we joined administrators 
in discussions to assess the impact of the ACA on the school 
system. Instead of embracing the new law's fundamental purpose, 
to provide high-quality health care to uninsured Americans, 
school representatives focused solely on how they could avoid 
the Act's requirement to provide coverage for all employees 
working 30 or more hours per week.
    Their shortsightedness led them to pursue a plan to cut the 
hours of the non-represented classroom aides and food service 
workers to 29 hours or fewer to circumvent the ACA's employer 
mandate. By reducing the total number of hours they worked, the 
system avoided any responsibility to provide them with 
insurance coverage or pay any of the ACA fees.
    While classroom aides' wages of $75 per day or $13,500 a 
year were maintained, food service workers, who earn between 
$11.10 and $15.50 per hour, or $11,588 to $15,660 a year, 
actually experienced a cut in pay when their hours were lowered 
from about 33 per week to 29. These groups of workers had to 
get health care through either a spouse, a second job that 
provides insurance, or the Federal Exchange.
    While we have no right to bargain over the wages, hours, 
and working conditions of these employees, we argued that the 
intent of the ACA was to expand health insurance coverage and 
urged the system to reconsider its position. We made this 
recommendation with the full understanding that if the system 
included these 200 employees in our plan, claims costs would 
likely increase and put pressure on our premiums. But we 
believe that this is the right thing to do and that an 
employer-sponsored plan can provide better benefits for our 
fellow employees than what is offered under an exchange.
    Moreover, we have so much confidence in our joint health 
care committee that we believe we can always work together to 
solve complex problems and keep health care costs as low as 
possible.
    I know that many employers complain about the imposition of 
the reinsurance fee and the patient-centered outcomes research 
fee on their budgets. However, my experience as a local 
president has taught me that our system doesn't retain costs 
but instead shifts them to employees or short-changes student 
services. So I imagine that the imposition of these fees on 
health plan sponsors will eventually result in some combination 
of less pay and more work for our educators and will detract 
from the high-quality education that all of our students need 
and deserve.
    Let me end by sharing a story that illustrates the 
consequences of not providing aides and cafeteria workers with 
access to health care. This summer a very talented, mid-career 
special needs classroom aide told me that he was resigning from 
the school system because he found a job with higher pay and 
health insurance. He said that he loved the children he worked 
with every day and wanted to stay in the system but could not 
afford to pass up a job with more money and health care. While 
the system hired a new aide to replace my colleague, this is 
not always the case. Moreover, the cut in hours from about 33 
per week to 29 per week means that the students miss out on 
about 45 minutes of classroom attention per day.
    In special needs classes, the presence of an aide enables 
teachers to complete their lessons for the day while meeting 
the needs of their students with disabilities. If the aide is 
not there and a student requires assistance, the teacher must 
stop teaching to do what is needed to help that student re-
engage in that day's lesson. These types of disruptions 
negatively affect student learning and the learning 
environment.
    Thank you again for letting me share my views on the 
importance of the ACA based on the experience of my members, 
all school employees, and the students we serve in Anderson.
    [The statement of Mr. Forkner follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Thank you, Mr. Forkner.
    Mr. Tanoos, you are recognized for five minutes.

 STATEMENT OF DANNY TANOOS, SUPERINTENDENT, VIGO COUNTY SCHOOL 
               CORPORATION, TERRE HAUTE, INDIANA

    Mr. Tanoos. Thank you, Chairman Roe and members of the 
subcommittee, for the opportunity to speak today and give 
testimony. A special thank you to Congressman Bucshon for his 
continued support on this topic over the course of time.
    My name is Danny Tanoos, and I am fortunate to serve as 
Superintendent of the Vigo County School Corporation in Terre 
Haute, Indiana. Our school system is the fifth largest school 
system in the State of Indiana.
    My comments today will focus on how the employer shared 
responsibility penalties under the Patient Protection and 
Affordable Care Act impact our great school system.
    On April 23, 2013, I traveled to Washington, D.C., to 
provide public comments to the Internal Revenue Service and the 
U.S. Department of the Treasury on the proposed rule regarding 
employer shared responsibility penalties. I informed the panel 
that the shared responsibility provisions under the Patient 
Protection and Affordable Care Act would hurt children and 
substantially undermine the quality of education that we can 
provide in our public schools. Similar comments were made 
during the hearing by Rick Allen, superintendent of Southeast 
Dubois County School Corporation, and Kathy Friend, the Indiana 
Association of School Business Officials representative.
    In addition to our public comments, representatives of 
Indiana public schools sent approximately 130 letters to the 
IRS, and I have those with the presentation to give to you 
today, and the Treasury expressing similar concerns. I am 
submitting those letters with my testimony today.
    I very much wish that I could report to you today that the 
IRS and the Treasury respectfully considered our comments. I 
also wish that I could point to a detailed response in the IRS 
final rule addressing the issues that we presented. 
Unfortunately, I cannot. The IRS dismissed our pleas in a 
single sentence in the 277-page final regulations. I continue 
to be gravely disappointed that the IRS failed to acknowledge 
and address our concerns.
    Today, I am here to provide specific examples of employees 
in my school district who have been hurt by the prospect of 
employer penalties under the Patient Protection and Affordable 
Care Act. I appeal to this committee to find a bipartisan 
solution to fix this significant, ongoing problem that is 
negatively impacting schools across Indiana.
    The principal of Consolidated Elementary School in Terre 
Haute, Suzanne Marrs, reports that one of the school's bus 
drivers is in desperate need of another job to supplement her 
family's income after her husband lost his job. Mrs. Marrs 
wanted to offer the bus driver an aide position; however, she 
could not because the school has imposed, and we have, a 29.5-
hour cap on hours for classified employees.
    Combining the bus driver position with the classroom aide 
position would have pushed this particular employee over 30 
hours per week. Mrs. Marrs stated that the employee is a ``hard 
working lady who is dedicated to her job. I was very sad to 
have to turn her down, when I know she would have been an 
excellent fit for our students.''
    This is a picture of that employee. She has a face, she has 
a name, and she is hard-working and dedicated. I know her.
    Our Director of Facilities, Support, and Transportation, 
Mr. Fennell, tells me that his staff believes that the 
Affordable Care Act works against them. His bus drivers 
previously were allowed to work up to 39 hours per week. 
However, as a result of the potential penalty, these bus 
drivers are restricted to 29 hours per week and cannot take 
field trips, academic trips, or athletic trips to earn more 
money. Instead of working for our school corporation, these bus 
drivers have to obtain other employment if they wish to work 
extra hours.
    The most significant impact is on our special needs 
students. These students need and want consistency. It is 
difficult for a student with autism or special needs to get 
comfortable with a driver and for the driver to understand all 
the needs of the student. It is best for our special needs 
students to have the same bus driver for their special needs 
and for their routes.
    Unfortunately, we now must split the route between two 
drivers. By using different drivers for the same route, our 
special needs students are subject to constant change, which is 
uncomfortable for our special needs students and not in their 
best interests.
    Faithful, dependable workers have been penalized due to the 
Affordable Care Act. One of our 20-year special education 
teaching assistants, Nancy Icenogle--and this is Nancy--has 
worked very hard and rarely misses work. This has negatively 
impacted her potential as an employee. Nancy has worked taking 
tickets at our extracurricular activities. She counted on this 
extra money in her budget for taxes, insurance, and to assist 
her at-risk grandchildren. Now she can no longer work the 
extracurricular activities because the extra hours put her over 
the limit.
    At Farrington Grove, the prospect of the employer penalty 
prompted the school to reduce both Debbie Lane and Amanda 
Lyttle from 6.5 hours to 6 hours per day. Both individuals 
previously assisted the school with dismissal supervision. Both 
are single parents with limited to no child support for their 
children. The reduction in hours results in the reduction in 
pay, which directly impacts their ability to provide for their 
children.
    That is the employee working with one of our students, who 
can no longer do so.
    Last winter, we had to charter a bus to transport 40 needy 
children from Farrington Grove Elementary School to Terre Haute 
South for a Christmas Party. Our own bus drivers were not 
permitted to drive for the field trip due to being over the 30 
hours. Forty children nearly lost out on numerous Christmas 
gifts due to a transportation issue. The bus cost the school 
more than $300 to transport the kids less than five miles away.
    Sarah Gore, the principal at Otter Creek Middle School, 
told me about how the 30-hour threshold created an unnecessary 
emotional disruption for a special needs student. Ms. Guy is an 
educational assistant in the functional classroom. As a result 
of the Affordable Care Act, her hours were reduced to 6 hours 
per day. Accordingly, it is now necessary for another 
educational assistant to serve the children in the functional 
classroom for the remainder of the day. One particular child 
did not adjust well to the change and has struggled.
    The principal at Ouabache Elementary School has the same 
situation. Mr. Quade is trying to put himself through college, 
work, and raise a toddler. Mr. Quade is an educational 
assistant, and he loves his job. He wants to stay in education 
for his career. He also wants to put in time volunteering and 
helping the kids. However, he can no longer come to family 
nights and evening events to support the kids because of the 
hour restrictions, and this is a picture of him. Struggling to 
find another job is very difficult for Mr. Quade.
    At Sarah Scott Middle School, the hours for educational 
assistants had to be staggered to cover the day. Different 
staff members now have to be utilized to staff the nurse's 
office. Some students are dropped off at school very early in 
the day so their parents can get to work, but the school is 
unable to test students, for instance, for blood sugar until 
7:45 in order to reduce the hours.
    Hillary Shepard has had to stop coaching cheer and dance 
due to do the hours, which she has worked. They put her over 
the limit.
    Others have had to stop working at after-school activities 
such as ball games and detentions, which allowed them to earn 
more money.
    We had a secretary at Otter Creek, Debby Davis, who took 
tickets at the ball games for years. Due to the potential 
employer penalties, she is no longer able to take tickets. She 
knows our students; she knows our families. She can no longer 
do this.
    Lonnie Sapp has been coaching football at Terre Haute South 
High School for 20-plus years. He wanted to be our alternative 
educational placement individual. He would have been a great 
addition to our staff. He is a positive role model for our 
students. He was unable to perform both positions due to hour 
restrictions. When we told him this, he had tears in his eyes. 
I talked to Lonnie personally. In fact, I talked to every one 
of these employees personally. He needed the position and 
wanted to be with our students. He had to choose, and he chose 
to do football and be a Kelly substitute through Kelly 
Services.
    The 30-hour threshold devalues the worth of a person. Our 
employees love their jobs and love kids, and when they are told 
that they can no longer contribute, it makes them very sad. The 
consequence of the Affordable Care Act is that many of these 
people feel demoralized because they can no longer contribute 
as they have in the past.
    The experience of Vigo County School Corporation is not 
unique. Almost all school systems in the State of Indiana are 
experiencing the same issues. On behalf of the Indiana 
children, I urge you to fix the employer shared responsibility 
penalty to allow our very good and dedicated employees to get 
back to work.
    And I go back to this picture. Would President Obama, the 
IRS, or anyone want this particular person to have to not work 
during the day two jobs in our school system; iroder to go out 
and get a night job and leave the family alone without having a 
mother in the house? I would say no.
    Thank you.
    [The statement of Mr. Tanoos follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Mr. Tanoos, thank you very much.
    Without objection, the letters to the IRS are admitted to 
the record.
    [The information follows:]
    [Extensive material was submitted by Mr. Tanoos. The 
submission for the record is in the committee archive for this 
hearing.]
    Chairman Roe. I now recognize Dr. Bucshon for five minutes.
    Mr. Bucshon. Thank you, Mr. Chairman, and thank you, all of 
you, for your valuable testimony on behalf of your 
institutions. It is greatly appreciated.
    I am a health care provider. Before I came to Congress I 
was a practicing cardiovascular and thoracic surgeon for 15 
years, the last 12 of which were in Evansville, Indiana. And as 
a health care provider, my goal is to have every citizen in our 
country have access to quality, affordable health care in a 
timely manner regardless of your zip code in our country. So 
that is the end goal.
    Unfortunately, that goal is not going to be met by the 
Affordable Care Act. The Congressional Budget Office has said 
that by approximately 2025, over 30 million Americans will 
still be uninsured, even after the law is fully implemented.
