[Congressional Record Volume 150, Number 67 (Thursday, May 13, 2004)]
[House]
[Pages H2967-H2986]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

[[Page H2967]]

House of Representatives

         SMALL BUSINESS HEALTH FAIRNESS ACT OF 2004--Continued
                              {time}  1415

  Mr. HOLT. Mr. Speaker, I rise in opposition to this bill and in 
support of the substitute that the gentleman from Wisconsin (Mr. Kind) 
and the gentleman from New Jersey (Mr. Andrews) will be submitting.
  Mr. ANDREWS. Mr. Speaker, I yield 2 minutes to the gentlewoman from 
New York (Ms. Velazquez), for whom I have the most profound respect, 
the ranking Democrat member of the Committee on Small Business.
  Ms. VELAZQUEZ. Mr. Speaker, I thank the gentleman from New Jersey 
(Mr. Andrews) for yielding me this time.
  Today, we should be focusing on helping small businesses address the 
health care problems they face. Instead, our debate is not about policy 
but about politics. The House has already passed this once, and it is a 
bit early for summer reruns. It is a good bill with broad bipartisan 
support. Passing it twice will not change that.
  As we move forward, small businesses are facing a real health care 
crisis. Small firms that can afford health insurance are seeing costs 
rise by nearly 20 percent every single year, and many small businesses 
do not even have health insurance.
  This is a good bill. It has strong solvency requirements and 
safeguards to ensure there will be no cherrypicking of healthy 
employees.
  Critics of this legislation will cite an outdated study that examines 
legislation far different than the bill before us today. This has the 
same validity as saying Columbus should never have sailed to the New 
World because previous studies had shown the world was flat.
  Association health plans will give small businesses the same 
advantages that corporate America and unions already have. I always 
say, if it is good enough for IBM, GM, and Lockheed Martin, it is good 
enough for small businesses.
  But we should stop playing politics with small business. If the Bush 
administration was truly committed to small businesses, association 
health plans would already be law.
  Today's debate is not going to help small businesses lower their 
health care costs, it is not going to help them cope with the constant 
fear of being just one illness away from bankruptcy. It is about time 
small businesses were able to afford quality health care. That is why I 
will encourage my Democrat colleagues to support this proposal and show 
as a party that we are bigger than this political gamesmanship.
  I call on the Republican leadership in the Senate and President Bush 
to make this bill a priority and pass it. I urge a ``yes'' vote.
  Mr. BOEHNER. Mr. Speaker, I am pleased to yield 2 minutes to the 
gentlewoman from West Virginia (Mrs. Capito).
  Mrs. CAPITO. Mr. Speaker, today I rise in strong support of 
association health plans. As we have heard, small businesses pay 17 
percent more for their health care than employees of large companies. 
In a State like West Virginia, where over 90 percent of our business is 
small business, this is impossible for our small business owners.
  Over 44 million Americans, sadly, are without health insurance, and 
more than 60 percent of those are employed by a small business. The 
high costs small businesses have to bear to provide health care, for 
what in many cases are just a few employees, prohibits owners from 
providing affordable health insurance and losing employees at the same 
time.
  Through a trade association, like the National Federation of 
Independent Businesses, small businesses would be allowed to band 
together, pool their resources, drive down health care costs and gain 
buying power.
  Nondiscrimination provisions in the legislation ensure health 
coverage will be offered to those who need it most, and solvency 
requirements will make sure that the health plans have the financial 
resources on hand to cover their employees' needs.
  Mr. Speaker, during a roundtable I had several weeks ago with small 
business owners in my district, everyone was concerned about offering 
health care coverage. Small business owners want to be able to afford 
this, not only for them as owners but also for their employees.
  This House has passed this association health plan legislation 
before. Workers need health care coverage, their children need health 
care coverage, and small business owners want to offer health care 
coverage. I urge my colleagues to support association health plans.
  Mr. TIERNEY. Mr. Speaker, I yield myself 3\1/2\ minutes.
  Mr. Speaker, the so-called Small Business Health Fairness Act is a 
bill that is attractive to a few but it is sufficient for none, and it 
seems to be harmful for everyone else. While there are employers, 
workers and family members who do depend on health insurance, what they 
really need is solutions that are going to work for everybody and not 
just some empty promises.
  The Congressional Budget Office did an estimate on this proposed bill 
and estimated that approximately 4.6 million people might obtain some 
coverage through these proposed associated health plans but only about 
330,000 of those people would be new customers.
  The fact of the matter is that there is not going to be the dramatic 
savings that is proposed here. That simply will not materialize. The 
Congressional Budget Office found that these AHP

[[Page H2968]]

premiums would only be marginally less than the traditional health care 
plans. In fact, the Mercer Consulting STUDY that was done for the 
National Small Business Association found that premiums would increase 
by 23 percent for those outside the AHP market. It also found there 
would be an increase in the number of uninsured workers in small firms, 
an increase of a million people, as a result of this being implemented.
  The fact of the matter is that Americans would also lose their right 
to vital medical coverage, like OB-GYN and pediatrician services, 
cervical, colon, mammography and prostrate cancer screening, maternity 
benefits, well-care child services, and diabetes treatment.
  When we had witnesses testifying at the committee hearing, Mr. 
Speaker, we specifically asked the small business witness whether that 
is what she wanted to have happen to her company. And her testimony 
indicated clearly she did not, and she did not understand that was 
going to be the result of this bill passing.
  This bill is going to disallow a lot of State protections, and almost 
all the States have in protections for people under this bill. This 
House voted for a Federal Patients' Bill of Rights that would have 
recognized States' protections that are in place for insurance 
programs. Almost every single Member on both sides of the aisle voted 
for that legislation; yet this piece of legislation, the AHP bill, 
would peel that away and take away the State protections for all those 
things that people in small business want.
  As a person in a small business and representing a number of small 
businesses for over 22 years, I can tell you small business employers 
do not want an inferior policy for their employees.
  With respect to the question one of our colleagues on the other side 
raised about the distrust of the private sector, we are all very much 
in favor of the private sector, but most people are in favor of it 
being a balanced situation in this country. We understand unless there 
is some reasonable regulation, some private industries will go too far 
in one direction, as has happened in the past with programs similar to 
this, the so-called MEWAs that existed at one time that were replete 
with fraud, corruption, and solvency problems.
  This is a situation that has to be corrected. We cannot allow it to 
happen again here, and there is evidence in recent times that that is 
exactly what would happen with this bill.
  Mr. Speaker, small business owners and their employees deserve 
protections. They deserve to go to the emergency room. Women small 
business owners deserve to go to gynecologists without referral from 
another doctor. Why should we treat small business owners and employees 
like second-class citizens by giving them second-class health care? 
Instead of extending the patient protections to all Americans, this 
bill would roll back the limited protections that exist today.
  I think if we speak plainly, Mr. Speaker, this bill eliminates the 
State regulation of AHPs and is in fact an anti-patients' bill of 
rights. For this reason and the other reasons I have mentioned, and 
others have said, and the fact that over a thousand different 
organizations oppose this bill, including the National Governors 
Association, the Republican Governors Association, 41 State attorneys 
general, the National Small Business Administration, the National 
Association of Insurance Commissioners, as well as a dozen other groups 
of labor business and consumer groups, I believe this is not a good 
bill for small business, it is not a good bill for the employees of 
small businesses. We can do better and we should.
  Mr. BOEHNER. Mr. Speaker, I yield 3 minutes to the gentleman from 
Maryland (Mr. Wynn).
  Mr. WYNN. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  It is interesting to note the gentleman just said, why should small 
businesses be treated as second class citizens. The fact of the matter 
is, they are already treated as second-class citizens because they do 
not have and cannot afford to have health insurance for their 
employees. Sixty percent of the 44 million uninsured people in America 
work in small businesses.
  Now, there is something very interesting happening in this debate, 
and I want to lay it on the line. All the people who are against this 
bill have health insurance. Yes, the unions and the governors, be they 
Democrat or Republican, and all the other folks who are saying this is 
a bad bill, have health insurance. On the other side, the folks who 
want this bill, are small business owners, 12 million of them, who 
cannot afford to provide health insurance for their employees. Why 
should they not have an opportunity to pool together to gain the 
leverage that would enable them to provide affordable health insurance?
  Now, you hear people saying the benefits are too skimpy and you do 
not have the State mandated benefits and all these other things. Those 
benefits are fine, and I have supported them. But the fact of the 
matter is if you do not have any health insurance, then the benefits 
and the protections and the consumerism and all that does not mean a 
thing because you do not have any health insurance.
  Number one, why not let the employees make the decision? If the 
benefits are too skimpy, the employees will not buy them. On the other 
hand, if a basic plan enables you to see a doctor or save money on 
going to a doctor, that is a good thing and people will buy it.
  The second item I might mention, large corporations that self-insure 
and unions that cross States lines do not have to adhere to these 
mandates that people are saying is so important. So what is the 
difference? It seems to me that if we do not want to treat folks as 
second-class citizens, let small businesses have the same benefits that 
big corporations and unions currently enjoy.
  Now, the other item you will hear about is cherrypicking. There are 
provisions in this bill to prevent cherrypicking. You will hear about 
solvency problems. There are provisions in the bill to ensure that the 
solvency is the same as the solvency for other insurance companies.
  Now, who gets insured? You have heard, well, people will lose 
insurance, insurance rates will rise. CONSAD Research Institute 
conducted a study that concluded that 8.5 million more Americans, 
uninsured workers, would have access to insurance under this bill.
  Now, this bill is not a panacea. It is not perfect. But it is a step 
forward that will enable us to insure the group of people who do not 
have insurance. Instead of listening to all the thousands and hundreds 
of groups that they are saying are against this bill, but who for some 
reason have insurance, let us provide a benefit to the uninsured small 
businessperson, give them the opportunity to have associated health 
plans and move towards insuring the uninsured.
  This is National Insure the Uninsured Week, not National Let Us Talk 
About Insuring the Uninsured Week. The thing that we can do that would 
do the most good is to pass this bill and move toward insuring the 
uninsured.
  Mr. ANDREWS. Mr. Speaker, may I inquire as to how much time is 
remaining on our side?
  The SPEAKER pro tempore. The gentleman from New Jersey has 12\3/4\ 
minutes remaining, and the gentleman from Ohio has 10 minutes 
remaining.
  Mr. ANDREWS. Mr. Speaker, I yield myself 30 seconds.
  My friend from Maryland, whom I respect very much, when they talk 
about the number of people who would gain insurance with AHPs, the 
Congressional Budget Office drew the conclusion that the vast majority 
of members of AHPs would not be newly-insured people. They would be 
people shifted from existing plans into the AHPs.
  I think the better authority is that one million people, net, one 
million more people would be uninsured as a result of this bill.
  Mr. Speaker, I yield 2 minutes to the gentleman from Ohio (Mr. Brown) 
a member of the Committee on Energy and Commerce.
  Mr. BROWN of Ohio. Mr. Speaker, I thank the gentleman from New Jersey 
for yielding me this time and for his leadership on health care issues.
  In my home State of Ohio, we have a successful multi-employer health 
insurance program sponsored by the Council of Smaller Enterprises, or 
COSE. Some 14,000 businesses participate. For 30 years, Ohio's COSE has 
been negotiating with commercial insurers to offer small businesses 
coverage and rates usually reserved for the

