[Congressional Record Volume 140, Number 106 (Thursday, August 4, 1994)]
[House]
[Page H]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: August 4, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
  SUPPORT UNIVERSAL COVERAGE AND SHARED RESPONSIBILITY IN HEALTH CARE 
                                 REFORM

  The SPEAKER pro tempore. Under the Speaker's announced policy of 
February 11, 1994, and June 10, 1994, the gentleman from West Virginia 
[Mr. Wise] is recognized for 60 minutes as the designee of the Majority 
Leader.
  Mr. WISE. Mr. Speaker, I am pleased to be joined today, in effect 
cosponsoring this special order, by the gentleman from Maryland [Mr. 
Cardin], a member of the Ways and Means Committee, and someone long 
active in health care who has a lot of respect in this body for his 
extensive knowledge of the subject. It is a privilege to be with him 
tonight.
  Tonight, as last night, the subject was universal coverage, why it is 
that in comprehensive health care reform, all people need to be in the 
pool. There was a long discussion about that last night. Tonight what 
we are taking on is the shared responsibility. That is, how do you, 
what is the vehicle for providing that insurance.

                              {time}  1620

  So the legislation that is being shaped by the House leadership, by 
the majority leader particularly, builds upon that which we already 
have in our system of shared responsibility. That is, requiring 
employers to provide insurance.
  In other words, getting the insurance where 9 out of 10 Americans who 
already have private insurance get it, and that is through the 
workplace, where we work.
  Just as all Federal employees, including Members of this House, get 
theirs through the Federal employees health benefits pool in which the 
employer contributes a certain percentage and the employee contributes 
a certain percentage, just as most Americans who have insurance get it 
through their workplace, so would this legislation seek to expand upon 
that.
  This is also about those people who work every day, who do their jobs 
that we run into and encounter every day and yet do not have insurance. 
And indeed, some of them work for the most profitable corporations of 
this land, those who work in fast food restaurants, those who work in 
gas stations, those who work in the hotels, those who work in a large 
number. And they are doing, incidentally, Mr. Speaker, what it is that 
our society asks them to do, do not get on welfare. Do not be on the 
dole. Go to work. And so they go to work. And they go to work at $4.25 
an hour, the legal minimum wage, or they go to work at $5 or $6 or $7 
an hour. And they do what society asks them to do.
  But there is a problem. They do not have health insurance. As we 
discussed last night, when they finally get their health coverage and, 
yes, they will get treated at a hospital, but it will cost everyone in 
this room and in society four times as much for that person to go into 
the hospital emergency room as it does to get their treatment the 
regular way, which they would have gotten had they had health 
insurance.
  So this is about those people who work every day, and it is about 
shared responsibility.
  Under the plan that the House leadership is coming forward with, 
there would be shared responsibility that, by 1997, all businesses over 
100 persons would have to provide insurance, and the employer would pay 
80 percent of the premium. By 1999, 5 years from today, all businesses, 
that includes those under 100 persons, would have to supply insurance 
with the employer providing 80 percent of the premium. However, the 
employer gets certain assistance to do that.

  The assistance, for instance, is that, first of all, they have 
reduced premium obligations through a tax credit of up to 50 percent of 
the employer's share of the premium. When you sort through it, what it 
means is that for many employers under 100 persons, while the 
requirement is that they pay 80 percent of the premium cost, after you 
take the 50 percent tax credit, that cuts it in half and so they are 
paying 40 percent of the premium cost.
  It works out for many employers, those with under 25 employees, for 
instance, whose average income is $11,000 or less, it works out to an 
increase of about 61 cents an hour. But for that, everybody in the 
firm, including the employer and his or her spouse, often working in 
the firm, has a comprehensive policy and it cannot be taken away.
  Other benefits to the employer include community ratings, spreading 
the cost out over a much bigger group, not just focusing on that 
restaurant or machine shop or gas station or whatever, where there 
maybe is 10 employees. And it one person gets seriously ill, the costs 
shoot up for everybody. Now the costs are spread out over the entire 
population. It keeps the rates down. They get relief through changes 
made to workers compensation.
  Our hope is that that part that the employer is presently paying to 
workers compensation for health care, if a person is injured on the 
job, they need health care, and certainly in my State of West Virginia, 
that is one of the leading, if not the leading, concern of small 
businesses, that that would be taken care of through the health 
insurance system while leaving the rehabilitation and the weekly 
stipend checks to the workers comp system. But at any rate, that should 
result in significantly lower worker comp premiums.
  The employer, for the first time, would have access to a safety net 
public program for those employers who have basically low-income 
workers, a Medicare Part C program. And, yes, there would also be, for 
those that find it worthwhile, a medical savings account that they 
would be eligible for in which they would buy a policy for their 
employees that would have a $2,000 out-of-pocket deductible, and then 
they would put the balance in an account that the employee would then 
be able to bank and decide whether or not to sue that for the basic 
primary health care or not.
  Finally, self-employed individuals, a growing number in our society, 
who are now today not able to deduct any percent of their health care 
costs, would be able to deduct 80 percent of the premiums under this 
proposal.
  Why are we even talking about employer-based health care?
  Incidentally, just so everyone understands, the employer is paying 80 
percent; the employee is sharing and paying up to 20 percent for low-
income workers, and we will discuss that later. There is assistance for 
them as well. But everybody is paying. The employer is not asked to 
bear the whole freight, but the employer pays something. The employee 
pays something. The government pays something. So everybody is in this 
together. It is shared responsibility.
  How did we get to the situation where 9 out of 10 American who have 
private insurance are deriving it from the workplace? Because following 
World War II, we had millions of people coming into the workplace that 
were returning home from abroad. And it was a social policy in this 
country of, first of all, getting them working and, second, how can we 
provide health care. This Congress chose not to address the issue of 
national health care then, although President Truman made proposals. 
And so instead they went to seeing what kind of incentives could be 
placed to provide insurance.

