[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]




 
                      RESCUING AMERICANS FROM THE
                       FAILED HEALTHCARE LAW AND
                  ADVANCING PATIENT-CENTERED SOLUTIONS

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

                                6HEARING

                               before the

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

                     ONE HUNDRED FIFTEENTH CONGRESS

                             FIRST SESSION

                               __________

            HEARING HELD IN WASHINGTON, DC, FEBRUARY 1, 2017

                               __________

                            Serial No. 115-1

                               __________

  Printed for the use of the Committee on Education and the Workforce
  
  
  
  
  
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]  

  


      Available via the World Wide Web: www.gpo.gov/fdsys/browse/
           committee.action?chamber=house&committee=education
                                   or
            Committee address: http://edworkforce.house.gov
            
            
                            _________ 

                U.S. GOVERNMENT PUBLISHING OFFICE
                   
 23-826 PDF               WASHINGTON : 2018       
____________________________________________________________________
 For sale by the Superintendent of Documents, U.S. Government Publishing Office,
Internet:bookstore.gpo.gov. Phone:toll free (866)512-1800;DC area (202)512-1800
  Fax:(202) 512-2104 Mail:Stop IDCC,Washington,DC 20402-001               
            
            
            
                COMMITTEE ON EDUCATION AND THE WORKFORCE

               VIRGINIA FOXX, North Carolina, Chairwoman

Joe Wilson, South Carolina           Robert C. ``Bobby'' Scott, 
Duncan Hunter, California                Virginia
David P. Roe, Tennessee              Ranking Member
Glenn ``GT'' Thompson, Pennsylvania  Susan A. Davis, California
Tim Walberg, Michigan                Raul M. Grijalva, Arizona
Brett Guthrie, Kentucky              Joe Courtney, Connecticut
Todd Rokita, Indiana                 Marcia L. Fudge, Ohio
Lou Barletta, Pennsylvania           Jared Polis, Colorado
Luke Messer, Indiana                 Gregorio Kilili Camacho Sablan,
Bradley Byrne, Alabama                 Northern Mariana Islands
David Brat, Virginia                 Frederica S. Wilson, Florida
Glenn Grothman, Wisconsin            Suzanne Bonamici, Oregon
Steve Russell, Oklahoma              Mark Takano, California
Elise Stefanik, New York             Alma S. Adams, North Carolina
Rick W. Allen, Georgia               Mark DeSaulnier, California
Jason Lewis, Minnesota               Donald Norcross, New Jersey
Francis Rooney, Florida              Lisa Blunt Rochester, Delaware
Paul Mitchell, Michigan              Raja Krishnamoorthi, Illinois
Tom Garrett, Jr., Virginia           Carol Shea-Porter, New Hampshire
Lloyd K. Smucker, Pennsylvania       Adriano Espaillat, New York
A. Drew Ferguson, IV, Georgia

                      Brandon Renz, Staff Director
                 Denise Forte, Minority Staff Director
                                 ------                                

                            C O N T E N T S

                              ----------                              
                                                                   Page

Hearing held on February 1, 2017.................................     1

Statement of Members:
    Foxx, Hon. Virginia, Chairwoman, Committee on Education and 
      the Workforce..............................................     1
        Prepared statement of....................................     6
    Scott, Hon. Robert C. ``Bobby'', Ranking Member, Committee on 
      Education and the Workforce................................     7
        Prepared statement of....................................    14

Statement of Witnesses:
    Bollenbacher, Mr. Scott, CPA, Managing Partner, Bollenbacher 
      and Associates, LLC, Portland, Indiana.....................    38
        Prepared statement of....................................    40
    Eddy, Mr. Joe, President and Chief Executive Officer, Eagle 
      Manufacturing Company, Wellsburg, West Virginia............    24
        Prepared statement of....................................    26
    Schlaack, Ms. Angela, St. Joseph, Michigan...................    32
        Prepared statement of....................................    34
    Troy, Mr. Tevi, PH.D., Executive Officer, American Health 
      Policy Institute, Washington, DC...........................    17
        Prepared statement of....................................    20

Additional Submissions:
    Adams, Hon. Alma S., a Representative in Congress from the 
      State of North Carolina:
        Letter dated January 3, 2017, from Seven Children's 
          Groups.................................................   130
    Bonamici, Hon. Suzanne, a Representative in Congress from the 
      State of Oregon:
        Letter December 28, 2016, from AARP......................    71
    Brat, Hon. David, a Representative in Congress from the State 
      of Virginia:
        Chart: Hitting the Wall: When Health Care Costs are No 
          Longer Manageable......................................    96
    Courtney, Hon. Joe, a Representative in Congress from the 
      State of Connecticut:
        Article: Is healthcare law really going into a death 
          spiral?................................................   149
    DeSaulnier, Hon. Mark, a Representative in Congress from the 
      State of California:
        Article: One in Five 2014 Marketplace Consumers was a 
          Small Business Owner or Self-Employed..................   142
    Espaillat, Hon. Adriano, a Representative in Congress from 
      the State of New York:
        Prepared statement of from Cuomo, Hon. Andrew M., 
          Governor of New York...................................    85
        Article: AAMC Statement on President Trump's Executive 
          Order on Immigration...................................    92
    Chairwoman Foxx:
        Republican Subcommittee Assignments......................     3
        Key Facts on Obamacare...................................   169
        Breaking Down the Uninsured..............................   172
    Polis, Hon. Jared, a Representative in Congress from the 
      State of Colorado:
        Letter dated January 4, 2017, from Hickenlooper, Hon. 
          John, Governor of Colorado.............................    64
    Mr. Scott:
        Letter dated January 30, 2017, from the U.S. Department 
          of Health and Human Services...........................    10
        Report: Highlighting the Progress of the Affordable Care 
          Act....................................................    46
        Prepared statement of from Pollack, Mr. Rick, President 
          and CEO, American Hospital Association.................   172
    Takano, Hon. Mark, a Representative in Congress from the 
      State of California:
        Letter dated December 6, 2016, from the American Hospital 
          Association and Federation of American Hospitals.......    79
    Thompson, Hon. Glenn ``GT'', a Representative in Congress 
      from the State of Pennsylvania:
        Submission for the record................................   156
    Mr. Troy:
        Briefing Paper: How the Implementation of the Affordable 
          Care Act Will Affect Doctors...........................   112
    Questions submitted for the record by:
        Barletta, Hon. Lou, a Representative in Congress from the 
          State of Pennsylvania..................................   174
        Stefanik, Hon. Elise, a Representative in Congress from 
          the State of New York 



    Responses to questions submitted for the record:
        Mr. Barletta.............................................   177
        Mr. Eddy.................................................   178


                   RESCUING AMERICANS FROM THE FAILED



                      HEALTHCARE LAW AND ADVANCING



                       PATIENT-CENTERED SOLUTIONS

                              ----------                              


                      Wednesday, February 1, 2017

                       House of Representatives,

               Committee on Education and the Workforce,

                            Washington, D.C.

                              ----------                              

    The committee met, pursuant to call, at 10:04 a.m., in Room 
2176, Rayburn House Office Building, Hon. Virginia Foxx 
[chairwoman of the committee] presiding.
    Present: Representatives Foxx, Wilson of South Carolina, 
Roe, Thompson, Walberg, Guthrie, Rokita, Messer, Byrne, Brat, 
Bishop, Grothman, Stefanik, Allen, Lewis, Rooney, Mitchell, 
Smucker, Scott, Grijalva, Courtney, Fudge, Polis, Wilson of 
Florida, Bonamici, Takano, Adams, DeSaulnier, Norcross, Blunt 
Rochester, Krishnamoorthi, Shea-Porter, and Espaillat.
    Staff Present: Bethany Aronhalt, Press Secretary; Andrew 
Banducci, Workforce Policy Counsel; Courtney Butcher, Director 
of Member Services and Coalitions; Ed Gilroy, Director of 
Workforce Policy; Jessica Goodman, Legislative Assistant; 
Callie Harman, Legislative Assistant; Nancy Locke, Chief Clerk; 
Dominique McKay, Deputy Press Secretary; James Mullen, Director 
of Information Technology; Michelle Neblett, Professional Staff 
Member; Krisann Pearce, General Counsel; Brandon Renz, Staff 
Director; Molly McLaughlin Salmi, Deputy Director of Workforce 
Policy; Alissa Strawcutter, Deputy Clerk; Olivia Voslow, Staff 
Assistant; Joseph Wheeler, Professional Staff Member; Tylease 
Alli, Minority Clerk/Intern andFellow Coordinator; Austin 
Barbera, Minority Press Assistant; Michael DeMale, Minority 
Labor Detailee; Denise Forte, Minority Staff Director; 
Christine Godinez, Minority Staff Assistant; Carolyn Hughes, 
Minority Senior Labor Policy Advisor; Kevin McDermott, Minority 
Senior Labor Policy Advisor; Richard Miller, Minority Senior 
Labor Policy Advisor; Udochi Onwubiko, Minority Labor Policy 
Counsel; Veronique Pluviose, Minority Civil Rights Counsel; 
Arika Trim, Minority Press Secretary; and Elizabeth Watson, 
Minority Director of Labor Policy.
    Chairwoman Foxx. Good morning. A quorum being present, the 
Committee on Education and the Workforce will come to order.
    Before we turn our attention to this morning's hearing, I'd 
like to take care of an administrative matter. Today, both the 
Republicans and Democrats have completed assigning members to 
the subcommittees. I ask unanimous consent on behalf of myself 
and Ranking Member Scott to submit those assignments for the 
record.
    Hearing no objection, the subcommittee assignments are 
made.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
      
    Chairwoman Foxx. Next, I recognize myself for an opening 
statement.
    I want to again say good morning to my colleagues and 
guests. I want to welcome our witnesses. We appreciate that you 
took time out of your busy schedules to be with us today.
    It is no coincidence that our first hearing is focused on 
our efforts to rescue Americans from a fatally flawed 
healthcare law and transition to a patient-centered system. 
There's an urgent need to address the challenges facing working 
families and small businesses under ObamaCare, and that's 
exactly what this hearing is about.
    For nearly seven years, Americans have struggled as they've 
seen their healthcare costs skyrocket, their plans canceled, 
and their choices and access to quality care diminished. That 
is why for nearly seven years Republicans have been fighting to 
provide the relief Americans desperately need.
    This has never been about politics. The fight to repeal and 
replace ObamaCare has always been about people.
    It has been about people like Steve from my congressional 
district. Steve resides in West Jefferson, and he and his wife 
are paying 225-percent-higher premiums than they were four 
years ago.
    Scott from Hickory, North Carolina, has had his healthcare 
plan canceled three times because of the law and today has 
access to only one insurance provider.
    Michael from Winston-Salem has an $800 monthly premium for 
him and his daughter, and their deductible is over $14,000.
    Terry, a 70-year-old retiree from Advance, is working part-
time just to help pay his wife's $900 monthly premium.
    These stories aren't unique to North Carolina. Working 
families across the country are suffering under a failed 
government takeover of health care.
    Remarkably, the consequences extend beyond higher insurance 
costs and limited plan options to fewer jobs and suppressed 
wages. In fact, a recent study by the American Action Forum 
found ObamaCare has destroyed 300,000 small-business jobs and 
cost small-business employees $19 billion a year in wages. An 
estimated 10,000 small businesses were even forced to close 
their doors because of the law's burdensome regulations.
    All of these individuals, families, and small-business 
owners were promised far different. They were promised lower 
costs, more choices, and more competition. What they got was 
the exact opposite.
    The reality is the 2010 healthcare law is completely 
unsustainable. It's collapsing as we speak. We cannot stand by 
as the law creates even more havoc in the lives of the American 
people. That's why we're on a rescue mission to deliver the 
relief people need, and this committee will play an important 
part in the process. We have already taken steps to repeal 
ObamaCare, and the Trump administration is actively working to 
stabilize health insurance markets.
    Once the law is repealed, there will be a stable transition 
to a patient-centered system. At least 4.7 million Americans 
have already been kicked off their healthcare plans under 
ObamaCare, and the last thing Republicans want is to disrupt 
more people's coverage.
    We're going to do this the right way. There won't be a 
massive bill that no one has read and is jammed through 
Congress in the dead of night. Instead, we will tackle the 
challenges of our broken healthcare system through step-by-step 
solutions that provide lower costs, more choices, and protect 
the most vulnerable among us.
    We will put patients in control of their healthcare 
decisions. That means eliminating one-size-fits-all rules that 
drive up costs and restrict choices. All Americans should have 
the freedom to select a healthcare plan that meets their needs.
    After years of costly federal mandates, we will empower 
small businesses to band together and provide affordable 
coverage for their employees. Additionally, we will preserve 
employee wellness plans that have been under attack in recent 
years by Washington bureaucrats.
    Undoing the damage of ObamaCare and achieving real 
healthcare reform won't happen overnight. We will continue to 
hold hearings just like this one, and we will continue to 
receive input from Governors, insurance commissioners, workers, 
and employers across the country.
    Today's discussion is an important step in this process. We 
look forward to hearing from all of you on how we can provide a 
better way forward on health care for the American people.
    With that, I yield to Ranking Member Scott for his opening 
remarks.
    [The statement of Chairwoman Foxx follows:]

  Prepared Statement of Hon. Virginia Foxx, Chairwoman, Committee on 
                      Education and the Workforce

    It is no coincidence that our first hearing is focused on our 
efforts to rescue Americans from a fatally flawed health care law and 
transition to a patient-centered system. There is an urgent need to 
address the challenges facing working families and small businesses 
under Obamacare, and that's exactly what this hearing is about.
    For nearly seven years, Americans have struggled as they've seen 
their health care costs skyrocket, their plans canceled, and their 
choices and access to quality care diminished. That is why for nearly 
seven years, Republicans have been fighting to provide the relief 
Americans desperately need.
    This has never been about politics. The fight to repeal and replace 
Obamacare has always been about people. It's been about people like 
Steve from my congressional district. Steve resides in West Jefferson, 
and he and his wife are paying 225 percent higher premiums than they 
were four years ago. Scott from Hickory, North Carolina, has had his 
health care plan canceled three times because of the law, and today he 
has access to only one insurance provider.
    Michael from Winston-Salem has an $800 monthly premium for him and 
his daughter, and their deductible is over $14,000. Terry, a 70-year 
old retiree from Advance, is working part-time just to help pay his 
wife's $900 monthly premium.
    These stories aren't unique to North Carolina. Working families 
across the country are suffering under a failed government takeover of 
health care. Remarkably, the consequences extend beyond higher 
insurance costs and limited plan options to fewer jobs and suppressed 
wages.
    In fact, a recent study by the American Action Forum found 
Obamacare has destroyed 300,000 small business jobs and cost small 
business employees $19 billion each year in wages. An estimated 10,000 
small businesses were even forced to close their doors because of the 
law's burdensome regulations.
    All of these individuals, families, and small business owners were 
promised far different. They were promised lower costs, more choices, 
and more competition. What they got was the exact opposite.
    The reality is the 2010 health care law is completely 
unsustainable. It's collapsing as we speak. We cannot stand by as the 
law creates even more havoc in the lives of the American people.
    That's why we are on a rescue mission to deliver the relief people 
need, and this committee will play an important role in the process. We 
have already taken steps to repeal Obamacare, and the Trump 
Administration is actively working to stabilize health insurance 
markets.
    Once the law is repealed, there will be a stable transition to a 
patient-centered system. At least 4.7 million Americans have already 
been kicked off their health care plans under Obamacare, and the last 
thing Republicans want is to disrupt more people's coverage.
    We're going to do this the right way. There won't be a massive bill 
that no one has read and is jammed through Congress in the dead of the 
night. Instead, we will tackle the challenges of our broken health care 
system through step-by-step solutions that provide lower costs, more 
choices, and protect the most vulnerable among us.
    We will put patients in control of their health care decisions. 
That means eliminating one-size-fits-all rules that drive up costs and 
restrict choices. All Americans should have the freedom to select a 
health care plan that meets their needs.
    After years of costly federal mandates, we will empower small 
businesses to band together and provide affordable coverage for their 
employees. Additionally, we will preserve employee wellness plans that 
have been under attack in recent years by Washington bureaucrats.
    Undoing the damage of Obamacare and achieving real health care 
reform won't happen overnight. We will continue to hold hearings just 
like this one, and we will continue to receive input from governors, 
insurance commissioners, workers, and employers across the country.
    Today's discussion is an important step in this process. We look 
forward to hearing from all of you on how we can provide a better way 
forward on health care for the American people.
                                 ______
                                 
    Mr. Scott. Thank you, Madam Chair.
    And I'd like to first, before we begin, introduce one new 
member who's here, Adriano Espaillat, who represent New York's 
13th Congressional District. He wasn't here when we introduced 
new members before. He represents the same district as the past 
chair of this committee, Adam Clayton Powell. He served in the 
State Senate and State Assembly in New York.
    We have another member, Carol Shea-Porter, who was 
appointed to the Committee. She is from New Hampshire and 
previously served on this committee.
    I'd like to welcome our witnesses and thank them for their 
testimony. This is our first hearing of the 115th Congress. 
Unfortunately, this hearing is part of a larger agenda to 
repeal the Affordable Care Act root and branch, despite the 
fact there's no credible plan to deal with the chaos that 
repeal would create.
    I'd first like to remind our Republican colleagues once 
again where we were when we passed the Affordable Care Act. 
Healthcare costs were skyrocketing. If you lost your job or 
wanted to start a new business and had a preexisting condition, 
you were out of luck. Women were paying more than men. Seniors 
had no help for paying for prescription drugs when they landed 
in the notorious doughnut hole. The miners suffering from lung 
disease struggled to get access to health benefits because of 
complicated requirements that made it almost impossible to 
prove eligibility. And every year millions of people were 
losing their insurance altogether.
    The so-called damage caused by the Affordable Care Act 
includes women no longer paying more for insurance than men. 
The costs have gone up but they've gone up at one-half the rate 
that they were going up before. Those with preexisting 
conditions can get insurance at the standard rate. We're 
closing the doughnut hole. We have helped miners get their 
benefits. And instead of millions of people losing their 
insurance every year, 20 million more people have insurance. 
And all Americans, even if they had insurance before, are 
enjoying consumer protections. Small businesses were exempt 
from virtually all of the mandates in the bill.
    And this progress will be reversed if the ACA is repealed. 
We know, for example, that 30 million Americans would lose 
coverage, with the vast majority in working families. Workers 
with job-based plans could lose out on ACA's consumer 
protections, such as prohibitions against annual and lifetime 
limits. They could lose out on access to free preventive 
services which keeps the American workforce healthier and on 
the job.
    These meaningful protections have improved the lives of 
people around the country, protections that are being 
threatened.
    The collateral damage won't stop there. The individual 
market could all but collapse if there's a repeal without a 
credible replacement, making it likely that nobody will be able 
to buy insurance at an affordable rate. Costs for uncompensated 
care will skyrocket, but those costs won't disappear. When 
people go to the hospital and don't pay, those costs have to be 
paid by somebody. When we passed the Affordable Care Act, that 
cost was about $1,000 on a family policy, covering 
uncompensated care. Coal miners who now benefit from enhanced 
protections and benefits provided by the ACA could lose them.
    Now, another important item to both workers and employers: 
employment. Repeal would devastate communities around the 
country, particularly rural areas that already face employment 
challenges. The American Hospital Association and the 
Federation of American Hospitals sent a letter to congressional 
leaders warning of massive job losses if the ACA is repealed. 
The letter noted a specific threat to rural communities, 
pointing out that hospitals are often the largest employers in 
many communities. Estimates show that repeal would result in a 
loss of 2.6 million jobs almost immediately.
    Over the last seven years, we have heard a lot of 
complaints about the Affordable Care Act, but we haven't seen a 
plan that would actually make things better. Just last week, 
our colleagues on the Budget Committee held a hearing where 
healthcare experts from the Urban Institute estimated that, if 
the GOP were to replace the ACA coverage expansion with tax 
credits at the inadequate level pushed by the new HHS Secretary 
nominee, the healthcare deductibles could skyrocket to $25,000 
for individuals and $50,000 for family plans.
    Today, we are likely to hear about some other plans that, 
frankly, just won't work or won't do anything. And there's no 
strategy or interest in protecting the millions of Americans 
who now benefit from the ACA.
    If a credible replacement plan were possible, we obviously 
would have seen it by now. But there's no legislation pending 
that has significant support, and there's no reason to believe 
that a replacement plan could be produced that would actually 
work.
    Now, some of the initiatives already taken by this 
administration have been proven to be counterproductive. For 
example, the administration took action to threaten the 
marketplace by pulling advertisements for coverage in the final 
days of the open enrollment period. It is well-known that those 
who wait till the last minute tend to be younger and healthier. 
And fewer of them signing up just means higher premiums for 
everybody else.
    And I ask unanimous consent to insert into the record a 
letter sent by three ranking members of House committees with 
healthcare jurisdiction to the Department of Health and Human 
Services asking for further details on the impact of this 
decision.
    Chairwoman Foxx. Without objection.
    Mr. Scott. Thank you.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Mr. Scott. Even President Trump's recent immigration order 
not only runs afoul of American values and our Constitution, 
essentially creating a religious test for entry into the United 
States and denying due process, but it also has an impact on 
health care in the United States. The Association of American 
Medical Colleges, one of the many groups to express concern 
over the Executive Order, released a statement explaining that 
the Executive Order could disrupt education and research and 
have a damaging long-term impact on patients and health care.
    So we do have a few options moving forward. We could choose 
to move to a single-payer system, or we can improve upon the 
ACA. Going back to the days where a preexisting condition meant 
you couldn't get insurance should not be an option.
    Now, since this is our first hearing in Congress, let me be 
clear about our shared priorities and the vision of Democrats 
on this committee. We are here to strengthen the economic 
security of Americans and to protect health care in this 
country. This is more that we need to do to improve access and 
affordability in health care, and Democrats are willing to work 
on a responsible improvement.
    If the goal is to replace, then repeal, we can work 
together. But you cannot count on our support if the first step 
is to create total chaos by repealing without any replacement 
in sight.
    In fact, Democrats are skeptical that there will ever be 
any replacement. We are reminded that the majority of the 
Republicans in Congress did not support Medicare. We know that 
over 60 votes have been taken in the House to repeal all or 
parts of the Affordable Care Act without any replacement in 
sight. And we have already missed the legislative deadline 
under the reconciliation. The two committees were given 
instructions to come up with changes in the Affordable Care 
Act, and they've missed that deadline. And so we're skeptical 
that there will be any replacement if there is a repeal.
    So it is my hope that we can focus our efforts on the 
financial security of American families by working to improve 
health care instead of turning the clock backwards and ruining 
health care possibly for everybody.
    Thank you, Madam Chair, and I yield back.
    [The statement of Mr. Scott follows:]