[[Page H2969]]

largest companies. Each year, COSE members collectively save almost $50 
million in health insurance premiums.
  Unlike the association plans envisioned under 4281, COSE works within 
the framework of State insurance law. That means COSE is not subject to 
the scams, to the insolvencies, to the indiscriminatory coverage 
schemes that are the hallmark of association plans. This bill puts Ohio 
COSE at risk.
  It is like a poker game. If one person is playing by the rules and 
the other is cheating, the cheater will probably win. Now the stakes 
are even higher. Not only is health coverage at risk for those who play 
by the rules, but the gains are short-lived for those who do not.
  Companies that join an association health plan may see favorable 
premiums one year and be priced out of coverage the next. Their 
employees may or may not be covered for needed health care and claims 
may or may not be paid. It is simply a crap shoot.
  The American Academy of Actuaries has no stake in the outcome of this 
debate. Private insurers hire actuaries to calculate premiums. Here is 
what the Academy has to say about this bill. ``This bill will likely 
have unintended negative consequences.'' The Academy says ``AHPs 
produce fragmentation of the market,'' as we have heard over and over 
and over today. They say, ``AHPs are likely to lead to cherrypicking, 
to adverse selection, and to increased costs for sicker individuals.''

                              {time}  1430

  The academy says that AHPs create an unlevel playing field, there 
have been many examples of AHP-like organizations becoming insolvent, 
and that the anticipated expense reductions are simply unlikely to 
materialize. Even though 44 million Americans are uninsured, the 
Republican majority has no intention of seriously considering proposals 
to expand access to health insurance.
  Mr. BOEHNER. Mr. Speaker, I yield myself such time as I may consume.
  Let me remind all of my colleagues that we are talking about 44 
million Americans who have no health insurance. They get to the doctor, 
albeit very late, they get to the hospitals, albeit very late, they die 
sooner, and they have higher health care costs that we all who have 
health insurance pay for. It all ends up in the size of our bill.
  But the bigger disgrace is that there are 44 million Americans who 
have no health insurance, no preventive care; and we are attempting to 
do something about it. The gentleman from Ohio (Mr. Brown) denigrated 
these interstate plans as scams that could go corrupt. Let me see. If I 
recall, we have companies like General Electric which have employees in 
virtually every State. They have a plan under the Employee Retirement 
Income Security Act. How about the Teamsters? I would say the Teamsters 
have plans that cover virtually every State.
  Why would we not allow small employers that belong to the NFIB, 
belong to the U.S. Chamber of Commerce, belong to the Electrical 
Contractors Association, why would we not let them come together to 
form the same kinds of health insurance plans that large companies and 
unions offer from coast to coast? What do we have to fear? What do we 
have to fear in trying to help 44 million Americans have a chance at 
good health insurance?
  Mr. ANDREWS. Mr. Speaker, will the gentleman yield?
  Mr. BOEHNER. I yield to the gentleman from New Jersey.
  Mr. ANDREWS. Mr. Speaker, I assume the gentleman's question was not 
rhetorical. What we have to fear, we should listen to the advice of 
attorneys general and Governors and insurance commissioners from around 
the country who say we have to fear this: we have to fear a poorly 
regulated or unregulated structure that is not properly accountable 
under fiduciary standards and has no experience in running insurance 
companies, which is why they oppose the bill.
  Mr. BOEHNER. Mr. Speaker, reclaiming my time, those regulatory 
requirements are not on the GEs that we talked about, they are not on 
the Teamsters, they are not on other big employer or union plans. They 
are governed under a Federal statute called ERISA that has worked very 
well to insure and provide the basis for health insurance in America, 
and we ought to trust small businesses that would join these 
associations and give them the same rights that big companies and 
unions have.
  Mr. Speaker, I yield 2 minutes to the gentleman from Georgia (Mr. 
Kingston).
  Mr. KINGSTON. Mr. Speaker, I thank the gentleman from Ohio (Mr. 
Boehner) for yielding me this time.
  I want to talk about this as a former insurance agent. I sold 
property and casualty insurance to small businesses all over Georgia 
before I came to Congress. I was not in the health care business, but 
quite frequently my clients would come to me and say, Can you help us 
with health care? Can you point us in the right direction? So I have 
some knowledge of it on the ground from the perspective of a pet store, 
a barber shop, a brick mason, small employers with 5 to 15 people.
  What their problem is, they have been priced out of the health care 
business because we insist through state-mandated benefit that they 
have to buy a Cadillac insurance plan. They cannot buy a stripped down 
Toyota; they have to buy the Cadillac with all of the options. That is 
what we are doing. Because of that, that brick mason with seven 
employees says to his employees, We cannot do health care any more. If 
your wife or somebody in your family cannot put you on as a dependent, 
you do not have any health care.
  What this plan does is it gets uninsured employees back in the 
business of health insurance, those employees who are making too much 
money for Medicaid, for example, and workers comp is only going to 
cover them on the job. This gives them access to the health care. It 
makes it affordable because that brick mason, that pet store, that 
barber shop can combine with other similar businesses all around the 
country, and they can go into the marketplace with the economy of 
scale, the buying clout which the GEs and big unions have, and then 
they can have affordable health care. It gives relief from some of 
these mandated benefits. A mandated benefit is not necessarily bad; but 
if you require someone to have pediatric shots, nobody is going to say 
that is a bad idea, it makes sense, but it might not apply to you or 
you might want to assume that risk or cost yourself.
  We are saying to these employers and employees you have no option, 
you have to buy this because we are the government and we know what is 
best for you. This gives them a commonsense approach, a great 
compromise so they can afford health care again. I urge my colleagues 
to support this bipartisan legislation.
  Mr. ANDREWS. Mr. Speaker, I yield 2 minutes to the gentleman from 
Ohio (Mr. Kucinich), another voice who joins the coalition of AFL-CIO, 
66 chambers of commerce and the National Governors Association, a 
gentleman who has brought great honor to this House during his 
Presidential campaign.
  Mr. KUCINICH. Mr. Speaker, when a doctor prescribes a path of care 
that does not work out, patients are always advised to get a second 
opinion, so I want to offer a second opinion in answer to the gentleman 
from Ohio (Mr. Boehner).
  This bill would increase the number of uninsured. It would increase 
costs. It would increase discrimination against older workers, and it 
would remove patient protections. Despite the widespread agreement on 
the need to provide more health care coverage, decrease cost and 
improve care, this bill moves in the opposite direction. Instead of 
improving access to health care, this legislation would worsen access.
  Approximately 1 million people would lose their insurance coverage if 
this bill is enacted. Instead of reducing premium costs, this bill 
would increase premiums for 20 million small business workers. Instead 
of making coverage more equitable, AHPs would lead to discrimination 
against older workers who would have a much more difficult time getting 
coverage. Instead of increasing patient protections, this bill would 
remove them. State patient protection laws would be effectively waived 
for AHPs, leaving patients without the ability to enforce protections 
for basic benefits, like emergency medical services and access to 
specialists.
  The Hippocratic Oath says ``Above all, do no harm.'' This bill takes 
a bad