  Well, if the government is not going to provide the insurance, who 
does? And so the goal was to have the employer provide the insurance. 
And to do that, the Congress instituted certain tax incentives that 
would encourage the employers of this country to provide that 
insurance.
  One of them was deductibility of the premium costs as a business 
expense. The second was to make the benefits of the policy nontaxable 
to the employee. You and I do not pay, Mr. Speaker, income taxes based 
upon the value of that policy to us. And so that was the accord that 
was reached.
  And the result was that more and more employers offered health 
insurance. In fact, during the 1970's and 1980's, employers even 
offered that health insurance in lieu of raises.
  So you can see what has happened in our society. Income, real take-
home income has actually been on a flat line or in some cases sloped 
downward, and that was done because people would have preferred to have 
kept their health insurance intact.
  Now, some have suggested that the employer responsibility, the shared 
responsibility is some kind of wild idea that President Clinton came up 
with and it is harum-scarum and drives everybody out of business. Let 
me just suggest to you who originally came up with a very comprehensive 
shared responsibility concept.
  Yes, it was that well-known radical socialist, single-payer advocate 
Richard Milhous Nixon who, in 1974, sent to this Congress a 
comprehensive health care bill which had, as its backbone, a shared 
responsibility provision by which employers would pay for 65 percent of 
the premium for a comprehensive plan. Employees would be responsible 
for 35 percent, and that over several years would then go up to a 75/25 
split.
  It also had other aspects of universal coverage because low-wage 
workers and low-income persons would get assistance through, yes, 
something similar to what is today called Medicare Part C. And so this 
is 1974 that this was proposed, and it is today 1994. So to those who 
would say delay because we have not had time to look at it, I would 
say, it has been about 20 years of exploration in this area.
  There is much more to talk about, but I see my good friend, the 
gentleman from Maryland [Mr. Cardin], who serves on the committee on 
Ways and Means, who was instrumental in putting together much of the 
components of this plan.
  I welcome the remarks he may wish to make.
  Mr. Speaker, I yield to the gentleman from Maryland [Mr. Cardin].
  Mr. CARDIN. Mr. Speaker, I thank the gentleman for yielding to me.
  First let me compliment my friend, the gentleman from West Virginia 
[Mr. Wise], for his hard work on health care reform, and his passion to 
bring this issue to the floor tonight, and his work on crafting a bill 
that will accomplish universal coverage and deal with the problems we 
have in our community.
  Mr. Speaker, I first want to appreciate the gentleman's reference to 
20 years ago. Actually we can go back 60 years that we have been 
debating health care reform. It is interesting that one of our 
colleagues from the other side of the aisle said ``what is the rush?''
  Mr. Speaker, we have been debating this issue for 60 years. It took 
us 30 years to get Medicare enacted, and now we are still trying to 
take care of the rest of our people, many of whom work every day of the 
week, trying to play according to the rules, and have no health 
insurance in order to protect their family.
  The problems are real, Mr. Speaker. We need to address those problems 
now. Let me tell Members about real cases of people in my district in 
Maryland, about a mom who had to go on welfare, who has two children. 
She has been offered a job at minimum wage and would like to get off of 
welfare, would like to take that job, but one of her children has a 
major medical problem. If that mom accepts a job that does not have 
health care benefits, she jeopardizes giving up her Medicaid, her 
health care that she has today.
  Mr. Speaker, I don't know of a person in this Chamber who does not 
want to enact welfare reform. The most important thing we can do for 
welfare reform is to guarantee everyone the right to insurance, so we 
need to move now. We need to address that problem, so that mom can get 
off welfare, can have insurance protection to help her family.
  Let me tell you about a small business person who is in my district, 
playing according to the rules, runs a small retail establishment, 
provides health care insurance for his employees and wants to do that, 
because he believes it is the right thing to do, to provide health care 
benefits.
  That person today is confronted with a real dilemma, because many of 
his competitors are not providing health care for their employees. Yet 
he is expected to compete in our marketplace today providing health 
care, finding ever-increasing premiums for his health insurance, and 
wondering whether he will be able to continue his health insurance.