 Prepared Statement of Hon. Robert C. ``Bobby'' Scott, Ranking Member, 
                Committee on Education and the Workforce

    Thank you, Chairwoman Foxx. I would like to welcome and introduce 
the newest Democratic members to the Committee.
    Congresswoman Carol Shea-Porter represents New Hampshire's first 
congressional district and is serving her fourth term in Congress, and 
I am pleased to welcome her back to the Committee.
    Congressman Adriano Espaillat represents New York's thirteenth 
congressional district, the same district as the esteemed past-chairman 
of this Committee - Adam Clayton Powell, Jr. He previously served as a 
member of the New York State Senate and as a member of the New York 
State Assembly.
    Welcome to the both of you.
    I would now like to welcome our witnesses and thank them for their 
testimony. This is our first hearing in the 115th Congress and this 
hearing will likely lay out our Committee's agenda for the coming weeks 
and months. Unfortunately, this hearing is also part of a larger agenda 
to repeal the Affordable Care Act, root and branch, despite the fact 
that there is no credible plan to deal with the chaos that this repeal 
will create.
    I'd first like to remind my Republican colleagues once again of 
where we were when we passed the ACA. Health care costs were 
skyrocketing and if you lost your job, or wanted to start a new 
business and you had a preexisting condition, you were out of luck.
    Seniors had no help paying for prescription drugs when they landed 
in the Part D ``donut hole''. Miners suffering from lung disease 
struggled to get access to health benefits because of complicated 
requirements that made it almost impossible to prove eligibility.
    Yes, the cost of health coverage remains a challenge for both 
employers and workers. But although costs in employer-provided health 
coverage have gone up, they have gone up much more slowly than they 
were prior to the ACA. Today, we are releasing a report that highlights 
all of the ACA's benefits to the American people, particularly those 
with job-based health coverage, and why repeal is so dangerous for our 
country and families' health and economic security.
    The ACA fixed many of these problems. Despite, Republicans' nonstop 
attacks on the ACA, we have made great progress in improving the 
nation's health care system. And because of those efforts, the rate of 
uninsured adults and the rate of uninsured children are at an all-time 
low.
    If my Republican colleagues continue on the course to repeal, we 
know that thirty million Americans will lose coverage, with the vast 
majority of those millions in working families. Workers with job-based 
plans could lose out on the ACA's consumer protections - such as 
prohibitions on annual and lifetime limits. They could lose out on 
access to free preventive services which keeps the American workforce 
healthier and on the job. These are meaningful protections that have 
improved the lives of people in this country - protections that the 
Republicans are threatening to take away. And the collateral damage 
won't stop there. The individual market will all but collapse, making 
it likely that nobody will be able to buy insurance at an affordable 
rate. Uncompensated costs will skyrocket and those costs won't 
disappear - they will be absorbed by other payers. Coal miners, who now 
benefit from the enhanced protections and benefits provided in the ACA, 
could lose them.
    Another item of importance to both workers and employers is jobs. 
Repeal would devastate communities across the country, particularly 
rural areas that already face employment challenges. The American 
Hospital Association and the Federation of American Hospitals sent a 
letter to Congressional leaders warning of ``massive job losses'' if 
the ACA is repealed. The letter noted the specific threat to rural 
communities, pointing out that, ``hospitals are often the largest 
employer in many communities.'' Estimates show that repeal would result 
in a loss of 2.6 million jobs across all states almost immediately; 
while a third of those lost jobs would be in health care, the impact 
would be felt across industries.
    Over seven years we have heard a lot of complaints about the 
Affordable Care Act, but we have not seen a plan that would make things 
better. Just last week, our colleagues in the Budget Committee held a 
hearing where a health care expert from the Urban Institute estimated 
that if the GOP were to replace the ACA coverage expansion with tax 
credits at the inadequate levels pushed by HHS Secretary nominee 
Congressman Tom Price, health care deductibles could skyrocket to 
$25,000 for individual and $50,000 for family plans. Today, we are 
likely to hear about some of the old, discredited, and highly 
inadequate ideas around health reform. But there is no strategy or 
interest in protecting the millions of Americans who now benefit from 
the ACA. If a credible replace were possible, we would have seen it by 
now, and yet there is no legislation pending that has Republican 
support and there is no reason to believe that a replacement would 
actually work.
    Unfortunately, the conversation around health care has now taken on 
an even more troubling tone. The new Administration has taken action to 
threaten the Marketplace by pulling advertisements for coverage in the 
final days of the open enrollment period, making no secret about its 
intention to subvert Marketplace enrollment. I ask unanimous consent to 
insert into the record a letter sent by the three Ranking Members of 
the House Committees with health care jurisdiction to the Department of 
Health and Human Services asking for further details on the impact of 
this decision.
    Further, President Trump's recent immigration executive order runs 
afoul of American values and our constitution by essentially creating a 
religious test for entry into the United States and denying due process 
to green card holders who have been unable to reenter the country. The 
impact of this order is being felt by communities across the country, 
and is particularly detrimental to students who wish to pursue their 
education in the United States. The Association of American Medical 
Colleges - one of the many groups to express concern over the executive 
order - released a statement explaining that the executive order could, 
``disrupt education and research and have a damaging long-term impact 
on patients and health care.'' I trust that my colleagues on the other 
side of the aisle are as outraged as I am at the executive order, both 
because of its lack of humanity and its detrimental impact on the 
health care sector in this country.
    So we have a few options moving forward. We can choose to move to a 
single payer system or we can improve upon the ACA. Going back to the 
days where a preexisting condition meant you didn't get insurance is 
not an option.
    Since this is our first hearing of the Congress, let me be clear 
about our shared priorities and the vision of the Democrats on this 
Committee. We are here to strengthen the economic security of Americans 
and to protect the health of this country. There is more that we need 
to do to improve access and affordably in health coverage, but setting 
the stage for a repeal vote that will take benefits away from 
hardworking Americans is irresponsible and morally reprehensible. 
Similarly, banning the best and brightest talent in the medical 
community from studying at our universities and practicing medicine in 
our hospitals is irresponsible and morally reprehensible.
    It is my hope that we can refocus our efforts to the financial 
security of American families, instead of turning the clock backward. 
Thank you.
                                 ______
                                 
    Chairwoman Foxx. Thank you, Mr. Scott.
    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.
    We will now turn to introductions of our distinguished 
witnesses.
    Dr. Tevi Troy is the chief executive officer of the 
American Health Policy Institute. Previously, Dr. Troy held 
numerous positions in the Federal Government, including serving 
as Deputy Secretary of Health and Human Services beginning in 
2007, where he oversaw all operations, including Medicare and 
Medicaid, public health, medical research, food and drug 
safety, welfare, child and family services, disease prevention, 
and mental health services.
    Mr. Joe Eddy is president and chief executive officer of 
Eagle Manufacturing Company and will testify on behalf of the 
National Association of Manufacturers. In addition to his work 
at Eagle Manufacturing, Mr. Eddy also serves on the Advisory 
Board of the McDonough Center for Leadership in Business at 
Marietta College and the Foundation Board at West Virginia 
Northern Community College.
    Ms. Angela Schlaack is a widow, mother of two children, and 
a student at Siena Heights University pursuing a bachelor's 
degree in Communications. She is an educated grief group 
facilitator at Lori's Place in St. Joseph, Michigan. Lori's 
Place serves children and adults who suffered a death or are 
dealing with anticipatory grief. She is active also in 
fundraising for the Leukemia and Lymphoma Society.
    Mr. Scott Bollenbacher is the creator and managing partner 
of Bollenbacher & Associates, LLC, a certified public 
accounting firm serving mainly small to midsize business in 
north-central Indiana and western Ohio. As a CPA, Mr. 
Bollenbacher provides accounting and tax services to clients in 
manufacturing, agricultural, retail, and professional services 
trades, as well as not-for-profits and individuals. Mr. 
Bollenbacher is testifying on behalf of the National Federation 
of Independent Business.
    I will now ask our witnesses to raise your right hand.
    [Witnesses sworn.]
    Chairwoman Foxx. Let the record reflect the witnesses 
answered in the affirmative.
    Before I recognize each of you to provide your testimony, 
let me briefly explain our lighting system. We allow five 
minutes for each witness to provide testimony. When you begin, 
the light in front of you will turn green. When one minute is 
left, the light will turn yellow. At the five-minute mark, the 
light will turn red, and you should wrap up your testimony.
    Members will each have five minutes to ask questions.
    Now I recognize Dr. Troy for five minutes.

    TESTIMONY OF TEVI TROY, PH.D., CHIEF EXECUTIVE OFFICER, 
       AMERICAN HEALTH POLICY INSTITUTE, WASHINGTON, D.C.

    Mr. Troy. Chairwoman Foxx, Ranking Member Scott, and 
members of the committee, thank you all for the opportunity to 
testify today on the effects of the Affordable Care Act on 
large employers and their employees, as well as how to advance 
patient-centered solutions going forward.
    My name is Dr. Tevi Troy. I am CEO of the American Health 
Policy Institute, a nonprofit research organization focusing on 
employer-sponsored healthcare benefits. I also served, as you 
mentioned, as a senior White House aide in the George W. Bush 
administration and Deputy Secretary of HHS.
    While the public debate over the ACA appropriately focuses 
on the 20 million Americans who are receiving coverage through 
its exchanges, Medicaid expansion, and other provisions, the 
ACA also significantly and in many cases unnecessarily 
increased the regulatory requirements and burdens on 
employment-based health care that covers more than 177 million 
Americans.
    Too little attention has been focused on this important 
aspect of the law. In this time of transition on health care, 
it is important to protect those who have gained coverage under 
the ACA, but it is also a critical priority to protect those 
who are covered by employers.
    There is clear evidence that the ACA has both directly and 
indirectly increased the cost of employer healthcare benefits. 
In 2014, an American Health Policy Institute study found that 
over the next decade the cost of the ACA to large employers -- 
10,000 or more employees -- will be about $4,800 to $5,900 per 
employee over a decade.
    My written testimony includes other studies showing how the 
ACA has increased employer costs, and I ask that they be 
submitted for the record.
    Furthermore, the regulatory burden the ACA imposes on 
businesses and individuals should not be underestimated. Since 
the ACA was enacted, 106 regulations implementing the law have 
been published. These regulations will cost the private sector 
more than $51 billion and require 173 million hours of 
paperwork in order to comply. These cost increases come from a 
number of ACA provisions that have a direct impact on employees 
and employers and on the cost of their health plans.
    Going forward, I believe that we should move toward a more 
patient-centered healthcare system and look to the private 
sector to lead transformation efforts. In order for the private 
sector to be innovative, it is imperative to protect the tax 
exclusion on employer-sponsored healthcare benefits as well as 
the ERISA preemption.
    For more than 60 years, employer-provided health benefits 
have been excluded, without limit, from income and payroll 
taxes. Over time, this benefit has helped make employer-
sponsored care a basic building block of our healthcare system. 
Given the role of employer-sponsored health insurance in 
providing stability and coverage to so many Americans, making a 
substantial change to the tax treatment of employer-provided 
health care could cause a significant disruption.
    We strongly support the bipartisan effort to repeal the 
ACA's 40-percent Cadillac tax on employer-sponsored health 
benefits and urge Congress to repeal this tax, along with other 
ACA taxes and fees. We have seen how problematic the tax 
approach is by its opposition from both business and labor. We 
are glad that the tax has been delayed until 2020 and hope to 
see it repealed soon.
    Reducing or eliminating the tax exemption on employer-
sponsored health care would raise the same problems as the 
Cadillac tax. It would serve as a middle-class tax hike, drive 
up the health insurance costs for millions of American 
employees, and eliminate the strong incentives currently in 
place that constantly pressure large purchasers of health to 
demand more efficient, affordable, and effective health care 
from the marketplace.
    Getting rid of or reducing the tax preference would also 
harm efforts to maintain strong risk pools and to cover the 
maximum number of people. As we have learned from experience 
with the ACA, encouraging people to get coverage is a costly 
and challenging endeavor, and risk pools are difficult to 
maintain as well. Employers, however, are both good at getting 
people covered and at maintaining manageable risk pools. Public 
policy should aim to encourage these important goals. As 
economist Peter Nelson has said, ``Employers do get people 
covered -- they very successfully get people covered.''
    A second key issue is the ERISA preemption. ERISA is the 
foundation of employer-sponsored health benefits, and we 
encourage you to strengthen the protections in the law.
    The longstanding preemption provision is vital to multi-
state employers because it enables them to offer uniform, 
nationwide healthcare benefits at the lowest possible cost to 
employers no matter what state they live in. This leads to 
better benefit design and reduction in administrative costs 
through economies of scale, increased purchasing power, and 
greater innovation. Without it, an employer doing business in 
50 different States would be required to comply with 50 
different State healthcare laws, something that would make 
administrating a healthcare plan a complex nightmare.
    In conclusion, I appreciate the opportunity to testify here 
today about the importance of employer-sponsored coverage and 
its importance to our system. Going forward, our policy should 
not be to increase the burdens or costs on employers and the 
177 million employees and dependents who get coverage through 
the employer-based system but to encourage that coverage for 
the benefit of our system as a whole.
    Thank you for having me here today.
    [The statement of Mr. Troy follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Chairwoman Foxx. Mr. Eddy.

 TESTIMONY OF JOE EDDY, PRESIDENT AND CHIEF EXECUTIVE OFFICER, 
   EAGLE MANUFACTURING COMPANY, WELLSBURG, WEST VIRGINIA, ON 
      BEHALF OF THE NATIONAL ASSOCIATION OF MANUFACTURERS

    Mr. Eddy. Thank you. Good morning, Chairwoman Foxx, Ranking 
Member Scott, and distinguished members of the committee. I 
thank you for the opportunity to appear here today before you 
and for holding this hearing.
    My name is Joe Eddy, and I am president and CEO of Eagle 
Manufacturing Company in Wellsburg, West Virginia. I'm 
currently on the board of directors of the National Association 
of Manufacturers, also known as NAM, and also serve on their 
Small and Medium Manufacturers Group. The NAM is the Nation's 
largest industrial trade association and a voice for more than 
12 million men and women who make things here in America.
    Eagle Manufacturing Company is a family-owned business 
established in 1894. We employ approximately 195 employees and 
are a prime manufacturer of safety cans, safety cabinets, 
secondary spill containment products, poly drums, and material-
handling products. At Eagle, we design and manufacture all of 
our own products. We are a respected brand name across the 
world for consistent quality and value, and all of our products 
are still made in the United States.
    Manufacturers have a proud tradition of providing health 
insurance for their employees. At Eagle, our tradition has been 
to cover 100 percent of medical costs. We have done this 
because it's the right thing for our employees and our 
community. No government policy or mandate leads us to provide 
this generous benefit. We often hear that people specifically 
want to come to work at Eagle because of our reputation for 
taking care of our employees. We live by our mission statement: 
Protecting people, property, and the planet.
    Unfortunately, the last few years under the Affordable Care 
Act have made it more difficult to live up to our own 
standards. Rising healthcare costs have forced us to make some 
difficult choices, and the ACA has further limited our options.
    In 2009, prior to the ACA, we were paying about $13,500 per 
year per employee, and by 2013 those costs increased to over 
$15,800 per year per employee. The additional taxes, paperwork, 
fees, and mandates of the ACA cost us nearly $1,000 per year 
per employee. As much as we work to keep costs down, our plan 
now costs over $22,800 per year per employee.
    We do not think that our benefits are excessive. They are 
necessary to attract, retain, and maintain a strong, quality, 
and healthy workforce. And I am not alone. Ninety-eight percent 
of NAM members offer health insurance to employees, and the 
cost of health care remains a top business concern for both 
large and small manufacturers. These rising healthcare costs 
impact all facets of any company: hiring new workers, 
maintaining competitive pay rates, making capital investments, 
as well as our decisions in researching and developing new 
products.
    Part of the challenge that the ACA ushered in was the 
paradigm shift in healthcare choices available to manufacturers 
and other businessowners. More specifically, the insurance that 
we had for more than 10 years was no longer available. Many of 
our employees had to find new doctors, and we had to learn to 
manage an entirely new system. Furthermore, the new product we 
purchased was more expensive, driving our healthcare costs up 
that year an additional $4,000 per year per employee.
    Unhappy with the outcomes of this change, we switched 
carriers again to another insurer. We are hopeful that our 
situation has stabilized, but businesses such as ours need 
flexibility and competitive options so that we can always find 
the best and most cost-effective plan for our employees.
    Perhaps the most challenging part of the ACA is the effect 
that it's had on our employer-employee relations. As I 
mentioned earlier, Eagle has 195 employees, but it should be 
noted that 150 of those are unionized through the United 
Steelworkers Union. We have traditionally had a strong 
relationship with the union and our employees. However, last 
year, during contract negotiations, for the first time in our 
history, we had to negotiate a cost-sharing arrangement with 
the union. The union members now have to contribute $35 per 
pay, or $910 per year, towards monthly healthcare premiums. As 
you would imagine, those were not easy negotiations, tending to 
break down the trust and partnership that we had established 
through the many years between the company and our employees.
    The years following the passage of the ACA have been 
costly, disruptive, and distracting from the things that we are 
really good at doing as manufacturers. Moreover, the dose of 
uncertainty delivered to us over seven years ago still has not 
been fully resolved.
    Eagle is very proud of our 123 years in West Virginia, 
manufacturing innovative, quality products for our customers. 
As a leader in the Wellsburg community, we strive to provide 
healthcare benefits that allow for a strong, healthy workforce, 
but it is a struggle given the limits, restrictions, and 
mandates of the Affordable Care Act.
    I know that my struggle is not unique and that many 
manufacturers across the country are facing the same 
challenges. I very much look forward to working with you to 
find a workable solution that will help control outrageous 
costs and provide the flexibility for employers to continue to 
provide the benefits their employees deserve.
    Thank you for inviting me to testify before you today, and 
I am happy to answer any questions. Thank you.
    [The statement of Mr. Eddy follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
      
    Chairwoman Foxx. Thank you very much.
    Ms. Schlaack, you are now recognized for five minutes.