[[Page H2970]]

health care situation in this country and makes it worse, which is not 
what the people ought to expect from this Congress. I urge the Congress 
to reject the underlying bill and at some point in the future we are 
going to have to answer the issue of universal, single-payer, not-for-
profit health care so we do not look at these kinds of phony, stopgap 
measures.
  Mr. BOEHNER. Mr. Speaker, I yield myself such time as I may consume.
  I remind my colleagues one more time that we are talking about trying 
to assist 44 million Americans who have no health insurance. This may 
not be the perfect product, it may not be the perfect package, but for 
the life of me, I cannot understand why people do not want to come to 
the plate and try to do something to help these Americans who do not 
have access to affordable health insurance.
  Maybe the answer is what we just heard from my good friend and 
colleague, a member of the committee from the other end of the great 
State of Ohio who wants a single-payer national health plan. I think 
most Americans looked up in the mid-1990s when this idea was floating 
around and said, Oh, no. No, no, I like my health insurance. I like 
going to the doctor I choose. I do not need the government running my 
health insurance plan.
  Mr. Speaker, I yield 1 minute to the gentleman from Illinois (Mr. 
Crane).
  Mr. CRANE. Mr. Speaker, today the House has a chance to help small 
business with their number one concern: health care. Many Members are 
already aware of this, but 25 million small business owners, their 
families and employees currently do not have health insurance. It is 
simply too expensive. We have a system in our country today that puts 
small business on one playing field and big business on another, and 
that is not acceptable. Small business is the driving force of our 
economy, the number one job creator in the Nation, and the backbone of 
our local communities.
  H.R. 4281, the Small Business Health Fairness Act, puts small 
business and big business on a level playing field. It gives small 
business the capability of buying health insurance at the same cost and 
with the same rules that big business plays by. I think it is time we 
gave our small businesses a helping hand.
  I am confident that we will pass legislation to create association 
health plans today, and I encourage all of my colleagues to support it; 
but it is time for the other body to act and pass the Small Business 
Health Fairness Act. The time has come to address this problem, and the 
entire Congress should support this legislation.
  Mr. ANDREWS. Mr. Speaker, I yield myself 10 seconds.
  Mr. Speaker, we certainly take up the challenge to present a better 
idea, which the gentleman from Wisconsin (Mr. Kind) and I will be doing 
in a few minutes under the alternative. We understand that the American 
Academy of Actuaries, a group with no vested interest in this debate, 
has concluded that 1 million people will be added to the roles of the 
uninsured by this bill.
  Mr. Speaker, I yield 2 minutes to the gentleman from Illinois (Mr. 
Emanuel).
  Mr. EMANUEL. Mr. Speaker, I rise in opposition to this bill. I do it 
as the son of a pediatrician and the brother of an oncologist. I 
appreciate that the Congress today and the Senate, the other body, is 
having a debate about health care. Senator Kerry is out presenting his 
health care plan; the only person lacking a health care plan in this 
debate, after 3 years in office, is the President of the United States.
  The Institute of Medicine estimates that 18,000 Americans die 
prematurely because of not having health care. This is not just a 
problem of the poor. The fastest growing group of working uninsured in 
this country are people earning up to $50,000 a year. Kaiser Family 
Foundation found that the system, the insurance system, literally pays 
somewhere close to $125 billion to cover the uninsured who do not 
receive health care. All of us who have health care pay an uninsured 
premium in our health care cost for those who show up at hospitals 
without health insurance, getting critical care rather than preventive 
care.
  Even as we spend more money than any other industrialized nation on 
health care, we have 44 million uninsured, of whom 33 million work and 
10 million are children.
  To address the needs, we can do better than the bill which experts 
say will damage, rather than benefit, the insurance market. We can do 
better than a bill that takes away important insurance requirements 
like cancer screenings and other critical preventive care rather than 
relying on the emergency care which is what the uninsured patient 
receives today.
  This bill would actually increase the uninsured premium all of us pay 
who have health insurance by putting additional strains on the 
insurance system and increasing premiums for many Americans. In 2000, 
the health costs for a family of four was $6,500. Today it is $9,000. 
It is going up exponentially by a third. Nobody has gotten an increase 
in salary by a third. What is the driving force behind that 
inflationary fact in health care insurance premiums? The uninsured who 
show up at hospitals. Hospitals recoup the cost by passing it on, which 
raises premiums.
  Mr. Speaker, I urge my colleagues to reject this bill and pass the 
substitute which will help small businesses provide health insurance, 
reduce the number of uninsured while reducing the premiums the rest of 
us pay.
  Mr. ANDREWS. Mr. Speaker, I yield 3 minutes to the gentleman from 
North Dakota (Mr. Pomeroy), who had a career in State government in 
insurance regulation and, frankly, I think knows more about this 
subject than any other Member of the House.
  Mr. POMEROY. Mr. Speaker, I thank the gentleman for yielding me this 
time and commend the gentleman as well as the chairman for what is a 
very interesting debate with some technical sophistication on the 
business of how we expand health insurance in the small business 
environment.
  Let me begin by explaining briefly how purchase decisions work in a 
small business, unlike General Electric. General Electric has a human 
resources department. They have actuaries on contract. They can 
thoroughly do due diligence on any health insurance program they are 
evaluating for their employees.
  Our Own Hardware store in Valley City, North Dakota, my hometown, is 
quite different. There is one business proprietor, may a half a dozen 
or a dozen employees, and when he sits down to visit with a person 
promoting a health insurance program, he does not have an ability to 
evaluate the rating scheme. He does not have an ability to assess the 
adequacy of the fairness of the medical underwriting. That Our Own 
Hardware store does not have the ability to determine whether the 
company is solvent and reserving adequately to pay future claims, the 
Our Own Hardware does not have to do that because when they sell health 
insurance now, it is regulated. We have a State insurance department 
that does that. That used to be my job. And the State insurance 
commissioners across this country are in their offices every day making 
certain that the presentations to the Our Own Hardware stores 
represents a product that is going to be there when they need it.
  When we buy insurance, we pay premiums today with the hope of getting 
the claim paid tomorrow, and that means we have to have a reliable 
entity on the other end. That is what regulation brings us.

                              {time}  1445

  The bill before us would depart from that. They would basically 
substantially do away with State solvency checks, with the State 
regulation on underwriting criteria, with the assessment of whether or 
not the rating is fair. I believe there would be very, very damaging 
results. In order to bring the cost of insurance down, we have seen 
self-regulated companies like the AHPs try to cheat on the business of 
paying claims. They do not have the capital to pay the claims when the 
claims come due. In fact, the most recent version of the AHPs that have 
been out there, these MEWAs, the insurance commissioners tell us they 
left more than 400,000 people holding the bag with medical claims but 
no insurance company to pay them.
  The majority talks a lot about trying to get coverage to those who do 
not have it. You sure do not want to give people the illusion of 
coverage that is not real because they count on that company in paying 
the claim. And what we see with these self-regulated

[[Page H2971]]

outfits, when you need them, they are not there. They have taken your 
money and they have left. So not only does it fail in a meaningful way 
to get coverage to those who need it, it undercuts the coverage of 
those who already have insurance. In fact, the estimate from the 
actuarial firm that a million would lose their coverage is yet another 
solid reason why we should not take this path and adopt the AHPs.
  Vote ``no'' on this measure.
  Mr. BOEHNER. Mr. Speaker, I yield myself such time as I may consume.
  With all due respect to my good friend from North Dakota who is one 
of the real experts on insurance and pension matters in the House, he 
is a former State insurance regulator, we have heard this claim that 
Governors, State insurance regulators and attorneys general are opposed 
to this bill. Of course they are. Every State, we know what they want 
to do. They want to regulate, regulate, regulate, regulate.
  Let us go back to the example. The Procter & Gambles, the GEs, the 
Teamsters, they are not regulating those plans. They have got some of 
the best benefits that they offer to their employees. Let us go back to 
your example of the dry cleaner. The dry cleaner does not have the 
actuary. He has got the regulator, the attorney general. What if all 
those dry cleaners in a State, the State of North Dakota, or all those 
dry cleaners from around the country in their national association came 
together and formed an association health care plan? Those employees at 
that local dry cleaner would have better benefits at more competitive 
prices than they could ever get in a State insurance risk pool.
  What do we have to fear from giving those small employers and, more 
importantly, their employees the chance to come together to have the 
same kind of a plan that big companies and unions have today?
  Mr. Speaker, I reserve the balance of my time.
  Mr. ANDREWS. Mr. Speaker I yield myself the balance of my time.
  I agree completely with the chairman that the number one issue on the 
health care agenda of this country is finding insurance for the 43, 44 
million uninsured. I agree with him completely that it is a worthy 
project for this House to pursue. Long overdue. Usually it does not 
persuade me when you submit a list of people who are against a bill or 
for a bill, because I think each one of us has the obligation to make 
our own judgment about these matters, as each one of us should here.
  At this point in the Record, by the way, I include the Mercer study 
to which I referred, the actuarial study to which I referred, and the 
letter from the Congressional Budget Office to which I referred.