  What makes matters worse is that that person, the person who is 
providing health insurance, is being asked not only to pay for his own 
employees but for the employees of his competitor who work down the 
street.
  We see, as you know, many people do not pay their bills. They have no 
insurance. They use our doctors and hospitals, but they do not pay 
their bills. It becomes uncompensated care.
  At the University of Maryland Medical Center in Baltimore, 16 percent 
of their billings go uncollected because of uncompensated care. That 
raises the rates that you and I pay, and that small business person 
pays for his employees because they have to pay higher premiums to 
cover the uncompensated care, the uninsured. That is not fair. That is 
not fair to the person playing according to the rules.
  Mr. Speaker, let me tell you about one more family in my district who 
has a young child who was born with a birth defect, a problem. The 
insurance industry calls that a preexisting condition. They do not have 
adequate insurance coverage to cover that child's needs, because of the 
practices within the insurance community.
  What we want to do is to provide universal insurance coverage. It is 
the only answer. There is no other choice. Our colleague, the 
gentlewoman from Connecticut [Ms. DeLauro], last night pointed out why 
you cannot do incremental, you cannot just enact insurance reform and 
believe that you have done the job, because you have not.
  If we just do insurance reform and do not provide universal coverage, 
which happens as people who are the oldest, who are the most 
vulnerable, who are the most expensive, who have preexisting 
conditions, become insured, sure, we want to get them insured, but the 
younger people, the less costly people without any shared 
responsibility with their employer, decide to leave the insurance 
pools. They do not want to pay the insurance cost, They do not think 
they are going to get sick.
  The cost of insurance becomes more expensive for people who already 
have insurance. They leave the insurance pool. More and more people 
become uninsured. The problems get worse.
  We have no choice, Mr. Speaker. The only way to answer the questions 
that have been posed by my constituents and the gentleman's 
constituents is to provide universal coverage. It is the only way we 
can do it.
  The bill being put together by the majority leader, the gentleman 
from Missouri [Mr. Gephardt], is the only bill that will give us that 
universal coverage. Let me explain why. There are three ways, 
basically, you can get to universal insurance coverage. One way is to 
have the Government do it, the single-payer system. That will do it, 
but you and I know that we are not going to get the votes to pass that 
bill in this Congress.
  There is a second way that you can get to universal coverage. We 
could pass an individual mandate and require all of our constituents to 
have health insurance. We could do that, but you and I know that a 
family working in my district who makes $20,000, where the employer 
does not pay any of the costs of health benefits, that that person 
cannot afford $5,000 of out-of-pocket costs in order to pay for the 
health benefits of his family.
  It is not enforceable, it cannot work, unless we are willing to put 
up huge Government subsidies and raise taxes to do it. We do not have 
the will to do that in this body. That is not the way we are going to 
proceed.
  As you pointed out, Mr. Wise, the way that most people get their 
insurance today is through the marketplace, through the employment, so 
the third way and the way in which the majority leader's bill is 
configured is shared responsibility, having all employers and all 
employees contribute to the cost of their health care. That builds on 
our current system and has the least disruption, and is the fairest.
  Why should that small business in my district have to pay the bill 
and its competitor not? The majority leader is putting together a bill 
where everyone pays their fair share. No free riders.
  How do you finance the plan? That has been asked to me by many 
people. We finance it through premiums, by everybody paying premiums, 
rather than having so many people get health care today without paying 
their bills and without paying premiums. That is a fair way to do it.
  Is it affordable? That is a very important point. We want to make 
sure it is affordable for the individual and affordable for the 
business, and as you pointed out, give relief for small businesses. If 
it is a small business that has low-wage workers, we give a tax credit. 
That impact may well be as low as paying 40 percent of the premium, 
which comes out to be about 45 cents an hour of additional labor costs, 
and it comes into effect in 1999. We give the small company four years 
to prepare for this change. It is very affordable. It deals with the 
problem.
  Yes, we need universal coverage. We have proceeded the only feasible 
way to accomplish universal coverage, a fair way, an equitable way, a 
way that will achieve the results that we all believe in, and will do 
it in a way that will build on our current system, build on the quality 
of our current system.
  I have a lot more that I could say, but I see we have been joined by 
some very distinguished individuals who have been extremely important 
in the development of health care reform in the House of 
Representatives, so at this time I want to thank the gentleman again.
  Mr. WISE. I thank the gentleman from Maryland for taking this time 
with me in putting this special order together.
  I yield to the gentlewoman from North Carolina [Mrs. Clayton] who has 
been very active on this issue.
  Mrs. CLAYTON. Thank you for yielding to me. I would like to join with 
the gentleman in a colloquy.
  Mr. Speaker, I am from a small business community and I am also from 
a rural community, so from that perspective, we look at it in terms of 
impact, the possibility of regulation causing the small business an 
enormous burden and taking away from its productivity.
  We had hearings today, and we thank the chairman for having those, 
and we heard the administrator not only talk about what is in the plan, 
but given the condition of small businesses right now, small businesses 
right now by and large are the victims of high costs, and they have 
bare minimum coverage.
  With having a health care plan where universal coverage is included, 
that gives them, in my judgment, and I like your comment on it, it 
gives them some relief for those businesses that are now covered. They 
will now have more affordable insurance premiums, and even better 
coverage, because what they are paying now is because they have to buy 
in small pools and they can bear the bare minimum. It is not really 
covering them.
  Mr. Speaker, would the gentleman from West Virginia comment on that?
  Mr. WISE. The gentlewoman raises a good point. I know she has small 
businesses in her district just like mine that are trying to provide 
insurance. I remember one of the small business people in my district, 
Jim Tillson, who runs an interior decorating firm, points out that he 
provides insurance for his employees, but every time he goes to bid 
against somebody for a job, whether Government or private sector, and 
that person does not provide insurance, he is at an automatic cost 
disadvantage, because he is doing what he should and yet the other 
person then comes in and they are late, and they have, because they are 
not putting in 8 to 10 to 14 percent of their labor costs into health 
insurance, they often come in and have an edge.