       TESTIMONY OF ANGELA SCHLAACK, ST. JOSEPH, MICHIGAN

    Ms. Schlaack. Good morning, Chairwoman Foxx, Ranking Member 
Scott, and the members of the committee. Thank you very much 
for inviting me to attend the session today.
    My name is Angela Schlaack, and I am originally from 
central Texas but have been a longtime resident of St. Joseph, 
Michigan. I'm here today to share with you a little bit about 
how the Affordable Care Act has impacted my life and the lives 
of my family. Never could I have imagined the life-changing 
events that would bring me here today.
    In November 2013, my husband, Michael Schlaack, suddenly 
had three days of extreme fever, headaches, and sweating. 
Michael was diagnosed with the most aggressive form of acute 
myeloid leukemia, and he had mere days to live. He was 44, 
exercised, did not smoke, got routine medical checkups, and had 
no prior health issues.
    He was admitted to the University of Chicago Medical 
Center's Leukemia Intensive Care Unit that night, as our local 
hospital does not have the ability to treat this type of 
disease.
    The University of Chicago is about 90 miles from our home, 
and the distance created an additional hardship on our lives. 
This diagnosis meant he was forced to take an extended leave 
from work, as living with AML is a full-time job in itself. His 
employer, Whirlpool Corporation, was supportive and, 
thankfully, very generous in their benefits. Little did we know 
at that point the cost of treating leukemia and how valuable 
our health insurance would be.
    The only cure as of now for AML involves chemotherapy and 
donor stem cell transplant. Not only were we responsible for 
Michael's medical expenses, but patients are also responsible 
for those of their donor.
    After six weeks of chemotherapy to keep the leukemia under 
control and preparation for transplant in place, Michael was 
able to return home for a few weeks before returning for 
another minimum six weeks inpatient. In those weeks at home, we 
still had to return to his hematology oncologist two to three 
times per week. At this point, we were beginning to realize the 
financial magnitude of what treatment for leukemia entails. Our 
bills were exceeding a million dollars already.
    Within three months of his stem cell transplant, Michael's 
leukemia relapsed with a vengeance. At this point, the only 
options were clinical trial therapies. We spent the next four 
months in and out of the hospital in Chicago, and he needed 
blood transfusions every few days. One bag of blood, which he 
was receiving multiple units of per week, was over $1,500 each. 
In addition to the 20 or so prescriptions he was taking, the 
constant trips for doctor visits to Chicago, we still had to 
maintain our household financially.
    With the extreme physical, mental, and emotional stress 
that came with this journey, one thing we did not have to worry 
about was the fact that we knew our insurance would not cut us 
off after any lifetime maximum. Hoping Michael would survive, 
we knew, despite this now preexisting condition, he would stay 
covered and not be discriminated for something he had no 
control over.
    The provisions of the Affordable Care Act kept us from 
filing bankruptcy and losing what we had built up in our over 
20-year marriage. The expenses incurred in a matter of 10 
months were nothing any health savings account could properly 
fund. We had peace of mind knowing Whirlpool's insurance would 
take care of us.
    In September 2014, Michael died at age 45 of AML. As I had 
been a full-time caregiver to him, in addition to trying to 
maintain some normalcy for our family, I was not employed. I 
was a stay-at-home mom to our then-10-year-old daughter. Our 
young adult son was in graduate school at the time and was 
entering the Peace Corps after graduation. Whirlpool graciously 
covered the three of us under their insurance for the rest of 
the calendar year.
    Though offered COBRA benefits beginning in 2015, the 
premiums were beyond anything I could afford. I was able to 
take advantage of something I never expected to need, the 
healthcare marketplace.
    Knowing I needed to continue to provide for myself and 
daughter from here on out, I decided to go back to college to 
complete my degree. Having access to the marketplace gave me 
the ability to provide excellent coverage for us at an 
extremely low monthly rate and not have to return to work yet 
simply to have the benefit of health insurance. We were able to 
keep our same doctors, and while dealing with our grief and 
this new life, the ability to have full coverage, including 
mental health benefits, was one less worry.
    Though I am just a common person from a small town in the 
Midwest, I know my experience with devastating health issues 
and having my whole world turned upside down in the blink of an 
eye is not uncommon, and anyone can be one illness away from 
losing everything they have. Our bills were nothing a health 
savings account could have remotely covered. Had Michael 
survived, he would have had a major preexisting condition. And 
being that AML has genetic links, our family is at risk for 
facing similar situations down the road.
    The Affordable Care Act has helped keep my life moving 
forward. It's given me the ability to continue a healthy life 
with access to routine care and without worry that one hospital 
admission could cost me everything.
    I implore you to please consider the benefits that the 
Affordable Care Act has provided. Whether through an employer 
or the marketplace, everyone deserves that peace of mind.
    Thanks for your willingness to hear my voice.
    [The statement of Ms. Schlaack follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Chairwoman Foxx. Thank you very much.
    Mr. Bollenbacher, you're recognized for five minutes.

    TESTIMONY OF SCOTT BOLLENBACHER, CPA, MANAGING PARTNER, 
BOLLENBACHER & ASSOCIATES, LLC, PORTLAND, INDIANA, ON BEHALF OF 
        THE NATIONAL FEDERATION OF INDEPENDENT BUSINESS

    Mr. Bollenbacher. Good morning, Chairwoman Foxx, Ranking 
Member Scott, and members of the committee. My name is Scott 
Bollenbacher, and I'm a managing partner of Bollenbacher & 
Associates, a CPA firm serving individuals and small-business 
clients, most of which are family-owned.
    I started the business in 2004 with six employees serving 
400 clients. We have grown to 11 full-time employees and six 
part-time employees serving 1,600 clients. I am pleased to be 
here on behalf of the NFIB to discuss how the ACA has impacted 
our business and our clients at today's hearing.
    As a small business, we are a close-knit family. Our 
employees are much more than employees; they are our friends. 
We care deeply for them. We care for their families. We want to 
provide for them -- provide benefits and help in any way we 
can. We know that our success as a business depends on our 
team. Most of our employees have been with us for 10 or more 
years.
    From 2004 to 2014, our firm maintained a high-deductible 
health insurance plan accompanied by a health savings account. 
The firm paid the entire premiums and funded up to $3,000 per 
year to the employees' HSA. This plan worked well for the 
business and our employees. We saved tax-preferred funds for 
predictable and unforeseen medical expenses.
    In late 2014, we learned that our policy no longer 
qualified under the ACA because it did not cover the essential 
health benefits package, specifically pediatric dental 
coverage. I requested the benefit be added but was unable to do 
so, and we lost our plan.
    We did not know what to do, and we had little time to 
choose a new option, but we explored all the available options 
with a consultant. We considered purchasing insurance through 
the SHOP exchange. However, the plan would have cost over 50 
percent more than our previous plan with less coverage. We 
considered dropping health insurance altogether and increasing 
the employees' salary to help them purchase insurance on their 
own. IRS restrictions made this very difficult. We considered a 
healthcare sharing ministry called Medi-Share, and we 
considered self-insuring.
    The only feasible option at the time was a partially self-
funded plan. I believe our firm was the smallest group they 
accepted at the time. The premiums were similar to our previous 
plan, but the coverage was not as good. It carried a higher 
deductible and did not cover vision care. It did not cover my 
family doctor.
    We have maintained this coverage for two years. In the fall 
of 2016, we learned that our carrier no longer wanted to offer 
self-funded health plans to small businesses, so they proposed 
to raise our premiums by 156 percent. We could either pay the 
increase or leave. We left. Essentially, our plan was canceled 
again. As with most small businesses, we must watch our 
expenses. A 156-percent increase is not possible.
    Once again, we worked with our benefit consultant to 
explore all options. Shopping for the right plan is complicated 
for us because the firm is close to the Indiana and Ohio 
border. Our employees live in both states. We must find a 
policy that is accepted by doctors and hospitals on both sides 
of the state line.
    We finally settled on another fully insured plan at a 78-
percent increase. It was our only available option. Most of our 
employees liked the HSA option we maintained for 12 years, but 
this plan is not HSA-eligible.
    The experience has been frustrating and stressful. The 
increases and cancellations are unsustainable for a small 
business like ours.
    Many clients experience similar disruption with premium 
increases and plan cancellations:
    A church could no longer provide three ministers with tax-
preferred money to purchase coverage in the individual market 
due to IRS guidance. The pastors ended up purchasing coverage 
on the individual exchange that was twice as expensive because 
they did not qualify for a subsidy.
    A cabinet manufacturer with 25 employees could no longer 
contribute the entire premium to their employees after a 44-
percent increase to their 2017 plan.
    A pallet manufacturer with 110 employees who could neither 
afford the $500,000 insurance nor the $70,000 employer mandate 
penalty was forced to terminate 80 employees and subcontract 
some of the work.
    A farmer couple who earns just above the subsidy had to pay 
a 38-increase after their plan was canceled.
    And a single, female businessowner suffered a policy 
cancellation, forcing her onto the individual exchange 
marketplace, where her premiums doubled without a subsidy.
    I want you all to know what's going on in the real world 
with average Joes and Janes. We work very hard. I brought a 
picture of our team today so that you see that we're real 
people. We've been hurt badly by the cost increases caused by 
the ACA and request your assistance in fixing this. As you 
consider repealing and replacing ACA, I encourage you to focus 
on lowering the costs and increasing flexibility for small 
businesses.
    Thank you again for allowing me to share my story today, 
and I'm happy to answer any questions.
    [The statement of Mr. Bollenbacher follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Chairwoman Foxx. Thank you very much.
    Thanks to all of our witnesses.
    And now we'll recognize members for five minutes of 
questioning, and I'll begin with Dr. Roe.
    Mr. Roe. Thank you, Dr. Foxx.
    And, first of all, Ms. Schlaack, I want to offer you my 
condolences for your loss. Two years ago today, I was sitting 
home with my wife, who was dying of cancer. So, certainly, my 
sympathy goes out to you and your family, and I share your 
grief.
    Ms. Schlaack. Thank you.
    Mr. Roe. You know, we had a promise from the 
administration, when we started debating the Affordable Care 
Act, to increase access and lower cost. And I think certainly 
everybody agreed with that. I know on our side of the aisle I 
did. And you all don't know me, but I'm a doctor that practiced 
medicine for over 31 years before I ran for Congress.
    And so what did we get? We got some increased access, but 
at what cost? And I know at our local hospital at home, 60 to 
70 percent of the uncollectible debt -- now, it's a billion-
dollar healthcare system -- are people with insurance.
    And, certainly, we agreed on the preexisting conditions -- 
everybody on this dais agreed with that -- and lifetime limits. 
I think that certainly was something that we all agreed on, 
because health care is more sophisticated and costs more money 
than it used to.
    And we created this incredibly complex plan. And I said 
this seven years ago in an article I wrote. I could have done 
three-fourths of what the ACA did in two paragraphs. And I've 
just heard the data that once again proved that. Mr. Scott 
pointed out that 20 million people who weren't covered are. 
Over half of them are Medicaid. We could have expanded Medicaid 
and allowed 26-year-olds to stay on their parents' healthcare 
plan. That would have covered, along with the 5 million people, 
almost, who lost their insurance, including me -- I had 
perfectly good healthcare insurance and lost it and had to go 
on the ACA. You ended up with 80 percent. All these regulations 
and things that these three witnesses have talked about could 
have been avoided easily.
    In my own state, almost as many people pay a penalty, a 
tax, a fee, whatever Judge Roberts labeled it, as get a 
subsidy. And for the people who get a subsidy, it's a good 
deal. The problem with it is there are millions of other people 
out there with small businesses who are being harmed by this.
    I was a mayor of my local community before I got elected, 
and we had to pay a $180,000 fee so that insurance companies 
would stay in the market. Eighteen of the 23 co-ops, one in the 
state of Tennessee, went broke to the tune of billions of 
dollars of costs of -- really, no health care got provided. 
Just the taxpayers were on the hook for this.
    And I can tell you flatly, we went through this over 20 
years ago in our state, healthcare reform. I could have written 
the epitaph of what's happening. We don't do something, we 
cannot not do something, because no one is going to be able to 
afford health insurance coverage any longer if we don't. I 
mean, Bill Gates won't be able to buy a health insurance 
policy. When you're talking about $22,000, that makes you not 
competitive with other people in foreign countries, and 
eventually you will lose your business.
    And, Mr. Bollenbacher, you mentioned one of the things you 
want to do is go across the state lines. I have a city in my 
district, Bristol, Tennessee/Virginia. I mean, the center 
street of that, one side you're in Virginia, one side you're in 
Tennessee, but you can't purchase health insurance.
    Mr. Scott mentioned there are no plans. There are. I've 
written one, and it has 130 cosponsors. It's been submitted, 
and we'll have some version of that.
    What I want to know from you all at the dais is what can we 
do, what would you expect us to do. When we rewrite this 
policy, what could we do to help you lower the cost and 
increase access, which was the premise of the ACA to begin 
with?
    Anyone can take it.
    Mr. Troy. I'll step in. Thank you for your statement, Mr. 
Roe.
    So we believe that the way to approach this is to try and 
incentivize the purchase of health care by lowering costs 
overall. What the ACA did, as you so cogently said, was to 
increase the costs for everyone and subsidize a select few. I 
think a better approach would be to try and make it cheaper 
overall to reduce costs.
    And there have been a number of Republican plans that have 
done this: the HSAs, health savings accounts, purchase across 
State lines, tort reforms, and association health plans that 
would allow people to get the tax benefits not just through 
their employer. And a combination of those things have been 
scored by the Congressional Budget Office as having the effect 
of reducing overall premiums.
    Mr. Roe. And Ms. Schlaack mentioned -- I use a health 
savings account and have since the day they came out. And for 
most people -- for her, she's right; it would only have covered 
part of the cost of that, not this astronomical cost. But for 
most of the care, it would work just fine.
    And the cost of the ACA -- a personal testimonial. I had 
major back surgery in September of this year. I looked at all 
the bills I got for the doctor, for the hospital, for the 
anesthesia, the MRIs, all of that. At the cost of the ACA, they 
still made money on me this year. My premiums were that 
expensive. And so I can pay that, but the average person where 
I live in rural Appalachia, which is what I represent, cannot.
    With that, I'll yield back.
    Chairwoman Foxx. Mr. Scott, you're recognized for five 
minutes.
    Mr. Scott. Thank you, Madam Chair.
    Madam Chair, I'd like unanimous consent to enter into the 
record a report prepared by the committee staff on the 
Democratic side showing the benefits of the Affordable Care 
Act.
    Chairwoman Foxx. Without objection.
    [The information follows:]    
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
        
