[Congressional Record Volume 146, Number 38 (Thursday, March 30, 2000)]
[Extensions of Remarks]
[Pages E451-E452]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    INTRODUCING THE HEALTH CARE ACT

                                 ______
                                 

                         HON. RICHARD K. ARMEY

                                of texas

                    in the house of representatives

                       Wednesday, March 29, 2000

  Mr. ARMEY. Mr. Speaker, proudly I join my colleague from California, 
Mr. Dooley, in introducing the Health CARE Act. The word ``CARE'' in 
the title stands for Coverage, Access, Relief, and Equity. Mr. Dooley 
and I believe this legislation will provide those things for millions 
of uninsured Americans. We regard this new bipartisan bill as 
affordable and enactable, and we will work to pass it this year.
  Identical legislation is being introduced in the Senate by a group 
composed of three Republicans, Senators Jeffords of Vermont, Frist of 
Tennessee, and Snowe of Maine, and two Democrats, Senators Breaux of 
Louisiana and Lincoln of Arkansas.
  The CARE Act creates a tax credit for the purchase of health 
insurance, and is to be the first in a series of measures that our 
bipartisan, bicameral group will propose to address the chronic problem 
of uninsurance in our country. Today, at any given moment, forty-four 
million Americans can be found who lack health-insurance coverage. They 
become uninsured for a variety of reasons, and it will take a variety 
of responses to address this growing problem.
  I should note here that the CARE Act is very similar to a bill I 
introduced last summer under the title of the ``Fair Care for the 
Uninsured Act'' (H.R. 2362). The CARE Act differs from Fair Care mainly 
in being less costly and thus, I hope, more enactable. The basic 
principles of the two bills are the same, and I will continue to work 
for the enactment of Fair Care as my long-term objective. I will not 
let the perfect be the enemy of the good. The CARE Act is a good first 
step and a solid proposal in its own right.
  Experts agree the uninsurance problem is caused in large part by 
Section 106 the Internal Revenue Code. Section 106 gives an extremely 
generous tax break for the purchase of health coverage, if it is 
purchased through one's place of employment but not if it is purchased 
elsewhere. This discriminates against people who buy their insurance 
outside the workplace. Such discrimination may have been tolerable in 
the 1940s and 1950s, when it was common for a citizen to be employed at 
one large company for most or all of his or her working lifetime. But 
it is completely out of step with today's dynamic workforce. Today, 
this health penalty tax, as I call it, falls most heavily on people who 
are mobile and part-time, on day laborers, farm workers, and the like. 
It falls especially hard on Hispanic Americans, who are often employed 
in these ways, and one-third of whom are uninsured nationally.
  Section 106 is unfair in another way. It discriminates against lower-
paid workers. Because today's tax-code is progressive, taxing people at 
increasingly higher rates as their incomes rise, tax breaks like 
Section 106 are by definition more generous to those in the higher tax 
brackets. Thanks to this regressive aspect of our system of progressive 
taxation--a system I hope to see replaced someday by the Flat Tax--the 
highly paid CEO today gets a much more generous tax break for health 
coverage than does the waitress at the corner coffee shop. This 
unfairness needs to be addressed.
  Right now, the ranks of the uninsured are swelling by more than 
100,000 persons a month, and it appears this pace will continue 
unabated until we go to the root of the

[[Page E452]]


  The Health CARE Act would address the inequities of the tax code by 
creating a new tax credit for the purchase of private health insurance, 
in the amount of $1,000 for a self-only policy and $2,000 for a family 
policy. A person could use this credit toward the purchase of any 
qualified private health-insurance policy, including so-called 
``COBRA'' coverage between jobs. If the person is paying for insurance 
on his own, he could apply the credit toward the cost of that coverage. 
The credit would be available regardless of where the person works or 
how much insurance he purchases. He could use it even if he owes no 
income tax. He could begin using it as soon as he signed up for 
insurance. He would not have to wait for a refund check from the IRS.
  A person would be eligible for the credit if he met all of the 
following conditions: First, he is not already covered by a federal-
government health insurance program. Second, he is not offered an 
employer-subsidized health plan through his place of work. Third, his 
annual adjusted gross income is less than $35,000 (if it is a self-only 
policy) or $55,000 (if it is a family policy). Persons making up to 
$10,000 a year more than these amounts would receive a reduced credit, 
which is phased-down over the range.
  Experts believe that any health-care tax credit must be worth at 
least 30 to 50 percent of the cost of an average health-insurance 
policy in order for people to be willing and able to use it to buy 
private health insurance. The Health CARE Act credit is worth about 40 
percent of the price of a self-only policy, and about 30 percent of the 
price of a family policy, depending on one's health status and the 
general cost of health care in one's region of the country. As a 
result, the credit will be available to an estimated 21.5 million 
currently uninsured Americans, and would help an estimated 5.5 million 
Americans who are now paying for health insurance without the benefit 
of any federal health-care tax breaks. The CARE Act credit would enable 
at least 3.2 million uninsured Americans to afford private health 
coverage, according to the Lewin Group, a private health-policy 
consultancy in Washington, D.C.
  Mr. Speaker, as a resident of the State with the highest uninsurance 
rate in the nation, I think tax equity for the uninsured is a moral, 
economic, and political imperative.
  The CARE Act is, in sum, a bipartisan proposal that offers real hope 
to Americans shut out of work-based coverage, makes health-care tax 
benefits fairer for all workers, begins to repeal the health penalty 
tax, gets more Americans covered, and does all of this while preserving 
the employer-based system of coverage on which most Americans rely.
  I am proud of this legislation and will work hard with my Democratic 
partner, Mr. Dooley, to pass it this year.

                          ____________________