                              {time}  1640

  There is another way that small businesses lose as well, because the 
small businessperson who could provide insurance but chooses not to may 
think that they are getting a break because they do not have to worry 
about their employees, but they are getting caught several different 
ways. First of all, they are paying more taxes, because their employees 
will eventually end up in the hospital and that uncompensated care is 
going to get paid somehow. In many cases, if they end up on Medicaid, 
we all pay.
  Second is that if that employer is actually trying to provide some 
level of insurance to himself or herself or their family, they may not 
recognize that the premium they are paying, that they can take 30 
percent of that premium and realize it is cost shifting. In other 
words, it is being used to pay the cost that somebody else did not pay. 
Therefore, all of us who have private insurance are paying. So that 
would be another great advantage, I believe, to having universal 
coverage and employer-based.
  The third is that, I know this is true in North Carolina just like it 
is in West Virginia, workers' compensation costs are an increasingly 
higher component of a small business' burden, and those costs can be 
lessened in terms of the health care part of it by enactment of this 
kind of legislation, particularly if we are able as many of us are 
urging that the workers' comp burden would then go to the health part, 
the treatment of the injury that the worker suffered would be under the 
health plan, not under workers' comp. So that should assist that 
business as well.

  I just wondered, too, if the gentlewoman might comment for just a 
second about any studies on job loss that have been done.
  Mrs. CLAYTON. I will comment on that, not so much the study, but I 
want to comment that there are 92,000 individuals in my district 
uninsured. That is completely unacceptable. Then when you further look 
at that, 81 percent of those individuals are people who work and they 
are not covered.
  Why should such a large number of people who are working not have 
coverage? The universal coverage means that once you get everyone in 
that pool, rural businesses in rural communities will certainly have 
that economy of scale. Some people are proposing and certainly the 
Chamber of Commerce, yes, we want reform, and the reforms that they are 
speaking about are good, these are issues that will be in our plan as 
well, but they miss the advantage of having everyone in there to reduce 
the cost as well as to raise the quality of care.
  As far as losing jobs, the Rural Study Research Institute published a 
study comparing President Clinton's plan, COOPER's plan and one of the 
senatorial plans. What they found was that as it relates to businesses 
in rural communities over the long haul, it would not change it; 
although it would increase in the immediate future, over the long haul 
it would not be detrimental to small businesses.
  What they further found, however, that the workers that would be 
improved, they would add to the productivity and, therefore, the inured 
benefit in not having to retrain and rehire would be to the business' 
advantage. More important, the rural families, those 92,000 people I 
was talking about, their health would be greatly enhanced.
  So there are studies comparing that there is not that much negative 
impact projected if we had the shared responsibility.
  Mr. CARDIN. Could I ask the gentleman to yield on the job loss issue, 
because I think we have heard that issue over and over again from some 
of the opponents of health care reform. We do not lose jobs when we 
increase the standards for working people in this country. We increase 
job opportunity and jobs in our community.
  I heard the same arguments when we passed the minimum wage increase. 
We did not lose any jobs.
  Mr. WISE. A 90-cent-an-hour minimum wage increase several years ago 
and the predictions were job killer, brings the economy to a halt, 
millions lost. Absolutely untrue. And many of the businesses that would 
be affected by this would be getting far less than a minimum wage 
increase and would be getting comprehensive health coverage.
  Mr. CARDIN. The same arguments I might say were made when we passed 
the Medicare tax. We did not lose jobs. Instead we protected a group of 
people. Then when we passed Social Security back in the 1930's, the 
same arguments were made, we were going to lose jobs. We do not lose 
jobs when we improve the standard of living for people who are working.
  Mrs. CLAYTON. Again in rural areas, there will be an increase of 
business opportunity as a result of health care reform. What will they 
be? There will be health-related industries. There will be the 
infrastructure and delivery. There will be the enhancement to the rural 
hospital, bringing in health providers. And in many of the smaller 
communities, the local hospital is the employer, so there is the 
opportunity of increasing business activity as it relates to the health 
industry. But the productivity of the citizen has to inure to the 
business benefit and I think that is very, very important.