    Mr. Scott. I'd like to ask all the witnesses if any support 
a total repeal of the Affordable Care Act without any credible 
replacement.
    Anybody?
    Let the record reflect that nobody volunteered.
    Does anybody propose -- we have a mandate that individuals 
buy coverage. Do any of the witnesses propose to eliminate that 
individual mandate?
    Mr. Troy. I don't think the individual mandate is 
effective, sir.
    And then, also, on your previous statement, I want to make 
sure that it's the -- we oppose the repeal without any 
alternative, but I think there will be an alternative.
    Mr. Scott. Okay. Well, if you eliminate the mandate for 
individuals, could you cover those with preexisting conditions?
    Mr. Troy. I think there are a number of proposals that look 
at covering people with preexisting conditions, especially 
those who maintain continuous coverage, and then also having 
high-risk pools to address those people, if it's designed 
correctly.
    Mr. Scott. Has that ever worked anywhere, covering those 
with preexisting conditions, without an individual mandate?
    Mr. Troy. We are obviously going into new places in health 
care and new directions, so I'm not aware of any --
    Mr. Scott. Well, that's not a new direction because they 
tried it in New York, and when the Affordable Care Act came in, 
the individual prices in the individual market were cut 50 
percent. The Governor of Washington State has indicated they 
tried it in Washington, and they had to repeal the whole thing 
because nobody could buy insurance if you didn't have the 
individual mandate. So it's not real new.
    Now, some of the witnesses have talked about the costs 
going up since the Affordable Care Act. We didn't hear much 
about the costs going up before the Affordable Care Act.
    If the witnesses could present, Mr. Eddy and Mr. Troy, what 
your cost increases were the 10 years before the Affordable 
Care Act, I would appreciate to see that. Because all the 
studies have shown that the cost increases since the Affordable 
Care Act have been on average about half of what the increases 
were before.
    Could you provide that for us?
    Mr. Troy. Yes. We actually prepared that, sir. From 1999 to 
2005, employer-provided healthcare costs for family coverage 
were increasing by an annual average of about 11.1 percent.
    From 2006 to 2010, we saw a number of steps by employers to 
reduce costs, including the implementation of CDHPs, consumer-
directed health plans, wellness programs, and other benefit 
plan innovations. And, as a result, the annual increase dropped 
to 4.8 percent -- still high, but much lower.
    And then in the intervening period from 2010 to 2016, the 
annual increase has been 4.7 percent. And this reflects the net 
costs increases and decreases from the ACA and additional cost 
savings innovations by employers. And we believe that without 
the cost increases by the ACA that 4.7 percent figure would be 
even lower.
    So it is absolutely true that costs have been going up over 
time, and we're looking for ways to continue to moderate those 
costs through innovative programs.
    Mr. Scott. Okay. Well, if you could show us that 11 
percent, because that's consistent with what most increases 
were before the Affordable Care Act. And the 4 percent is 
consistent with what most of the -- closer to what the 
increases have been since the Affordable Care Act.
    So complaining about the costs going up without pointing 
out that they were going up a lot faster before the Affordable 
Care Act tends to be a little misleading.
    Some of the plans that have been referred to point out that 
you can reduce costs, but all of those plans appear to just 
shift the cost to the patient by cutting benefits, that the 
patient's going to be just as sick, probably going to get the 
same kind of treatment, just have to pay more.
    Ms. Schlaack, can you say where you would be without the 
Affordable Care Act?
    Ms. Schlaack. I'd probably still be paying bills from three 
years ago. My daughter and I wouldn't have been able to afford 
any health insurance if we wouldn't have had the marketplace to 
go to. Where my COBRA payments were going to be $1,000 a month 
for the two of us, with the marketplace our premiums were under 
$100 a month. We had deductibles that were possibly $500 a 
month the first year, and the second year they were lowered.
    We very well could have been bankrupt from well over the 
million dollars that my husband's medical expenses racked up 
in, again, just 10 months' time.
    Mr. Scott. You mentioned the lifetime cap. What did you 
mean by that?
    Ms. Schlaack. I know prior to the ACA, some insurance 
companies, once you hit a million dollars, you could be 
penalized and not be able to get insurance ever again. And had 
he survived, he could've possibly not ever been able to get 
coverage from anyone.
    Chairwoman Foxx. The gentleman's time has expired.
    Mr. Walberg, you're recognized for five minutes.
    Mr. Walberg. Thank you, Madam Chairman, and I appreciate 
this hearing.
    Of course, what we desire is that people, in general, 
across the spectrum, be covered and have better opportunities 
for health care. We appreciate the fact that some have had good 
results, but we want to do this for all. And so we need to take 
this seriously here.
    Dr. Troy, you cited several studies in your testimony 
predicting that the ACA would increase the cost of offering 
coverage for large employers. These studies were conducted in 
2012, 2014, and even 2016. Has this prediction come to be?
    Mr. Troy. Thank you for that question, sir.
    So two points on that. First, number one is the study in 
2012 and our study in 2014 that I mentioned that would increase 
costs $4,800 to $5,900 for an employee over a 10-year period, 
these were numbers that were produced by teams, benefit teams, 
at large employers that were reflecting what the CEOs and CFOs 
were looking at in making their determinations. So it is very 
important to look at those projections in saying that these 
affected how employers looked at the plans going forward.
    The second thing, there has been a recent study that found 
large costs associated with general ACA administrative costs, 
reporting disclosure and notification costs, costs associated 
with benefit plan design changes related to the ACA, costs of 
adjusting benefits to keep up with the ACA affordability 
requirements, and PCORI fees. So those are some of the biggest 
recurring costs.
    One cost that has not come to fruition at this point is the 
Cadillac tax, which was delayed in a bipartisan effort, which 
we applaud, and would impose extremely large costs on employers 
if it were to be instituted going forward. And so we would like 
to see its repeal.
    Mr. Walberg. So, basically, costs did increase, as you 
suggested in the studies. What were the biggest contributing 
factors to those increases?
    Mr. Troy. So I mentioned a number of those, so I'll be a 
little more specific.
    So the H26 dependent coverage, which I recognize is 
popular, one company said that it could cost about $69 million 
over 10 years. Another one estimated about $56 million over 10 
years.
    In terms of the transitional reinsurance fee, estimated 
cost of $15.3 million from 2014 to 2016.
    One-hundred percent coverage of prevention services and 
other benefit mandates, one company said that this would cost 
them about $36.5 million over 10 years.
    And, again, the big five are the ACA administrative costs, 
the reporting disclosure and notification costs, the costs 
associated with plan design changes, the costs of adjusting 
benefits, and the PCORI fee.
    Mr. Walberg. Okay. These are things we need to work on.
    Mr. Eddy, thank you for your testimony, and it's admirable 
that your company traditionally paid 100 percent of the medical 
costs for your employees. And it was your desire to continue 
doing that, as a good number of businesses I've interviewed in 
my district as well, who literally at times with tears in their 
eyes, with their insurance agent sitting next to me, talked 
about what this would mean to them, to change a process that 
they felt they wanted to continue because of the family, as 
they called it. It was the right thing to do.
    It's understandable that it was not sustainable under ACA. 
And it's no surprise that your colleagues in the manufacturing 
business continue to cite the cost of health care as a top 
business concern, according to the National Association of 
Manufacturers.
    Could you tell the committee more about the difficult 
choices ACA forced you to make in breaking with the tradition 
of providing this type of coverage for your employees?
    Mr. Eddy. Yes, sir. Thank you, Congressman.
    You know, the difficult decisions really started with the 
implementation of the ACA during the tough times of a really 
bad recession, and it couldn't have been a more worse time. And 
the decisions that we've had to make, now we seem to focus more 
on how we're going to try to manage things like hiring people 
that we need and, you know, how soon people have to retire now. 
Every decision that we make now revolves around the costs and 
the uncertainties really afforded to us by the Affordable Care 
Act.
    So the tough thing we had to do -- we always like to try to 
take care of our employees, and that's not only with good 
salary but also good benefits. We've always had that as a 
company philosophy. Asking them to participate in health care, 
as you said, it has really disrupted the relationship between 
management and union, management and the salary group, as well, 
because they pay more than the union does for their health 
coverage now. It's just a matter of trying to keep them 
accountable and realize the additional burdens that we've had 
to take on here.
    Really, the bad part for the union and the company is I 
truly believe we could have added another 20 to 25 people in 
the last five to seven years if we didn't have the additional 
burden of the Affordable Care Act. I'm not sure where the 
increases would have taken, but we didn't see the major 
increases.
    Now, as an employer, we look for flexibility. That's all we 
can ask you, as you're working on the ACA, to give us some more 
flexibility as an employer, as well as options. And without 
that, the uncertainty going forward, it really delays any 
options for hiring people, developing new products. It's really 
created a major burden.
    Thank you for your question.
    Chairwoman Foxx. Thank you.
    Mr. Walberg. Thanks for your response.
    And my time has expired.
    Chairwoman Foxx. The gentleman's time has expired.
    Mr. Polis, you're recognized for five minutes.
    Mr. Polis. Thank you, Madam Chair. I thank the chairwoman 
for yielding and the witnesses for coming.
    We're here today to discuss the Affordable Care Act and its 
repeal. This committee has held a number of hearings in this 
area, in particularly to highlight the dangers of repealing the 
Affordable Care Act without a replacement that improves and 
builds upon it.
    Of course, I would note that the title of the hearing is 
somewhat deceptive. It's called ``Rescuing Americans from the 
Failed Healthcare Law and Advancing Patient-Centered 
Solutions.'' Obviously, we hope that we can move forward in way 
to improve upon the healthcare law and leave something in its 
place that's better.
    It has been six years since the law passed. Before the 
passage of the Affordable Care Act, about 48 million Americans 
had no insurance, and now that number has fallen to 28 million. 
For the first time, being a woman is no longer a preexisting 
condition; a diagnosis in childhood doesn't preclude coverage 
as an adult; and cancer survivors can't be sent a bill for 
their radiation after hitting their coverage ceilings for the 
year. As was indicated in the testimony, medical bankruptcies 
can be avoided. The statistics bear that out as well.
    In my home state of Colorado, I'd like to submit a letter 
from our Governor Hickenlooper urging this body to protect 
healthcare coverage for 600,000 Coloradans. Without objection, 
Madam Chair, I'd like to add that to the record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    Mr. Polis. And I would also like to share a couple stories 
as well.
    A few weeks ago, Elizabeth Robinson, a constituent of mine, 
called my office in Boulder. She works as a homeless navigator 
for Boulder Municipal Court. For Elizabeth, the expansion of 
Medicaid that Colorado and 31 states took advantage of has been 
absolutely critical for serving the homeless population with 
which she works. She urged me specifically to oppose repealing 
the law because of the dramatic consequences to the most 
vulnerable.
    I also received an email from Dorothy, who shared her 
story. She's from Louisville, Colorado, 63 years old, self-
employed, earns less than $20,000 a year. Thanks to the 
subsidies on the individual marketplace, she finally has 
coverage that's affordable as she waits for her Medicare 
eligibility.
    Elizabeth is an advocate, Dorothy is a patient, but both of 
them believe strongly the Affordable Care Act is working for 
them.
    My first question is for Ms. Schlaack.
    According to January reports from The Commonwealth Fund, 
repeal would cost $54 million in gross State product and $1.8 
million for Michigan alone in local and state tax revenues.
    In addition to your personal responsibilities, are you also 
concerned about this negative fiscal impact on your State the 
repeal would produce?
    Ms. Schlaack. Well, sure, Michigan being a lot of 
manufacturing facilities that struggle as it has been for a 
while. Also, like, the area where I live is right on Lake 
Michigan, and it's a heavy tourist economy. And when people 
don't have jobs, they don't have extra money to spend, and the 
tourist economy is going to suffer. And the small community 
where I live, a lot of it is based around tourism.
    Mr. Polis. Thank you.
    And, Dr. Troy, I appreciated in your written testimony 
where you said it's important to protect those who've gained 
coverage under the ACA. What concerns me is the CBO has made 
clear that repealing the ACA would cause over 30 million 
Americans to lose their insurance.
    Would your organization oppose legislation that doesn't 
maintain those coverage gains made by the Affordable Care Act 
in some way, shape, or form?
    Mr. Troy. Thank you, Congressman, for the question.
    As I said earlier in my testimony, I do believe it is 
important to protect the 20 million who have coverage via the 
ACA. I think the CBO study suggests that just if you repeal it 
and do nothing in its place, you would have a number of people 
without coverage, and I think that would be a problem.
    So we want to build on the existing building blocks of 
American health care, the successful ones, such as employer-
sponsored care, and make sure that we can expand coverage and 
maintain coverage for all.
    Mr. Polis. So I think you said it would be a problem if it 
didn't maintain that coverage. Is that what you said?
    Mr. Troy. We absolutely would like to maintain coverage 
levels, yeah.
    Mr. Polis. Mr. Eddy, you mentioned some of the -- this is 
on the pay-for side, the way that the Affordable Care Act was 
paid for. You mentioned in particular the so-called Cadillac 
tax. There's other aspects, like a tax on unearned income, 
medical device tax. I'm not aware of your organization's 
position on all of those, but certainly you've made it clear 
you oppose the Cadillac tax.
    Do you have other ideas for how to pay for an ACA 
replacement? And whatever takes the place of it, have you put 
other potential pay-fors on the table that are acceptable to 
you?
    Mr. Eddy. No, Congressman, I have not seen anything else 
that's --
    Mr. Polis. Does your organization propose any, or do you 
simply oppose the current ones?
    Mr. Eddy. There are some provisions of the ACA that --
    Mr. Polis. Pay-fors, pay-fors. The ways that it's paid for. 
The revenues.
    Mr. Eddy. Well, I don't support the fact that it's a 
mandate and has to be paid with penalties if not. And I 
understand why there are the mandates and the health insurance 
industry fees. The fees are really what -- the pay-fors, the 
additionals --
    Mr. Polis. Right.
    Mr. Eddy. -- where that amount could have gone to health 
coverage for our employees.
    Mr. Polis. My time has expired, but, in concluding, I would 
just say, you know, it's fine to oppose particular ways of 
paying for it, like fees and certain taxes, but, obviously, 
something has to be paid for. So maybe you can put, in the 
future, some on the table -- we'll be happy to submit that to 
you in writing after the hearing -- as to how you would like to 
pay for the replacement for the ACA.
    And I yield back the balance of my time.
    Chairwoman Foxx. The gentleman's time has expired.
    Mr. Rokita, you're recognized for five minutes.
    Mr. Rokita. I thank the chairwoman.
    I also thank the witnesses for your testimony today. I 
learned a lot from each of you.
    I want to start by commenting on some of the comments made 
by the Ranking Member, a dear friend of mine, Mr. Scott, who 
talked in his opening statement about a Budget Committee 
hearing. I happen to be an officer on that committee. And I 
just want to say, while I don't dispute that there was some 
testimony given at that committee hearing along the lines of 
what Mr. Scott was talking about, the overwhelming testimony 
last week in the Budget Committee was that -- and these were 
experts in the field of health care and the economy and both -- 
was that ObamaCare was roundly criticized, that, in fact, if it 
was left to go on, it would implode, that the fact that you had 
another major government control in people's lives only meant 
that costs were going up and choices were going down.
    So that was the takeaway from the Budget Committee 
witnesses last week when we examined this. And it's not any 
different than the other examinations we've had on ObamaCare 
over the last several years.
    Mr. Scott also talked about some misleading figures, about 
the increase in costs and whether or not the increase in costs 
actually went down with ObamaCare or whether, if we didn't have 
ObamaCare, the costs would've continued to increase at a higher 
rate.
    What I find to be misleading about the 6 years or so that 
we've had ObamaCare is statements like this: If you like your 
doctor, you can keep your doctor. That, in fact, is wrong. If 
you like your healthcare plan, you can keep your healthcare 
plan. That, in fact, is wrong. There are over 1,000 counties in 
the United States right now that have one choice on the 
exchange for a healthcare provider. In fact, it's gotten worse.
    Then the cost was told to us to not be more than $2,500 per 
family or something along those lines. And, of course, we've 
blown through that figure almost immediately.
    So where are we today?
    I'd like to recognize my fellow Hoosier, Mr. Bollenbacher. 
I'm glad to see you here. I'm very familiar with your area of 
the State from when I served as Indiana Secretary of State.
    Can you explain a little bit about how a small accounting 
firm owner from northern Indiana winds up testifying before 
this committee on this issue? Did you ever think that would be 
the case? And can you go into a little bit more detail?
    Mr. Bollenbacher. Thank you.
    In the fall of 2016, we received a renewal for our health 
insurance of 156 percent, and it just blew me away. Many of my 
clients -- I was expecting a 40- to 50-percent increase based 
on the number my clients had been receiving. When I received 
156, I just shook my head. I had no idea what we were going to 
do.
    My team members are my family. You know, I want to care for 
them, I want to take care of them. So I wrote a letter to 
President Obama just explaining to him about our 156-percent 
increase. And I sent that also to the NFIB, and they contacted 
me to come speak today, which I'm grateful for.
    Mr. Rokita. Well, you're not alone. I mean, in Indiana 
alone, 31 percent of small businesses offered coverage in 2010, 
and by 2015, the most recent year that I could find data, only 
23 percent of those same businesses were able to offer 
coverage, a decrease of 26 percent in the number of offerings.
    And your reason, just to be clear for the record, for this 
reduced coverage among small-business owners?
    Mr. Bollenbacher. The costs have been increasing. It's just 
increasing out of control.
    Mr. Rokita. When you described how your insurance was 
canceled the first time, you said there were some less ideal 
options. One of those was Medi-Share, I heard from your 
testimony, and some other things. Could you go into a little 
bit more detail there?
    Mr. Bollenbacher. We looked at a number of options. Medi-
Share is called a church plan. I have a number of clients that 
have gone to that. It's usually a half or a third of what even 
on the exchange it would cost them. And that was one of the 
options that we looked at.
    Mr. Rokita. But that's not working?
    Mr. Bollenbacher. For those clients that have gone to Medi-
Share, they are still on it. It is working for them.
    Mr. Rokita. Okay. Thank you.
    And then, Mr. Troy, I think with the 30 seconds I have 
remaining, I'd just like to ask you, at the risk of this 
committee losing jurisdiction over the issue, why do employers 
have to be involved in the insurance market? I mean, I 
understand the history and all that, but why couldn't if we 
changed or modified the Tax Code could we not incentivize 
individuals to enter directly into a competitive marketplace? 
Why does the employer have to be involved?
    Mr. Troy. I don't think the employer has to be involved per 
se. I just think that is the way the system has evolved, and to 
change it precipitously would be to cause large disruptions. As 
we saw with the Affordable Care Act, the disruptions are often 
quite problematic. Somebody mentioned the 5 million people who 
lost their individual plans via the ACA.
    So I think the best way to go forward is to try and avoid 
disruptions and focus on what is working. And you have 177 
million people getting health care through employers. If you 
were to disrupt that, the government would have an even larger 
hole to fill in terms of covering people.
    Chairwoman Foxx. The gentleman's time has expired.
    Ms. Bonamici, you're recognized.
    Ms. Bonamici. Thank you, Chairwoman Foxx and Ranking Member 
Scott.
    And thank you so much to all of our witnesses for being 
here today and testifying.
    I wanted to just follow up on what Mr. Rokita said about 
employer-provided health care. And also Dr. Roe mentioned, as 
well, that insurance costs make us noncompetitive with other 
countries. And I want to point out that that's not necessarily 
a function of the Affordable Care Act.
    I was born in Detroit, Michigan, many years before the 
Affordable Care Act. And everyone knew in Detroit, Michigan, 
that if you make something in Detroit or if you go across the 
bridge and make it in Windsor, Ontario, you have very different 
cost considerations, because in Windsor, Ontario, they don't 
have employer-provided health care, because Canada, like 
basically every other industrialized country, has universal 
health coverage.
    So it's not necessarily a function of the Affordable Care 
Act that healthcare costs are making us unaffordable. And if we 
want to have a conversation about that in another hearing, I'd 
welcome that.
    Madam Chairwoman, I ask unanimous consent also to insert 
into the record a letter from the AARP supporting the 
Affordable Care Act and expressing concerns about the effects 
of repeal.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
       