    Why is that? Many personally choose not to be insured. The 
other reason is when you are seeing next year the projections 
about the costs on the insurance exchanges, we are expecting, 
many are expecting a double-digit increase in addition to the 
fact that the deductible levels we have heard in testimony--it 
is not my opinion--as high as $6,000 to $8,000 per family 
deductible on the exchange policies, and I would argue you 
don't have health insurance if you have to pay $6,000 to $8,000 
out of your pocket every year. Most people can't afford that.
    Indiana is in the process of trying to get the Federal 
Government to approve Healthy Indiana plan as a way to expand 
health care access to all of our citizens. I support Healthy 
Indiana plan because I support the states' abilities, all of 
our states, to innovate and look for ways to improve the way 
that we provide health coverage to our disadvantaged and low-
income citizens.
    And I am hopeful that the U.S. Federal Government will give 
our state the opportunity to use this innovative way to cover 
everyone to improve the coverage percentage in our state. It 
has already been used as a pilot program. It has been shown to 
be successful at decreasing cost. It has also been shown 
successful at encouraging individuals to properly access the 
health care system. What I mean by that is skip preventive 
health care services and see a physician rather than going to 
the very high-cost emergency room care for non-emergency 
purposes.
    With that, I would also like to quickly outline what 
Congress has already done, and a number of our colleagues. Our 
colleague, Todd Young from the 8th District, introduced H.R. 
2575, the Save American Workers Act. This legislation, in fact, 
would change the definition of the full-time employee from 30 
hours to 40 hours per week. The bill passed the House this 
April by a vote of 248 to 179, and 18 of the Democrat members 
voted for that.
    Of course, Congressman Messer has introduced his bill, H.R. 
4775, concerning the classrooms, and that is why we are here 
today, to discuss that.
    We have also passed H.R. 2667 by Tim Griffin, 264 to 161, 
to authorize the employer mandate delay that the President has 
done administratively, and he threatened to veto the bill, 
calling it unnecessary.
    And finally, the House passed H.R. 2668, the Fairness for 
American Families Act, again by Representative Todd Young from 
Indiana and many others, which would delay the individual 
mandate for one year to give individuals and families the same 
relief employers received from the delay of the employer 
mandate. It passed 251 to 174.
    So Congress is aware of these issues and we are doing what 
we can to try to convince the United States Senate to at least 
have a discussion about what we have passed and try to find 
common ground.
    With that, Danny Tanoos, I want to ask you, traditional 
private-sector businesses may have the flexibility to adjust 
the cost of their products to cover these increasing costs. Can 
you discuss this with us briefly? What kind of flexibility, if 
any, does a school system like yours have to help cover the 
extra cost?
    Mr. Tanoos. Thank you, Congressman. We have zero. I mean, 
you can't increase the cost of textbooks or fees on students. 
We refuse to do that if we could. Fifty-six percent of our 
students are on a fee-reduced lunch. We are a district that is 
in need to help all of our students with all kinds of things, 
like clothing and food. To be able to charge them more would be 
inappropriate. So, no, we don't have that. We are not able to 
increase the price of any product like a business might be able 
to.
    Mr. Bucshon. And, Mr. Snyder, you discussed this briefly. 
At Ivy Tech, what would your option be to cover the increased 
costs?
    Mr. Snyder. We have estimated that with 4,000--one of the 
issues we have is that we have the advantage of being a 
statewide institution. But under the law, it means we have to 
track every hour and every location. So it really negates the 
strength that we have as a statewide institution, and we said 
we had 1,000 people at risk of being covered by health care, 
that would be $10 to $15 million that would have to be passed 
on to students because the students are the only flexible place 
of doing that. That would amount to perhaps as much as a 20 
percent increase in tuition, just not affordable for our 
students, most of whom are on Pell.
    Mr. Bucshon. Thank you. That is the critical part that both 
of you have just mentioned, is what would happen with these 
costs. School districts like Vigo County can't do anything. Ivy 
Tech would have to increase the cost to their students, which 
may then eliminate some low-income individuals from the ability 
to get an education.
    Mr. Chairman, I am going to introduce a letter from Clay 
County Community Schools, unanimous consent to introduce this 
letter to the record concerning their position on the 
Affordable Care Act and how it affects their schools.
    Chairman Roe. Without objection, so ordered.
    [The information follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Mr. Bucshon. I yield back.
    Chairman Roe. I thank the gentleman for yielding.
    Mrs. Brooks, you are recognized for five minutes.
    Mrs. Brooks. Thank you, Mr. Chairman. I would also like to 
thank my colleague, Mr. Messer, for holding this hearing.
    As we just heard from Congressman Bucshon, an issue that 
came up I think was a common theme in all of your testimony was 
the issue with respect to the 30-hour-work-week being 
determined now under the Affordable Care Act as full-time 
employment. I am very proud that our colleague, Todd Young from 
Indiana, did, and it has passed the House, the Save American 
Workers Act, which would change the definition of full-time 
from 30 hours to 40 hours, and we certainly hope that the 
Senate would take that up.
    But I think, as you all have talked about the 30 hours 
being the critical piece, I am the daughter of a school teacher 
and coach and the sister of a teacher, and I am very proud of 
what--I have been at the Zionsville School District. I have 
also been at the Anderson School District, and I am very proud 
of what our school districts are trying to do with very, very 
limited budgets.
    So I am very curious, Mr. Shafer, as the CFO of the 
Zionsville School, with the small budget that you receive 
relative to other districts, has the United States Department 
of Education provided you any guidance or any help as to how to 
fund these shortfalls when your school district is faced with 
these huge fees imposed by the Affordable Care Act?
    Mr. Shafer. Well, I would have to say that they have not. 
The school district itself actually receives the least amount 
per capita in Federal aid through the various Federal Title 1, 
Title 2, and Title 3 programs of any school district in the 
state, just as it is near the bottom in SAFE funding. Most of 
those are also based on the same types of formulas and would 
give us the same result.
    The unfunded mandate to pay $1.6 million under employee 
responsibility payments are the only alternative to offer 
insurance to the cost of the better part of $1.25 million is a 
historically huge unfunded mandate for us, one that we simply 
have no ability to handle whatsoever that left us with the one 
and only one solution, which was to reduce our employees. We 
had to choose between reducing the hours of those employees who 
we can reduce. The other alternative for us would have been 
simply to lay off enough teachers to generate enough savings to 
pay those fees. When you start talking about $1.6 million, you 
are talking about 27 teacher jobs. We can't do without one 
teacher that we have now. We certainly can't do without 27. So 
we had to find a different way that would cover that cost for 
us, or at least eliminate that cost. That was reducing hours 
under the 30-hour rule. And no, we received no help from any 
Federal agency in looking at other ways to do that.
    Mrs. Brooks. Thank you.
    Mr. Tanoos, you mentioned that the IRS issued a one-
statement response to your 130 letters in the testimony that 
you provided. Do you recall what that response was?
    Mr. Tanoos. Basically, no. I mean, it was never going to 
change it. The bad part about it, Congresswoman Brooks, is that 
they said they would get back with us after our testimony in 
April, that they would get back with us in just a couple of 
months, and it took them nearly six months. We had to go to 
Congressman Bucshon to go over to the IRS and Treasury to try 
to get a response. School systems were waiting for that answer 
and never got it. When we did, it was just that one sentence. 
It was a basically condensed ``can't do it.''
    Mrs. Brooks. So the Federal Government has not helped in 
any way in alleviating the challenges that you are facing.
    Mr. Tanoos. I think they have actually hurt us in the sense 
that what they have done is not only reduced it to a 30-hour 
work week, but also you can't count a school calendar year as 
the year of work. It has to be the school year or a two-week 
break period is all you can count. So you can't count those 
employees. If you had counted over 365 days, it would have been 
a lot different. But they narrowed that down to just the 
calendar of a school year.
    Mrs. Brooks. And so I am going to next turn to you, Mr. 
Snyder, whom I actually used to work for as General Counsel at 
Ivy Tech Community College, so this is an unusual circumstance 
to have you here, but I am thrilled. As Dr. Roe said, we still 
work for you as taxpayers, and also as a resident of Anderson. 
But I know that Ivy Tech certainly is always incredibly 
creative, having worked there from '07 until '12, in trying to 
solve problems on behalf of the students. But one of your 
biggest challenges by having so many adjunct faculty, which is 
required, and also they provide tremendous value in the 
classroom. A lot of students I talk to loved their adjunct 
faculty because they had such incredible experiences in the 
workplace that they could bring in.
    But you have talked about the challenge in finding 
credentialed faculty, and often the credentialed faculty would 
travel from one campus to the other. Can you talk a bit further 
about how that is impacting student success? How is that 
impacting students' ability to get the classes they need, 
students' ability to have access to that kind of expertise?
    Mr. Snyder. Yes. Let me say that is a very important issue. 
But let me lead in to say, particularly for the people in 
Indiana who are watching this hearing, it is actually quite--we 
are very proud of what you have done both for Ivy Tech and for 
Congress. It is very unusual to have four very important 
congressmen all from one state on a committee like this. I 
think for the people in the audience this is not very usual, 
and to have this powerful assembly, including our chairman from 
Tennessee, it is very important.
    The adjunct has a very unique role in community colleges 
across the country who do what we do. They are like citizen 
professors. They have a day job. They usually have other things 
that they can do; in many cases, not relying on us for health 
care coverage, relying on us to really expand their life and 
let them teach as much as they would like to as an avocation 
and a vocation.
    So this has been very constraining for us, particularly 
with the fact that you have a campus, a new campus in 
Shelbyville, and a campus in New Castle. We have to have a 
system where we have to report to the IRS where these people 
are teaching. It is going to be quite laborious. And then there 
is this issue of a look-back period that is in the law, which 
means also there is administrative cost.
    I think the administrative cost we have not even captured, 
and I think that is something that, as we look forward to 
trying to get people across the aisle to look at, we need to 
understand that as well as the out-of-pocket cost to the 
individual who is restricted from teaching.
    Mrs. Brooks. Thank you.
    Mr. Chairman, my time is up. I yield back.
    Chairman Roe. I thank the gentle lady for yielding.
    Next is Mr. Messer.
    Mr. Messer. Thank you, Mr. Chairman. Again, I want to thank 
everybody for their participation in the committee. I thank the 
chairman for traveling up from Tennessee and helping the 
Chamber of Commerce here in Greenfield last night with a dinner 
in town. I appreciate that.
    You know, as the president alluded to, it is unique to have 
four members of one state on a committee, on any committee, let 
alone a committee like Education and the Workforce, and then to 
have four members that are so active and willing to travel 
around the state to come here, all great friends and great 
champions for education in our state. I think it is a 
tremendous opportunity for our state to have my colleagues with 
me on this committee.
    I do see a few other dignitaries. It is a room full of 
dignitaries. But I see state Representative Randy Frye, Senator 
Mike Crider. I appreciate you all being here.
    I want to point out the biggest dignitary in the room to me 
is my mother, Chris Messer, who just came in after the opening 
testimony.
    I appreciate the testimony of all of the leaders who are 
here today.
    I do think it is important to say that all of us on this 
committee believe the status quo in health care is not 
acceptable, and we all recognize that costs around the country 
are spiking. We all recognize that with problems like 
preexisting conditions and other areas, something had to be 
done.
    We are here today, though, to talk about the President's 
health care law and the real-world impacts of that law, as Dr. 
Bucshon shared. We all agree that every American should have 
access to high-quality, affordable health care. The problem is 
that when the President's bill has moved from intention to 
results, what we see instead are spiking costs around the 
country, in many of the communities I represent a reduction in 
access to health care, and it has hit schools particularly 
hard.
    So one of the questions I have for the three school system 
leaders--and there is no trick question here. I am just trying 
to get this all on the record together.
    Mr. Shafer, could you tell me again your estimated impact 
of the cost of the Affordable Care Act on your school system?
    Mr. Shafer. Yes. The employer responsibility payments we 
estimated at $1.6 million. The alternative to that would have 
been for us to offer coverage to those employees we weren't 
covering. We estimated that cost at approximately $1.17 
million.