  Mr. WISE. I thank the gentlewoman for that contribution.
  I would now yield any time he would wish to the majority leader who 
has been so active and has, of course, brought us to this point today.
  Mr. GEPHARDT. I thank the gentleman for yielding. I want to support 
this point, that requiring employers and employees to be involved in 
shared responsibility really is at the heart of successful health care 
reform. I want to elaborate more as the people on the floor have been 
about why this is so vital to this effort of successful reform.
  If voluntary programs were workable, the people who work for 
employers today would have been covered a long time ago. It is an 
attractive idea to say, ``Well, let's put money out there, let's put 
subsidies out there and see if we can get people involved.''
  There are a couple of problems with that. One, where do we get the 
money to give them the subsidies? We usually get it from the people 
that are already involved. So we have to say to the 83 percent of 
employers and employees that they are already involved: ``We want you 
to pay more money, to offer subsidies to people that have not done what 
you have done for a long, long time,'' without giving the people who 
have been involved any benefit or any help that you can give them 
through getting everybody involved.
  In other words, you have got to ask them for more money to get people 
to do things that they have already been doing, and you give them no 
benefit in reduced premiums because you cannot ensure them that any of 
these people will get involved. So they will see it as a double 
unfairness.
  The other thing I would like to bring up is that some have said this 
is a requirement, it is a mandate, it is a requirement of employers and 
employees and that is something we have never done. I want to point out 
to Members that when we did the Social Security Program, there were 
lots of Members who said, ``Let's have a voluntary Social Security 
program. Let's let employers and employees voluntarily set up a pension 
program.'' If that is the case we would have made, we never would have 
had Social Security. Social Security is a requirement. It is a mandate. 
Every employer in the country and every employee in the country has to 
pay a payroll tax to put away the money so that they can get a pension 
when people hit 62 and 65 years of age.
  When Medicare was on the floor of this House in 1965, the same 
suggestion was made. People said, ``Make it a voluntary program. Why 
require people to do this?''
  The problem was, if we did not make it mandatory to have a Medicare 
payroll tax, the Medicare Program would never have been achieved.
  We all know that both programs are very popular. No one on this side 
of the aisle in the Republican Party, no one on the Democratic side 
will get up today and seriously suggest that we get rid of the 
mandatory nature of the Social Security Program or the Medicare 
Program. No one, I think, in the Congress would make that suggestion. 
If it worked for the elderly with the Pension Program and the Medicare 
Program, why will it not work with regard to medicine and medical care 
for everyone in the country?
  The reason a requirement is necessary is that we will never get 
everybody involved until everybody knows what the rules are, and we 
will never stop the cost-shifting, we will never stop the unfairness 
and the unworkability of what we are doing today.

                             {time}   1650

  The final point is that people say this is going to lose jobs, that 
people will not be able to make these payments, they will close down 
their companies and jobs will be lost. This is the same argument we 
hear every time there is a suggestion to increase the minimum wage.
  I have voted for minimum wage increases two or three times since I 
have been in Congress, and every time people will come and say we 
cannot do this because we will have to shut down companies and jobs 
will be lost. That is what people said when the minimum wage was 
increased by 90 cents in 1988. To my recollection, no jobs were lost 
because of the minimum wage increase. In fact, I would argue jobs were 
probably created because consumers, workers had more money and were 
able to buy more products and feed that money back into our economic 
system, which created more jobs. It is synergistic.
  I would make the same argument about health care, but I would also 
say that small employers can afford this. If people will just look at 
our bill, the cost for many small businesses would be 60 cents an hour, 
less than the minimum wage increase of 1988. Some firms would have to 
pay 90 cents an hours, some firms a dollar, some firms a dollar and a 
quarter. They would have 4 years to get ready to do it.
  We are not going to have a minimum wage increase in that time. If we 
get health care done, there is not going to be a minimum wage increase. 
So this supplants the minimum wage increase.
  Let us also remember that under our bill companies that now provide 
insurance will get subsidies as well. This will lower the cost for 
companies that are already providing insurance. So they will be helped 
as well as the companies that are not now providing insurance. So the 
majority of companies in the country that are small and have a lot of 
low-wage employees, that are providing insurance today, will have their 
costs lowered for health care insurance. So it will help them create 
jobs, help them be able to do better at what they are doing.
  The Economic Policy Institute says that more than 250,000 
manufacturing jobs will be created as a result of this kind of a bill. 
The Employees Benefit Research Institute says 660,000 jobs will be 
created if we can pass this kind of a bill. The Brookings Institute 
estimates that 750,000 home health care jobs would be created as a 
result of this bill. And again, small business, which now pays as much 
as 35 percent more than large businesses for health care, will get 
dramatic discounts. That is why the Wall Street Journal called health 
care reform an unexpected windfall for small businesses.

  I can understand small business people being concerned if they are 
asked to commit to a requirement. If I was a small businessman I would 
be concerned. But we have to look past the concern to the facts. The 
facts are that most small businesses would be advantaged, helped by the 
requirement that everybody has got to be in the pool, everybody has to 
be participating, everybody has to be responsible.
  I want to end my little piece of this debate tonight with the word 
responsible. People say this bill is all about the right to have health 
care. Yes, it is about the right to have health care, but it is more 
about the responsibility to pay for health care. This is not a bill 
just about rights. It is a bill about responsibilities.
  What is responsibility? Mr. Bennett on the Republican side has 
written a book about virtue. It is a good book. In the book he talks 
about responsibility, how we all have to be responsible, responsible to 
ourselves and responsible to each other. The requirement or mandate for 
health care coverage in our bill is primarily about responsibility, the 
responsibility of employers to their workers, the responsibility of 
workers to their employers and to their fellow workers, the 
responsibility to ourselves.
  If I am young, well, and healthy I probably would want to gamble on 
not having health insurance. So if I do not have health insurance as a 
young person, because my employer does not give it to me or I am not 
even working, maybe I am self-employed and I do not want to come up 
with the money, what happens if I get sick? What do I do? I probably do 
not go to a doctor if it is something that I do not think is too 
serious because I do not have coverage. I do not have insurance. I have 
not been responsible for prepayment of my health coverage. So maybe I 
get sicker than I should get, and then maybe I end up in an emergency 
room. Then I have worse problems than I should have had because I was 
not responsible to myself, as well as the cost I now put on all of my 
brothers and sisters who live in this country who are going to have to 
pay my cost.