    Ms. Bonamici. The AARP also mentioned in the letter that 
Medicaid is the only safety net for millions of children with 
disabilities, adults, and seniors in need of critical long-term 
services and supports.
    I want to point out that, in Oregon, the Kaiser Family 
Foundation estimates that more than 546,000 Oregonians could 
lose coverage if the ACA Medicaid expansion is repealed. Also, 
in Oregon, we have been doing some great innovations with care. 
We have CCOs improving care and reducing costs with patient-
centered primary care homes. It's really working well to 
provide that preventive care.
    And I've heard from hundreds of constituents in Oregon. In 
fact, thousands showed up recently at a townhall meeting that I 
did with our Senators about this issue. They're terrified about 
losing their coverage.
    And Debra from Rainier shared her story with me. She called 
my office. She's worried that she's going to lose her care if 
the ACA is repealed. She's in the final stages of pancreatic 
cancer. She's not yet eligible for Medicare. She's worried that 
her cancer will prevent her from obtaining coverage without the 
Affordable Care Act. So she's spending her remaining time 
advocating for those who have benefited from health reform and 
doing what she can to prevent the repeal of this important law.
    And I know her fears are shared with millions of Americans 
in districts all across the country. And I hope my colleagues 
will keep her, as well as you, Ms. Schlaack, in mind as we 
debate this repeal.
    And, Ms. Schlaack, thank you so much for being here to 
share your story. I know it's not easy to come forward and talk 
about something so personal.
    But you mentioned that the type of leukemia your husband 
was diagnosed with has genetic links so your family might be at 
risk. Can you discuss how the repeal might affect your family 
if individuals with preexisting conditions are no longer 
protected under the ACA? And if you might mention, what would a 
high-risk pool do? Do you think that's an acceptable 
alternative for your family?
    Ms. Schlaack. No, not -- I mean, a high-risk pool, not at 
all. I mean, actually, the University of Chicago continues to 
work with samples from my husband to further educate 
themselves. And I've learned from my own family about some of 
the genetic links.
    And being that I have a young daughter who previously was 
almost a preexisting condition for being a female, the thought 
that 30, 40 years down the road, if she sees the same thing, 
she won't possibly have the choice of buying prescriptions or 
paying for groceries.
    Ms. Bonamici. Thank you, and I hope we can keep your story 
and others in mind.
    Mr. Eddy, you stated in your testimony your business had 
experienced some significant challenges as the health coverage 
you offered your employees changed, but you are hopeful your 
situation is stabilized. So can you talk a little bit about how 
the repeal of the Affordable Care Act without a credible 
alternative would affect your current situation?
    There's a lot of uncertainty now. I know the President has 
said there's going to be insurance for everybody. I don't know 
how that plan would work. We haven't seen that yet. But how 
would the uncertainty of repeal and replace, how would that 
affect your business and business owners like you?
    Mr. Eddy. Thank you, Congresswoman.
    For the answer to that, I will reference a study that the 
NAM has completed called ``Shaping Up.'' The NAM took a hard 
look at the challenges as well as the opportunities for 
employers concerning healthcare insurance coverage. They were 
really looking at three broad themes with that: controlling 
costs, such as eliminating burdensome taxes and paperwork; 
expanding coverage options, such as providing flexibility for 
employers to cater their health insurance options; and access 
to better information in the form of improved healthcare IT and 
information sharing.
    I think that document would maybe tend to give some 
additional, broader perspective than my own personal. I think 
that I would reference that, and that would be made available 
to you.
    Ms. Bonamici. Thank you, Mr. Eddy.
    And I see my time has expired. Thank you, Madam Chairman.
    Chairwoman Foxx. Thank you. The gentlewoman's time has 
expired.
    Mr. Guthrie, you are recognized for five minutes.
    Mr. Guthrie. Thank you, Madam Chairman, for the 
recognition. Thank you all for testifying. I appreciate you all 
being here.
    And, Mr. Bollenbacher and Mr. Eddy, you mentioned in your 
testimony about your small businesses. And I have heard from 
families in my district. Right when we first got back to the 
session, a lot was going on in January, and I got a call, my 
office got a call from a young lady. And I called her back. I 
wanted to talk to her personally. And she has a special needs 
son, and she was really concerned -- and she's on the exchange 
in Kentucky -- extremely concerned about the idea that she 
might lose her health care as a lot of stuff has been reported. 
So I wanted to assure her, we're going to have a transitional 
plan and an ability for her to move forward.
    But then we started talking about her plan. In Owensboro, 
Kentucky, on the exchange, you have one insurance choice. She 
said her husband works for a small business, less than 50 
people, didn't get health care now through that business, had 
to go on the exchange, only one choice. Her child has special 
needs. We have great physicians in Kentucky, all over our 
state, but there was a particular physician for her child's 
needs in Cincinnati at the Children's Hospital and he was not 
in network.
    So we started walking her through, after we talked about 
you're going to be able to continue your current coverage, the 
things that we want to do in our replacement plan that will 
have her have better coverage. One is, well, if it's a small 
business, associated health plans for small business will have 
better opportunities to provide health insurance, if she can 
buy out-of-state plans, if she needed a doctor in Ohio, because 
they had special skills for her child.
    So we started walking through that, and she became more 
confident as we moved forward that we can improve the situation 
that she's in instead of being stuck in an exchange with one 
plan.
    But my question. So I've actually put the Employee 
Protection Act that would allow small businesses, because what 
we are going to do with small business -- because the people 
who are really trapped in this are people that are single 
employers, small businesses trying to buy on the individual 
market or small market. And what I want in this bill, and I 
want to see how this would help you, that you could actually 
offer pre-ObamaCare plans, pre-ACA plans. If you could go back 
and offer a plan like that to your employees, would that help 
you?
    I think, Mr. Bollenbacher, you're a smaller business, I 
believe.
    Mr. Bollenbacher. Yes, sir. It sure would. We feel like we 
have no options right now. We have a cookie-cutter plan that we 
have to pick, and that's it. And before the ACA, we had the 
ability to pick the plan that best fit our particular needs.
    Mr. Guthrie. Mr. Eddy.
    Mr. Eddy. Yes, Congressman, we run into the same issues. We 
are in the northern panhandle of West Virginia, so we are about 
a mile from Ohio and five miles from Pennsylvania.
    One of the issues as far as going backwards is the fact 
that we don't have several of the carriers that used to 
represent West Virginia. The ACA has weakened and some of them 
have actually been taken over. So our options now are somewhat 
limited to three carriers in the northern Ohio Valley. And we 
would like to maybe move some of the provisions back that would 
give us more options and flexibility that we talked about. So, 
yes, that would be important.
    Mr. Guthrie. And we think what we want to propose will give 
her more options for her son, and that's what we hope to 
certainly accomplish.
    Mr. Bollenbacher, I think Mr. Rokita -- I was out but just 
coming back -- asked you about a letter that you sent to the 
President. Can you talk about the response you got on the 
letter -- or from the administration? I didn't expect him to 
personally respond, but from the administration what did you?
    Mr. Bollenbacher. Sure. A month or so after I sent the 
letter, somebody from the SHOP Marketplace called me, just to 
talk about the plans that they had available on the SHOP 
network, which really wasn't any benefit to us.
    Mr. Guthrie. Okay. Well, thanks.
    And then, Dr. Troy, in your testimony you mentioned that 
innovations in large employer-sponsored healthcare benefits 
helped to reduce healthcare costs for employees, retirees, and 
dependents. Can you share with the committee some of the ways 
employer coverage is reducing costs?
    Mr. Troy. Thank you. So as I was saying earlier, that we 
were seeing reductions in employer-sponsored costs in that 
period, 2006 to 2010, before the ACA went into effect, and it 
was a result of program design changes and plan design changes 
on the part of employers, which included the implementation of 
consumer-directed health plans, wellness programs, which have 
been shown in many cases to reduce costs and actually improve 
the health of employees, which is really what we are trying to 
get at, and other significant plan innovations.
    And, again, combined, these really dropped the annual 
increase from 11.1 percent in the period before 2006 to from 
2006 to 2010 to 4.8 percent. And we believe that additional 
innovations by employers could reduce costs even further in the 
years ahead. Employers are now taking this issue very 
seriously.
    Mr. Guthrie. Thank you.
    Thank you, Madam Chair. I yield back my time.
    Chairwoman Foxx. Thank you so much.
    Mr. Takano, you are recognized for five minutes.
    Mr. Takano. Thank you, Madam Chair.
    Madam Chair, before I begin, I would like to ask unanimous 
consent to insert into the record a letter from the American 
Hospital Association and Federation of American Hospitals 
raising grave concerns with repealing the Affordable Care Act.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Mr. Takano. Thank you, Madam Chair.
    I'm disappointed that my colleagues are yet again seeking 
to undermine a law that has helped millions of Americans get 
health coverage while creating a more just and compassionate 
healthcare system for hundreds of millions more through 
consumer protections.
    Before I get to my questions, I want to speak briefly about 
the impact of the Affordable Care Act on my constituents. When 
I took office in 2013, a quarter of my constituents were 
uninsured. By 2015, the uninsured rate was cut in half to less 
than 12 percent, and nearly 90,000 people were newly insured.
    People like my constituent and childhood friend Heather 
Froehly. Heather had a preexisting condition, and for years 
before the ACA she was priced out of the insurance market and 
denied coverage. She contacted me during the first enrollment 
period in 2014 to let me know that she had successfully 
purchased a plan and was thrilled to be covered for the first 
time in years. The law's subsidies ensured here coverage was 
not only accessible but affordable.
    Soon after, Heather was diagnosed with stage two breast 
cancer. In the following months she underwent treatment, and 
I'm happy to report Heather is now cancer free and doing well. 
Heather has told me without hesitation that the Affordable Care 
Act saved her life. Had she not been able to obtain coverage, 
she would not have been able to go to that appointment where 
the doctors first discovered her cancer. She was fortunate to 
catch the cancer before it progressed further. I don't want to 
think what she would have done without the ACA.
    Now, we know the costs of repealing the ACA: 30 million 
people will lose their insurance, including nearly 5 million 
Californians. It would cost my State nearly 150,000 jobs. But 
more than that, we know that stories like Heather's or Ms. 
Schlaack's can be found in every district represented here 
today. Democrat and Republican districts share the same 
predicament.
    Cancer does not recognize red states and blue states. We 
have to take off our partisan blinders and acknowledge where 
the ACA has succeeded and where it must be improved. And I hope 
we can agree that it would be a terrible mistake to repeal a 
law that has saved so many American lives.
    Now, Ms. Schlaack, first of all, I want to thank you for 
your courage this morning and sharing your family story. And 
I'm incredibly sorry for our loss and appreciate your 
willingness to speak here today.
    Now, my colleagues on the other side of the aisle seem to 
be in a great rush to repeal a law that insures millions of 
Americans and that they have any access at all to lifesaving 
care. And it seems in their illogical haste to score political 
points and make good on an ill-informed promise to repeal the 
ACA that they have ignored the impact of their actions, 
especially for families who are dealing with a significant 
healthcare crisis.
    Can you help us understand what it must be like for those 
families, on top of the deep concern for their loved one's 
health, to be scared about Republican attempts to dismantle a 
law that is working to ensure that they maintain lifesaving 
care? Can you help us understand?
    Ms. Schlaack. Thank you.
    Well, like I had mentioned before, I mean, when you're 
going through this treatment, whether you're the patient or 
caregiver or family friend, your focus is on wellness. And the 
bills keep coming in regardless of what's going on, and the 
fact that you don't have to worry about whether you're going to 
be covered or not is one less worry.
    Mr. Takano. Tell us more about the annual or lifetime caps, 
the fact that there were no caps annually.
    Ms. Schlaack. Right.
    Mr. Takano. How would that have affected you and your 
husband?
    Ms. Schlaack. Well, for instance, my husband had to have -- 
in a 10-month period he had 12 bone marrow biopsies. Those are 
four grand apiece. Blood transfusions multiple times a week. An 
ambulance arrived from our house to the hospital, which 
happened three times, $2,000. This is not counting the doctors, 
the medical staff, the hospital admissions. Easily before he 
was even halfway through his treatment would have maxed out a 
lifetime million-dollar maximum like it used to be.
    Mr. Takano. So this consumer protection was key. And if I 
had more time, I would want to ask Mr. Eddy and Mr. 
Bollenbacher whether their policies had any lifetime or annual 
caps and that might have made them more affordable to them. But 
I don't have the time. My time expired. So I don't want to 
yield back, but my time has expired.
    Chairwoman Foxx. Thank you very much.
    Mr. Rooney, you are recognized for five minutes.
    Mr. Rooney. Thank you, Chairwoman Foxx, and thank the 
witnesses for being here today. I've got questions for Dr. Troy 
and Mr. Eddy.
    People throughout southwest Florida have expressed many of 
the frustrations shared here today. According to Forbes 
magazine, an average 64-year-old woman in Lee County, Florida, 
has seen her insurance premiums and costs jump 135 percent. 
Under these exchanges, due to the failure of competition, most 
southwest Floridians now have one choice for their health 
insurance. Many of them are on a fixed income.
    So my question for Dr. Troy is, if the failed experiment of 
ObamaCare continues as is, what chance do our average southwest 
Floridians have to see their healthcare costs go down?
    Mr. Troy. I am, too, sir, concerned about the lack of 
choices on the ACA exchanges, and we are having an increasing 
number of exchanges with only one option, as you were saying. 
The cost trend suggests that the chance for the average 
Floridian of seeing cost reductions under the ACA are very low.
    Mr. Rooney. Thank you.
    Mr. Eddy, thank you for being here as well. Glad to see 
another businessperson here who has firsthand experience with 
this disaster on our employees.
    According to the American City Business Journals, Lee 
County, Florida, is the third-best place for small businesses. 
Employer mandates have prevented many of our small-business 
owners from hiring new employees. And as I think you've 
mentioned as well, many have had to reduce the hours worked to 
deal with the cost increases of ObamaCare.
    Can you share with us some insights on how the employer 
mandates have curbed jobs and wage growth?
    Mr. Eddy. Yes, Congressman. Thank you.
    The obvious first one is the cost. As it restricts our 
hiring capability, the costs per year, if you look at just the 
costs related to the mandates and the health insurance industry 
fees, those two alone really represent about three full-time 
equivalent employees for us.
    The restrictive parts of the ACA really, as I said earlier, 
dictate a lot of different business decisions that we make, 
including capital investments. Looking to the future, we have 
to, any time we make a capital investment for growth, we have 
to hire and plan on hiring new employees.
    So this has, as I said, become one of our most critical 
decisionmaking parts. And it's not just the costs and fees, 
it's the future. It's the uncertainty. The Cadillac tax, for 
example, is of critical concern because of our -- the curve on 
the costs right now by 2018 would possibly put us into that 40 
percent additional tax rate.
    So it's fully encompassing, to say the least, for all of 
our business decisions.
    Mr. Rooney. Well, I appreciate that response. Like I say, 
I'm an employer too, and I'm used to satisfying customers, as 
you are. And maybe we ought to think about a system that puts 
the patient first, patient-centric care, where they get to make 
the choice instead of a top-down government mandate. What do 
you think about that?
    Mr. Eddy. I can tell you, I'm no healthcare expert, but 
without change -- and I want everybody to know that we are all 
compassionate to the needs of the people. That's why we employ 
and try to take great care of our employees. But I'm very 
concerned about the long-term sustainability of health care in 
general if we don't make a major change. I'm supportive of 
that, yes. Thank you.
    Mr. Rooney. Thank you very much.
    Again, thank you all for being here.
    And I yield back.
    Chairwoman Foxx. Thank you very much.
    Mr. Espaillat, you're next for five minutes.
    Mr. Espaillat. Thank you, Madam Chair.
    Dr. Troy, I appreciate in your written testimony that you 
stated, and I quote, ``It is important to protect those who 
have gained coverage under the ACA.'' However, I am concerned 
that about 30 million individuals are projected to lose health 
insurance if the ACA is repealed. Specifically, New York State 
Governor Cuomo, Andrew Cuomo, has stated that over 2.7 million 
New Yorkers would lose coverage, with Republicans offering no 
guarantee to protect this coverage.
    I ask for unanimous consent to include Governor Cuomo's 
statement announcing the impact of the ACA repeal on the 
record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
     
    Mr. Espaillat. Dr. Troy, I appreciate that in your written 
testimony, you stated that employers, and I quote, ``however, 
are both good at getting people covered and maintaining 
manageable risk pools. Public policy should be aimed at 
encouraging these important goals.'' You also mentioned the 
risk pools are difficult to maintain. Employer risk pools for 
the chronically ill is a central tenet of Speaker Ryan's ``A 
Better Way'' paper.
    I would like to know how you will separate the healthy from 
the ill. And considering that high-risk pools are more 
expensive to buy by consumers, more expensive to administer, 
and generally provide less coverage, how do you propose to 
implement these high-risk pools without taking a real hit on 
consumers and patients across the country?
    Mr. Troy. Thank you, sir, for your question. And as a 
native New Yorker, I congratulate you for your joining Congress 
and joining the committee.
    In terms of risk, managing risk is a crucial part of how to 
handle any possible healthcare plan going forward. It's a 
crucial part of healthcare reform. One of the things about 
employers and why I said in my testimony that they are good at 
managing risk is that they have large pools of people who work 
for them and therefore the risk pools generally tend to be 
better. You don't have the same kind of options such as you 
have in the ACA exchanges in which you have the young and 
healthy people choosing not to participate. And we, too, have 
evidence that the percentage of the young people in the ACA 
exchanges are younger than needs to be to maintain an 
acceptable risk pool. So I think --
    Mr. Espaillat. Aren't they generally more expensive to buy? 
Aren't they more expensive to administer and provide less 
coverage?
    Mr. Troy. Are you saying employer-sponsored plans? No, we 
have not found that to be --
    Mr. Espaillat. High-risk pool.
    Mr. Troy. We have not found that to be the case.
    In terms of high-risk pools, the idea is to minimize the 
number of people who would be in them. And that's why employer-
sponsored health care is an important building block, as would 
be, perhaps, association health plans that would allow other 
people to join what are effectively risk pools by joining with 
their civic organization or their union or their religious 
organization and then get the tax-preferred benefit. So the 
idea is to minimize the number of people in high-risk pools.
    But, yes, of course, you are right that the specific high-
risk pools that these programs that would establish, the 
specific high-risk pools programs would establish are more 
expensive because we're dealing with a group by its nature that 
is high risk. The idea is to minimize the number of people in 
those pools.
    Mr. Espaillat. Dr. Troy, the Trump administration's recent 
immigration executive order has made it impossible for many 
foreign-born physicians and students to enter the United 
States. On your blog in December 2013, you discussed the 
worrisome expected doctor shortages. And in 2012, while a 
fellow at the Hudson Institute, you wrote a piece that 
commented on the physician shortage that this country already 
faces.
    As a healthcare policy matter, does it make sense for the 
administration to make it more difficult for the United States 
to meet the health needs of our population by restricting the 
number of doctors we recruit and train?
    Mr. Troy. Thank you very much for that question. As a 
healthcare policy nerd, I guess, as you said, who wrote this 
paper four years ago, I'm flattered that people are reading the 
paper, and I hope it has an important public policy impact. I 
absolutely think that we do have concerns about a doctor 
shortage. I've always been in favor of an immigration system 
that works to bring in people who are willing to work and 
willing to help improve our economy, and I worked in the Bush 
administration on the immigration reform plans that would have 
helped bring more doctors into the country.
    Mr. Espaillat. So you support an exemption for doctors and 
healthcare professionals from those countries that are 
currently being hit with the ban?
    Mr. Troy. I would like to see our immigration policy have 
plans to allow more doctors to come into the country, 
absolutely.
    Mr. Espaillat. Madam Chair, the statement from the 
Association of American Medical Colleges expresses deep 
concerns about this new immigration policy. I ask unanimous 
consent to insert this in the record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    Chairwoman Foxx. And the gentleman's time has expired.
    Mr. Espaillat. I yield my time.
    Chairwoman Foxx. Mr. Brat, you're recognized for five 
minutes.
    Mr. Brat. Thank you very much, Madam Chairman.
    Thank you all very much for being with us today.
    I'm on the Budget Committee, and so I like to kind of zoom 
in on the mandatory spending problem this country faces, and a 
lot of that is going to be impacted by increasing healthcare 
costs over the years. And so that's where I'm headed.
    And so we all appreciate the concerns shared across the 
aisle on uninsured, the costs. We want to get it right. But the 
amazing thing I never hear and that the media, unfortunately, 
never covers is the impact on our children with the programs, 
Medicare, Social Security, et cetera, going forward. So I'll 
just share a few facts.
    And then I don't know whether you all have this in your 
planning horizon or not, because it is 10 to 20 years off. But 
just the basic fact, everyone -- I taught economics for a 18 
years -- everyone wants everything in the short run, right? I 
mean, utility maximization, et cetera, and we're pushing stuff 
off when it comes to the debt, et cetera. So in Virginia, 
healthcare costs are going up by 20 percent, and that's pretty 
typical. Some States, 50 or more percent increase in premiums. 
So, number one, is that sustainable?
    Two, Kaiser recently has come out with just the standard 
premium rates, about $17,000 for a family of four in Virginia 
or across the country. That's just the new family of four 
premiums, $17,000. Is that sustainable?
    Average family income in my counties is about $65,000 for 
family. Family income 65, 17 health care. Is that sustainable? 
Deductibles are over 5,000 typically now for silver, bronze 
plans, right, not just high deductible. It is across the board. 
Is that sustainable?
    And then my commentary is what I know is not sustainable. 
So currently we are 20 trillion in debt. And if you go out to 
CBO, the trendline is in 10 years we're going to add another 10 
trillion. Likely, we'll be at 30 trillion in debt. When does 
the bond market call that in? Is that sustainable? I don't 
think it is.
    The flip side of that is what's driving that debt? A lot of 
the pressure is coming from the mandatory spending programs. 
Medicare and Social Security are both insolvent in 15 years, 
roughly speaking. In 50 years, it's not clear whether our kids 
will have those programs at all.
    And healthcare costs are, of course, probably the main 
driver of those programs, of Medicare, Social Security, 
Medicaid, veterans, et cetera. And I haven't heard enough 
analysis of that. This is a huge ethical issue and an ethical 
tradeoff of current generations versus the next generation. So 
everyone's talking about what we would all like right now, but 
the facts look to me, with Medicare and Social Security 
insolvent in 15 years and maybe nonexistent in 50 years when 
our kids retire, is anyone taking that into account?
    And so what goes with that, the main graph out at CBO also 
shows in 10 years all Federal revenues will go only to 
mandatory spending programs, right? So all Federal revenues 
will only go to mandatory spending programs, Medicare, Social 
Security, Medicaid, Bush prescription drug plan, et cetera. 
Right? So that means there's no money left for the military, 
education, transportation, everything we believe in across the 
aisle.
    And the mirror image of that same statement, that there's 
no Federal revenues left, is the deficit in 10 years is 
expected to be $1.2 trillion, which fully funds the 
discretionary budget, right? So we will be deficit financing 
the entire discretionary budget in 10 years.
    So this is just CBO facts, most of it related to 
mandatories. And I just want to open it up to your comments. 
Why don't we just work down the -- Dr. Troy, why don't you lead 
off, just on the sustainability. And, sorry, I've left you 
probably with probably way too little time.
    Mr. Troy. That's, fine, sir. I will be brief.
    We have a chart that we've prepared. It's called ``Hitting 
the Wall,'' and it talks about the period from 2025 to 2030 
when we're going to have Medicaid spending hit over a trillion 
dollars. All of the baby boomers will have retired. The 
Medicaid trust fund, as you say, will be insolvent. And we are 
very concerned about all those trends going forward.
    We are also concerned about recent public policy which puts 
more people onto government-sponsored healthcare programs and 
fewer on private programs. So we would like to see more 
reliance on this employer-sponsored care as a way to address 
these issues going forward. And I would like to submit that 
chart for the record.
    Mr. Brat. Right. Thanks.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
      Mr. Brat. Mr. Eddy, please.
    Mr. Eddy. Yes. I think I would refer back to the concern 
about sustainability not only of the healthcare plan, but also 
of the tax base if this continues to damage small companies. A 
large part of the tax base, has to be remembered, comes from 
the small businesses. As our friend Adam Smith said, there's 
only three ways to create new wealth in any culture: 
agriculture, manufacturing, and resource extraction. And a lot 
of those companies that support those industries are small 
businesses now. So without change, I really am concerned about 
our sustainability even with the tax system. Thank you.
    Mr. Brat. Thank you for bringing in Adam Smith.
    Thank you all very much.
    Chairwoman Foxx. Thank you very much.
    Mr. Grijalva, you are recognized for five minutes.
    Mr. Grijalva. Thank you very much, Madam Chair.
    I think it's important, kind of, to remind as we deal with 
ACA and have this discussion in this panel -- and thank you for 
being here -- and as we stumble or edge toward TrumpCare in the 
foreseeable future, it's important to remember that there were 
60-plus votes for repeal in this House. And at the time it was 
a messaging vote. Now reality bites, that we have issues to 
deal with and how do we keep commitments that, perhaps, are 
contradictory to even some of the testimony that I read from 
the witnesses here today.
    For example, President Trump said that he wanted health 
care for everyone, he mentioned that, and that he wanted it to 
be great, affordable care for everyone. The commitment not to 
touch Medicare and not to touch Social Security. Congressional 
leaders on the Republican side have talked about dealing with 
the popular parts of ObamaCare, no prohibition of preexisting 
conditions, no gender discrimination in terms of costs, 
preventive mandated examinations for wellness issues, no 
maximum caps, sons and daughters remain until they're 26.
    And Mr. Troy, Mr. Eddy, those two are doable in your 
professional, learned experience, to do what the President said 
had to be done and to keep the essential programs that are 
popular with the public? That's why the public is demanding a 
replacement, just not merely a repeal. Are they doable at all?
    Mr. Troy. Thank you for the question, sir.
    First of all, I'd like to state that I am not a 
spokesperson for the Trump administration or the Obama 
administration.
    Mr. Grijalva. Nobody is. That's not the point here.
    Mr. Troy. And I was happy to reclaim my First Amendment 
rights when I left government 7 years ago.
    But I would like to make the point that there are a number 
of serious plans that would reduce the overall cost of premiums 
on average according to CBO analysis, and I think that is the 
best way to go forward in order to incentivize people to 
purchase health care on their own without subsidies for some 
and an overall mandate. Thank you.
    Mr. Grijalva. Yeah. Let me follow up, if I may.
    Mr. Troy, part of what you also hear is that we have to 
eliminate the mandate, we have to eliminate the subsidy, we 
have to eliminate the medical device tax, high-end fees and 
taxes, and we have to eliminate issues that are revenue 
generation that allow many of the important things, like Indian 
health care that's part of the Affordable Care Act, that would 
go out the window. Community health centers and the trust fund 
established for community health centers that are essential in 
rural America and in poor America for services, those would all 
go out the window.
    So how can on a wish that costs of premiums will go down, 
when in reality the balance of revenue and program offerings 
under ACA are intrinsically tied together? How do you eliminate 
all the revenue generation and still have a program?
    Mr. Troy. So we do oppose elimination of many of the taxes, 
including the Affordable Care Act, the Cadillac tax in the 
Affordable Care Act. In terms of CBO projections being a wish, 
that is how public policy is made. We make projections based on 
what CBO assumes that the policies will do and that's how 
they're voted on. And I was pleased to see that this one 
particular CBO study showed that the costs would be reduced if 
a number of these programs in totem would be put together to 
lower the costs on individuals and their premiums.
    Mr. Grijalva. I'm sorry, Mr. Eddy, but if you have any 
comment on either one of those points.
    Mr. Eddy. Thank you, Congressman.
    I really tell myself I should have no comment here, but 
what I would like to say is I think we've all learned a good 
bit about what works and what doesn't work in the last five 
years, six, seven years of ACA. You know, from my standpoint as 
a small-business owner, I would hope that there could be a 
balance created between this group, actually, to work towards 
what does work better. I have no answer for you on that, 
though. Thank you.
    Mr. Grijalva. I appreciate it.
    I yield back, Madam Chair.
    Chairwoman Foxx. Thank you very much.
    Mr. Bishop, you're recognized for five minutes.
    Mr. Bishop. Thank you, Madam Chairwoman, and thank you for 
the opportunity to be a part of this committee hearing today.
    Thank you to all the panelists. A special thank you to Ms. 
Schlaack, a fellow Michigander. Also, I want you to know as a 
parent, husband, my heart goes out to you and your family. I do 
want you to know that your testimony here today makes a 
difference. And oftentimes people don't think that, but your 
being here today, your personal story makes a difference, and I 
want to thank you for that.
    Higher premiums and uncovered out-of-pocket expenses for 
the most part are devastating families and entrepreneurs and 
everyday Americans of all backgrounds. The ACA has caused 
cancelled policies, rising costs, poor coverage, and lack of 
choices for families, business owners, and employees alike.
    Many Americans simply can't afford health insurance. In 
fact, in 2015, 8 million Americans chose to pay the individual 
mandate tax penalty rather than to purchase insurance at all.
    I hear from constituents every day and business owners. I 
have spent the last couple of years traveling the state. And 
just reflecting what I'm seeing in Michigan, plans in Michigan 
exchanges saw deductibles go up an average of $492 in 2017. 
ObamaCare exchange rates will jump nearly 17 percent in 
Michigan regardless of what Congress does this year. Insurers 
are leading the exchanges, private practices are folding over, 
and our doctors are being forced into retirement because they 
cannot afford the cost to stay in practice to comply with all 
of the incredible regulation.
    Nationally, those who currently have a plan under the 
exchange can expect an average premium increase of 73 percent, 
while individuals who are now just joining will see a 96 
percent increase in premiums. The average cost to the new 
consumer in the individual market is expected to rise $1,800 
per year.
    We often hear, as we absolutely did here today, the 
argument that if ObamaCare isn't implemented, costs would rise 
anyway. And I know, Dr. Troy, you've answered that question on 
more than one occasion. And just building on what Mr. Guthrie 
had asked you, as a healthcare policy expert, can you tell me -
- obviously, prices would continue to increase. But would the 
cost of health care increase at the same rate under the 
previous system but for the implementation of ObamaCare?
    Mr. Troy. So the healthcare inflation rate continues to be 
higher than the overall inflation rate. There has been some 
moderation in the healthcare inflation rate. So it's still 
higher than overall inflation in the last couple of years. CBO 
has looked at this and wondered what the effect of -- or the 
cause of this was. It looked at the ACA as one possibility, but 
it said that the biggest factor was the lingering effects on 
the recession in terms of moderating the healthcare inflation 
rate. Also, some of the premium hikes that we have seen in the 
last couple of years in the ACA exchanges suggest that new 
studies going forward might find even higher rates.
    And then the other thing I would say is that employers have 
done a lot of work in recent years to try and bring the down 
costs. And we've seen some improvement in the costs in 
employer-sponsored care even as they face the additional 
effects of the ACA costs.
    Mr. Bishop. Okay. We could have a lot of this conversation 
for many days.
    Doctor shortage. You just were asked -- you were just 
brought into that discussion as well, the fact that the current 
immigration plan may have an impact on that. But can you share 
with me the extent to which the result of rising costs on the 
current practitioners and the current costs with regulation 
compliance has an impact on the number of our doctors, 
especially those freestanding specialists who are leaving the 
practice of medicine?
    Mr. Troy. I'm glad you raised that, because that study that 
I wrote back at Hudson Institute in 2013 did talk about the 
cost of the Affordable Care Act on our medical profession and 
suggested that we might have problems filling the number of 
doctors we need as a result of the costs imposed by the ACA, 
but also the lack of discretion imposed on doctors of the ACA. 
Doctors want to see that they actually have the ability to make 
decisions, and the more their decisions are constrained, the 
less likely they are to go into the profession.
    Mr. Bishop. What exactly is, what's the biggest regulation 
that doctors face that is causing the most consternation among 
the practitioners that's making them leave the practice almost 
overnight?
    Mr. Troy. So I hear a lot of doctors complain to me about 
the electronic medical records and the way that it forces them 
to look at the screen instead of at the patient. And when you 
look at the patient, that's when you get to make better 
decisions about the patient's health. But I would, also, I know 
we're short on time, I would ask that entire paper that I wrote 
about the ACA's impact on doctors be submitted for the record. 
Thank you.
    Mr. Bishop. Thank you very much, Dr. Troy.
    And I yield back.
    Chairwoman Foxx. If the gentleman from Michigan would like, 
we can insert that study into the record.
    Mr. Bishop. I would. And I move to admit that to the 
record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
     