    Mr. Messer. President Snyder, on your school system?
    Mr. Snyder. We have at risk about 1,000 faculty. We pulled 
back their hours. We have not calculated what we think is our 
out-of-pocket loss of income. The cost of insuring them we 
estimate exceeding $10 million per year.
    Mr. Messer. Mr. Tanoos?
    Mr. Tanoos. Thank you. Ours would be $6 million to insure 
all of our employees.
    Mr. Messer. Six million dollars?
    Mr. Tanoos. Yes, sir.
    Mr. Messer. And if you chose to absorb that expense rather 
than reduce hours in the way you described, how would you pay 
for that in your school system?
    Mr. Tanoos. There is a money tree in back of our school 
house--
    [Laughter.]
    Mr. Tanoos. We would pick it off of there.
    [Laughter.]
    Mr. Tanoos. We would not be able to. I mean, we have worked 
very hard to run our school system as a successful business, 
and we have our cash balance to a nice amount to be able to 
treat our employees fairly. We would not be able to give 
raises. We would go in the red and eventually be taken over by 
the State of Indiana.
    Mr. Messer. And, of course, the ultimate person who pays 
the bills for your school system--
    Mr. Tanoos. Yes, sir.
    Mr. Messer.--is the taxpayer.
    Mr. Tanoos. Yes, sir.
    Mr. Messer. President Snyder?
    Mr. Snyder. We were just roughing out the number. We have a 
very low-cost degree, a nursing degree, that you can get for 
under $10,000. The cost for that nursing degree would go up by 
$1,500 to $2,000.
    Mr. Messer. It would come out--
    Mr. Snyder. It would have to come out of the pocket of the 
student.
    Mr. Messer. For your students.
    Mr. Shafer?
    Mr. Shafer. As I said earlier, the only way that we could 
have raised that much money within our budget to not cut hours 
would have been, in fact, to lay off teachers. We estimate that 
we would have had to lay off approximately 27 teachers, which 
is nearly a 10 percent reduction, which is just simply undoable 
for us to maintain any kind of educational quality.
    Mr. Messer. And, of course, you have limitations on your 
ability to raise property taxes. But ultimately, if you absorb 
those fees, that million dollars would have come out of the 
Zionsville taxpayer.
    Mr. Shafer. One way or another.
    Mr. Messer. Yes, one way or another.
    You know, to me this is in some ways a complicated issue, 
but in other ways very simple. There is no free lunch, as you 
said. There is no money tree here. We all share the goal of 
trying to provide affordable health care to every American. But 
at a time when schools are already cash strapped, it makes no 
sense to put this additional mandate on our schools. It is not 
fair to try to balance or pay for the President's health care 
on the backs of our schools and our students, and if we really 
care about them, we need to do something about it.
    I appreciate your courage and your testimony today in 
highlighting this important issue. Thanks.
    Chairman Roe. The gentleman yields back.
    Mr. Rokita, you are recognized for five minutes.
    Mr. Rokita. Well, I thank the Chairman.
    It is good to be back here on this side of the state. It is 
good to see so many friends and familiar faces. I haven't seen 
some of the audience since I served as Indiana Secretary of 
State, but thanks, Luke, for organizing us here.
    I will admit, though, a couple of months ago I was a little 
further down the road seeing Thomas the Tank Engine--
    [Laughter.]
    Mr. Rokita.--with Kathy and the kids, and that was fun in 
its own right.
    Dr. Roe, thanks for chairing this hearing today. I 
appreciate your leadership and everything you do.
    Picking up on what Luke mentioned and what Mr. Snyder 
mentioned, yes, it is excellent to see so many Hoosiers on this 
panel. You know, this committee has jurisdiction, one of only 
three committees that has jurisdiction over health care in 
Congress, and of course we do a lot of education issues 
generally as well. In fact, Susan and Luke are also on a 
committee that I chair, kindergarten through 12 education. Of 
course, this committee, the full committee has jurisdiction 
over a lot of Indiana and the nation's business regulations.
    So, in a way, I am not surprised that so many Hoosiers 
serving in Congress are on this committee because I think, in a 
lot of ways, it is the leading, cutting-edge practices that we 
have here in this state that is really going to lead to a 
turnaround for our entire nation. At least that is the hope, 
and it is going to start with the leaders here that I have a 
privilege of serving with.
    Indiana simply is a great place to work, and then we have a 
balanced approach to regulations and so forth, and we are not 
ideologues or activists when it comes to trying to decide how 
these regulations should look. In fact, on the whole, I can 
tell you just from my serving in the state in public office for 
12 years in this state, we trust people. We believe in family. 
We believe in communities. We believe in neighborhoods. We 
believe in school systems and our ability to solve our problems 
and not being reliant on some Federal Government program, much 
the same being as Dr. Bucshon talked about.
    I will also say, Dr. Roe, when I was cutting the lawn or--
excuse me--cutting the grass last night--around here we say 
cutting grass, not mowing the lawn, I am not sure how it is in 
Tennessee--at about sunset I came upon a nest of yellow 
jackets. So I am pumped full of yellow jacket venom right now. 
So, number one, I am glad that we have two doctors on the 
panel. Number two, I mentioned this to somebody else when I 
came in, I want to be very clear with you, it is not the yellow 
jacket venom that is going to cause these comments and these 
questions. I just don't like the law because of the things I 
said earlier.
    So with that, let me go to Mr. Forkner, if I can. I hear a 
lot about unions, and not just teacher unions but unions 
generally, trying to get waivers from the Affordable Care Act. 
But I am confused with your testimony because you say you 
embrace Obamacare, but you are also providing your own 
insurance because you want insurance to be there.
    So, which is it? Are you going to fully embrace Obamacare, 
or are you going to try to provide your own, or would you go 
for a waiver if you had the opportunity? And what do you think 
about unions who have tried to get a waiver under Obamacare?
    Mr. Forkner. Our position in Anderson is we have a very 
strong, self-funded insurance program.
    Mr. Rokita. That is good enough. So that is good for you, 
the union.
    Mr. Forkner. Yes, and we think it is strong enough, and we 
think we have a good enough working relationship that we would 
embrace bringing in those employees that don't have insurance.
    Mr. Rokita. Okay. So that is not the private sector but at 
least a private entity, the union, going after and solving its 
insurance problem, right?
    Mr. Forkner. Yes.
    Mr. Rokita. So you would be for others doing that, too.
    Mr. Forkner. If they have the resources.
    Mr. Rokita. Right. But if they don't have the resources, or 
they are just not the same as yours and different from the 
requirements of Obamacare, whether it be the 30-hour work week 
effect or whether it be maternity coverage for 45-year-old 
males, if it is not your insurance or something that you think 
is as good as your insurance, then you would prefer people be 
on Obamacare. You said you embraced Obamacare.
    Mr. Forkner. Yes.
    Mr. Rokita. So I want to understand why you might think 
that it is better, Obamacare. In your estimation you can judge 
for others what is best for them, like Obamacare.
    Mr. Forkner. I can only speak for what I know, and that is 
school systems.
    Mr. Rokita. But you are the president of a union, right?
    Mr. Forkner. Yes.
    Mr. Rokita. Or you are an officer in a union. Okay. I guess 
I am just confused by the testimony, and I don't want to say it 
is hypocritical. I just want to get some clarification on what 
you believe. I mean, do you think that Obamacare is best for 
people, or do you think people making their own decisions about 
their health care is best for them?
    Mr. Forkner. I think that the Obamacare law, if carried 
out, is a good law and would provide health care for people who 
drastically need it.
    Mr. Rokita. So you, at that point, upon full 
implementation--and my time has expired, but upon full 
implementation of Obamacare, you would cease and desist your 
own program, health care program?
    Mr. Forkner. I don't think we have to.
    Mr. Rokita. Thank you. My time has expired.
    Chairman Roe. I thank the gentleman for yielding.
    I will now yield myself five minutes.
    First of all, I thank the panel, and I thank you all in the 
room. Not to be one-upped about your mother, I had lunch with 
my mother yesterday before I got on the plane to celebrate her 
92nd birthday.
    [Laughter.]
    Mr. Messer. I won't tell you my mom's age, but she is not 
92.
    [Laughter.]
    Chairman Roe. Well, when I am home, I typically don't tell 
anybody her age. I just tell everybody she was born in 1922. 
She gets mad when I say how old she is.
    [Laughter.]
    Chairman Roe. I was the only one on the panel--and I think 
you can certainly understand why it is a privilege to work with 
these four members - not from Indiana. It truly is. I gave up a 
medical practice to run for the U.S. Congress because I care 
deeply about this country. I am a U.S. military veteran, a 
physician, and I thought it is time for physicians-- just 
regular citizens--to stand up and go to Washington, not career 
politicians, and I truly wanted to work on health care.
    I read the Affordable Care Act, all 2,700 pages of that 
bill. I have read every bit of it. I have not read the over 
20,000 pages of rules that go along with implementing this, and 
that is something I want to get into with the panel in just a 
moment. It is unbelievable when you try to then implement this 
particular plan. Let me go over a little bit of it.
    The way we Americans get our insurance is through our jobs. 
It used to be 160 million of us did. About 60 percent of those 
are self-insured, like Mr. Forkner's plan is probably self-
insured. The city I ran as a mayor was self-insured. The others 
just have an individual policy through their job or on their 
own. So the ERISA-based plan, that is how we covered insurance.
    Then we have about 47 million of our citizens are on 
Medicaid, about 47 million are on Medicare. 15 or 16 percent of 
us are uninsured. So we did all of this for people who were 
uninsured, this incredibly complicated scheme. And as I 
listened right here, remember, the plan was to decrease cost 
and increase coverage.
    What has happened is, just listening to these folks right 
here, we have increased the cost of them providing the 
insurance coverage, taken away some of their flexibility, and 
not another person has been covered. I tried to hear did 
anybody else get covered here; the answer was no, nobody did.
    I have similar stories in my hometown where substitute 
teachers are being reduced to three days a week and have lost 
income because of this. And why? Because education budgets are 
strained. In the State of Tennessee where I live, we don't have 
a state income tax. We have personal property taxes and sales 
taxes. That is how we run our state business, on a few fees. 
That is all we have. So we can't force people to buy more goods 
and services.
    One of the things I want to talk about to help pay for this 
scheme, the Affordable Care Act, is the reinsurance fee. I 
found this unbelievable that we took major insurance companies, 
and then we went to people, Mr. Forkner, just exactly like you 
represent, that are in the individual self-insured market, and 
what we did to them, for every person--not for every policy but 
for every person--there is a $63 fee.
    One company that came into my office, that is going to cost 
them $100 million this year, of which they get absolutely 
nothing for, nothing. What that money goes to is to indemnify 
to be sure that major insurance companies don't lose money. How 
awful is that? I mean, that was unbelievable when I heard that. 
The costs are all passed back down to us, the consumer. We are 
ultimately going to pay it.
    So what we have done to make this care affordable, we call 
it, is we have narrowed the doctor panels to where many plans 
don't have the doctors you want on there, we have increased the 
out-of-pockets, and we have increased the co-pays. Let me give 
you an example in my community.
    I was on the faculty of the medical school for 30 years in 
my community. We have a hospital there where now, 40 percent of 
the uncollectable debt are people with insurance. And why? 
Because if you have a $10,000 out-of-pocket and you make 
$35,000 a year, it might as well be $100,000 if you are out-of-
pocket. You can't pay that. So we have got to have something 
different.
    I want to go on, Mr. Shafer. My time is limited. I want you 
to talk about the 9.5 percent affordability. So the government 
decides what is affordable, not the person, the individual. Can 
you go into that a little bit?
    Mr. Shafer. Yes. The 9.5 percent affordability which, of 
course, has now been indexed to 9.56 affordability, is a 
threshold that we would have to meet for any coverage that we 
provide to our employees. There are penalties for missing the 
9.5 percent threshold also built into the law.
    Chairman Roe. A tax.
    Mr. Shafer. Yes, a tax essentially, an excise tax. If we 
were to miss the 9.5 percent, our numbers say that we would 
lose another $400,000 for penalties for that, as well as the 
other numbers I mentioned. We think that is unacceptable. 