       [Prepared for: National Small Business United, June 2003]

Impact of Association Health Plan Legislation on Premiums and Coverage 
                          for Small Employers

(By Beth Fritchen, FSA, MAAA; and Karen Bender, FCA, ASA, MAAA, Mercer 
                       Risk, Finance & Insurance)


                           executive summary

       National Small Business United (NSBU) engaged Mercer Risk, 
     Finance & Insurance (Mercer) to analyze the ``Small Business 
     Health Fairness Act of 2003'' (H.R. 660 and S. 545). This 
     legislation would encourage the formation of federally 
     certified Association Health Plans (AHPs) by exempting these 
     plans from various state laws that govern health insurance 
     sold to small employers today.
       Proponents of H.R. 660 and S. 545 argue that federally 
     certified AHPs would expand access to affordable health 
     insurance for small employers and reduce the number of 
     uninsured. Opponents believe the legislation would have the 
     exact opposite effect--that is, it would cause premiums to 
     rise and the number of uninsured to increase.
       Mercer developed an actuarial model to assess how this 
     legislation would affect premiums for small firms that 
     purchase state-regulated coverage and firms that enroll in 
     AHPs over a four year period as well as the impact on the 
     number of uninsured.
       The analysis concludes that federal AHP legislation would 
     not alleviate the health insurance cost pressures faced by 
     small employers. Rather, the proposed AHP legislation would 
     have a detrimental impact on small employer premiums, 
     especially for firms with high-cost workers, and would cause 
     a significant number of small employers to drop coverage, 
     thereby increasing the nation's uninsured population.
       In brief, we found that once federal AHP legislation was 
     fully implemented:
       Health insurance costs would increase significantly for 
     small businesses in the state-regulated insurance market. 
     Health insurance premiums would increase by 23% for small 
     employers that continued to purchase state-regulated coverage 
     This increase would result from AHPs' ability to attract 
     healthier-than-average firms out of the state-regulated 
     market. AHPs' exemption from mandated benefits would allow 
     them to tailor products attractive to healthier populations. 
     Moreover, exemption from sate limits on premiums and 
     marketing standards would allow AHPs to enroll healthier-
     than-average groups and encourage firms with high cost 
     workers to switch back to the state-regulated market.
       As AHPs attract small employers whose perceived health 
     status is good, firms with greater expected health care 
     utilization would remain in the state-regulated market, where 
     they have the protection of mandated benefits and other 
     requirements. The resulting outflow of low-cost groups from 
     the state-regulated market and the remaining concentration of 
     high-cost groups would start an adverse selection spiral that 
     would accelerate premium increases for employers in the 
     state-regulated market.
       AHP legislation would increase, not decrease, the number of 
     uninsured. The number of uninsured would increase by over 1 
     million as a result of coverage losses among workers in small 
     firms and their dependents. As premiums for small employers 
     in the sate-regulated market increased, some firms would drop 
     coverage and not switch to an AHP. Coverage declines would 
     also result when groups covered by AHPs drop their coverage 
     when their rates increase because someone in the group gets 
     sick. While some of these groups would switch back to the 
     state-regulated market, others would drop coverage entirely.
       Federal AHPs would gain a pricing advantage through risk-
     selection, not greater administrative efficiency. The 
     modeling predicts that after four years premiums for AHPs 
     would average 10% below that of the existing small group 
     market. However, we expect these price reductions to result 
     from favorable risk selection and exclusion of benefits 
     rather than improved purchasing efficiency or lower 
     administrative costs. AHPs could use a variety of techniques 
     to select healthier-than-average firms--techniques available 
     to AHPs because the legislation preempts key provisions of 
     state law designed to prevent risk selection.
       Specifically, under H.R. 660 and S. 545 AHPs could: charge 
     firms with high-cost workers much higher premiums than 
     permitted under state law; experience rate each association 
     based on the risk of only their members; and offer pared-down 
     products without benefits that would be needed or desired by 
     higher-risk small employers. Together, these strategies would 
     allow AHPs to offer the most attractive rates to healthy 
     groups and avoid the cross-subsidies that state small 
     employer health insurance reforms require.
       Federal AHPs would insure the healthiest small employers. 
     The modeling estimates that the average morbidity (a measure 
     of whether a firm is ``sick'' or ``healthy'') of firms 
     enrolling in AHPs would be 21% lower than the average 
     morbidity of small employers in the market today. Further, as 
     higher-cost small employers dropped coverage in response to 
     rate increases resulting from the movement of healthy 
     employers out of the state-regulated market, the average 
     morbidity of the uninsured population would increase by 
     12.3%. AHPs would appeal most to firms with younger workers 
     given the close correlation between age and health status.
       Small employers would face higher premiums overall. Average 
     small employer premiums (considering both cost increases for 
     the state-regulated market and premium reductions for AHPs) 
     would increase by 6%. Average premiums would increase because 
     the size of the average premium increase for the population 
     remaining in the state-regulated market (23%) would outweigh 
     the smaller average premium decrease for those covered by 
     AHPs (10%).
       These results indicate that AHP legislation is not a 
     solution to rising health care costs for small employers. 
     While some firms obtaining coverage through AHPs may see 
     lower premiums, firms with higher-cost employees would see 
     their premiums increase. Overall, small employers would pay 
     higher premiums and the uninsured population would increase 
     if this legislation were enacted.
                                  ____


    Association Health Plan Bills Need Changes: Actuaries Find AHP 
                           Legislation Flawed

       In a letter to members of Congress, the nonpartisan 
     American Academy of Actuaries identified several serious 
     concerns with the Small Business Health Fairness Act of 2003 
     (H.R. 660 and S. 545). The bills would amend the Employee 
     Retirement Income Security Act to allow trade, industry, 
     professional and similar associations to be sponsors of 
     health insurance plans for their members. The Academy offered 
     to work with proponents of the bills, which bill sponsors 
     hope will expand the availability, affordability, and 
     accessibility of health insurance coverage.
       Karen Bender, M.A.A.A., chairperson of the Association 
     Health Plan Work Group, said that while the legislation has 
     merit and is

[[Page H2972]]

     well intentioned, ``we have serious concerns about some of 
     the bills' provisions. As written, the bills are flawed and 
     need significant rewriting to be actuarially sound and 
     protect consumers.''
       Some of the concerns that the group has with the 
     legislation are:
       Risk of Insolvency--The proposed rules governing the 
     minimum surplus requirements for an AHP does not account for 
     the growth of the AHP. Similar organizations have become 
     insolvent in the past. In response, most states enacted 
     solvency standards. To maintain the benefit of such standards 
     to consumers, the surplus standards should be similar to the 
     minimum requirements for Health Risk-Based Capital developed 
     by the National Association of Insurance Commissioners. The 
     legislation also relies on reinsurance vehicles that do not 
     currently exist in the market.
       Unclear Regulatory Authority--AHP government regulation is 
     not clearly defined in the law. Consumers, AHPs, and 
     regulators may have no place to go for redress and guidance 
     without clear regulatory authority.
       Unlevel Playing Field--The consequences of different rules 
     for AHPs vs. state-regulated plans fragments the market, 
     producing an unlevel playing field in insurance coverage that 
     will lead to cherry-picking, adverse selection, and increased 
     costs for some individuals.
       The House Committee on Education and the Workforce is 
     considering the House bill, and the Senate bill has yet to be 
     scheduled for committee consideration. For a copy of the 
     letter, go to the Academy website at www.actuary.org, or call 
     Tracey Young at 202-785-7872.


                                American Academy of Actuaries,

                                                   April 28, 2003.
     Hon. John A. Boehner,
     Chairman, House Committee on Education and the Workforce, 
         Rayburn House Office Building, Washington, DC.
       Dear Representative Boehner: This letter presents the 
     comments of the American Academy of Actuaries Association 
     Health Plan Work Group regarding the Small Business Health 
     Fairness Act of 2003 (H.R. 660 and S. 545). As you know, 
     these bills would amend ERISA to establish a new ``Part 8--
     Rules Governing Association Health Plans.''
       H.R. 660 and S. 545 are designed to expand access to 
     affordable health insurance by promoting the use of 
     Association Health Plans (AHPs). We support efforts to 
     increase the availability, affordability, and accessibility 
     of health insurance. While the goals of the legislation are 
     laudable, the bills do not address the core problem, which is 
     the high cost of health care. As currently written, the bills 
     will likely have unintended negative consequences that would 
     hinder the intent of the legislation.
       Members of the American Academy of Actuaries are available 
     to assist Congress in developing solutions to address the 
     issue of small-employer health insurance reform.