  This issue of the mandate, this issue of the requirement is primarily 
an issue about responsibility, responsibility to ourselves, our 
responsibility to our fellow country people. Our bill says at bottom, 
as we said in the 1930's in Social Security, as we said in the 1960's 
in Medicare, that each of us as Americans have to be responsible. That 
is how you get rights. It is the mirror of rights.
  I just say to the gentleman who has taken this special order tonight 
to speak up for this requirement that in my view this is a debate at 
bottom about responsibility, about all of our responsibility to 
ourselves and each other. I believe with all my heart that the American 
people want us to be talking about this and doing this, and getting 
everyone to do it.
  It would be terrific if we could put out some incentives and 
everybody would do the responsible thing. We know they would not do 
that in Social Security, they would not do that in Medicare. They are 
not going to do it in health care. We need the help of this requirement 
in the law to make this a better society.
  Mr. WISE. I thank the majority leader for a very eloquent statement 
that I think lays out clearly what the issues are here.
  Mr. Speaker, I am delighted to see the gentleman from Oregon [Mr. 
Wyden], who has been an active member of the Committee on Energy and 
Commerce, certainly long active in health care.
  Mr. Speaker, I yield to the gentleman from Oregon [Mr. Wyden].
  Mr. WYDEN. I thank the gentleman for yielding and want to pick up on 
the excellent statement he and the majority leader have made, because I 
think small business and the issue of how small business is treated in 
this discussion is probably the key piece to doing health care reform 
right.
  The fact of the matter is in districts like mine across the country 
there are very few big businesses. Most of our districts are made up of 
small businesses. If health care ends up putting small businesses out 
of business, then folks are not going to have jobs, let alone health 
care. I think most of our constituents would think that would be fairly 
foolish, even by Federal standards. So this job has got to be done 
right.
  I want to lay out why I think the Gephardt-Foley proposal is an 
effort to address the concerns of small business in a thoughtful way by 
talking first about a block in any one of our neighborhoods that is 
made up primarily of small businesses. Let us say that we have two 
small businesses on the block, and one of them covers their people and 
the other does not.
  What we know in our State, and I think in virtually any part of the 
country is the business that covers its people, offers preventive 
coverage, catastrophic coverage, and some outpatient services, it is no 
Cadillac, it is no Mercedes, it is the basics, and small business does 
it in many instances at considerable hardship, but we also know that 
there is a business down the street that may not cover its people.

                              {time}  1700

  Well, those employees get sick. They are not going to be able to defy 
human nature. They are going to get sick, but they are not going to get 
early preventive coverage or maybe the outpatient services, and we know 
that they are going to end up going to the hospital emergency room, and 
when they go to the hospital emergency room, those expenses, and I want 
our colleagues to focus on this, those expenses are socialized. The 
hospital has got to socialize those expenses and pass them on to 
everybody else in the community, and especially the small businesses.
  So what is helpful about what the gentleman from West Virginia and 
the majority leader are doing is they are saying we are going to bend 
over backwards to be sensitive to small business. That is why there 
have been so many changes like the voluntary alliance kind of concept.
  But we are going to say we are going to be fair to all of the small 
businesses, make sure that all of them get a fair shake, and we do not 
perpetuate the situation we have today where the small businesses that 
often, at considerable expense and difficulty, cover their people end 
up having to pay a higher premium simply because there are many who do 
not.
  I understand our caucus leader, the gentleman from Maryland, is under 
considerable time constraints, and I would be happy to have him yielded 
to for any comments that he chooses to make. We will pick him up a 
little bit later in the debate.
  If I could continue then for a bit longer, it seems to me that, 
recognizing the situation of those two businesses located next to each 
other, one of them covering their people, the other not covering their 
people, when we started this discussion over a year ago, most of the 
small businesses that I talked to felt that they considered it fair 
that they make a contribution to the costs of their workers' health 
care. In fact, I could go into almost any Chamber of Commerce in my 
State, explain about health care financing, say that individuals should 
have to contribute because there needs to be individual responsibility, 
the Government has a role for the destitute, but, yes, businesses 
should contribute as well, because otherwise the businesses who cover 
their people would be subsidizing the ones who were not, and in 
virtually any Chamber of Commerce in my State when the debate started, 
the vast majority of small businesses would say, ``Yes, we should make 
a contribution to the costs of our workers' health care, because it is 
unfair to do otherwise.''