Again, that translates into seven more teachers a year that we 
would have to give up to be able to pay that tax.
    We feel like that as a public entity, we have said to the 
taxpayer we are taxing you through your sales tax, your income 
tax, your property tax for money for education. We are taking 
this money from you to educate your children. Oh, no, wait a 
minute, now we are going to turn around, take the money we have 
taken from you for educating your children. Instead we are 
going to send it to the Federal Government for them to forward 
to insurance companies while, in the meantime, your children 
suffer from the lack of this money being used in the classroom, 
as was promised to you. We think this is a major problem.
    Chairman Roe. I thank you.
    My time is limited. I want to finish by saying that I 
personally have never seen a Republican or a Democrat heart 
attack in my life. I have never operated on a Republican or a 
Democrat cancer in my life. It is a people problem, and we 
should have sat down, and let me share some frustration.
    We invited the Democrats, by the way. This is not a 
Republican feel-good meeting. The Democrats were invited to be 
here also and chose not to come.
    We offered 80 amendments to that health care bill in 2009. 
I had 10, myself. I went to the Rules Committee. Not one of 
those amendments was ruled in order to be heard on the House 
floor. We were totally shut out of the argument, the debate. 
That is wrong. This has got to be a bipartisan solution because 
it affects every American citizen.
    The last thing I want to say is that what the government 
decided was what you buy. Never before in American history has 
the government said you must buy this, and this is what you 
must buy or you will be penalized. You have to buy a health 
care plan that, at minimum, has ambulatory patient services, 
has emergency services, hospitalization, maternity, and 
newborn. And let me assure you, being the father of three 
grown, married children, I don't need maternity services. I 
would jump off the top of the courthouse if I thought I was 
going to have to have maternity services again.
    [Laughter.]
    Chairman Roe. Mental health and substance use--if I stay in 
Congress much longer, I may need that one.
    [Laughter.]
    Chairman Roe. Including behavioral health treatment, 
prescription drugs, rehabilitative services and devices, 
laboratory, preventive and wellness services, chronic disease, 
pediatric services, including dental and vision care. I mean, 
before, we got to pick out what we bought and what we could 
afford as a family. Now the government has decided that, and 
that is one of the reasons that the cost has gone through the 
roof is to provide all that.
    I want to thank the committee, a terrific job you all have 
done here today. I thank you for taking the time preparing this 
and being here.
    Before we dismiss this first panel, I want to do something 
I normally don't do during a hearing, but we are on the road. 
You know, I just got back from Vietnam about two months ago, a 
trip there, and I am a Vietnam-era veteran. If there are any 
veterans here, I want them to stand, or if they are standing 
already, hold your hand up.
    I want to thank you for your service because without you, 
we could not have this meeting today.
    [Applause.]
    Chairman Roe. Thank you for your service to our great 
nation.
    I will dismiss this panel and take a five minute break and 
be right back with the second panel.
    [Recess.]
    Chairman Roe. It is now my pleasure to introduce our second 
panel of distinguished witnesses.
    First, Mr. Dan Wolfe is the Owner of Wolfe's Auto Auctions 
in Terre Haute, Indiana. Since 1980, Mr. Wolfe has served as 
Vice President, Chief Operating Officer, and General Manager of 
Wolfe's Auto Auctions.
    Thank you, Mr. Wolfe, for being here.
    Mr. Mark DeFabis is the President and Chief Executive 
Officer for Integrated Distribution Services, Inc., in 
Plainfield, Indiana. Integrated Distribution Services, Inc. 
provides integrated and logistical services and specializes in 
retail and direct consumer fulfillment and transportation 
management.
    Welcome.
    Dr. Robert Stone is the Director of Hoosiers for a 
Commonsense Health Plan in Bloomington, Indiana. Dr. Stone is 
also the State Coordinator in Indiana for Physicians for a 
National Health Program and teaches at Indiana University 
School of Medicine as an Assistant Clinical Professor of 
Emergency Medicine, and is Director of Palliative Care since 
2012.
    Welcome, Dr. Stone.
    Mr. Nate LaMar is the International Regional Manager for 
Draper, Inc., in Spiceland, Indiana. Mr. LaMar has been with 
Draper for over 15 years serving as International Regional 
Manager and the Government Relations Manager.
    Welcome, Mr. LaMar, and thank you for your service to our 
country.
    Before I recognize you to provide your testimony, let me 
briefly explain our lighting system again. You have five 
minutes to present your testimony. When you begin, the light in 
front of you will turn green. When one minute is left, the 
light will turn yellow. When your time has expired, the light 
will turn red. At that point, I will ask you to wrap up your 
remarks as best you are able to. After everyone has testified, 
members will each have five minutes to ask questions.
    With that, Mr. Wolfe, you are recognized for five minutes.

  STATEMENT OF DAN WOLFE, OWNER, WOLFE'S AUTO AUCTION, TERRE 
                         HAUTE, INDIANA

    Mr. Wolfe. Thank you, ladies and gentlemen, for letting me 
be here. You already know who I am. I am Dan Wolfe, so I won't 
bore you with my resume.
    Our family has been in business for 55 years. We have been 
in the auto auction business for 40 years. We employ 232 
people, 64 full time, 168 part time. Those numbers are down 
from 2008 due to the recession but are rising and will rise 
again.
    We offer health insurance to our full-time employees, 
although not affordable by today's standards of our government. 
The current plan is $1,500 deductible, with a $5,000 out of 
pocket. The cost of that to our business is roughly $2.42 per 
employee per hour, up to as high as $3.23, and that depends on 
the work week and how many hours they work.
    To meet the proposed guidance of not to exceed 9.5 percent 
of income, that cost would move to $2.87 per hour, up to $5.15 
per hour per employee, representing an 18 to 59 percent raise 
in cost per hour. Where is this affordable?
    To lessen this cost, there are alternatives. We can move to 
a plan that offers the government minimum, with a $5,000 
deductible and $10,000 out-of-pocket expense, which would lower 
the cost to $2.42 per hour, as high as $3.46 per hour per 
employee. Still, this represents a raise anywhere from zero to 
42 percent. For that coverage, many will not be able to afford 
the $5,000 or the $10,000, and their next step would be 
bankruptcy.
    All the while, raises will not be forthcoming due to the 
rising cost of employment. Employees will be looking for 
greener pastures, always looking everywhere else, and we hire 
full-time employees to stay with us. We look at longevity. We 
take time to train these people. We focus our energies mainly 
on customer service and quality of work.
    Currently, over 17 percent of our full-time employees have 
been employed over 10 years, and many of those over 20. These 
employees get annual raises and bonuses, and that is not to 
mention the 15 family members who dedicate their lives to this 
business, a family business.
    Other options would be to drop current health insurance and 
offer nothing, therefore sending current employees to the pool 
and causing our businesses to pay penalties as high as$140,000 
per year, non-tax-deductible. That would call for other 
options. We would have to cut other expenses, employees, 
whatever it took, to make up that $140,000 non-tax-deductible 
money.
    Now, keep in mind these numbers are ever changing because 
we still don't know, when this act becomes an act, when it is 
going to happen, whether it is '14, '15, '16. Everything is a 
moving spectrum to us. We spend a lot of time on this trying to 
figure out exactly what it is going to cost us, and that 
entails money and time spent that we could spend otherwise 
making good business decisions and raising people's pay, and 
also just enjoying a better life.
    Is our health care system in need of reform? In my opinion, 
yes. Is this the answer? In my opinion, no. How do you cut 
medical and insurance costs without attacking the good old free 
enterprise system that America was founded on?
    Both costs are high but, to some degree, they are 
warranted. If we are to spend money on an already over-blown 
budget we currently have in Congress, why not spend it on 
incentives for the economy and job creation?
    In closing, I would urge Congress and the President to look 
closely at the burdens already imposed upon Americans today 
with rising utility costs, fuel costs, and general goods and 
services. Why not have incentives for businesses to employ more 
and pay higher wages, so Americans can afford insurance? The 
threat of small businesses lost and, more importantly, jobs and 
the quality of life lost looms large. Just put America back to 
work.
    [The statement of Mr. Wolfe follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Mr. Wolfe, thank you very much.
    Mr. DeFabis, you are recognized for five minutes.

   STATEMENT OF MARK DEFABIS, PRESIDENT AND CHIEF EXECUTIVE 
 OFFICER, INTEGRATED DISTRIBUTION SERVICES, PLAINFIELD, INDIANA

    Mr. DeFabis. Thank you. Chairman Roe and distinguished 
members of the subcommittee, thank you for inviting me to 
testify today. My name is Mark DeFabis and I am the President 
of Integrated Distribution Services, Inc., a third-party 
logistics provider in Plainfield, Indiana, where we employ 72 
full-time individuals and 100 to 150 seasonal and part-time 
unskilled workers.
    Prior to the implementation of the Affordable Care Act, IDS 
was experiencing annual premium increases in the 10 to 17 
percent range.
    Over 50 percent of our employees smoked. Most did not 
utilize a primary care physician and accessed health services 
through either the emergency room or an immediate care 
facility. Many also had chronic conditions such as high blood 
pressure, high cholesterol or diabetes but were not taking 
maintenance drugs. It became obvious that if we were to control 
our health care costs, we would need to address the health of 
our workers. For that reason, we implemented a wellness program 
designed to improve the health of our employees, which in turn 
would reduce our premiums.
    Our wellness program offers annual health screenings and 
incentives to employees to stop smoking, obtain and see a 
primary care physician, and use maintenance drugs for chronic 
conditions. Over 80 percent of our employees participate in our 
wellness program, and the outcomes have been dramatic. We have 
reduced the number of smokers by over 60 percent, reduced the 
number of claims related to serious preventable health issues, 
those with chronic treatable conditions are now on maintenance 
drugs, and we have seen better awareness by all employees of 
the benefits of exercise and healthy eating.
    In 2009, the last year before the implementation of the 
ACA, our wellness program and its success translated into a 
5.28 percent increase in our healthcare premiums with no change 
in benefits, proving that IDS could control the cost of our 
health care by improving the health of our employees.
    Unfortunately, that correlation no longer exists under the 
ACA. Since the implementation of the ACA, IDS and our employees 
have seen our healthcare premiums increase 76.64 percent. This 
increase would have been greater had we not mitigated it by 
raising deductibles 20 percent and maximum out-of-pocket 
expenses 17 percent. Since September of 2012, 5 percent of our 
annual premium increase has been due to taxes and fees imposed 
by the ACA, which our insurer must collect and pay on our 
behalf.
    In summary, since the ACA took effect, our company and 
employees have seen premiums increase dramatically while 
deductibles and out-of-pocket costs have been raised, all 
during a period when the overall health of our employees has 
improved.
    As we prepare for the impact of community rating on our 
underwriting beginning in 2015, it is clear that the relative 
health of our employees will have no direct impact on our 
health care costs, leaving us no choice but to evaluate whether 
to continue to invest in our popular and effective wellness 
program. I fear that the implementation of community rating 
will result in even more dramatic increases on top of the 76.64 
percent that we have already experienced.
    I want to commend the State of Indiana for allowing 
insurers in the individual and small group market to delay 
community rating through grandmothering, also known as 
transitional relief, and I hope that the insurers will continue 
the grandmothering by exercising that option through 2015. I 
have spoken to business acquaintances of mine in states such as 
Virginia which have not delayed community rating, and they have 
seen increases between 80 and 90 percent.
    From the experience of IDS, I can say that the Affordable 
Care Act is anything but affordable for our employees and our 
company.
    As I mentioned, IDS has between 100 and 150 seasonal and 
part-time workers. These unskilled workers come to us through 
various private staffing companies and/or community 
organizations such as Goodwill Industries. While at our 
facilities these individuals work in excess of 30 hours per 
week. As a result of the ACA, these staffing companies and 
community organizations will be faced with either reducing the 
number of hours these individuals work or will have to provide 
health insurance to comply with the ACA.
    I have had conversations over the last two years with our 
staffing companies, and they still cannot provide me with an 
estimate of the impact this will have on their workforce. One 
thing I have been told is that whatever the cost impact to our 
staffing providers, it will be passed on to us in the form of 
higher rates. This could result in our staffing costs 
increasing as much as $250,000 per year.