    Chairwoman Foxx. Ms. Adams, you're recognized for five 
minutes.
    Ms. Adams. Thank you, Madam Chair, and thank you, Ranking 
Member Scott, for hosting today's hearing.
    And thank you to all of the panelists.
    Much of what has been discussed today includes the impact 
of ACA on the health and economic security of our country. 
Repealing it would take away vital health insurance, as we've 
heard, for nearly 30 million Americans, and with more than 129 
million Americans with preexisting conditions would be denied 
coverage.
    Madam Chair, I'd like to ask unanimous consent to enter 
into the record a letter from seven children's groups.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
  
    Ms. Adams. Thank you very much.
    Ms. Schlaack, first of all, you've experienced a terrible 
tragedy. Again, I want to add my thought and sympathy to you 
and your family and commend you for having the strength to 
share your story.
    You describe in detail the impact of ACA in terms of 
coverage both for your daughter and your son, and in your 
testimony you mention that having ACA allowed you to have 
coverage for your daughter without having to quickly go back to 
work simply to get the benefit of health insurance.
    So it does sound like ACA allowed you to be flexible with 
deciding when to go back to work after your husband's death. Is 
that the case?
    Ms. Schlaack. That's correct.
    Ms. Adams. Okay. I also want to raise with you, you know, 
oftentimes with great personal tragedy comes the need to access 
mental health services. Under ACA, more individuals have access 
to such services. As someone who has experienced personal 
tragedy and currently working with those who have, how 
important is that mental health service, such as grief 
counseling, how important is that to be accessible and covered 
under health plans?
    Ms. Schlaack. Thank you. Not only for myself to be able to 
effectively parent and continue on with my life, but also for 
my daughter.
    It is statistically shown that children who suffer a loss 
of a parent or live with a parent with a serious illness often 
have difficulty processing that, and it then translates into 
school issues, behavioral issues beyond their young years, well 
into college, making not necessarily the best choices. And the 
fact that she and I are both able to continue with counseling, 
therapy for our own mental health has been invaluable because 
it is a very expensive service that we couldn't have afforded 
otherwise.
    Ms. Adams. Okay. And so after actually working in this 
field, you believe it's important for other families to access 
it as well?
    Ms. Schlaack. Very much so. I work with groups, peer 
groups, and many times that's not quite enough. A lot of times, 
especially children don't want to talk about things like this 
with their parents, with someone in their home, and they need a 
third party who they can express what they're feeling and help 
them work through the emotions that they often don't even 
understand.
    Ms. Adams. Right. Okay. Thank you.
    So you talked about your son -- or you mentioned it in your 
written testimony -- who was able to stay covered under an 
employer-sponsored plan after serving in the Peace Corps. What 
has it meant to him to have the coverage a young adult starting 
out in the world?
    Ms. Schlaack. Well, as he was right out of -- he finished 
his bachelor's program, went straight to a master's program, as 
we were able to continue to cover him then, so he didn't have 
to work full time and go to school. And then in the interim, 
between graduating and starting the Peace Corps, which he did 
have full coverage from the government as a Peace Corps 
employee, but then once that service was up, he transitioned 
back into the U.S., his benefits stopped.
    And until he was able to attain his own full-time 
employment, which thankfully he does have, I was able to keep 
him covered. So it was one less thing that he -- because, 
frankly, the medical care he could get in Mongolia where he was 
serving wasn't exactly stellar, and he was able to come back 
and have the coverage he had in the past and before he started 
out on his own as an independent adult.
    Ms. Adams. Thank you. And as his mom, I know you have peace 
of mind.
    Thank you very much. I yield back, Madam Chair.
    Ms. Schlaack. Yes. Thank you.
    Chairwoman Foxx. Mr. Byrne, you are recognized for five 
minutes.
    Mr. Byrne. Thank you, Madam Chairman.
    Lady and gentlemen, thank you for being here today.
    Most people expect to get their health insurance through 
their employer. Most people work for small businesses. So the 
topic we've been talking about today and the impact on small 
business is a big deal.
    I represent southwest Alabama. We don't have too many big 
employers. Virtually everybody works for a small business. 
Between 2015 and 2016, for the urban county in my district, 
Mobile County, the increase for small businesses for their 
insurance premiums is 14 percent. That turns out to be about 
$2,000 per employee in 1 year. For small businesses, that's a 
big hit.
    And, Mr. Bollenbacher, I'm informed that you actually had a 
156 percent increase and that you wrote President Obama about 
that. So I would like to ask you, sir, did you hear back from 
President Obama? Have you received any subsidy from the Federal 
Government to help you with that increase? And if you don't 
receive a subsidy and you get an increase of that magnitude, 
what do you, as a small-business owner, what do other small-
business owners that you work with, what do you all do with 
that?
    Mr. Bollenbacher. Yes. I don't think my microphone is 
working.
    Chairwoman Foxx. Turn on your mike, please.
    Mr. Bollenbacher. Yes. I did write a letter to President 
Obama.
    Mr. Byrne. Did you hear back?
    Mr. Bollenbacher. I had somebody call me from the 
healthcare marketplace to the SHOP.
    Mr. Byrne. Did you hear back from the President that you 
wrote to?
    Mr. Bollenbacher. No, I did not, but 156 percent increase 
is not feasible.
    Mr. Byrne. Did you get a subsidy to help you with it from 
ObamaCare?
    Mr. Bollenbacher. No.
    Mr. Byrne. So how do small-business people deal with an 
increase with like that, if the President won't talk to him or 
write him back and won't give him a subsidy like he had given 
in other parts of the program?
    Mr. Bollenbacher. What we were forced to do is look at 
options, and there were no good options. Basically, there was 
one plan that we ended up having to pick, which was a 78 
percent increase. I've had other companies, other clients I 
work with, have dropped their insurance altogether. They just 
cannot afford it. They've laid people off to get under the 
full-time employee equivalent.
    Mr. Byrne. And maybe, Dr. Troy, Mr. Eddy, make you all can 
answer this for me. As a result of this, have we seen a decline 
in the number of businesses and employees working for small 
businesses that have insurance? Have small businesses just 
said, ``Look, we can't afford it''?
    Mr. Troy. I'm not aware of statistics on that specifically, 
but I do know there are concerns among small businesses. And 
I've heard stories, including by some of your colleagues today, 
about limitation of hiring by small businesses as a result of 
the ACA.
    Mr. Byrne. How about you, Mr. Eddy?
    Mr. Eddy. Again, I agree with Dr. Troy. I don't have any 
specific statistics, but I know how it affects us, and it 
curtails our hiring capabilities as well as our capital 
investments, which lead to additional hiring. So we plan, as 
long as we can afford, to cover our employees with as much 
coverage as we can. You know, with the high deductibles that we 
have today and the continuing uncertainty in the future costs, 
I'm not sure how long that will be able to be sustained. Thank 
you.
    Mr. Byrne. Mr. Bollenbacher, I'm sorry you didn't hear back 
from the President of the United States. You wrote him. You're 
a citizen of this country. You have a legitimate concern. And 
you had a right to get a response. He's not President anymore, 
so there's nothing we can do about that.
    Madam Chairman, I really do worry about what's going to 
happen to all these employees in America that work for small 
businesses and want to get their health insurance, expect to 
get their health insurance through their employer, and their 
employers have just gotten to the point where they can't afford 
it.
    And so the employers are left with one or two choices. 
Either they continue to pay the high cost of this, in which 
case they've got to figure out a way to recoup that somewhere 
else, and my fear there is there will be less hiring, fewer 
jobs; or we figure out a way to get some real relief to small 
businesses by getting this incredibly expensive burden off of 
them and let small businesses do what they've done through the 
history of this country, which is grow and prosper and hire and 
provide benefits and good wages to the people of America.
    And I yield back.
    Chairwoman Foxx. The gentleman yields back.
    Ms. Shea-Porter, you're recognized for five minutes.
    Ms. Shea-Porter. Thank you.
    And, Ms. Schlaack, first, let me say I'm sorry for your 
loss, and I understand how challenging it is when there's 
somebody in your family, because I had a family member who had 
decided -- he was a registered nurse, and he decided that he 
wanted to do ministry with music. He's a gifted musician, and 
he wanted to go to nursing homes and work with Alzheimer's 
patients. And so he was able to do that with the Affordable 
Care Act. And then shortly thereafter, he was diagnosed with 
advanced prostate cancer. And the Affordable Care Act saved his 
life, because he had access to treatment. So while our outcome 
was certainly better, it was a terrifying time.
    I am also concerned about small businesses, and so I urge 
my colleagues on the other side to work with us to help to 
reduce the costs and figure out more. The fact that we haven't 
been able to work together I think is a tragedy.
    But since the Affordable Care Act began expanding access to 
health insurance in my home State of New Hampshire, 63,000 
people who didn't have it before have gained that peace of mind 
that we have all been talking about and the financial security 
that coverage provides. Now, their coverage and many others is 
at risk.
    Despite the fact that Republicans have had seven years to 
come up with a so-called replacement plan, the current plan 
looks like repeal and collapse. Insurers make decisions over 
the coming months about whether to offer plans for next year 
and you're still hearing the story, the dog ate my homework. 
The stakes cannot be higher.
    If congressional Republicans go down this road, the Urban 
Institute estimates that 118,000 people in my State alone could 
lose coverage and 30 million nationwide. Just yesterday, the 
Economic Policy Institute released a report that repeal would 
cost 4,600 jobs in New Hampshire. This wouldn't just erase the 
gains that we've made, that would send us backward, and I don't 
believe anybody wants to go backwards here.
    My constituents are deeply concerned, and rightfully so. 
I'd like to read some testimony from two of them. First is 
Jameson from Somersworth, New Hampshire, who shared this, and I 
quote: ``The ACA gave me the opportunity to purchase affordable 
health care when I needed it most. It allowed me to get the 
medical service I needed without me going into more debt or 
standing up time after time after time just waiting in the 
emergency room. Although I'm not a profitable insurance 
policyholder, I surely am a grateful one. Repealing the ACA 
would be inhumane, irresponsible, and outright foolish.''
    And there's Jack from Rollinsford, New Hampshire, who said 
``Before the ACA, I was uninsured due to a preexisting genetic 
condition and high medical costs, struggling to afford even the 
most basic tests to keep myself healthy. Today, I have great 
affordable coverage and the help I need to live a long, 
productive life.''
    So my question to you, Dr. Troy is, today's hearing 
concerns the quote, unquote, ``failed health law.'' What 
benchmarks would you allow Jameson and show Jameson and Jack to 
defend your allegation the healthcare law has failed in New 
Hampshire and around the country? The uninsured rate? Average 
medical debt? The number of plans that have comprehensive 
substance abuse treatment? The number of issuers offering 
coverage in our individual market? Because all of those have 
shown dramatic improvement.
    You work with numbers. Are there any statistics you could 
show Jack and Jameson about access to coverage and care in New 
Hampshire that could possibly support the idea that this law 
has somehow failed to improve health care for my constituents?
    Mr. Troy. Thank you very much for that question.
    I believe and I've written that there are three basic 
metrics for judging whether the law is a success. Number one is 
coverage. While you say that the law has increased the number 
of people covered, that is absolutely true, more people are 
covered subsequent to the ACA, but, A, not as many as the law 
said it would or CBO projected that it would cover. And we 
still do not have the level of universal coverage that I 
believe that we should strive for in this country.
    Number two is costs. President Obama said that the law 
would reduce costs, bring down costs for individuals, bend the 
cost curve down. As Dr. Brat was saying earlier, our long-term 
costs are still quite high, and we've seen very high increases 
in the premiums at the exchanges in recent years.
    And then the third, and I think really the key question 
that will determine whether the American people believe the law 
is a success, is President Obama's promise if you like your 
health care you can keep it. And we have seen disruptions in 
the individual markets that some people have not had the 
coverage they had previously as a result of the ACA.
    And then there are questions that the costs we were talking 
about throughout this hearing imposed on employers. And if 
employers are changing the health care they're providing as a 
result of the costs of the ACA, then the answer to the question 
of that is no.
    Ms. Shea-Porter. Okay. Well, let me stop you there, because 
I'm running out of time. But first of all, the fact that the 
coverage isn't 100 percent but so much closer hardly seems a 
reason for you to complain. It seems to me you would want to 
say, well, that's wonderful, we've expanded coverage and let's 
do even better and get 100 percent.
    And your second point, where the costs have not dropped, 
can you point out anything anywhere, starting from your sale of 
your home or whether you rent or whether you buy groceries, 
anywhere where the costs have dropped? We all know that the 
rate of increase has dropped. And you, yourself, introduced 
some of those numbers earlier in your testimony.
    So I'm not sure what you're saying here. If you're saying 
that I didn't get everything I wished for, and that's how it 
sounds here, I didn't get everything I wished for yet, what 
would be the purpose of going backwards and taking away when 
you've acknowledged that the increase of people who are covered 
went much higher? What is wrong here?
    Chairwoman Foxx. Ms. Shea-Porter, your time has expired. 
And we'll ask Mr. Troy to submit his answer for the record.
    Mr. Troy. I will.
    Ms. Shea-Porter. Thank you. And I yield back. And I would 
very much appreciate an answer to that. And thank you.
    Chairwoman Foxx. Mr. Allen, you're recognized for five 
minutes.
    Mr. Allen. Thank you, Madam Chair.
    And, again, I appreciate the panel participating today. I, 
too, have learned a little bit about what you're dealing with.
    Just 2-1/2 years ago I sat in your seat, Mr. Eddy, as a 
small business and dealing with not only the economy but the 
increase in benefit costs and stagnant wages, which is still a 
major problem. I think that probably, too, we should understand 
that really health insurance benefits came out of the business 
community. In fact, it exploded during World War II when there 
were wage controls and the war board allowed the companies to 
extend benefits, health benefits and other benefits, to compete 
for employers. And, of course, now the government is heavily 
involved.
    And we know that, again, costs are increasing. In fact, I 
have met with lots of groups that are involved in the markets. 
And, of course, the health insurers are getting a little bit -- 
well, they're getting a bad rap because they are blamed for the 
increase. But I know for a fact that most of them submitted 
certain reforms to the administration that would drive down 
costs and they were totally ignored.
    And that brings me to my point here that I want to make 
today. And, again, I don't know if this is the first time 
you've testified here in Congress, but you obviously see the 
very partisan part of what -- in fact, I'm ashamed of it, 
really, of what happens here that we can't come together. We 
can send somebody to the moon, but we can't come together and 
do what's right for the American people, and that's sad.
    But we're going to work on it. We're going to continue to 
work on it. Your testimony is very important to us, and we 
thank you for that.
    With that, again, you've listened to us, and we've listened 
to you. Dr. Troy, I would like to start with you, and just 
we're getting to the end of this. Can you summarize in your 
mind where you see us going and what's best for the American 
people?
    Mr. Troy. Thank you for that question, and I applaud your 
call for bipartisanship. Before the ACA, every piece of major 
social welfare legislation in this country had passed on a 
bipartisan manner, and that's one of the reasons that these 
laws were accepted and the American people moved on 
subsequently. When you have a law passed in a unipartisan 
manner, you have this situation where there's continued 
contentiousness about the law seven years later.
    I would like to see some kind of bipartisan reform going 
forward so that it would be more lasting. I would like to see 
it along the lines of what we were talking about earlier in 
terms of building on the basic building blocks of American 
health care, which includes employer-sponsored care, which 
covers 177 million people, but also works to reduce the overall 
costs, thereby incentivizing people to purchase it on their own 
and not having to do it via mandate. Thank you.
    Mr. Allen. Now, what's important about what you said there 
is incentivize. I learned that in the business world, that the 
best way to get the production from your workforce is to give 
them incentives to do these things rather than mandates.
    Mr. Eddy, do you have any comments about how to solve this?
    Mr. Eddy. I'd be in Congress if I had the ability to solve 
it.
    Mr. Allen. Well, that's the reason I'm here. I'm not sure 
I'm getting anywhere.
    Mr. Eddy. As I said, I depend on you all to work together 
to do this.
    But along with the repeal of the taxes, I'd like to see us 
consider reducing some of the reporting requirements. The 
mandates generate a lot of reporting requirements, a lot of 
compliance issues.
    Also, the greater flexible. I'd like to see the proposals 
and see options and flexibility improved.
    Thank you.
    Mr. Allen. Ms. Schlaack, my heart goes out to you for your 
loss.
    Ms. Schlaack. Thank you.
    Mr. Allen. What is your recommendation knowing that we're 
$20 trillion in debt. And you've got a child. I have 12 
grandchildren. How do we do this?
    Ms. Schlaack. Again, fortunately, I'm on this side and not 
yours -- your side of this table, I'll put it.
    But, I mean, to have a productive, efficient workforce you 
need healthy, happy employees, mentally and physically. And I 
know it's dollars and cents, but it comes down to loyal, 
healthy employees that you can count on to be at work and to 
maintain their job.
    Mr. Allen. Let the record show that maybe was the most 
important thing that was said here today at this hearing.
    Mr. Bollenbacher.
    Mr. Bollenbacher. I believe for small businesses we need 
options. We need flexibility. We need more than one choice to 
provide for our employees.
    Chairwoman Foxx. The gentleman's time has expired.
    Mr. Allen. I yield back.
    Chairwoman Foxx. Mr. DeSaulnier, you're recognized for five 
minutes.
    Mr. DeSaulnier. Thank you, Madam Chair.
    Let me start at the beginning, just agreeing to the 
comments by my friend from Georgia and by the chair. It would 
be wonderful if we could approach this more in a problem-
solving perspective, acknowledging that we have philosophical 
differences as to how to accomplish that. And I say that from 
the perspective of being a small-business owner for over 35 
years.
    Mr. Bollenbacher, I hesitate to use this phrase, but I feel 
your pain. I owned restaurants in the bay area for a long time. 
And before the ACA, one of the problems I had was the cost, 
that it was going up. So for my employees, who I was able to 
pay 100 percent of their costs, I found situations before the 
ACA where I had a manager come to me in tears because she 
couldn't afford the copay. I contributed the copay.
    So when we compare this and Dr. Troy, I would like to go 
back to the ranking member's comments and how we get to a 
perspective of more problem solving in a bipartisan fashion as 
you affirmed would be preferable.
    But in addition to owning a small business, Ms. Schlaack, I 
also have great empathy for your perspective as a survivor, so 
far, of incurable blood cancer. I, fortunately, had insurance 
that I paid for, that has helped me pay for the very large 
costs for my treatment.
    I will say, and I'd be curious about your experience, but 
perhaps just personally, as to the question about electronic 
records. There's somewhat of a joke about those of us who have 
gone through treatment, and I tease my oncologist that I see 
more of his back as he looks at my CAT scans and my blood. But 
he will say, but that's where the information is.
    So understanding that there's a process to introducing 
technology and understanding that we should have done it faster 
when it came to electronic records, there's still a long term 
and a short-term benefit for me. I'm an example of it.
    And at some point, a wonderful book, ``Rise of the 
Robots,'' where they talk about automization. And for 
specialists in the medical field, I always ask when I go out to 
research facilities: How much is the oncologist in my case 
interpreting the results of my examinations and how much is a 
computer interpreting it and telling him or her what the 
diagnosis should be and what the treatment should be? And what 
I always get is over the course of time the computer is doing 
more and more of that work.
    So to Dr. Troy, to follow on the ranking member's, if we're 
going to be rational about this, more than opinion, an opinion, 
even research that's based on a biased perspective, from my 
experience it would be better to look at where other similar 
examples have worked historically and where they work right 
now.
    So in the industrialized world, one of the reasons I was so 
supportive of ACA and supportive of universal health care and 
Medicare for all, is that that's my perspective of who we 
compete with. And most of those countries that we compete with, 
their percentage of costs of health care is smaller than their 
GDP than the U.S. and their outcomes have historically been 
better -- Mongolia not included in this, by the way.
    So the ranking member's question about if your theories are 
in play right now and practiced in a similar industrialized 
community, where is it? What can we learn from that? And why 
can we be so certain that your suggestions will worked when 
they are applied to a very complex country?
    And I'll just say, lastly, from my perspective having been 
very involved in the implementation in California when I was in 
the legislature, we had huge struggles. We continue to have 
huge struggles. We worked with the California NFIB. We delayed 
some of the requests in the mandates on small businesses. As a 
small-business person, I wanted to make sure that they didn't 
incur undue burden, as my friend from Alabama said.
    So in the short time left, maybe you could just elucidate a 
little bit on your response from the ranking member. If you're 
going to be rational and evidence based and rely on as much 
empirical, nonbiased research as possible from either 
perspective, it would suggest to me that we go to places that 
have implemented health care, dealt with this, and either from 
your perspective, being more market based or more driven closer 
to universal health care, where has it worked and where hasn't 
it?
    Mr. Troy. Thank you very much for your question. I 
certainly try to avoid the word ``certainty'' when it comes to 
public policy, because I think it behooves us to have modesty 
in our approaches and not be completely certain about anything 
about the previous policies or going forward.
    One of the reasons we spend more on health care is that we 
are, in many ways, a more generous country. We spend dollars 
until the last minute of life in ways, and some of these 
countries, some of our Western allies do limit treatments at 
the last hours of life in ways that we don't.
    The results are certainly mixed. To some degree, we do have 
lower life expectancy, but part of that is unfortunately due to 
higher road deaths and higher gun deaths. So there are other 
factors at work.
    I don't have the perfect plan in another country. I have 
seen some positive results from Singapore, which does have 
people have some kind of catastrophic plan and also combines it 
with some kind of has that can be transferred generation to 
generation, and that has showed some impact in moderating 
healthcare costs. But, again, Singapore is a small homogeneous 
country, and obviously, we are a very large heterogeneous one. 
So it is, obviously, a difficult public policy conundrum.
    Mr. DeSaulnier. Thank you, Dr. Troy.
    And thank you for indulging me, Madam Chair. I have some 
articles on the Treasury report issued on January 12 that I 
would like to submit for the record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
      