                           Executive Summary

       Some of the unintended negative consequences of the 
     legislation and our related concerns are as follows:
       Unlevel Playing Field: The consequences of different rules 
     for AHPs versus state-regulated insured plans is a 
     fragmentation of the market resulting from an unlevel playing 
     field. This is likely to lead to cherry-picking, adverse 
     selection, and increased costs for sicker individuals.
       Risk of Insolvency: The proposed rules governing the 
     minimum surplus requirements for AHPs do not account for the 
     growth of the AHP. Historically, there have been many 
     examples of AHP-like organizations becoming insolvent. 
     Following such events, most states enacted solvency 
     standards. To maintain the benefit of these standards to 
     consumers, the surplus standards should be similar to the 
     minimum requirements for Health Risk-Based Capital (RBC) 
     developed by the National Association of Insurance 
     Commissioners (NAIC). Also, the bills at issue rely on 
     affordable reinsurance vehicles that do not currently exist 
     in today's marketplace.
       Unclear Regulatory Authority: Governmental authority for 
     regulating AHPs should be clearly specified. Absent this 
     clarification, it is likely that nobody will be regulating 
     AHPs or that there will be conflicting regulation. When 
     regulatory authority is unclear, consumers have no place to 
     turn for redress.
       Unclear State Assessment Authority: The authority to levy 
     assessments will depend on what governmental body has 
     regulatory authority over AHPs. It should be clear what 
     states are allowed to do with assessments generated by AHPs.
       Actuarial Certification: The definition of a ``qualified 
     actuary'' should require membership in the American Academy 
     of Actuaries and should specify that the individual must have 
     pertinent health actuarial expertise.
       Other Concerns: Anticipated expense reductions are unlikely 
     to materialize.


    Issues Contributing to an Unlevel Playing Field and Subsequent 
               Destabilization of the Small-Group Market

       Allowable Rating Practice Differences Contribute to an 
     Unlevel Playing Field 
     Section 805(a)(2) requires that contribution rates must be 
     nondiscriminatory with regard to individual participants. It 
     also states that contribution rates for any participating 
     small employer must not vary on the basis of any health 
     status-related factor or the small employer's type of 
     business or industry.
       However, the term ``contribution rates'' is not defined. 
     Clarification of whether this refers to a contribution by an 
     individual within a small employer group or the rate an 
     individual employer within an AHP pays is necessary. If this 
     is intended to eliminate the possibility of varying rates for 
     individual small employers by health status, there is a 
     conflict in the language of the paragraphs that follow. The 
     language states that nothing in the bill shall be construed 
     to preclude an AHP from varying contribution rates for small 
     employers to the extent allowed under the state for 
     regulating small group insurance rates. Later in the 
     legislation, it allows an AHP to choose a single state as its 
     ``applicable authority'' and it need only follow the rating 
     rules of that state for the nationwide plan. If an AHP 
     chooses a state that has no restrictions on small group 
     rates, it seems the limitation on varying contribution rates 
     by health status is not enforceable, thereby resulting in 
     cherry-picking.
       This provision would permit an AHP to be exempt from small-
     group rating laws, which have been enacted by many states. 
     The AHP could charge small employers with less healthy 
     employees a higher rate than would be permitted for health 
     insurers operating under the small-employer rating 
     restrictions. The result would be that small employers whose 
     employees are greater health risks are more likely to obtain 
     coverage from the private health insurance market, where 
     rates are limited, than through AHPs, who may not have the 
     same limitations. State small group legislation sought to 
     eliminate this sort of selection in the market by requiring 
     health insurers to put all their small groups in one pool and 
     to limit the premium charged to one employer relative to 
     another. Introducing AHPs that are not required to adhere to 
     the same rating rules brings selection back into the market. 
     The consequence will be that the rates for the two pools will 
     diverge, causing further instability in an already fragile 
     market.
       Lower Solvency Standards Contribute to an Unlevel Playing 
     Field.--State-regulated, non-AHP insured plans are subject to 
     state solvency regulation. Ongoing surplus requirements are 
     normally met by risk or profit charges within the premiums or 
     contributions. While this may result in short-term premium 
     savings for the AHPs, the inadequate contributions to surplus 
     likely will contribute to AHP insolvencies, resulting in 
     consumers and providers being responsible for unpaid claims.
       Benefit Differences Contribute to an Unlevel Playing 
     Field.--AHP groups, according to the bills, will be exempt 
     from state mandated benefits. Healthier groups are less 
     likely to utilize mandates and, therefore are more likely to 
     choose AHP coverage, while groups with higher health risks 
     and higher utilization of these mandated services are more 
     likely to remain in the traditional insured market, thus 
     widening the gap between the two markets. Currently, both 
     high and low utilizers are in the same insured pool and the 
     cost for mandates is spread across a larger pool for a small 
     incremental cost. Splitting the required mandates by market 
     will lower the cost for some, but raise the incremental cost 
     for others.
       In summary, market destabilization is a likely result of 
     the proposed AHP legislation, as currently written, because 
     of the disparity in allowable rating practices and solvency 
     standards, which would be compounded by benefit 
     differentials. The only way to maintain a level playing field 
     is to have a common set of rating rules and consumer 
     protection laws for every entity, whether it is an insurance 
     company, health maintenance organization (HMO), or a self-
     funded AHP.


                           Solvency Standards

       Solvency standards should include both claim reserves and 
     surplus requirements. The description of claim reserve 
     requirements for AHPs in Section 806 of the bills seems 
     adequate. The proposed rules governing AHPs should include 
     ongoing requirements that are similar to the minimum 
     requirements for Health Risk-Based Capital (RBC) developed by 
     the National Association of Insurance Commissioners (NAIC). 
     The start-up capital included in Section 806(b), ``Minimum 
     Surplus in Addition to Claims Reserves,'' does not adjust for 
     future inflation or size of the AHP. Many states had similar 
     minimum surplus requirements that became inadequate until 
     they made legislative changes to increase minimums for 
     inflation.
       However, capital requirements also need to increase with 
     the growth of AHP claim volume. Recognizing that capital 
     requirements need to be tied to the size and risk profile of 
     risk-bearing entities, states are now implementing the NAIC 
     Health RBC formula. Under the Health RBC Underwriting Risk 
     Factor, an approximation of surplus for many entities would 
     be a minimum of eight percent to 10 percent of the total 
     projected claims for the AHP during the year following the 
     evaluation of such claims. The minimum surplus is adjusted to 
     reflect the purchase of stop-loss reinsurance and other types 
     of reinsurance.
       While the requirements for claim reserves, surplus, and 
     other factors may be adequate for the start-up phase of an 
     AHP, they appear inadequate if the total annual claims volume 
     of the AHP exceeds $5 million to $10 million (5,000 to 10,000 
     individuals). As the AHP gets larger, the total surplus 
     requirement for solvency rises with claim volume. AHPs that 
     provide coverage for employers in

[[Page H2973]]

     higher-risk industries may have even larger surplus 
     requirements. Such employers may not have higher initial 
     claims, but due to higher employee turnover they may have 
     higher claims in future years, necessitating larger surplus 
     requirements.


                        Actuarial Certification

       Section 806 of the bills provides for the certification of 
     AHP solvency by a ``qualified actuary.'' The work group 
     wishes to stress the importance of defining that term as ``an 
     individual who is a member of the American Academy of 
     Actuaries,'' and they further recommend that the definition 
     be strengthened by requiring pertinent health actuarial 
     expertise.
       It is important that the definition of a ``qualified 
     actuary'' should be ``an individual who is a member of the 
     American Academy of Actuaries.'' As the U.S.-based 
     organization with primary responsibility for promoting 
     actuarial professionalism, the Academy staffs and supports 
     the Actuarial Standards Board (which promulgates actuarial 
     standards of practice), the Committee on Qualifications 
     (which develops qualification standards), and the Joint 
     Committee on the Code of Professional Conduct (which develops 
     and maintains standards of conduct for actuaries).
       The Academy also staffs and supports the Actuarial Board 
     for Counseling and Discipline (ABCD), which provides 
     confidential guidance to actuaries on how to maintain high 
     professional standards in their practices and investigates 
     complaints that may be brought against them. Academy members 
     who fail to comply with applicable professional standards are 
     subject to public discipline up to and including expulsion 
     from membership. Academy membership thus brings with it the 
     obligation to comply with high standards of qualification, 
     conduct, and practice, and we believe Academy members will 
     satisfy that obligation when making the solvency 
     certification required by Section 806.
       Actuaries who are not members of the Academy, or one of the 
     other U.S.-based actuarial organizations, are not subject to 
     the professional standards and discipline process just 
     described. Therefore, in a situation where a non-member 
     actuary had issued a flawed certification of an AHP's 
     solvency, the Academy would be unable to help monitor the 
     situation.