    Every company in the third-party logistics industry, which 
employs hundreds of thousands of part-time and seasonal 
workers, is facing this same no-win situation. The ACA's 
arbitrary establishment of a 30-hour work week as full time 
does not reflect the real world and is ultimately harmful to 
all small businesses and the unskilled workers for whom we 
provide jobs.
    Largely overlooked are the hidden costs associated with the 
ACA and its reporting requirements. The recently released IRS 
draft forms for health coverage information reporting combined 
with the compliance reporting to determine full-time employees 
are not only confusing but are cumbersome to complete. Much of 
the information cannot be gathered with current automated 
payroll systems and will require many hours of manual work to 
compile the required data. I am concerned that this is only the 
beginning. As it becomes ever more apparent that the goals of 
the ACA are not being met, businesses will be asked to provide 
increasingly detailed reporting without any consideration for 
the increased cost.
    Thank you for your time today. As a small business owner, 
both myself and my industry are happy to work with our elected 
officials on this important topic.
    [The statement of Mr. DeFabis follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Thank you, Mr. DeFabis. Thanks very much for 
your testimony.
    Dr. Stone, you are recognized for five minutes.

  STATEMENT OF ROBERT STONE, DIRECTOR OF PALLIATIVE CARE, IU 
       HEALTH BLOOMINGTON HOSPITAL, BLOOMINGTON, INDIANA

    Dr. Stone. Thank you. Good morning, Mr. Chairman and 
members of the subcommittee. Thank you for the opportunity to 
testify today.
    My name is Robert Stone. I am an M.D. I was born and raised 
in Evansville and have practiced medicine in Bloomington for 
the past 31 years, including 28 years working in the Emergency 
Department.
    A doctor in the ER is on the front line of American 
medicine. There is nowhere to hide. Everything good and bad 
about our health care system is in plain sight.
    I can't tell you how many times I have seen a guy limp in 
and tell me how he had fallen a few days earlier. His ankle is 
still swollen and not getting better. I examine it. I probe the 
sore spots and say I am worried it could be broken. I say we 
need an x-ray. He says, ``Doc, I can't afford an x-ray, I don't 
have any insurance.'' What is an x-ray going to add to his 
bill? At least $200. No wonder he walked on it for a few days.
    Then there is diabetes. It is not simple to take care of, 
and the cost of the medication is bad enough, but it is the 
test strips used in the glucose monitors, those are the expense 
that adds up and cuts into people's budgets.
    It is commonly believed that if you have a serious 
condition like diabetes, you must qualify for some sort of 
insurance, but that is not true. Our best estimate is that 
there are around 75,000 diabetics in Indiana with no health 
insurance. I have seen this many times. At first they thought 
they were coming down with a cold. Then they started vomiting. 
They ran out of test strips and were afraid to take their 
insulin for fear of dropping their blood sugar too low, but 
when they got to the ER they were near death with a sugar over 
500. For lack of a 50-cent test strip, they spent a $10,000 
night in the ER.
    The incidence of diabetes in Indiana is higher than the 
national average, which is not surprising since 30 percent of 
our adults are obese. We rank 41st nationally in overall health 
and 45th in infant mortality. That is shameful. We are less 
healthy than our neighboring states of Ohio, Michigan, and 
Illinois, but have traditionally done a little better than 
Kentucky to the south. Kentucky is catching up to us now 
because they have cut their percentage of uninsured 
dramatically by taking full advantage of the Affordable Care 
Act.
    Some people say there are those who don't deserve health 
care. I disagree. Everyone deserves health care. I have been 
heartened to find support from Governor Pence. Listen to the 
language he has been using over the past four months.
    ``I have long believed that a society may be judged not 
only by how it deals with its most vulnerable, but also by how 
it comes alongside those often forgotten working people who are 
striving every day for a better life.''
    ``Low-income, working Hoosiers lack access to the kind of 
quality health insurance that their better-off neighbors enjoy. 
Many Hoosiers cannot access affordable coverage and live in 
uncertainty.''
    ``Hoosiers have long cherished the principle that we must 
love our neighbor as ourselves, that we must not walk by on the 
opposite side of the road when our neighbors are hurting and in 
need.''
    In these words, I hear an implicit understanding of the 
failure of our current system to meet the needs of too many, 
and an acknowledgement that government must take a larger role 
in guaranteeing access to health care.
    Make no mistake, Governor Pence is no friend of the 
Affordable Care Act. But he has done the right thing by moving 
forward to expand Medicaid through the ACA under the title of 
HIP 2.0.
    Mr. Messer, it appears that you too are a sworn opponent of 
the Affordable Care Act, but you have supported Governor Pence 
on Medicaid expansion, and I commend you for that. However, I 
want to address some of the misleading points in your editorial 
on August 26th, ``Congress Coming to Greenfield,'' or at least 
I fear they are misleading.
    You imply that Hoosiers purchasing coverage through the 
health insurance exchanges will see their premiums rise 
sharply. To start with, insurance premiums have been rising 
much faster than wages or inflation for decades. This trend is 
much older than the ACA. Last Friday the Associated Press 
reported ``Indiana residents will have more than triple the 
number of health insurance plans to choose from when the 
Federal insurance exchange enrollment period starts in 
November,'' and this is according to the Indiana Department of 
Insurance. And according to the Indiana Department of 
Insurance, they are predicting in Indiana premiums are going to 
rise 5 percent this year. That is quite different from the 13 
percent that you wrote.
    Likewise, employers have been cutting hours of part-time 
workers to avoid paying benefits for years. Mr. Messer, you 
claim that the Congressional Budget Office predicts that the 
ACA will ``push as many as 2.3 million people out of the 
workforce over the next seven years.'' Way back in February, 
the Washington Post refuted that number in an article titled 
``What the CBO Report on Obamacare Really Found.'' Under 
Congressional questioning, ``CBO director Douglas Elmendorf 
confirmed that, in reality, his report suggests Obamacare will 
reduce unemployment.''
    This is my family's experience: my son, daughter, and son-
in-law are all covered under the Exchange. The cost of all 
three policies is less than what we paid for my son alone last 
year.
    I will wrap up.
    There is an elephant in the room that no one is talking 
about. The real fear in this room today is not that the ACA is 
somehow going to ruin this country. It is the fear that the 
members here, including Mr. Messer, have that as the ACA goes 
forward, as people understand it and are helped by it, they are 
going to want to go further, not back. They don't want health 
care taken away from them. The elephant here, the real fear, is 
that as people come to appreciate the ACA, they are going to 
vote against politicians who are trying to repeal it and take 
it away from them.
    I went to medical school to take care of people. We need to 
figure out how to take care of everyone.
    Everyone.
    It's that simple.
    [The statement of Dr. Stone follows:]
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    Chairman Roe. Thank you, Dr. Stone.
    Mr. LaMar, you are recognized for five minutes.

STATEMENT OF NATE LAMAR, INTERNATIONAL REGIONAL MANAGER, DRAPER 
                    INC., SPICELAND, INDIANA

    Mr. LaMar. I wanted to start by thanking my congressman, 
Luke Messer, for scheduling this field hearing here in the 
district. It is great to see that he and fellow Hoosiers, 
Congressman Bucshon and Congresswoman Brooks, serve on this 
subcommittee, and that they are joined today by Congressman 
Rokita, who serves on the larger Education and the Workforce 
Committee. I would also like to thank Congressman Roe for 
scheduling this field hearing in Indiana. We greatly appreciate 
it.
    In addition to serving as International Regional Manager 
for Draper, I also manage Government Relations there and serve 
as President of Henry County Council. My employer, Draper Inc., 
was founded in 1902, is privately held, and is currently in the 
fourth and fifth generations of ownership by the same family.
    Draper is a manufacturer of audiovisual products, window 
coverings, and athletic equipment. With just over 500 
employees, Draper is barely into the medium-sized category of 
companies. Draper is the largest private-sector employer in 
Henry County, Indiana, and is the third-largest employer in our 
county overall.
    Draper is a fine example of corporate social 
responsibility, as it established an on-site health clinic in 
2006 for employees and their dependents who participate in 
Draper's health insurance plan, along with a wellness program. 
Having an employee health clinic so conveniently located has 
reduced lost work hours. In addition, in early 2014, Draper 
received a national award as the Healthiest Workplace in 
America, for which Congressman Messer recognized us on the 
floor of the U.S. House of Representatives. The Draper Health 
Clinic even served as a model when Henry County government and 
the New Castle Community School Corporation jointly established 
an employee health clinic more recently.
    Admittedly, I am no expert on health insurance or human 
resources. However, I learned the facts that I am about to 
share with you today from Draper's Director of Human Resources, 
Karl Dick.
    The three most noticeable areas in which the Affordable 
Care Act has affected Draper financially are coverage for 
employees' children up to age 26; the Patient-Centered Outcomes 
Research Institute, or PCORI; and the transitional reinsurance 
fee.
    One by one. Coverage for employees' children up to age 26 
caused our insurance rates to go up by default when it was 
added. But this mandate begs the question: What incentive do 
the so-called ``young invincibles'' have to sign up for health 
insurance when they can remain on their parents' plan?
    The Patient-Centered Outcomes Research Institute's, or 
PCORI, purpose seems to be to determine whether the Affordable 
Care Act works. It is funded by the PCORI fee, which cost 
Draper $893 in 2013, $1,830 in 2014, and who knows how much in 
2015. As there is currently no sunset provision for the PCORI 
fee, it could last indefinitely, and rise indefinitely.
    As for the transition reinsurance fee, on January 15, 2015, 
Draper will owe $63 per covered member, meaning both covered 
employees and their dependents, per year. This will amount to 
somewhere around $75,000, based on our 2014 membership. For 
2015, and presumably payable on January 1st of 2016, it will be 
$44 per member. Based on current enrollment, that would be 
about $52,000. The transitional reinsurance fee for 2016 has 
not yet been determined. The program pays insurers in the 
individual market that covers high-risk individuals. Draper 
gets nothing for paying this fee.
    In addition to these three most salient financial burdens 
for Draper, mandatory 100 percent preventive services have also 
increased our health insurance costs. Draper will likely be hit 
with the excise Cadillac tax, but it is not yet definite. As a 
result, Draper has already and will begin to take more 
aggressive action with our health plan designs in order to 
avoid this tax. The Affordable Care Act seems to be a 
government mandate to treat your employees well, just not too 
well. We cannot directly pass on the costs of the excise 
Cadillac tax to employees, but our HR Director's guess is that 
any impacted company will reconsider wage increases or other 
employment-related costs to indirectly cover the cost increase 
due to the additional tax. Draper is strongly enforcing that 
its part-time employees' annualized averages cannot exceed 30 
hours per week.
    The ACA's reporting mandates will absolutely bury our Human 
Resources Department. For example, the IRS' draft forms 1095B 
and 1095C mandate that a company the size of Draper must report 
every covered individual's name, Social Security number, and 
date of birth every year. The forms must be filed 
electronically for companies with over 250 employees, such as 
Draper. However, there is no guidance or process yet 
established to explain how to do this. It is unclear if the 
information can be downloaded directly into the form or if our 
HR Department will have to manually enter the information and 
just send the form back electronically. In addition, the final 
version of forms 1095B and 1095C are not yet available. Our HR 
Department's worst fear is that the final versions will be made 
available on December 15, with a December 31 deadline for 
submission.
    In conclusion, our HR Director told me that the Affordable 
Care Act is not as horrendous as originally thought, but the 
increased costs are a negative, and the IRS 1095 forms are a 
paperwork nightmare.
    Thank you again for scheduling this hearing, and thank you 
for your service to our country.
    [The statement of Mr. LaMar follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    Chairman Roe. Thank you very much, Mr. LaMar. I never could 
figure out why anybody would jump out of a perfectly good 
airplane like you have.
    [Laughter.]
    Chairman Roe. Dr. Bucshon, you are recognized for five 
minutes.
    Mr. Bucshon. Thank you, Mr. Chairman.