    Chairwoman Foxx. Mr. Grothman, you are recognized for five 
minutes.
    Mr. Grothman. Okay. Mr. Bollenbacher, you are kind of what 
I think was going to happen until the ACA stepped in. You are 
somebody who, the way it is described, for a relatively small 
employee -- what, 11 employees over there? -- you are doing a 
great job of managing your costs.
    I'd like to know what your costs per employee was or did 
you feel you had your costs per employee under control with a 
combination of HSAs and giving some money toward your 
employees?
    Mr. Bollenbacher. Yes, I do. We were seeing increases, you 
know, 8 to 12 percent. The health savings accounts the 
employees really liked. They were able to save money to put 
away for those future unexpected claims. It was manageable for 
us to continue that.
    Mr. Grothman. And your costs were still going up 8 or 9 
percent?
    Mr. Bollenbacher. I'm sorry?
    Mr. Grothman. Your costs were still going up 8 or 9 
percent? Or you felt you got your costs under control with a 
combination of HSAs and --
    Mr. Bollenbacher. Yes, sir.
    Mr. Grothman. Okay. So you were happy to live with the 8 or 
9 percent.
    Mr. Bollenbacher. A lot better than 156 percent.
    Mr. Grothman. Okay. And is that after the ACA kicked in or 
before?
    Mr. Bollenbacher. The 8 to 12 percent was before. We were 
seeing 156 percent last year.
    Mr. Grothman. Right. Okay.
    I'll go to Mr. Eddy. There are a variety of problems that 
business has. And I don't know whether I caught how you're 
handling your healthcare costs. But could you give us in 
general the type of plan you were offering your employees 
before the ACA kicked in?
    Mr. Eddy. It was a common plan with a thousand dollars for 
a single and a thousand-dollar deductible for the family plan. 
As I said, it was about $13,500 per year for the family plan. 
I'm not sure how to describe the plan, but it was full 
coverage. We paid the entire amount of the plan for our 
employees.
    Mr. Grothman. Okay. Do you know, and I guess this is either 
for you or Mr. Bollenbacher, have you or other people involved 
in NFIB -- are you with NAM? Is that what you're involved with?
    Mr. Eddy. Yes, I'm here with NAM.
    Mr. Grothman. Right. Stories of employees being conscious 
or other employers being conscious of both a desire to hold 
employees' hours below 30 hours or employees conscious of the 
cliffs in which they're going to lose their subsidies? Have you 
heard stories like that?
    Mr. Eddy. Well, I've heard the stories, but we don't -- you 
can't experience that. That's not something that I think is 
pretty common.
    Mr. Grothman. Okay.
    Mr. Bollenbacher. Yes, sir. I've been dealing with that 
almost on a daily basis where my self-employed clients, the 
farmers, the pastors at churches, where they're right at that 
cutoff, and it's a cliff. And if they go over that cliff, they 
may pay $7,000 or $8,000 back, and it hurts them badly.
    Mr. Grothman. Bingo. I'm glad you're a CPA. Because that's 
what we want. At first I was thinking I was asking you as an 
employer. But I'm not asking you as an employer. I'm asking you 
as a CPA. So you see that your customers, the people you fill 
out tax returns for, are conscious of the fact that they cannot 
make more money. Or, in other words, they are maybe 
artificially holding down their compensation to make sure that 
they don't hit the cliff.
    Mr. Bollenbacher. Absolutely. It's a big number for most of 
my clients.
    Mr. Grothman. Okay. And do you find employees sometimes 
conscious of that as well?
    Mr. Bollenbacher. Not as much as the self-employed. But, 
yes, I have had individuals where they're an employee, they get 
a paycheck, maybe they sell some stock, and it puts them over 
the cliff, and all of sudden they owe $2,000 or $3,000 back 
that they weren't expecting.
    Mr. Grothman. Okay. Mr. Troy, you talked about the 
different taxes out there. I think you talked about the -- oh, 
the Cadillac tax and that sort of thing. And you advocate 
repealing them. But what would happen if we repealed them? 
Would that make ObamaCare that much more fiscally impossible?
    Mr. Troy. I do believe that the Cadillac tax does not bring 
in nearly as much revenue as the CBO or the JCT, Joint 
Committee on Taxation, suggests it would. I think that the 
Affordable Care Act has a lot of spending itself. And so if the 
committee goes forward and the Congress goes forward with 
repealing it, along with the taxes, then it wouldn't make the 
ACA more fiscally responsible, but it would reduce both the 
costs and some of these revenues from taxes.
    Mr. Grothman. I guess the point I'm trying to make is if we 
repeal the taxes, the money is going to have to come from 
somewhere else, Right?
    Mr. Troy. If you maintain the ACA as it is, but just minus 
taxes. But I don't think that's a working plan on the table.
    Mr. Grothman. Right. But that is what would happen. I mean, 
when people talk about continuing the ACA, if you continued the 
ACA and got rid of these harmful taxes, the money would have to 
be made up from somewhere else, correct?
    Mr. Troy. As with any program, yes.
    Mr. Grothman. All right. Okay. Thank you for --
    Chairwoman Foxx. Thank you. The gentleman's time has 
expired.
    Mr. Courtney, you're recognized for five minutes.
    Mr. Courtney. Thank you, Madam Chairman.
    So at midnight last night this enrollment period for 2017 
came to a close. This morning I checked in with the folks in 
Hartford about how the final numbers came in. The answer that 
came back is that we just about pretty much held steady in 
terms of last year's enrollment. It was a little bit of a dip, 
partly because they didn't use insurance agents to help with 
enrollment, which they're going to reverse that for next year. 
That was a bad move they made. But nonetheless, I mean, it 
pretty much held steady.
    And I make that point just because we've heard a lot of 
talk today and over the last few weeks about whether or not the 
law is in a death spiral. There was an interview recently that 
was reported with the American Academy of Actuaries, which I 
think we would all stipulate doesn't have a partisan bone in 
its body, about whether or not in fact there is a death spiral 
going on, and Cori Uccello, the organization's senior health 
fellow, answered, ``I don't see any evidence of that happening 
right now. The problem with the argument,'' according to 
Uccello, ``is that ObamaCare's enrollment is actually holding 
steady and not dropping off.'' And we know that from the 
national exchange as well. A death spiral is when people really 
start running towards the exits, and it just concentrates the 
sickest in the pool. And as Uccello points out, the age 
distribution for 2017 is pretty much holding steady.
    In my district, which we've driven the uninsured rate down 
to 3.6 percent, I think it's almost the lowest of any member's 
district on this committee, and that's because of a grassroots 
effort with libraries, community health centers, hospitals, 
insurance agents up until last year, who really just flooded 
the zone in terms of trying to get people help and assistance 
that took place.
    And I would just share this, because as a former employer I 
think the description of your problem is exactly the sore spot 
that we need to address, Mr. Bollenbacher. But, frankly, it is 
not a monolithic story that's out there.
    Willimantic Waste, which is a trash hauler in my district, 
they have about 200 employees, I got a letter from the HR 
director who indicated to me, and I'll just read it quickly, 
``I was skeptical about the claims that the ACA would help 
level out the cost of our company-sponsored health plan. But 
the numbers have come in, and over the past three years we have 
seen a decrease or no increase in our premiums every year. 
2015, minus 2 percent. 2016, minus 1 percent. 2017, zero 
percent.''
    And, again, I'm not saying that to diminish your comments. 
But the fact is it is really not monolithic that's out there. 
And what we ought to be doing is focusing on questions about 
whether to have a reinsurance mechanism, which was in the bill 
and unfortunately got stripped. It was part of the Republican 
Medicare Part D plan as a way of leveling off premiums through 
that. Very successful. We use it for flood insurance.
    Again, and this is coming from Connecticut where we have a 
lot of insurance companies, that's the biggest weakness that 
they identify in terms of why the 2017 spike increased. But 
Standard and Poor's even then said it appears to be just a one-
year phenomenon.
    So, Madam Chairwoman, I would like to submit this story 
from the Academy of Actuaries, as well as Willimantic Waste 
paper for the record.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    Mr. Courtney. Thank you.
    And just to go back to -- I mean, one bipartisan ray of 
hope here is on the Cadillac tax. As many know, we teamed up 
last year on a bipartisan basis, pushed it back to 2020. A 
bunch of us did it back in 2010 and pushed it out to 2018. But 
nonetheless, I mean, there is, again, a strong feeling that 
this is a really totally inefficient way of trying to 
accomplish some type of goal, which is really just to shift 
costs to businesses and employees.
    And I would just say, Dr. Troy, I mean, you point out that 
the CBO study, it really is not a traditional tax analysis. 
It's assuming an income windfall that will happen as employers 
don't incur as much costs in terms of paying higher premiums. I 
just wonder if you could comment in terms of really -- there 
really is no study that has ever really demonstrated that sort 
of backboard basket that they're describing, is it?
    Mr. Troy. Thank you so much for that question, Mr. 
Courtney, and I would like to applaud you for your bipartisan 
efforts to eliminate the Cadillac tax. Thank you for that.
    We have done a number of studies at the American Health 
Policy Institute about the deleterious impact of the tax, and 
we looked very carefully at this question of how much revenue 
it would supposedly raise. In doing so, we found that not only 
would it not bring in as much revenue as the CBO and the JCT 
projected, but also that to the extent that it is imposed and 
employers are trying to reduce costs in reaction to it, that 
the reduced costs are not necessarily going to employees as the 
CBO study projects or assumes. We talked to employers, and 71 
percent said that it would not lead to increased wages. So I 
just think it's on unfounded assumptions.
    Thank you for your leadership.
    Mr. Courtney. Thank you. H.R. 173, and I think we could do 
it on the consent calendar if it was brought up tomorrow. Thank 
you.
    I yield back, Madam Chairman.
    Chairwoman Foxx. Thank you very much.
    Mr. Thompson, you're recognized for five minutes.
    Mr. Thompson. Madam Chair, thank you for this hearing.
    As someone who arrived in Washington to serve in January of 
2009 when this original -- and I won't say it was even a 
debate. I came here with 28 years of healthcare experience, 
nonprofit community healthcare experience. In my time off, I 
volunteered as an EMT, showing up at the homes of my neighbors 
at all times of the day and night -- or mostly the night when I 
was home -- to respond to healthcare needs.
    And there was no debate in 2009. In fact, those of us who 
came here, and there was a lot, my good friend from Tennessee, 
Dr. Roe, came here as a physician, there was a lot of us with 
healthcare experience. A lot of friends across the aisle who 
had great experience. None of us were welcomed to the table. 
And we wound up with this very partisan legislation that was 
shoved down the throats of the American people.
    So I appreciate this hearing. I think this is a part of a 
dialogue that we have had for some time with the American 
people, but also among ourselves. I respect that there are 
differences. But the fact that we are proceeding in a way with 
transparency to do better.
    I happen to believe that our Nation's healthcare policy 
should be one that promotes the healing and the health of all 
Americans without hurting millions. And that's not what we have 
today.
    And I also believe this debate should be conducted based on 
facts, not fear. So I really caution all my colleagues, and 
especially those across the aisle that I've heard just in the 
past few days, it's been about the fear, driving the fear. That 
doesn't help this process.
    One of the things I heard was that we have no plans. And so 
I want to -- I'm going to be offering this, request unanimous 
consent for the record. But this is a submission for the record 
I have. This is a compilation of replacement plans or 
improvement plans or whatever you want to call it, plans for 
health care.
    Just some of the titles on this first page: Patient Freedom 
Act, Obamacare Replacement Act, A Better Way: Our Vision for a 
Confident America. It's more of a vision. Patient Choice, 
Affordability, Responsibility and Empowerment Act. H.R. 5284, 
the World's Greatest Healthcare Plan Act. That was creative, I 
guess, in title. Empowering Patients First Act, which by the 
way, was a version of something that I had cosponsored back in 
2009, before the Affordable Care Act came out of the back 
offices here in Washington, and that's been introduced in both 
the House and the Senate. And the American Health Care Reform 
Act, which actually the prime author of that is my good friend 
from Tennessee, Dr. Roe, that he referenced. That's page one of 
six.
    So I request unanimous consent to present this, a list of 
detailed plans on how to reform the health sector for Members 
of Congress. Some of these are from Presidential candidates, 
some scholars and think tank community, and other top 
conservative thought leaders.
    Chairwoman Foxx. Without objection.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
       