                          Applicable Authority

       Section 812(a)(5) provides a definition for ``applicable 
     authority'' that allows the U.S. Department of Labor (DOL) to 
     delegate responsibility to enforce federal standards for AHPs 
     to states in certain instances. However, this authority is 
     not universal. The section provides for situations in which 
     there is ``joint authority,'' presumably between the state 
     and federal levels. There are also situations in which the 
     DOL has sole authority over an AHP and state jurisdiction is 
     preempted.
       These provisions create confusion about which regulatory 
     entity has responsibility for oversight of the various 
     functions of AHPs. We make note of the bills' recognition of 
     the value of the expertise and resources currently in place 
     at the state level. However, we are concerned that the 
     current language will create situations similar to previously 
     proposed legislation on Multiple Employer Welfare 
     Arrangements (MEWAs) in which the scope of regulatory 
     responsibility over such plans was unclear. As an example, 
     Section 802 of the bills gives certification authority to the 
     secretary of labor. It may be difficult for an individual 
     department of insurance to monitor the certification status 
     of AHPs operating within their state. It is crucial that the 
     oversight responsibility regarding solvency standards be 
     clear to avoid situations where AHPs fail because of 
     confusion regarding what entity is to be monitoring and 
     taking action when necessary.
       There are a number of specific questions not answered by 
     this language in the bills. For example, does the current 
     language enable individual states to require AHPs operating 
     within their boundaries to abide by all existing insurance 
     regulations, including small-group rating laws and mandated 
     benefits? Or is the scope of states' responsibilities limited 
     to verifying the solvency of an AHP? Can the states 
     require AHPs to meet minimum solvency standards required 
     for insurance companies if those requirements are more 
     stringent than those described in these bills? Thus, it is 
     not clear that states would be willing to effectively 
     regulate these entities if the exemptions are viewed as 
     contrary to the intent of the state legislature.
       Section 813(b)(2)(D) establishes that each AHP can identify 
     a single state to act as its ``applicable authority.'' This 
     section further provides that the laws of this single state 
     ``supersede any and all laws of any other State in which 
     health insurance coverage of such type is offered.'' Many 
     states have devoted much time and many resources to 
     developing requirements pertaining to rating, benefit 
     coverage, and consumer disclosures that they believe serve 
     the best interests of their citizens. However, this section 
     would exempt AHPs from having to abide by these laws if the 
     AHP has elected a different state to act as its ``applicable 
     authority.'' This could result in AHPs ``shopping'' for the 
     state perceived to have the least oversight, effectively 
     negating the existing health insurance laws in most states. 
     In some states with small employer regulations that 
     significantly increase the cost of health insurance, all of 
     the small employers could migrate to AHPs, resulting in 
     federalization of the state's small group market.
       In addition to rating and benefit regulations, provider and 
     claim payment laws add further complexity to this issue. 
     These include, but are not limited to: any willing provider 
     laws, prompt payment rules, privacy and patient protection 
     laws, and regulations regarding assignment of claims.
       The work group is concerned that by dividing the oversight 
     responsibilities between the state and federal governments, 
     confusion will result regarding which entity has authority 
     over which function. The end result could be either 
     overregulation to the point that AHPs cannot operate, or 
     underregulation. When regulatory authority is unclear, 
     consumers have no place to turn for redress.


                       State Assessment Authority

       Section 811 of the legislation allows states to impose 
     assessments on AHPs based on the amount of premiums or 
     contributions received from employers and employees who make 
     up the plan. Many states use assessments to subsidize ``high-
     risk'' pools for uninsured individuals. However, it is 
     questionable whether a state would have the authority to levy 
     such assessments if it defers to the DOL to regulate its AHPs 
     or if a multi-state AHP is domiciled in another state's 
     jurisdiction.
       The states also may have problems enforcing the provision, 
     given the requirement that such assessment ``is otherwise 
     nondiscriminatory . . . .'' Section 811 provides that the 
     rate of the assessment cannot exceed premium taxes paid by 
     health insurers or HMOs. In most states, HMOs are not taxed 
     or pay a lower tax than health insurance companies. AHPs 
     might argue that imposing an assessment based on the premium 
     tax rate applied to a health insurer would be discriminatory 
     if a lower rate or no premium tax was applied to HMOs. The 
     work group recommends that the legislation clearly delineate 
     where assessment authority will be placed, at the state or 
     federal level, and what the provisions of the assessments 
     will be.


                             other concerns

       Expense reductions are not likely to materialize. 
     Administratively, each employer group will require the same 
     amount of underwriting, enrollment, mailings, and customer 
     support as they currently do in the small group insurance 
     market. It is unlikely that the AHPs will have more buying 
     power than the insurers that represent small employers today.


                               conclusion

       The work group supports efforts to expand access to health 
     insurance. However, H.R. 660 and S. 545 can have many 
     unintended negative consequences. These include: An unlevel 
     playing field, leading to market destabilization and higher 
     rates for sicker individuals; potential AHP insolvencies, 
     resulting in unpaid claims for consumers and providers; 
     unclear regulatory responsibility; unclear directives 
     relating to assessments; and a promise of expense reductions 
     that are unlikely to materialize.
       Again, members of the American Academy of Actuaries are 
     available to assist Congress in developing solutions to 
     address the issue of small-employer health insurance reform. 
     If you or your staff would like additional information or 
     assistance, please feel free to contact Holly Kwiatkowski, 
     the Academy's senior health policy analyst (federal), by 
     phone at (202) 223-8196 or by e-mail at 
     [email protected].
           Sincerely,

                                                 Karen Bender,

                                                      Chairperson.
       Other Academy members contributing to this letter are: 
     Michael S. Abroe, FSA, MAAA; David J. Bahn, FSA, MAAA; 
     Jennifer J. Brinker, FSA, MAAA; Michael L. Burks, MAAA; James 
     E. Drennan, FSA, MAAA, FCA; Richard M. Niemiec, MAAA; Donna 
     C. Novak, ASA, MAAA, FCA; John R. Parsons, MAAA, FCA; John J. 
     Schubert, ASA, MAAA, FCA; David A. Shea, Jr., FSA, MAAA; Mark 
     Wernicke, FSA, MAAA; and Jerome Winkelstein, FSA, MAAA.
                                  ____

                                                    U.S. Congress,


                                  Congressional Budget Office,

                                    Washington, DC, June 18, 2003.
     Hon. George Miller,
     Senior Democratic Member, Committee on Education and the 
         Workforce,
     House of Representatives, Washington, DC.
       Dear Congressman: This letter responds to your request of 
     June 17, 2003, for additional information on CBO's estimate 
     of the impact of H.R. 660 on enrollment in the health 
     insurance markets for small employers and self-employed 
     workers. We expect that the effects of the bill would be 
     fully reflected in those markets by 2008, and all of the 
     following numbers refer to that year.
       Under current law, CBO estimates that approximately 30.1 
     million people will be enrolled in health insurance offered 
     by plans in the state-regulated small group insurance market. 
     Under the bill, CBO estimates that combined enrollment in 
     state-regulated plans and association health plans (AHPs) 
     would rise by about 550,000 people to a total of 30.7 million 
     people. Of this, approximately 23.2 million people would 
     retain coverage in the state-regulated market. About 7.5 
     million people would be enrolled in AHPs, including the 
     additional 550,000 people who would not have been covered by 
     any small-employer plan under current law, and 6.9 million 
     people who would have been covered in the state-regulated 
     market.
       The same considerations apply to self-employed people. We 
     estimate that approximately 4.7 million people will be 
     enrolled in

[[Page H2974]]

     state-regulated coverage purchased by self-employed workers 
     under current law. Under H.R. 660, CBO estimates that 
     combined enrollment through state-regulated insurers and AHPs 
     would rise by about 70,000 people to 4.8 million people. Of 
     this, approximately 3.8 million people would retain state-
     regulated coverage. About 1.0 million people would obtain 
     coverage through AHPs, including the additional 70,000 people 
     who would not have been insured under current law, and 0.9 
     million people who would have been covered in the state-
     regulated market.
       If you would like additional information on this estimate, 
     the CBO staff contact is Stuart Hagen, who can be reached at 
     225-2644.
           Sincerely,
                                              Douglas Holtz-Eakin,
                                                         Director.