    I want to thank Dr. Stone for pointing out our Indiana 
health care data. I did the same on a statewide health care 
tour that Dr. Tim Brown, who is a state representative and 
chairman of the Ways and Means Committee for the state, did 
this past spring and summer, and agree that we have some 
challenges in Indiana which we need to address, and that is 
what we are all here to do, to try to figure that out.
    I would also like to say that on the rate issue that has 
been brought up, the promise was the Affordable Care Act would 
decrease rates and make things more affordable. So any increase 
of a cost under the Affordable Care Act is a broken promise.
    The other thing is that in actual fact, when you look at 
what the American people think about the Affordable Care Act, 
it is less popular today than it was the day it was passed. Why 
is that? Because it is starting to hit people, like many of 
you, directly.
    So I think that is why you are seeing a bipartisan 
discussion in Washington. I am disappointed we don't have some 
of our colleagues from the other side that were invited to the 
hearing to be here today because it is a bipartisan discussion 
on how to deal with some of these very important issues and how 
we deal with that.
    As far as job loss and unemployment, the CBO actually said 
that people now have the ability to choose not to work and be 
dependent on a government program. Hence, we will be losing 
people out of the workforce voluntarily, choosing not to work 
because now they have the ability to depend on the rest of us 
that do to subsidize their health care. In my view, that is not 
the right approach, to discourage employment.
    With that said, Mr. Wolfe, I am going to ask you, your 
testimony says you prefer to hire full-time employees to 
promote longevity and maintain quality customer service, which 
is very true in any business. How has the employer mandate, or 
the projected employer mandate depending on when it comes into 
law, impacted your ability to hire full-time employees? And 
have you hired more part-time employees instead of full-time 
employees since the Affordable Care Act or what you see is 
happening under the Affordable Care Act in the future?
    Mr. Wolfe. Well, we have added employees, and there is a 
constant turnover because of our particular situation.
    Mr. Bucshon. Right.
    Mr. Wolfe. And our full-time employees have been burdened 
with more overtime hours because who wants to be there 48 hours 
when they don't have to be? Before they were enjoying 40, 41, 
42, something like that. Now we have to put the overtime on 
them so we don't put 28 to 30 hours on everybody else, or above 
that 28, 30-hour barrier.
    So, yes, we have employed more people, but we are seeing 
more turnover. If they can find a full-time job, of course, 
they are going to move on to them. I wish them all the best. 
But I am seeing more people that are holding down two jobs, 
getting 25 or 26 hours and having to juggle those hours just so 
they can--
    Mr. Bucshon. Anybody who has a business, whatever that 
business is, whether it is health care, whether it is an auto 
auction, knows that turnover and retraining of employees is a 
huge expense because your employees who already work there, 
they have to spend their time training new people, and you can 
see this especially in hospitals, like nursing departments and 
others, if you have any transition. So, you can see the impact 
that will have on your business.
    The other thing I wanted to mention that you mentioned is 
getting people back to work. This past weekend I did the 
National Republican Saturday address, and the focus of that is 
what has been done already in the House as it relates to 
getting people back to work.
    The best solution for many of our issues is getting people 
in solid, good-paying jobs. Tax reform, regulatory reform, 40 
jobs bills that we see as potential job-creating bills that 
have not been acted on in the United States Senate, many of 
which there are many bills that were sponsored by the 
Democrats, over 30 of them in other areas that are sitting on 
the table in the United States Senate.
    So when you hear people saying Congress and looping us all 
in together, I would encourage you to look at the facts. I 
think getting people back to work is one of the best ways we 
solve our health care problem.
    And then I will make a final statement on health care. 
Again, as a physician I want everyone to have access to 
quality, affordable health care. Dr. Stone is on the front 
lines. I have been there in the ER. I know exactly what he is 
talking about. It is not right. It is not fair. But again, in 
my view, the Affordable Care Act is not going to be the 
solution to solve that problem. It doesn't address cost. Cost 
is the issue. If we don't address cost, no matter how much 
insurance you provide for people, we can't sustain our system 
if we can't control the cost.
    So, Mr. Chairman, I yield back.
    Chairman Roe. I thank the gentleman for yielding.
    Mrs. Brooks, you are recognized for five minutes.
    Mrs. Brooks. Thank you, Mr. Chairman, and thank you to 
everyone representing small businesses, and to you, Dr. Stone.
    One of the things that I think you all talked about in some 
parts were the wellness of your employees and your staff and 
how important that is to try to provide and encourage and 
incentivize wellness opportunities. Certainly, that helps keep 
folks out of coming to Dr. Stone's ER if employees are well and 
take care of themselves.
    But also, one of the other things that I know small 
businesses particularly struggle with is the certainty or the 
uncertainty of the future and how do you plan. As many multi-
generational businesses, you haven't been successful by not 
doing a lot of planning for the future. I think what I heard 
today is that there has been a lot of uncertainty that the law 
has created as to what are your expenses going to be with 
respect to your planning for the future.
    I guess I would just like to start with you, Mr. Wolfe, and 
actually talk to the business owners about how is this 
impacting your planning for the future. You certainly talked 
about the fact that you aren't able to provide--obviously, 
everyone wants to provide, particularly long-term, great 
employees, raises and promotions and so forth. How is the 
implementation of the Affordable Care Act affecting the 
certainty for your business planning?
    Mr. Wolfe. On our end, we have spent numerous hours, just 
the family, talking about how we are going to handle it. With 
the uncertainty of this plan or this Act, we have no way of 
knowing. We have tried to figure out if we are better off to 
pay the current employee and just offer nothing. I think we are 
going to end up going to one year, when it finally becomes an 
act or becomes active, we will spend one year, and we may have 
a debt on that is unreal. We could be looking at $140,000 in 
our company that is non-tax-deductible. Or we can go with the 
plan and find out later on that so many went into the pool. 
There is so much uncertainty with us. We have spent, like I 
say, the family has spent a lot of time talking, and we really 
have no answers as of yet.
    Mrs. Brooks. Okay. Thank you.
    Mr. DeFabis, how are you planning, and can you talk a 
little bit more about your wellness program and what you see 
for its future, which has provided so many terrific results so 
far?
    Mr. DeFabis. Well, as with any business, you look at your 
total cost of employees, and the less control we have over our 
health care costs, that unknown, we can't make decisions about 
hourly raises and those kinds of things because you don't know 
how much of the overall cost of your employees can be eaten up 
by health care anymore. I think that is what we saw the big 
benefit of in the wellness program, is we had, at least for a 
period of time, we were able to control ourselves what that 
increase was, and we then could take--okay, now that we have X 
amount available for employees' total cost of an employee, you 
could make an hourly increase. Now we are not able to make that 
planning, and we are having to wait and look for other ways 
that reward employees.
    Mrs. Brooks. I know that a lot of logistics companies like 
yourselves use a lot of staffing companies for the seasonal and 
the part time. Did those employees, those part-time folks, did 
they actually take advantage of your wellness program as well?
    Mr. DeFabis. Those that are eligible have. The staffing 
agencies that we use, some of them offer programs with that 
regard. But again, trying to engage those staffing agencies and 
some of the not-for-profits that we are using to supply that 
worker to us, to say what are their plans, are they going to 
offer coverage, and what will that coverage look like; and if 
so, are there controllable areas that they are going to try to 
address? At this point, there really isn't any definitive 
answer at all other than whatever that cost is going to be, it 
is going to get passed on to us.
    Mrs. Brooks. Mr. LaMar, congratulations to Draper for being 
one of the healthiest companies in America, let alone Indiana. 
As we heard from Dr. Stone, Indiana has a long way in going in 
improving the health of our citizenry. So I want to applaud all 
of the companies for putting a focus on that. But what are you 
seeing with respect to the costs of the Affordable Care Act and 
how it is going to affect your wellness program, which 
obviously is one of the best in the country?
    Mr. LaMar. So far, according to our HR Director, the 
wellness program, he doesn't foresee a threat to it.
    Mrs. Brooks. Good.
    Mr. LaMar. However, the facts that we have started our own 
on-site health clinic, there are some concerns about that. He 
says for the near term we should be safe for the health clinic, 
but long term it is just unfortunate that Draper, a good 
example of a company that has done the right thing by its 
employees by trying to establish an on-site health clinic, why 
should we be burdened with additional costs to subsidize those 
companies who have not done the right thing? That is the 
concern.
    And as far as your question goes regarding staffing and 
planning, we have had to increase our usage of staffing firms, 
third-party staffing firms, whereas in the past we just offered 
temporary hires direct employment via Draper.
    Mrs. Brooks. Thank you.
    My time is up. I yield back.
    Chairman Roe. I thank the gentle lady for yielding.
    Mr. Messer, you are recognized for five minutes.
    Mr. Messer. Thank you, Mr. Chairman.
    Thank you to our panelists.
    I want to start by asking a question of the employers. You 
can tell from your testimony that the people you work with are 
people you care about, and it is indicative, frankly, of the 
businesses I see throughout my district, the employers that 
work with their employees and, frankly, feel responsible for 
their well-being and their lives.
    So again, not a trick question, just to try to group this 
together on the hearing record. I will start with Mr. Wolfe. As 
the Affordable Care Act has moved forward over the course of 
the last year or two, have you seen costs of health care, your 
ability to provide access to high-quality health care for your 
employees, and has the cost gone up or the cost gone down?
    Mr. Wolfe. We were informed just--September is our policy 
date. So it went up. There was a 6 percent increase.
    Mr. Messer. Six percent.
    Mr. DeFabis, your reference?
    Mr. DeFabis. As I referenced, our cumulative increase over 
the time since the implementation of the ACA started is over 76 
percent. At this point, we have been given no indication that 
rate of increase is going to be decelerating.
    Mr. LaMar. At the beginning of the ACA, Draper had a low-
deductible plan for everybody. However, it launched a high-
deductible health savings account plan at the time. Those who 
signed up for the high-deductible HSA plan had their premiums 
locked in for a three-year period. That would have been 2010, 
2011, and 2012. However, the premiums went up in 2013 and 2014.
    Mr. Messer. Okay. Of course, for those individual 
consumers, their deductible was much higher and an expensive 
out-of-pocket potentially.
    Mr. LaMar. And I forgot to mention, for 2014 we launched a 
third program which is an even higher deductible HSA plan, an 
$8,000 family deductible, and then the plan that most employees 
are on is the $4,000 family deductible.
    Mr. Messer. And I applaud the use of health savings 
accounts. It is an Indiana innovation, founded by Pat Rooney, 
Golden Rule, and I think that part of the solution of what we 
needed, we look at a way to try to bring health care costs 
under control.
    I will turn to Dr. Stone. I certainly appreciate your work 
on the front lines. While we may disagree, I respect your 
opinion and applaud your willingness to come and be here and 
speak publicly today.
    I would say in your testimony you assert that ``some people 
say there are those who don't deserve health care.'' I am 
frankly aware of no one who believes that. That is not my 
position. I don't think it is the position of anybody here on 
the panel today.
    You do correctly note that I very much oppose the 
President's misnamed Affordable Care Act. There were real 
problems with our health care system before the law was 
enacted. Unfortunately, the law leaves too many of those 
problems unsolved, and it makes health care more expensive for 
too many people.
    My fear is that this law will not work. For too many, it is 
already not working. And by the time its most ardent supporters 
realize the damage that has been done, the price of cleaning up 
the mess will be too high, both financially and in terms of 
helping those people, who will have been hurt the most, people 
like students and hourly workers.
    You cited some questions about how high premiums are going 
up. I can tell you on an anecdotal basis I have talked to 
nobody who says their premiums are going down. You talk to a 
lot of people who are seeing premiums spike.
    As Dr. Bucshon mentioned, the debate about how the 
President's health care law is littered with broken promises 
that were made to justify its enactment. One example, the 
President said the bill could save families $2,500 in coming 
years. Clearly, that has not happened.
    Some proponents like yourself say that--you essentially 
argue that costs would have gone up more than they have without 
the law, and frankly I think for the average consumer that is 
just not good enough.
