[Congressional Record Volume 140, Number 79 (Tuesday, June 21, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: June 21, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]


                              {time}  1100
 
                      MANDATING COVERAGE OR ACCESS

  The SPEAKER pro tempore (Mrs. Clayton). Under the Speaker's announced 
policy of February 11, 1994, and June 10, 1994, the gentleman from 
Georgia [Mr. Collins] is recognized during morning business for 5 
minutes.
  Mr. COLLINS of Georgia. Madam Speaker, while the issue and debate 
about health care reform are very complicated, they can be boiled down 
to a basic question that Congress and the American people must ask.
  Should health care reform be based on federally mandated employer 
health care insurance coverage; or instead, on employer health care 
insurance access. There is a world of difference between the two 
options. Mandated coverage means an unfunded, open-ended, entitlement; 
but access means a private market remedy encouraging individual 
responsibility.
  Supporters of an employer mandate to pay for health care insurance 
claim that it will provide 100 percent coverage, while providing 
greater health care coverage and benefits for all employees. But in 
reality there are real costs that the employee will pay with this type 
of mandate.
  As the health care debate continues, individuals who are considering 
supporting a mandate on employers to provide health care must ask ``Am 
I willing to pay more, through reduced wages, fewer job opportunities 
and a smaller health care benefit package than I receive now, in order 
to pay for health care insurance coverage for those that already have 
access to health care services?''
  But let us look at the one example we do have in this country of a 
fully implemented employer mandate to pay for health coverage:
  The State of Hawaii passed a health care employer mandate in 1974. 
But this mandate has not been effective in achieving the 100 percent 
health care coverage that Clinton administration officials argue will 
be the natural result of the President's plan. Even with the passage of 
Hawaii's Prepaid Health Care Act in 1974, and the Health Insurance 
Program of Hawaii, as many as 7 percent of Hawaiian residents are 
without health care coverage.
  Additionally, the employer mandate-based program has failed to 
effectively control costs. Health care costs in general for Hawaii have 
skyrocketed over the past few years: Between 1980 and 1990, total 
health care spending in that State rose 191 percent, compared to the 
national average of 163 percent.


                    EFFECTS OF THE EMPLOYER MANDATE

  Most damaging is the impact that this program has had on the private 
sector in Hawaii.
  The owner of a 17-employee small business located in Maui, HI, 
recently testified before the Small Business Committee about the impact 
of the employer mandate on her business.
  She stated that costs associated with the employer mandate have 
caused her, as a business owner to ``hold off purchasing new 
equipment'' and ``slow down any expansion plans.''
  She stated: ``We had to hold wages at the same level for 2\1/2\ 
years.''
  She added:

       For 5 years we have had plans to start a retirement fund 
     for our employees, and each year, costs associated with 
     mandated benefits have made us cancel those plans.
       In thinking they were doing employees a favor through 
     mandates, the State of Hawaii only caused more hardships for 
     workers: their wages rose at slower rates, and they 
     ultimately received less health care than they previously 
     had. We are at a point in our business that we will do 
     anything to avoid hiring one more person--and not for a lack 
     of need.


                               EMPLOYERS

  In Hawaii, 4 in 10 employers had to reduce their number of employees, 
55 percent restricted wage increases, and 6 in 10 raised prices to the 
consumer as a result of the mandate.
  Between 1980 and 1986, Hawaii's employment grew by only 9 percent, 
compared to 20 percent for the U.S. Pacific coast States, and in 1975 
when the employer mandate went into effect, Hawaii was 25th among the 
States in average annual wages. By 1986, they had fallen to 36th.
  Private sector health care does not mean fundamentally flawed health 
care. There are weaknesses in coverage and high costs that must be 
addressed. There is agreement on the issue that we need insurance 
reform, greater access through the elimination of pre-existing 
conditions, greater portability of coverage, and elimination of 
loopholes that exclude those individuals and families just above 
poverty levels.
  But in deciding on the best health care reform plan, the 
administration would be wise to remember their very own campaign 
slogan: ``It's the economy stupid.'' As we debate proposals that will 
change the way we deliver, ensure, receive, and finance health care, we 
must carefully consider the impact these changes will have on the 
American economy as a whole.
  Because in the long run, by placing a mandate on employers to pay for 
health care, the American people the American workers will ultimately 
once again be paying the price through reduced wages, fewer benefits, 
and diminished employment opportunities in our private sector.

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