  There is a reason that it is not just Democratic Governors but 
Republican Governors who object to this bill. There is a reason why 
Democratic and Republican attorneys general object to this bill, why 
Democratic insurance commissioners and Republican insurance 
commissioners object to this bill. It does not work. What it does is 
offer a Faustian bargain, where people give up their guaranteed 
protection for breast cancer screenings, care for OB-GYN services, care 
for diabetics. They give that up. They leave it to the whim of the 
insurance industry. What they get for it is not lower premiums and more 
people insured, but you get more uninsured.
  The actuaries have concluded that 1 million people will be added to 
the rolls of the uninsured by this bill. Outside experts who do not 
favor either side in a partisan sense have concluded that 1 million 
persons will be added to the ranks of the uninsured by this bill. The 
insurance commissioners, the attorneys general and the Governors of 
both parties throughout the country do not object to this bill because 
they have some turf desire to regulate. They object to this bill 
because it presents an unworkable situation where insurance companies 
will fail, where creditors will not be paid, where people depending 
upon insurance will not be insured, and we will have the chaos that we 
had some years ago under the multiple employer welfare associations.
  There is a better way to cover the uninsured. We will debate that 
better way in just a few minutes in the substitute that the gentleman 
from Wisconsin and I are putting forward. But we should not add to the 
ranks of the uninsured. It is our responsibility to offer a better 
alternative, and we do. But it is the responsibility of this entire 
House to join with Governors of both parties, 66 chambers of commerce, 
the National Association of Health Underwriters who perhaps best 
understand this, insurance regulators, attorneys general, and not turn 
to a gimmicky, insufficient solution to this problem. I urge defeat of 
the legislation.
  Mr. BOEHNER. Mr. Speaker, I yield myself the balance of my time.
  We often have debates here in Congress about public policy and how to 
change public policy. Many times the debates, once they get here, the 
perfect becomes the enemy of the good. We do not claim that the 
underlying bill is going to cover all of the uninsured and eliminate 
that problem, but we do think it is a giant step forward in helping the 
uninsured get access to high-quality health insurance at affordable 
prices.
  Even the flawed study that my colleague has pointed to on a number of 
occasions, the CBO study which was flawed in a number of areas, says 
that 330,000 of the uninsured will in fact get health insurance. I 
think the number is far, far higher than that. I think we are talking 
about millions of Americans will have a chance at good health 
insurance. But let us say it is only 330,000, 330,000 families that 
would get coverage under this bill. I think that is a good step in the 
right direction.
  Let me take an example of how this would work. Let us take a Realtor. 
We all know Realtors work all over the country. They are independent 
contractors. They have their own business. In many cases they are not 
employees of the firm that they work for, but they have to go buy an 
individual policy or family policy in a State insurance pool, the most 
expensive way to buy health insurance in America. In the case of 
Realtors, you could take the Ohio Association of Realtors, New Jersey 
Association of Realtors, maybe the National Association of Realtors, 
could put together a plan of maybe 5 or 6 choices, maybe 10 choices for 
their members all over the country. I will guarantee that those 
Realtors would have much better health insurance policies than they 
have today and the cost of that policy will be far more competitive 
than what they are paying in these State insurance pools.
  This is a very good opportunity to help many small employers and 
their employees all across the country. We should not miss this 
opportunity.
  Mr. CANTOR. Mr. Speaker, I rise today in support of three important 
initiatives we took this week to meet the uninsured crisis head-on and 
to address the rising costs of health care.
  We have a crisis on our hands--over 40 million Americans are without 
health insurance. In addition, it is becoming increasingly difficult to 
not only obtain affordable health coverage, but to keep it--especially 
for America's small businesses.
  According to the Associated Builders and Contractors, over 60 percent 
of the Nation's uninsured are small business employees. Small 
businesses are the backbone of our economy. We must ensure that we 
create an environment that allows these businesses access to affordable 
health care. If we do not address the issue, we will see more and more 
small businesses stop growing or close their doors. It is imperative, 
therefore, that we pass legislation creating Association Health Plans 
and legislation that allows families to roll-over money year-to-year 
from their Flexible Spending Accounts or into new Health Savings 
Accounts.
  These two pieces of legislation will dramatically improve our 
Nation's health care climate, especially for small businesses. More 
individuals and their employers will be able to afford health care; and 
in turn, we will see the health of Americans improve and the costs of 
health care decline.
  The third piece of legislation addresses America's medical liability 
crisis. Physicians in Virginia and across the country are being forced 
to close their doors due to the astronomically rising costs of medical 
malpractice premiums.
  On February 4, 2004, as many as 1,500 physicians from all over my 
State marched on the Virginia Capitol to make the case for common-sense 
medical liability from reform in the State legislature. Led by the 
Medical Society of Virginia, Virginia's White Coat Day march on 
Richmond was designed to educate state lawmakers on how doctors' 
skyrocketing malpractice insurance is limiting patients' access to 
medical care. Outrageous runaway jury awards are causing malpractice 
premiums to rise uncontrollably,and many doctors are being forced to 
raise prices or shut their doors. These higher costs are then passed on 
to working families and small businesses.
  Not only should the Virginia legislature address this issue, but we 
as a Congress need to do the same. We need to take President Bush's 
lead in ending the jackpot payouts that our legal system encourages.
  Mr. Speaker, we must pass these common sense reforms into law in 
order to help our Nation's uninsured and address the rising costs of 
health care. These are issues we cannot afford to ignore.
  Mr. BLUMENAUER. Mr. Speaker, one of the most frustrating aspects of 
the way we run Congress today is an interest in scoring political 
points as opposed to solving problems. Nowhere is that more in evidence 
than the symbolic political acts surrounding healthcare this week in 
the House of Representatives.
  We are in the midst of a healthcare crisis for the uninsured, for 
small businesses, and for practitioners. There is a complicated, 
interconnected fabric that provides healthcare in this country that 
includes insurance companies, HMO's, public agencies, Federal 
Government programs and the institutions that represent and train 
medical professionals. Advocacy groups, legal experts and consumers all 
have legitimate interests and something to say.
  Sadly, the Republican leadership in the House of Representatives 
continues to be more interested in scoring political points than 
solving problems. Simply recycling the same flawed legislation, is 
clearly far less than our best effort and stands little likelihood of 
passage to the Senate, where similar legislation continues to languish.
  These bills would undermine our efforts by insuring only the 
healthiest and wealthiest, leaving 511,00 uninsured Oregonians and tens 
of millions of Americans behind. Furthermore, the Association Health 
Plans proposals would exempt state solvency requirements, leaving the 
consumers at a significant risk.
  If we were able to openly debate these proposals on the floor I know 
that the healthcare community would be well served because the majority 
of Congress does not want to short change it or our citizens. Most in 
Congress do not want to artificially restrict payments and are 
sincerely interested in making sure that Federal policy does not create 
or enhance abusive or distorted behaviors.

[[Page H2975]]

  The most dramatic example would be fixing flawed funding. There is a 
gusher of money going to items far less important, far less essential 
to the American public, such as the unaffordable, unnecessary 
additional tax benefits to those who need help the least. It is time 
for the vast array of interests represented by the healthcare community 
and the people vitally dependent upon it to insist that the Republican 
Leadership stop the games. Everyone should commit to full, fair, honest 
debate in a more open legislative process. This is the only way we will 
enact cost effective legislation, and stop the funding abuses. We must 
stop holding legislation hostage, to another political agenda. I will 
continue to work with my healthcare community at home along with 
national groups and organizations to produce the type of process, 
discussion and legislation Americans critically deserve.
  Mr. SANDLIN. Mr. Speaker, with nearly 44 million Americans lacking 
basic health care coverage, it is time to take action. Today, in a 
disingenuous public attempt to respond to the crisis of the uninsured, 
the Republican leadership has decided to spend the valuable time and 
limited resources of the American taxpayers debating Association Health 
Plan (AHP) legislation that has already been voted on in the 108th 
Congress.
  The absolute irony, of course, is that instead of strengthening the 
health of our nation, AHPs will increase the ranks of the uninsured, 
increase the health insurance costs for small businesses that don't 
participate in AHPs and destroy consumer protections currently 
safeguarded by state regulations. Clearly, this is not sound policy.
  Why are AHPs so bad? The creation of Association Health Plans will 
destabilize health insurance markets by forcing the state-regulated 
market and national AHP market to compete with each other. Few will 
benefit and most will suffer from this damaging division. Small 
businesses who choose to stay in the safer, state-regulated health 
insurance market will see their health insurance premiums skyrocket by 
23 percent. The reality is that AHPs can offer lower premiums mainly 
because they offer fewer benefits--which is attractive to people in 
good health. With the AHPs siphoning off healther people into their 
market, state-regulated insurers will be responsible for covering a 
larger proportion of people with higher health care costs. Rather than 
risk being spread out and absorbed by many, it is divided, thereby 
threatening the solvency and accessibility of the state-regulated 
insurance businesses.
  Mr. Speaker, it is clear that Association Health Plans hurt American 
workers and their families. The lower costs available to small 
businesses opting into AHPs are simply not worth it when you consider 
the damaging strings attached. This legislation allows AHPs to pre-empt 
over 1,000 important state laws that States enacted to protect the 
basic health care needs of our communities. These laws include 
critically necessary benefits like mammographies, diabetes care, well-
child visits, mental health services, and direct access to OB/GYN and 
pediatricians. Pre-empting state laws also allows AHPs to redline and 
re-underwrite insurance for higher risk people, allowing discrimination 
against consumers and causing insurance premiums to rise.
  Employees will be further compromised by the lack of rights afforded 
to them under their AHP policies. If consumers are denied important 
healthcare treatment, they will not be allowed an independent external 
review and/or Consumer Ombudsmen program as state consumer-protection 
laws regulate. Further, there are very weak protections 
against insolvency under the AHP program which means small employers, 
American workers and their families may be burdened with millions of 
dollars of unpaid claims, which is exactly what health insurance is 
supposed to insure against.