    You mentioned the question about whether 2.3 million people 
will be pushed out of the workforce in the next seven years. It 
is a line from the CBO. In testimony, you are right. In 
committee, there was a discussion about whether some workers 
will decide, so they can keep the President's subsidies and, 
frankly, keep their wages artificially depressed, whether they 
will work less. It essentially sounds like you are heralding 
the health care law could incentivize people to work less and 
be more dependent on their Federal subsides. I prefer to 
incentivize work, personal responsibility, and self-reliance 
over government dependence.
    You mentioned the elephant in the room. If I have a little 
time--oops, I am out of time.
    Chairman Roe. It's okay, go ahead.
    Mr. Messer. Okay. I want to ask just a couple of quick 
questions because, to me, the real elephant in the room is that 
the rising cost of health care itself is one of the primary 
reasons so many people lack access to care. So we need to enact 
patient-centered, market-based reforms that will expand access 
to affordable health care, not just massively redistribute 
wealth to the few.
    So here are a few examples. I think Indiana has been an 
incredible model on medical malpractice reform, driven by 
Governor Bowen in the 1970s. Would you support a sort of 
national approach to medical malpractice reform that would 
mirror the kinds of success we have had here in Indiana?
    Dr. Stone. Well, I might be able to surprise you with my 
answer on that.
    [Laughter.]
    Mr. Messer. Maybe you agree.
    Dr. Stone. I am no expert on malpractice, but I have not 
seen any of the national bills on medical malpractice that were 
I thought quite as good as what we have in Indiana. Indiana is 
typically ranked as one of the five best states in terms of 
medical malpractice. And I will perhaps surprise you again. I 
come from a family of lawyers, both my grandfathers, my father, 
my older brother, and my sister-in-law. So I am kind of the 
black sheep as the only doctor around. But I will tell you that 
I have friends who are trial lawyers, but the trial lawyers 
have a lot of power in the Democratic Party, and I worry about 
the effects of a national bill that might not be as good as 
what we have in Indiana.
    So here is one case where I am all for states' rights. 
Let's keep our Indiana bill.
    Mr. Messer. Two other quick things, doctor, with your 
permission, Chairman. Would you support greater price 
transparency so health care consumers can get the most bang for 
their buck? One of the real challenges we face is it is hard 
for consumers to know what the price is and what the quality of 
the care provided is.
    Dr. Stone. Boy, this price transparency thing is a really 
complicated problem, and I don't fully understand--I wish I 
did--why it is so hard to get price transparency. But in most 
of my years working in an emergency department, we were an 
independent group that contracted with hospitals. We had our 
own billing company, and we were under a lot of restrictions. 
We would sign a contract with Anthem, and then we had to sign a 
confidentiality agreement. We could not report what we were 
being reimbursed. So it is a very complicated problem.
    It sounds like it would be easy. The Time magazine article 
last year, ``Bitter Pill,'' talked about the incredible 
differences in charges.
    I am not a policy expert, but from a policy perspective I 
am not sure how you really make that happen, but I would be 
interested in looking at it.
    Mr. Messer. Of course, to make markets work, we have to 
know what the price and quality is.
    This is probably going to be the easiest one, and then I 
will let it go, okay? But I do think it is important, and it is 
something we can do to make a difference. Would you support 
streamlining health care delivery models in cracking down on 
waste, fraud, and abuse in the system?
    Dr. Stone. Sure, of course.
    [Laughter.]
    Mr. Messer. There is much that can be done beyond what has 
been done with the Act.
    Thank you very much.
    Chairman Roe. Would that be ``Do you still beat your 
wife?,'' one of those kinds of questions?
    [Laughter.]
    Mr. Messer. That one was easy.
    Chairman Roe. Mr. Rokita, you are recognized for five 
minutes.
    Mr. Rokita. I thank the Chair, and I thank Mr. Messer for 
his questions. They are along the same lines, the same kind of 
questions I had.
    I do want to make sure the record is clear that the doctor 
is not for waste, fraud, and abuse. I appreciate that very, 
very much.
    [Laughter.]
    Mr. Rokita. I also appreciate very much the private-sector 
testimony that we had here today, and I am going to have some 
questions for you all. But in this time when you turn on the 
news and you hear elected leaders, especially at the national 
level, decry companies and individuals being successful and 
making a profit, I want to be on record congratulating you for 
your profitability, for being good at what you do, for so many 
reasons, but chief amongst them is the fact that if you are not 
making a profit, then no one has a job. I say that here just so 
we don't lose sight of that as a state and a nation. Thank you 
for what you do.
    Now, we talked earlier, and I think it was Dr. Bucshon who 
did a nice job of listing out what I would term the piecemeal 
approach that we have been able to take in Congress so far in 
getting some reforms, many of them technical in nature, 30 
hours versus 40 hours, to the health care law. Certainly, none 
of that has passed the Senate, and it certainly won't be signed 
by the President I don't imagine, but we did some good work 
getting those things out.
    But we have to also, I think, make sure we are keeping our 
eye on the ball in terms of repealing this in a holistic 
fashion, not because none of us want to see a better system--we 
certainly do--but so that we can get to what could be. And what 
could be in a lot of ways are found in those 80 amendments that 
Nancy Pelosi would not hear back in 2010 or 2009 when this 
Affordable Care Act was passed in the dead of night, a multi-
thousand-page bill that no one read, and now we are suffering, 
as the majority of the testimony here clearly indicates that we 
are suffering under.
    What could be, with 135 co-sponsors already, is a 
comprehensive bill that goes into transparency, mandates it, 
very heavy on that Indiana innovation mentioned earlier called 
Health Savings Accounts. It incentivizes it. Right now, under 
Obamacare, health savings accounts, the idea that you can 
empower your employee to make better health care decisions to 
drive down costs, Mr. DeFabis, is effectively outlawed. The 
opposite is incentivized under Obamacare. It is effectively 
outlawed, if not severely limited.
    So what we are talking about in the comprehensive sense is 
empowering the individual, trusting the individual, your 
employees, from the richest citizen to the simplest of us, 
knowing that we can make better health decisions for ourselves 
than some one-size-fits-all, government run, government 
controlled system.
    Let me put that in a little bit of an example. Think about 
any one of your employees. Think about the examples that the 
doctor made, that $200 x-ray that fellow couldn't afford. With 
a Health Savings Account, with a pool of money, even if it is 
government funded, they could use to make better health care 
decisions, that man would have shopped that x-ray, would have 
found the best deal using his skill set that is so natural to 
all of us as Americans, and that is consumerism, right?
    We can go down the streets of Greenfield and I think, if I 
remember right, there is still a Firestone, still a Goodyear? 
There is a Burger King and McDonald's. We can find the best 
value. Each of us knows how to do that. And not every 
transaction in health care is an emergency. Some are, like if 
these bee stings had gone the wrong way last night, I wouldn't 
go to the Internet, I would go to the emergency room.
    But a majority of our health care decisions and 
transactions are not emergency. So let's trust people, not some 
government bureaucrat or some utopian searching person who is, 
yes, well-meaning, wants to help people--sure, we all do--but 
thinks they can do it best for the rest of us.
    So with the time I have remaining--I usually don't 
pontificate like that, but I wanted to get that on the record 
because I think that is the synthesis of the testimony I have 
heard today, at least the majority of it.
    Health savings accounts. Has your company, Mr. Wolfe, had 
any experience with them or be willing to try that, the idea 
that you can actually incentivize your--
    Mr. Wolfe. We are actually exploring that right now. We 
have two insurance companies working with us to see if they can 
lessen the burden.
    Mr. Rokita. Right. Thank you.
    Mr. DeFabis, did you have--
    Mr. DeFabis. Yes. We have a high-deductible plan with HSA, 
and I can say since we have implemented that, it was a change, 
a major change for our employees, but I think if you were to go 
back and ask them now, I think everybody likes it. Now, it is 
interesting to see the dynamic that happens because they do 
share information amongst themselves: ``Where are you buying 
your medication? Where are you going?'' It has been a pleasure 
to see that when they have been empowered that way.
    Mr. Rokita. Let's trust that empowerment.
    Mr. LaMar?
    Mr. LaMar. We have the high-deductible HSA plan for quite 
some time now, but the consumer transparency that you 
mentioned, that is something that our HR department has 
undertaken for about two years now. We contract with a third-
party firm who, if you need an MRI or an even more serious 
procedure, a colonoscopy or what have you, this firm will go 
out and shop it for you to find the cheapest rate throughout 
east central Indiana, and then it will strongly recommend that 
an employee go to the low bidder. Employees are not mandated to 
do that. They are not forced to do it, but they are just 
strongly encouraged to do that, to keep our overall premiums 
down.
    Mr. Rokita. And it looks like in that sense there may be a 
new cottage industry developing.
    Mr. LaMar. Exactly.
    Mr. Rokita. That would be helpful to the economy, too.
    My time is surely expired. But in the spirit of Congressman 
Messer taking liberties--
    [Laughter.]
    Mr. Rokita.--let me take a little bit less of a liberty, 
Mr. Chairman, and just finish with a statement.
    I know Mr. Pence. I know the governor. I consider him a 
friend. I probably think he would pop out of his seat if he was 
still up here, based on Dr. Stone's characterization of his 
comments. But the Healthy Indiana plan, which is what the 
Medicaid waiver is all about, central to that, surely you know, 
is the health savings account. Again, here is an example for 
the simplest of us Hoosiers, by empowering them with decision-
making capability, trusting them to make better value 
decisions, better than any Federal Government program or state-
administrated program could, we are able to cover so far 40,000 
more Hoosiers, people who really needed it. That goes to our 
shared goal of helping everyone get the health care they do 
deserve without adding to the Indiana budget.
    Let's capitalize on that. Let's use examples like that in 
trusting ourselves more than a one-size-fits-all program.
    I yield back.
    Chairman Roe. I thank the gentleman for yielding.
    I am going to reminisce just a moment as a medical educator 
and tell you all a short story. My first pediatric in-hospital 
rotation was at St. Jude's Children's Hospital in Memphis, 
Tennessee, where I went to medical school, and it had been 
opened about six or seven years at that time. At that time, 90 
percent of those children who went in there I knew who I 
started an IV on would not survive. They died. Today, 90 
percent of those children live.
    I don't want to take a step backwards in that other 
direction. I am telling you, when the Lord walks on the earth 
again, the first step will be at St. Jude's Children's 
Hospital. It is a wonderful place. All children are treated for 
free regardless of their ability to pay. Their parents are put 
up. And you the citizens make that possible through donations. 
I don't want to see that medical research take a step back.
    In my own community where we have a medical school, and I 
was on the original faculty of that school, with the Affordable 
Care Act, because Medicare payments to hospitals have been cut, 
we have lost 50 primary care residency slots. Hospitals pay 
above the cap, and there is an amount of money that Medicare 
will pay to help educate us as doctors. We have lost 50 of 
those. That is 500 doctors that won't get trained in tri-cities 
Tennessee.
    Our hospitals lost 800 jobs, high-paying jobs with health 
benefits, retirement plans, and futures, I might add. We used 
to think you could have a future in medicine. It is the most 
uncertain time I have seen in my lifetime in health care. What 
we did with this plan, with the Affordable Care Act, we took a 
part of the health care system that was working fairly well--we 
just heard of two people who had very innovative ways to help 
hold their costs down, and we have taken that away from them. 
Washington has taken that away.
    They were figuring it out. I have heard that same story 
with BAE. When I was the mayor of Johnson City, we put a 
wellness program in, a self-insured plan, held our costs down. 
With community rating, that is going to be gone now.
    Now, are there going to be some beneficiaries? Sure. There 
are going to be people who couldn't get health insurance before 
who can now. There is no question there are going to be some 
winners, but I think there are a lot more losers, as we have 
heard today. This theme, I have heard it all over the eastern 
United States when I have held these forums. It is the same 
exact theme. Did we need health care reform? Absolutely we 
needed health care reform. We needed it. And what Mr. Rokita 
was saying is that we don't trust individuals.
    The government, the Federal Government, I do, because the 
simplest decision in the world--health care decisions ought to 
be made between a physician and the patient and that patient's 
family, not the insurance company, and certainly not the 
Federal Government. Let me tell you, when people tell you can't 
shop for health care, baloney. Americans are the best shoppers 
in the world. We will drive across five lanes of interstate to 
get gas two cents a gallon cheaper. So I know good and well we 
will shop when we are talking about thousands of our own 
dollars.