    Mr. Thompson. Thank you, Madam Chair. I really do 
appreciate that.
    I have some questions. I have some concerns in terms of 
access. My observation is just because you have coverage 
doesn't mean you have access to health care. And I think that 
was the flaw of the Affordable Care Act. It focused on health 
insurance, not health. And I just look at premiums and -- I'm 
sorry, deductibles. I mean, we can look at it all differently. 
But the deductibles, which we really haven't talked about 
today.
    It was reported to me about a constituent I have that was 
recently diagnosed with cancer, that because his deductibles 
are so high today, dramatically higher than what they were, 
grew faster than what they should have, he's made a conscious 
decision not to pursue care or treatment because when he looks 
at that annual deduction, at his age, he would really like to 
be able to pass something along to his children and 
grandchildren. That's an awful situation that we have put that 
individual in with these deductibles. And, again, you can have 
a card in your purse or your wallet that says you have 
coverage, but do you really have health?
    So I like this debate we're having, and I look forward to 
it. And I've managed to use all of my time, but Dr. Troy, you 
mentioned innovation and flexibility in employer-sponsored 
benefits can help reduce the cost of health care for employees, 
retirees, and dependents. Can you give me just one example of 
that innovation?
    Mr. Troy. Sure. So just one example, right now I have been 
working with a group of employers on something called the 
Health Transformation Alliance. This is a collection of over 30 
employers who are working together, sharing data, looking at 
how to proceed based on actual facts and data -- we talked 
about that here in the panel -- in a way to improve the health 
of employees. And then they're going to go forward with a 
pharmaceutical initiative, a medical network initiative. And 
based on the data that they come together with, in order to get 
better results and better costs.
    Mr. Thompson. Thank you, Chairwoman.
    Chairwoman Foxx. The gentleman's time has expired.
    And I recognize now, Mr. Mitchell, who's been very patient.
    Mr. Mitchell. Thank you, Madam Chair.
    Actually the witnesses have been very patient, and we 
should commend you for your endurance if nothing else. Thank 
you for being here.
    I am from Michigan. We have 15 counties that have one 
insurance carrier right now. Another 25 have only two. Eighty 
percent of the plans in Michigan are much narrower now in terms 
of providers than they were in 2007.
    Dr. Troy, is there any mechanism within the ACA or any hope 
within ACA that situation will improve in Michigan, which is, 
in fact, a national phenomenon as well? Do you see anything 
coming out of ACA that could possibly fix that?
    Mr. Troy. I don't see anything coming out of ACA that would 
fix that. I mean, ACA is kind of a static thing right now, and 
the conversation right now is not about putting something, a 
new mechanism into ACA that would lead to those improvements 
that you're seeking.
    Mr. Mitchell. I'm not sure we could identify a new 
mechanism which would cure that. But, yes, I don't see anything 
there either.
    Before I joined this esteemed body, I was the CEO of a 
midsize company, not a small company, a little larger than 
yours. The impact, however, was similar in that year one, 
health insurance costs are going to go above 50 percent in year 
one, not quite 157 percent.
    Question for the two employers in the group. How did you 
manage the cost increase within your price and your operating 
structure? How did you manage that cost? I doubt you were able 
to pass that on down the chain. How did you manage that?
    Mr. Eddy. Again, the timing couldn't have been worse. As 
was stated, I've been with the company 21 years now, and I 
started as the new CEO, president and CEO, on January 1, 2009. 
I'd heard a lot about the potential for the Affordable Care Act 
coming. We saw our premiums, our deductibles, you know, the 
mandates, the costs. Again, I'm not sure how you manage without 
-- with uncertainty. I mean, you know, one of my sayings to my 
management group is, as we lose control, increase your options. 
Okay? And ACA took all of that away. So that really took one of 
my management philosophies away.
    But when you're looking at annual increases in the mandates 
and the health care, the health insurance industry fees, you 
know, 3 percent per year of our premium costs increasing, 2.5 
percent per year from the mandates changes. And these have 
continued. It's not a one-time increase. These are annual 
increases.
    Mr. Mitchell. Were you able to just pass those costs along, 
Mr. Eddy, to your consumers?
    Mr. Eddy. We have not had the ability to increase our 
prices for the last five or six years because we haven't seen 
any GDP growth, so our company hasn't grown but maybe 2.5 to 3 
percent on average. That's in revenues. Our profitability is 
down significantly. With the increase in the mandates and 
insurance and taxes and fees is one thing, but the others are 
the increases in premiums. It's taken away, as I said, I would 
like to have grown significantly more than we have. We have had 
the ability to increase our international markets, but we 
haven't been able to do that as fast as we would like to.
    Mr. Mitchell. Another question, Mr. Bollenbacher or Mr. 
Eddy. We talked a little bit briefly, a colleague talked about 
deductibles. We haven't talked about much of that here. I know 
I've seen the deductibles go wild for myself and the people 
close to me. What's been your experience in terms of deductible 
costs, the increases of the last several years?
    Mr. Bollenbacher. The deductibles I'm seeing have increased 
from 5 to 8, up to 12,000 recently.
    Mr. Mitchell. In your opinion, I mean, you're close to your 
employees, does that adversely impact their willingness or 
ability to actually access care? I agree with my compatriots 
that health insurance doesn't mean you can access health care 
these days. What impact does it have on your employees?
    Mr. Bollenbacher. It definitely does. It's a big hurt for 
them.
    Mr. Mitchell. Mr. Eddy, any feedback on that?
    Mr. Eddy. Well, we're a little different. Again, we have a 
fully employer-funded HRA, the Health Reimbursement Accounts. 
So it's a little different for our employees. We still cover 
100 percent of the deductible.
    Mr. Mitchell. That's admirable and not commonplace, I don't 
think.
    Mr. Eddy. Again, it's admirable, and it creates a lot of 
challenges, and we know it's not sustainable.
    Mr. Mitchell. Thank you.
    And I'll yield back, Madam Chair. Thank you very much.
    Chairwoman Foxx. Thank you very much.
    Mr. Lewis, you're recognized for five minutes.
    Mr. Lewis. Thank you, Madam Chair. I'm so glad we're 
talking about employer-sponsored care today and the effects the 
ACA has. I do want to talk a little bit about the individual 
market that has been hit the hardest. If, in fact, you look at 
Minnesota, it's been hit the hardest. The State of Minnesota 
had to just do an emergency $310 million subsidized premium 
plan. We'll call it that. So when we look at what repeal and 
replace might look like or repeal and repair or fix might look 
like, we know what the status quo looks like.
    Before I came to Congress, I was a sole proprietor like 
many of your member businesses. I went through three insurers 
in 5 years. My premiums tripled to the point where we were 
paying $2,200 a month for a $10,000 deductible. A lot of folks 
here have said health insurance is not health care access, and 
that's certainly true. Has that been the experience of some of 
your members?
    Mr. Bollenbacher. Yes, it has. And I would add that before 
the ACA most of my clients had insurance, if not all of them 
had insurance, and many of them have been dropped from their 
insurance and been forced to go in the marketplace.
    Mr. Lewis. Let's talk a little bit about the employer-
sponsored market, because it hasn't just been the individual 
market. The 10 essential wellness benefits, the minimum amount 
of coverage that came down from the ACA so that you as business 
men and women had to buy this particular plan that the ACA 
dictated. Repealing some of those, Mr. Eddy, would that solve 
some of the problem, repealing some of those mandates?
    Mr. Eddy. I believe that it would, Congressman, yes. Again, 
that is one of the options that we're looking to improve upon, 
having that as maybe another option that we can choose from.
    Mr. Lewis. You know, this committee and this Congress is 
dedicated to making certain no one slips through the cracks. 
We're going to have high-risk pools or some mechanism for 
people with preexisting conditions. But I want to get your take 
on portability and how that applies to people who have that 
very real problem of preexisting condition and can't get 
coverage.
    When people get their insurance at work and they work 30 
years or 25 years, and then they get a little older like me and 
a little sicker, and then they lose their job, they're thrown 
into that individual market, and now they're trying to buy 
insurance for the first time and telling the insurance 
industry, well, I'm going to have a lot of claims here, but I'm 
just starting my premiums. If we could unlock some of that tax 
advantage from the corporate side to the individual side, would 
it increase portability and solve some of that problem?
    Dr. Troy, go ahead.
    Mr. Troy. Yes, as I was saying in my testimony earlier, 
that some of the Republican plans call for something along the 
lines of association health plans, which would allow 
individuals to band together and purchase health care in a tax-
preferred way in mechanisms other than just through their 
employer. That would include your civic organization, your 
religious organization, perhaps your union. And I think that 
would help unlock the job lock you're talking about and also 
provide possible additional portability.
    Mr. Lewis. Mr. Eddy.
    Mr. Eddy. Obviously I think it's a good thing to be able to 
have portability supportive of the preexisting, you know, not 
having preexisting conditions. So, yeah, I think that would 
help tremendously.
    Mr. Lewis. And of course the best way for people to be able 
to afford health care is to have a good, robust, productive 
job. And to the degree that these sorts of regulations, 
including the ACA, have hindered the economy and hindered your 
ability and your members' ability to employ people, that has a 
real impact on health care access too, does it not?
    Thank you all. I yield back my time.
    Chairwoman Foxx. The gentleman yields back.
    We were expecting Mr. Smucker, I believe. And there he is.
    Mr. Smucker, you're recognized for five minutes.
    Mr. Smucker. Thank you, Madam Chair.
    I appreciate the testimonies from all of you. I can tell 
you businesses in my community, I've been out throughout the 
last year during a campaign talking to individuals and 
businesses, and then just recently during one of our weeks back 
in the district met with a few businesses, the Affordable Care 
Act and the impact on health insurance in their organizations 
and for their employees is top of the list in terms of their 
concerns about issues that will impact their ability to 
continue to do business as they have in the past.
    They're very worried -- I'm thinking of one husband and 
wife who own a company, about 15 employees, who see their 
employees as a family, and then being able to help provide for 
their medical needs is an important part of sort of how they 
feel about their employees and the makeup of the company.
    And so I'm glad that this is a top priority for us here, 
and I look forward to building a better healthcare system, 
working with everyone here to build a system that will work for 
everyone.
    Dr. Troy, as you know, ERISA is the backbone of the 
employer-sponsored healthcare system that we're talking about. 
Since 1974, it has allowed multistate employers to offer 
uniform benefits to their employees across the Nation, reducing 
costs and allowing for innovation. ERISA's preemption of State 
laws is a key component in the law and one that you said needs 
to be strengthened. As we consider reforms to the healthcare 
system, how would you recommend the committee strengthen the 
ERISA preemption?
    Mr. Troy. Thank you very much for that. A good question.
    First of all, ERISA significantly reduces administrative 
costs by allowing multistate employers who self-insure to offer 
a uniform set of health benefits that are generally not subject 
to the 50 different State laws. So in terms of strengthening it 
going forward, we have been concerned about the increase in 
State fees and taxes on self-insured health employer benefits 
in recent years. Some States have imposed fees on healthcare 
claims of self-insured employers, including Alaska, Kentucky, 
Maryland, Massachusetts, Rhode Island, Vermont.
    So we're concerned about those kinds of taxes going 
forward, and we want to make sure that as we talk in the ACA 
repeal and reform effort about ways to use State flexibility, 
which I applaud, that we make sure that we still maintain the 
ability for employers to have better ERISA preemption.
    Mr. Smucker. Thank you very much. I appreciate that.
    And, again, I'm very much looking forward to working with 
my colleagues and this committee, with the chair, and with 
other Members of the assembly to rebuild an effective 
healthcare system where everyone can have access to the health 
care that they need at a price that they can afford and with 
the doctor that they choose.
    Thank you.
    Chairwoman Foxx. Do you yield back?
    Mr. Smucker. I do.
    Chairwoman Foxx. Thank you very much.
    Well, even though I think I have the very best questions, I 
saved mine to the end so that if people want to be going other 
places, they can do that since I know I'm going to be here 
until the end. So I want to say again thank you to all of our 
witnesses for being here.
    Mr. Bollenbacher, yours is a story we've heard over and 
over again. The healthcare coverage you had as a small business 
before ACA was working for your company and what your employees 
wanted. However, the ACA forced you out of that coverage -- 
several times, in fact, as you've described -- and added costs 
and burdens of lesser coverage.
    Can you tell us what your employees liked about the 
previous coverage that you're not able to offer them today 
because of this failed law?
    Mr. Bollenbacher. The plan we had before met their needs. 
It was affordable. They really liked the health savings account 
feature. Most of my employees are fairly young, fairly healthy, 
and they were able to put money away. As an employer, we put in 
up to $3,000 per year to their accounts. Even when one lady had 
a baby, she had money in her has to help pay for that, so she 
had no money out of pocket.
    Chairwoman Foxx. So it sounds as though what they liked is 
having control, more control over their healthcare dollars and 
their healthcare costs than is available to anyone under the 
ACA?
    Mr. Bollenbacher. Yes, ma'am. That's correct.
    Chairwoman Foxx. That's wonderful. Thank you.
    Mr. Eddy, you mentioned in your testimony that one of the 
most challenging aspects of the ACA is the effect that it's had 
on your employee-employer relationship. Most employers fiercely 
protect that relationship and do not want to do anything to 
harm it. Can you talk about how the ACA forced this tension 
between you and your employees? Did your employees understand 
that it was the ACA and the Federal Government placing new 
requirements and costs on the company that was forcing you to 
make difficult decisions?
    Mr. Eddy. Of course I tried to educate our employees, but 
more specifically our United Steel Workers Union, that their 
best interests as always are our best interests and that we try 
to take care of them.
    The tension obviously arose when we were trying to 
negotiate an increase -- or actually not an increase, but for 
the first time ever that they would have to copay a little bit. 
And with that, they know because I told them that it was ACA, 
but they look to us to take care of them. So from their 
standpoint, it was a company responsibility to take care of 
that.
    We have had a situation where for years since I've been the 
CEO, I see every employee on the floor on their birthday, as 
well as many other days during the year, and they were 
impressed with that. But after the negotiations on our last 
contract and having to implement, and even with the staff rep 
agreeing to it, a little bit of copay, again, $35 per pay, 
there were several folks that felt that we let them down. And 
explaining to them that the cost increases were not -- we 
couldn't sustain as a company, obviously the union agreed to 
it. But we also had to increase their pay rate over the life of 
the contract 4 years to help offset those costs. So it cost us, 
but, again, we were trying to incorporate more accountability 
for them.
    Chairwoman Foxx. Thank you.
    Dr. Troy, there were some comments made about other 
societies in the world these days who provide, quote, ``free 
health care'' to their citizens. And you mentioned Singapore 
being a rather homogenous society, much smaller than we are. 
We're often compared to Switzerland. I don't know the exact 
population of Switzerland, 7 million people or something; 
Canada, 35 million people. We have about 300 million people.
    Is there any other similar culture to ours that provides 
free health care, quote, ``free health care'' to its citizens.
    Mr. Troy. Look, we are a unique Nation. I am a proud 
believer in American exceptionalism, and I know that we are 
different. We have also tried to be more reliant on private 
sector health care and market. We are not completely there 
because it's a mixed system. So I think it is hard to compare 
our approach to different countries and say we should adopt, 
let's say, the British model or the Canada model. Even though 
we are close friends with those nations, we have different 
systems, and I don't think their systems would work if imported 
here.
    Chairwoman Foxx. Thank you very much.
    I would like to thank again our witnesses for taking the 
time to testify before the committee today. Other members have 
said to you thank you and that being here does make a 
difference, and I would like to say that to you also.
    I would now like to recognize Ranking Member Scott for his 
closing remarks.
    Mr. Scott. Thank you, Madam Chair, and thank you for having 
this hearing. It gives us an opportunity to flesh out many of 
the problems. This one witness said we all want less cost and 
more flexibility. We have a plan, the Affordable Care Act, 
where the costs have gone up, but the studies have shown the 
costs have gone up at about one half the rate they've been 
going up before. People with preexisting conditions can get 
insurance at the standard rate. There are no lifetime or annual 
caps on coverage. Women aren't paying more than men. And 
instead of millions of people losing their insurance every 
year, 20 million more people have insurance than they did.
    There are improvements we know we can make. We could insert 
a public option so in those States where the competition isn't 
what it should be, you would at least have an opportunity to 
buy the equivalent of a Medicare card. Or you can go to a 
single-payer plan, which would get the health care out of the 
employer costs. There are a lot of things we can do.
    But we still have complaints about the present situation, 
but it's hard to debate when there is no credible alternative. 
One thing that is conspicuously omitted is, well, what could we 
do better? We have heard about the problems with small 
businesses. We didn't hear about the horror stories of small 
businesses if one of your employees happened to have diabetes 
or you had extremely high costs, you were unlikely to get 
affordable health care under the old days. Now you can get it 
at the standard rate.
    But what is the alternative? We haven't heard that. We have 
seen some initiatives taken by this administration that have 
been counterproductive. We had an executive order right after 
the inauguration which essentially suggested a repeal of the 
Affordable Care Act without details, causing great concern and 
confusion in the insurance market. We have the executive order 
on immigration which, as many of the hospital associations have 
indicated, disrupts their ability to get students and 
professionals from other countries. We had the ads pulled at 
the last minute, making it more likely that the healthy, 
younger enrollees might not get the word and might not enroll. 
That just increases the costs for everybody.
    So we have a lot of work to do. But until we have some 
credible alternatives, it's hard to have a coherent debate. I 
would just hope that we would agree that we're not going to do 
any repealing until we have a replace ready to go, and if that 
is the discussion, we have something to talk about. But if the 
idea is to repeal and inject total chaos in the insurance 
market, making it likely that nobody can buy insurance, we're 
not going to be very cooperative in that effort.
    So, Madam Chair, thank you for having the hearing and 
allowing these issues to be voiced.
    Chairwoman Foxx. Thank you, Mr. Scott.
    I also am going to enter into the record some facts about 
our situation before the Affordable Care Act and during the 
Affordable Care Act, key facts on ObamaCare and health care. 
There have been so many numbers tossed about here. Your 
members, you've just said 20 million more people have gotten 
health insurance, but your Members have thrown around the 
number 30 million are going to lose their insurance. So it's a 
little difficult to keep track of all of these numbers that are 
being thrown around. But I do intend to put a fact sheet into 
the record today.
    [The information follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
       
    Chairwoman Foxx. Forty-eight million Americans did not have 
health care before the Affordable Care Act. I happen to have 
the numbers on that, and I'll be entering that into the record. 
I think I just heard you say again that there are no credible 
alternatives, and yet Mr. Thompson just sat here five minutes 
ago and presented six pages of bills that have been presented 
as credible alternatives. So I think we have to constantly do 
fact-checking around here to give the real facts about what's 
happening.
    Ms. Schlaack, I want to say, along with my colleagues, that 
we're sorry for your loss. But I was very intrigued in your 
comments that all of the examples you used about the great 
coverage that you got came under your employer-sponsored health 
care as a result of your husband's terrible illness and not as 
a result of the ACA, and yet it was implied that the coverage 
that you got came under the ACA. So we all want to share our 
concern and support for you in your loss. But I noted that in 
your written testimony, as well as in your spoken testimony.
    So I do think that the hearing today has been helpful and I 
think has brought out a lot of good information about the 
negative impact of the ACA, particularly on working people in 
this country. That's where I think the real problem has been. 
And I would like to thank you all for coming again and tell you 
that we look forward to working with you on an alternative to 
this.
    And with that I --
    Mr. Scott. Madam Chair, may I make a brief comment, just 
very brief, because I think Ms. Schlaack's comment was she had 
employer-based coverage as well, but her husband died.
    Ms. Foxx. Right.
    Mr. Scott. She lost the employer, but had the marketplace 
as the safety net.
    Chairwoman Foxx. Thank you very much for that 
clarification, Mr. Scott.
    There being no further business, the committee stands 
adjourned.
    [Additional submissions by Mrs. Foxx follow:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    [Additional submission by Mr. Scott follows:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    [Questions submitted for the record and their responses 
follow:]

[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]



    [Responses to questions submitted for the record follow:]
    
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]    
    
    
    [Whereupon, at 1:01 p.m., the committee was adjourned.]