  Over this period of a year, with all of the lobbying and all of the 
distortion and all of the half-truths, there has been this sense across 
the land that instead of saying we are all going to make a contribution 
to equitable financing of health care, that somehow the Federal 
Government was going to apply a tourniquet around the throats of our 
small businesses and in effect strangle them in the early days of their 
getting their business off the ground; well, I think what we have seen, 
as a result of a year's worth of listening to those small businesses to 
show that we were going to be especially sensitive to the messages 
coming from Chambers of Commerce and Rotary Clubs and the like, we have 
now the list of the many changes which the gentleman from West Virginia 
has put down, and I note that it does not even talk about some of the 
other ones that are of great benefit to small business such as the 
matter of voluntary alliances so the little guy can pool his purchasing 
power.
  I think what is valuable about the gentleman's chart is that many of 
these changes have been made in direct response to what Members of this 
body have heard in the last year. They did not come about by accident. 
They came because the small business community said, ``Yes, we are 
prepared to do our fair share. We know we have all got to contribute, 
but when the Congress takes this up, make it as nonbureaucratic and 
nonregulatory as possible.'' And what the gentleman's chart shows is 
that the Congress, now, in moving toward consideration of this bill in 
the next few weeks, has listened to the small business community and 
moved to make this bill less bureaucratic and less regulatory, so that 
it is not ``one size fits all'' Federal health policy, but health 
policy that can work for the small businesses across our country.
  Mr. WISE. I thank the gentleman from Oregon very much. You, of 
course, were in the very beginning of this debate, which has gone on 
for well over a year now, and have been one of the advocates for small 
business and have been pointing out the impacts to small business, been 
one of the ones saying to businesses, ``Actually put the pencil to it; 
do not just react to the arguments that are made by a lobbying group 
who, of course, gets paid based on how much conflict they can create, 
not on how much consensus.'' So you have taken a very, very active 
role, for which we are all grateful.
  As we have been to the West in Oregon, we are going to move farther 
west right now to the gentleman from Hawaii. I think Hawaii has a 
unique story, because, of course, Hawaii is, I believe, and the 
gentleman may correct me, the only State that in its entirety has an 
employer mandate or shared responsibility in effect and has been in 
effect for quite awhile.
  I yield to the gentleman from Hawaii [Mr. Abercrombie].
  Mr. ABERCROMBIE. I thank the gentleman very much. I certainly 
appreciate this opportunity to get away a little bit from some of the 
heated rhetoric, to get away from some of the apocalyptic statements 
that have been made, to be able to focus for us in this special order 
for those who are observing here in the gallery and those who are 
tuning in to our debate and for those who will hear about it, that 
Hawaii, the 50th State, has for 20 years, and I would like to repeat 
that, for those who may not be aware of it, for 20 years, had a prepaid 
health care plan.
  Mr. Speaker, I have in my hand the entire debate that took place 
starting in 1973. Here we are in 1994, 20-plus years later, trying to 
come to a determination that was reached two decades earlier by your 
fellow citizens out in the State of Hawaii.
  What we did, and of particular interest here in this special order, 
is see to it that small businesses and those who could not otherwise 
afford insurance had their concerns addressed.
  Hawaii, as many people no doubt know, is made up of business which is 
agriculturally based, governmental business with respect to the 
military and other Federal, State, and local government entities that 
have great prominence due to the particular nature of our State being 
the forward basing area, if you will, in the Pacific for the United 
States military, and tourism. All of these are, in effect, service-
economy-based activities, and I want to indicate that for many years 
now, and I hope that the message that I am bringing will be listened to 
outside the light of partisan rhetoric, because this was overwhelmingly 
passed in the Hawaii State legislature and is overwhelmingly supported 
by most people, people in the State of Hawaii.
  You will find that in this State of small businesses, of a service 
economy, that we have had, as a result of the passage of the prepaid 
health care plan in 1974, a situation in which virtually all employees 
are covered, all regular employees are covered by an employer mandate. 
Now, you can call it anything that you want. There is an obligation of 
the employer to address the health needs of the employee.
  This has been in effect for 20 years. Within 20 days of passage, 
insurance companies who were there purely for one reason and one reason 
only, to extract the maximum amount of money from the individual or the 
business and return as little as possible to that individual or to that 
business with respect to any damages or medical services or any other 
kind of activity normally associated with medical insurance, went out 
of business.
  Now, this is commonly known as cherrypicking. In other words, for 
those of you who are not familiar with it, the insurance companies look 
to see how they can maximize their profit and minimize their risk, not 
maximize their service to you, not maximize the medical services 
available to you as an individual, far from it, in fact, to keep you 
from getting those medical services, to minimize it.
  Now, this is what happened: Virtually every company now offers the 
100-percent coverage; we are talking about 80 percent, we are talking 
about 50 percent, we are talking about employee contributions. Very, 
very rapidly after the passage of our bill 20 years ago, businesses 
realized when the genuine health insurance companies came into 
existence, when real competition came into existence, when a health 
maintenance organization like the Kaiser Corp. and a Blue Cross/Blue 
Shield cooperative endeavors such as the Hawaii Health Insurance, 
Hawaii Medical Insurance Association, came into existence, doctors and 
hospitals offering an insurance policy, they began to compete with one 
another to drive prices down, not up, down.