    In my own practice, we have 450 employees. I have a health 
savings account. By far the majority, 85 percent, elected--we 
said you could have either plan. Mr. DeFabis, you learned 
exactly the same thing. The employees talked. They found out 
that they could have it better--it was better for them when 
they made those decisions, and 85 percent of the people we 
insure now in our practice use a health savings account.
    What Mr. Rokita was talking about was a bill--and it sounds 
like Dr. Stone would support most of it. I wrote H.R. 3121. Mr. 
Rokita was very much a part of it, a 182-page bill to put 
people in charge of their health care, not somebody else. And 
until I am responsible for the bill, you are not going to look 
the same at it as if I paid $20 and everything else is covered. 
Hey, if I had--Mr. Wolfe, if I had car-buying insurance and had 
a $25,000 deductible, I am driving a Bentley. I have never been 
in a Bentley. I am not driving a Honda.
    So you see what I am saying? We have to be responsible for 
that or we will never get in control of our costs. There is 
enough money in the American health care system to cover 
everybody. I have no doubt about that. There is. It is just the 
way it is distributed right now is not very good.
    In my state, 19 percent increase. My own insurance for my 
family went up with the Affordable Care Act 75 percent. I can 
pay that. I don't like it when my wife writes the check, but I 
can afford to do it. A lot of people cannot afford to do that, 
and they will do without. For the people who are working in 
these jobs--we had the educators here--who are working five 
days a week as a substitute teacher, not only do we cut their 
hours with this and the folks at schools can't get any more 
money in there without raising taxes on the senior citizens and 
other people who are least able to pay, not only do we do that, 
then we fine them when they don't buy it.
    Think about that. We take their jobs away, their hours 
away, and then we have the audacity to have you pay a fine.
    Now, I want to pass along a little tidbit of information 
that you can use however you want to. This is a personal choice 
you have to make, but I read the bill. I would recommend 
everybody do that who voted for it. That didn't happen. But in 
the bill, there are no criminal or civil penalties if you don't 
pay the fine, the tax. They can't garnish your wages. The only 
thing the government can do to get your money is if you over-
pay your taxes.
    I told that young woman I talked to this week who had lost 
her job, I said it is between your own conscience whether you 
over-pay your taxes or not. If I were you, I would under-pay 
them this year so the government couldn't get their money from 
you. I think that is the most unbelievable thing in the world 
is to put a business in a position where they have to cut your 
hours and then fine you when you can't buy something they force 
you to buy. Unbelievable.
    I think my time has expired. I want to thank the panel. You 
all have done a tremendous job, both panels.
    Mr. Snyder, before I finish, I want to commend you because 
I think community colleges are absolutely critical in allowing 
an educational opportunity to people who can't. In Tennessee 
this year, we passed the Tennessee Promise, where every single 
high school graduate can go to a technical school or a 
community college for free. So no longer will the cost be 
something that a young person has to endure and have these huge 
debts when they get out.
    So I think you are right on, and I want to encourage you to 
continue to find innovative ways to make it affordable for 
young people.
    I want to thank our witnesses again.
    Does anybody have a closing comment?
    Dr. Bucshon?
    Mr. Bucshon. Just briefly, Mr. Chairman. Again, one of the 
reasons I ran for Congress is because I have been in the ER, 
like Dr. Stone, and I have had patients that had pre-existing 
conditions that worked their whole lives and couldn't get 
insurance, and I also know that if you are going to try to 
solve what I consider maybe one of the biggest issues of our 
generation--how we get everyone to have affordable, quality 
health care and access--that certainly physicians in government 
should be part of that discussion to give our perspective.
    That is why, I think along with Dr. Roe, and we have 14 or 
so other M.D.s, I do think it is important to be part of the 
discussion, and I would encourage everyone out there who is 
listening or who is in the crowd that has the ability, 
regardless of whether you are in health care, to please engage 
on this issue and give your perspective, not only health care 
providers but business people, individual citizens. We need 
your help, and by ``we,'' I mean the people who are your 
elected officials, to help us solve this problem.
    I yield back.
    Chairman Roe. Mr. Messer?
    Mr. Messer. I just want to thank the Chairman, thank my 
colleagues, thank our panelists, and thank everybody here from 
Indiana State's congressional districts, both here in Hancock 
County and neighboring counties as well.
    Chairman Roe. Thank you.
    Mrs. Brooks?
    Mrs. Brooks. Thank you, Mr. Chairman, for coming to Indiana 
and for holding this hearing.
    As a freshman member of Congress, I have been a bit 
overwhelmed by the number of phone calls, emails, and letters 
that are written to a member of Congress' office. I will tell 
you that the number-one issue is health care. That is the 
number-one issue that we hear from constituents. So while 
sometimes a lot of people get tired of us continuing to talk 
about the Affordable Care Act, I will tell you it is still top 
of mind not only for families and individuals, and how they are 
impacted, but also our medical providers.
    We have, I believe, the best medical providers in the 
world, and we want to make sure that we continue to be the most 
innovative and the best medical and health care system in the 
world. So that is, I think, why we have continued, and I want 
to applaud you for keeping attention on this critical issue, 
because I too do not believe that the Affordable Care Act got 
it right and we have to fix this.
    And I yield back.
    Chairman Roe. Mr. Rokita?
    Mr. Rokita. Thank you, Chair.
    Like Congresswoman Brooks, the top of mind for my 
constituents in Indiana's 4th District, which goes all the way 
from the southern line of Lake County, the Kankakee River, down 
through Logansport, Lafayette, Kokomo, all the way to 
Greencastle, this is the issue. It certainly is not stale, and 
I think leadership demands that we lead on what could be.
    So again, I encourage, like Dr. Bucshon said, everyone in 
the audience, everyone within earshot, let us know your 
opinion, let your opinion be heard, and not just to your 
congressman or congresswoman, but to that person walking out of 
church. Maybe get out of your comfort zone a little bit, 
someone you might not otherwise talk to about these kinds of 
issues. This is not just a health care issue; it is a political 
issue. It is political in the sense of who is going to run your 
life. Everything we do around Washington, D.C., really comes 
down to that.
    Get out of your comfort zone, because if you are listening 
to this right now, if you are here in the audience or by some 
other telephonic method, besides any other addictions or 
afflictions you have, you are leaders and you are needed. You 
have a sphere of influence, and people will listen to you, 
whether your opinion is along the lines of Dr. Stone or along 
the lines of the majority of other witnesses here today.
    It is going to be up to the people to solve this problem, 
so that is where the focus has to be. Can we do a better job 
about managing our lives, or are we better off giving it to a 
subset of us to manage them for us? I certainly believe the 
former.
    But like I said in the beginning, I am very proud to be a 
Hoosier and very proud of what the state has done. And because 
of the civil discourse from everyone here today and some of the 
ideas that were brought up and some of the testimony that we 
heard, I am even prouder to leave this dais as a Hoosier. So 
thank everyone for your continued leadership.
    I yield back.
    Chairman Roe. I thank the gentleman for yielding.
    Once again, I just wanted to spend a minute or two 
reminiscing about 2009. We had nine physicians on the Doctors 
Caucus, which I co-chair. There are 15 of us now. And not one 
of us was asked one thing about the health care bill. I found 
that astonishing. I thought somebody cared about what I 
thought. It turned out they didn't, and it was unbelievable to 
me that you could have spent over 30 years in health care, 
along with 20 years in health care reform called TennCare.
    We had tried to reform our health care system in Tennessee, 
called TennCare, and I had almost 20 years' experience with 
that. I really wanted to help and be part of the solution. I 
was totally shut out of that debate.
    As I said just a moment ago, health care is not political. 
It astonishes me that it is Democrat and Republican. It is 
unbelievable. It is about providing health care, and there is 
nothing any simpler. There is no simpler economic transaction 
in the world than a patient coming to see me, me providing a 
service, and somehow there is a little remuneration that takes 
place. It is not complicated.
    We have spent a billion dollars on healthcare.gov, and let 
me give you an example. I now have one full-time staff member 
who just tries to help people navigate that. One quick example, 
a young woman called at about six weeks pregnant, and she was 
having her third baby--second baby. She got to the 
healthcare.gov website and got stuck there and couldn't move 
along.
    I am not going to tell you the whole story. Four exchanges 
between our Tennessee Medicaid and healthcare.gov, and on my 
election day, August 7th, I am on the phone for two hours 
working on this young woman. I asked the question, I realize I 
have been out of the operating room and out of delivering 
babies for a little while.
    By the way, I delivered almost 5,000 babies, and it helps 
to get elected if you have delivered your own voters. I found 
that out.
    [Laughter.]
    Chairman Roe. But I asked the question. I said, has the 
human gestation changed from 280 days yet, or is it still the 
same? And they sort of laughed, but I said, no, I am serious, 
because this patient is due in two weeks. I became worried 
about her.
    We got her health coverage through healthcare.gov two weeks 
before she was to have this baby, which was breach and she had 
to have a--so she was having complications. And guess what? 
Because of our state laws, when she went in to see the 
provider, he thought she had neglected her baby and they called 
Social Services and the young woman was afraid she was going to 
lose her baby. That is how crazy this has gotten.
    We need to get some common sense back into health care and 
get a lot of these bureaucrats out of it and thousands of pages 
and get it back between just doctors and patients and simple 
things like that. Dr. Stone has dealt with this for 30 years, 
and he is trying to figure out a way to best do it. I 
appreciate it and applaud you for that.
    I want to finish by saying there are some common themes I 
have heard today, and those are from our educators, the 
continuity of care for special needs kids, extra-curricular 
activities like sports and field trips and things like that. 
Quite frankly, I have held a large employer roundtable, 
manufacturing roundtable in the last week, and one of the 
things those employers are looking for is those soft skills 
that you learn in athletics--show up on time, give your best 
effort. Those are very important skills. And the band. All of 
those things that kids learn how to do, to be there on time, 
that works well in the workplace.
    I have heard about less classroom attention. I don't think 
anybody thinks that is a better idea today.
    By the way, for any of you educators that are out there, I 
want to set the record straight. You hear every year how 
terrible you are when compared to Lichtenstein and Norway and 
whatever. Here are the facts. There are almost 100,000 school 
systems in the United States. If you take our schools with 10 
percent poverty or less, and poverty is defined by free and 
reduced lunch, we have the highest 15-year-old test scores in 
the world, bar none, period.
    It is a problem with poverty, not our educators. They are 
doing a great job. So if you know an educator, pat them on the 
back. They feel kind of beat down right now with all that is 
going on, at least they do in my state.
    Reporting requirements, they are unbelievable. Right now, 
Mr. Wolfe, they don't know what they are. Every business up 
here doesn't know exactly. That adds cost to their business and 
uncertainty to their business, new fees and taxes. This 
reinsurance fee where you make sure big, powerful, wealthy 
insurance companies don't lose money is mind-boggling when this 
city right here--I guarantee you, the mayor of this city is 
going to have to provide a check from people who pay taxes here 
to pay that reinsurance fee, of which he will get nothing for 
it, the people who are recipients will get nothing for it, 
higher turnover rates because people need full-time work.
    I have learned a lot today. I have heard a lot of good 
things and certainly appreciate working with my four great 
colleagues here.
    I want to thank our police officers who are here today and 
with us. I want to thank you all for your service. You put your 
life on the line every day. I know as a mayor, when I would 
drive by a car with one of you guys pulling somebody over, I 
would say a little prayer for you because you do very dangerous 
work, and I thank you for that work, making our communities 
safer.
    I thank all of you all for being here and attentive. This 
has been a great audience. We are going to keep doing this dog 
and pony show on the road because I like to get out among the 
people where the common sense is because, I can tell you, 
inside 395 and Washington, D.C., the oxygen ain't right.
    [Laughter.]
    Chairman Roe. With no further business, the committee 
stands adjourned.
    [Applause.]
    [Additional Submission by Mr. Messer follows:]
    [GRAPHICS NOT AVAILABLE IN TIFF FORMAT] 
    
    [Whereupon, at 12:34 p.m., the subcommittee was adjourned.]

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