                              {time}  1710

  Now, do not forget, Mr. Speaker, that we are in a situation in which 
most of our costs are higher than on the mainland. We are an island 
State. In order for us to get between our counties, between the major 
islands, we have to fly between the islands. We do not have roads, we 
cannot paddle. Well, if you have a team of paddlers and you train all 
year, you could make it in 8 or 10 hours between Molokai and Oahu. The 
fact is all or a majority of our costs are much higher than they are on 
the mainland, for obvious reasons having to do with our isolation, 
distance from one another.
  All prices are higher except in one category, Mr. Speaker: health 
care costs. They are down a considerable percentage, 10 or 12 percent, 
depending on the area of the country compared.
  No matter where you measure it in the rest of the country, our health 
insurance costs are down.
  Also, Mr. Speaker, our unemployment figures have been consistently 
the lowest in the country.
  One of the things you hear is if you put in employer mandates for 
small businesses, people are going to be fired, people are going to 
lose their jobs. If that is the case, why is it that Hawaii has one of 
the highest employment figures in the Nation?
  You will see, if people will examine the situation honestly--and, Mr. 
Speaker, I am not trying to put this in partisan terms--I am hopeful 
that people on the other side of the aisle and those who have their 
doubts or are struggling to try to come up with something affirmative 
on this side of the aisle will realize this is something that effects 
everybody in the Nation. This is one vested interest group, one special 
interest group that does not have a voice other than the voices that we 
bring to it on the floor of this Congress; that is, the average person 
in the consuming public.
  I can assure you that the experience of Hawaii indicates that not 
only does small business thrive but this becomes a distinct benefit and 
actually stabilizes the work force.
  People have less anxiety, people have security, they are enthusiastic 
about their work.
  And one final point with respect to this, because of all the 
publicity generated recently about some of the big franchises, Pizza 
Hut, in particular.
  We have heard so much in the abstract and we have been able to 
particularize about Pizza Hut. This is one of the big franchises in 
country.
  The reason it is such a good example to bring up is because everybody 
is familiar with it. I believe it is in all 50 States, if I am not 
mistaken.
  Pizza Hut has health insurance for its employees in Germany, its 
employees in Japan, and its employees in Hawaii.
  Now, do you mean they cannot provide that, then, in the other 49 
States when they have been doing it for 20 years and they are expanding 
and they are good employers? There is nothing special about Pizza Hut 
employers, the franchisee in Hawaii. The people involved in that 
franchise are fine people, they are good business persons, they 
contribute to the community. I am proud that they are there, we are 
happy that they are there. They do a terrific business out there and 
deservedly so, and they provide health insurance for all of their 
employees, and their business is expanding.
  Well, now, the bottom line is small business does not get hurt, small 
business and everybody's business improves when you have health care 
across the body public.
  Mr. WISE. If the gentleman could answer this one quick question for 
me: It has been many years since my wife and I had privilege of 
visiting Hawaii--that was before children--my question is are there 
McDonald franchises in Hawaii?
  Mr. ABERCROMBIE. There are McDonald's franchises, every kind, Little 
Caesar's every kind of franchise there is, and every single one of 
these franchises, every single one of these national chains, there is 
COSTCO, Kmarts, all kinds of operations, every single one of them 
provides health insurance for their employees, does so today, and every 
one of these businesses is thriving, every one of these businesses in 
Hawaii is happy to be doing business in Hawaii, and those businesses 
are expanding.
  Mr. WISE. I appreciate that, because now having had children, I know 
the importance of happy meals. I think a happy meal is even happier 
when the people serving it have health care, as well as those on the 
other side of the counter as well.
  Mr. ABERCROMBIE. We are all in this together.
  Mr. WISE. We certainly are. That is what shared responsibility is all 
about.
  Mr. Speaker, in the couple of minutes left, to summarize: This is 
about shared responsibility, it is about building upon the base that 
already most Americans get their health insurance from, and that is 9 
out of 10 who have private insurance get it through the workplace. This 
is about assisting businesses that would have a tough time making it on 
their own to provide the insurance; this is about assisting them to do 
that. It is comprehensive.
  When you hear the scare tactics, Mr. Speaker, just remember Social 
Security, which is an employer mandate, shared responsibility by the 
employer and employee. Most of these arguments were made in the 30's 
about ``job killer,'' ``businesses will go under, how are we to 
survive?'' Now, who is it today that urges that we do away with Social 
Security?
  When you hear these arguments, Mr. Speaker, they were made in 1965 
about Medicare. Indeed one of the advocates of not doing a Government 
mandate, Senator Dole, the Dole bill we have heard a lot about, he 
voted against Medicare, incidentally. Yet, 30 years later, who is it 
that would call seriously to do away with Medicare? You would be 
lynched, justifiably so, by all of our seniors over 65 who know that 
that program, while not totally perfect, provides the assurance they 
need.
  And, yes, I have heard about the great cost projections, how much 
higher Medicare is today than it was projected in 1965. Question: What 
is the alternative? Do you want to do away with it? No; you want to put 
it into a comprehensive package so you can deal with all of the issues 
at once.
  We have heard these same arguments on minimum wage, we have heard the 
same arguments just recently on the deficit reduction package. It was 
to be a job killer too.
  The Wall Street Journal today, ran an op-ed article by Al Hunt 
pointing out that all the doom and gloom projections about that are 
wrong and that the economy, instead of going down, is going up.
  So that is what this issue is all about. We have a lot to debate over 
the next couple of weeks. But I just urge Members to look carefully at 
this issue. If you are serious about universal coverage, we must build 
upon the base that we know so well, assist employers to perform their 
obligation, as the employees, those of us who derive insurance from our 
workplace, while we at the same time meet our obligation, Government 
meets its obligation, and we reach truly that goal of having everyone 
with private health insurance that cannot be taken away.

                          ____________________