  Finally, Mr. Speaker, it is worth noting that a recent study by 
Mercer and the National Small Business Association concluded that AHPs 
would swell the ranks of the uninsured to rise by more than one million 
people--an increase of 8.5 percent. This is because as premiums for 
small business employers in the state-regulated market increase, some 
firms would drop coverage. Further, businesses covered by AHPs might 
have to drop coverage if they are forced to pay new, higher premiums if 
someone in their group gets sick.
  Mr. Speaker, it's hard to imagine why anyone would vote for such a 
flawed piece of legislation that would be devastating to American 
families. Sadly, the answer is clear: The Wall Street Journal recently 
said that a major business trade organization stands to reap more than 
$100 million of annual revenue by selling AHP policies if H.R. 4281 is 
passed. Mr. Speaker, our constituents deserve better than this.
  The fact is that there are clear alternatives. Yesterday, I 
introduced H.R. 4356, the Small Business Health Insurance Promotion 
Act. This legislation will provide immediate, concrete relief by 
securing affordable health insurance coverage for millions of self-
insured individuals and employees of small businesses.
  Mr. Speaker, as an incentive to provide coverage, the Small Business 
Health Insurance Promotion Act would make small businesses or self-
employed individuals eligible to receive a 50 percent tax credit for 
four years to defray the cost of health insurance. The bill would also 
authorize funding to create state and national multi-insurer pools to 
provide comprehensive and affordable health insurance choices to small 
employers and the self-employed. Regardless of whether a business 
elected to enter the state or national pool consumers would be 
guaranteed quality coverage--coverage in each pool must be 
substantially similar to health benefits coverage offered in any of the 
four largest health plans in the Federal Employees Health Benefit 
Program (FEHBP). In this legislation, unlike in AHPs, important 
consumer protections would be safeguarded, the same coverage available 
to Members of Congress and other federal employees.
  Forget the gimmick. Rather than offering up stale legislation which 
will hurt--not help--the health of our nation, let's take real action 
and pass sound coverage policies. Pass the Kind substitute, and take up 
the Small Business Health Insurance Promotion Act, as well as other new 
Democratic initiatives like the FamilyCare Act and the Medicare Early 
Access Act. Together these initiatives could provide health coverage to 
more than one-half of the 44 million uninsured Americans. Our American 
families deserve no less.
  Mr. STARK. Mr. Speaker, I rise today to oppose H.R. 4281, the ``Small 
Business Health Fairness Act of 2004.'' This bill would hurt small 
businesses and patients by increasing the costs of health insurance and 
the number of uninsured.
  If my comments today sound familiar, it is because they are almost 
exactly the same arguments I made last June, when this exact same bill 
passed the House. It was a bad idea then, and it is an even worse idea 
today. During this ``Cover the Uninsured Week'' the Republicans suggest 
association health plans can cover millions of uninsured Americans. In 
reality H.R. 4281 would actually add to the nearly 44 million uninsured 
in this country. This warmed over re-vote is a waste of time and 
taxpayer resources, and has nothing to do with providing affordable 
healthcare options to our citizens.
  According to recent studies, association health plans would actually 
increase costs for most small businesses and their employees. Our own 
Congressional Budget Office has estimated that over 80 percent of small 
businesses would see increased premium costs under H.R. 4281. Those 
small employers that currently offer traditional, state-regulated 
health insurance would see their premiums increase by 23 percent on 
average. Premiums will increase because AHPs will offer only bare-bones 
coverage, attracting the healthiest individuals, leaving traditional 
health insurance plans with the sickest and most expensive patients. 
This shift would penalize businesses with sicker employees, and make 
health insurance even more unaffordable for those who need it most.
  I am glad to see my Republican friends are concerned about the 43.6 
million people in this country who lack health insurance. However, AHPs 
are not a real solution, and will actually add 1 million people to the 
continuously growing number of uninsured. As traditional health 
insurance becomes increasingly expensive, more and more businesses 
would have no choice but to drop health insurance for their employees, 
leaving these individuals with little or no opportunity to purchase 
health coverage.
  Not only will this bill increase the number of uninsured, it will 
blatantly discriminate against small businesses with sicker employees--
often those businesses with lower-income and minority workers. Because 
H.R. 4281 would allow AHPs to avoid state laws against cherry picking, 
these plans would only offer insurance to small businesses with the 
healthiest employees. Any premium reductions touted by the bill 
sponsors--at most a modest 10 percent reduction--would be a direct 
result of cherry-picking and reduced benefits, not greater efficiency. 
As healthy people move into AHP's skeletal coverage, sicker people are 
left without health insurance, increasing the morbidity of the 
uninsured population by over 12 percent.
  Small businesses will not be able to provide more affordable health 
insurance to their employees under this bill. Although proponents claim 
that AHPs would give small-employers bargaining power to purchase 
affordable health insurance, most states already have laws in place 
that allow for group purchasing arrangements. This bill would harm 
existing State laws and usurp the traditional role of States to 
regulate small-employer health insurance.
  This bill would also preempt key State provisions that protect 
millions of insured Americans. For example, many States regulate 
insurance premiums to prevent insurers from discriminating against the 
sick. But under this

[[Page H2976]]

bill, AHPs could offer extremely-low ``teasers'' rates, and then 
rapidly increase premiums if the enrollee becomes sick. Many small 
businesses would find these high rates unaffordable, and would be 
forced to drop coverage. Furthermore, nearly all States have enacted 
external review laws, which allow patients to have an independent 
doctor review a claim that has been denied by the insurer. Patients who 
join AFPs would lose this right.
  Additionally, this legislation would be a setback to government 
efforts to reign in fraud and abuse. Association health plan exemptions 
in this bill are nearly identical to those Congress grated to multiple 
employer welfare arrangements (MEWAs) in the 1970s, which led to 
widespread fraud and abuse. These exemptions allowed MEWAs to rack up 
$123 million in unpaid healthcare bills, and prompted the Department of 
Labor to open 90 fraud and abuse investigations. Congress recognized 
and corrected this problem, but now my Republican colleagues are 
ignoring the lessons of the past and are headed right back down the 
same dangerous road with AHPs.
  Finally, this bill would exempt AHPs from state-required benefits, 
which have helped to ensure that millions of Americans get access to 
necessary healthcare services. These benefits include mammography 
screenings, maternity care, well-child care, and prompt payment rules. 
In my State, California, employees who join AHPs could also lose access 
to certain emergency services, direct access to OB/GYNs, mental health 
parity, and other important benefits.
  The Democratic substitute offered today by Representatives Andrews 
and Kind is a real solution for providing small-businesses access to 
affordable health insurance. Using the $50 billion President Bush 
included in his FY04 budget for the uninsured, this proposal would 
allow small businesses to buy-into a small employer health benefits 
plan (SEHBP). Republicans have been stammering for years about giving 
people the same insurance options as members of Congress and this 
substitute would do just that. The SEHBP would be substantially similar 
to the Federal Employers Health Benefits Plan (FEHBP) and millions of 
uninsured would finally have the same options we have as Members of 
Congress.
  This association health plan bill is bad for patients, bad for small 
businesses, and bad for states. It is opposed by over 1,000 
organizations, including the National Governors Association, local 
Chambers of Commerce, small business associations, physician 
organizations, labor unions, and healthcare coalitions. H.R. 4281 would 
increase premiums, increase the number of uninsured, lead to massive 
fraud, and remove key state patient protections. I urge my colleagues 
to reject this legislation.
  Mr. JONES of Ohio. Mr. Speaker, I rise today in support of Small 
Businesses, and I am an advocate of Small Businesses providing quality 
health insurance to the men, and women, and the families of those who 
work for them. But, because I oppose H.R. 4281 that does not make me 
anti-Small Business, just like opposing the war in Iraq does not make 
one unpatriotic. What it makes me is an advocate for the truth and the 
facts. And the fact is that these association health plans would be 
exempt from almost all state consumer protection laws regarding 
benefits, premiums, and solvency. States are generally the primary 
regulators of health insurers, and assure appropriate access to health 
care, and protect against fraudulent marketing schemes. It is no wonder 
the National Governors Association, the National Conference of State 
Legislature, and Consumer Unions oppose this legislation. This 
initiative would allow Associated Health Plans to engage in the cherry 
picking of the healthiest population nationwide. In Ohio, AHPs would 
not be required to provide basic mammography screening, direct access 
to OB-GYN's, mental health services, alcoholism treatment, and vital 
primary health care. In addition to not providing particular types of 
services, there would be no limitation on how frequently AHPs could 
increase an employee's premium to continue coverage. AHPs could then 
also vary their rates for older or sicker members of their plans. 
Establishing association health plans will not significantly reduce the 
number of uninsured Americans. The Congressional Budget Office 
estimates that while 4.8 million Americans would join association 
health plans; only 330,000 of them would come form the ranks of those 
currently uninsured. The remaining 4.5 million would simply switch from 
an existing health plan to an association health plan. These plans 
would discriminate against older and sicker Americans, putting an extra 
burden on those who rely on health plans, and forcing the state to 
provide coverage for those who may not otherwise find an AHP. I believe 
governmental authority for regulating AHPs should be clearly specified. 
Absent this clarification, it is likely that no one will be regulating 
AHPs, or there will be conflicting regulation. When regulatory 
authority is unclear, consumers have no place to turn for redress. If 
is for these reasons that I support Small Business and oppose this 
bill.
  Mrs. BIGGERT. Mr. Speaker, I rise today in support of H.R. 4281, the 
Small Business Health Fairness Act.
  Sixty percent of those who are uninsured are employed. Their 
employers either cannot afford to offer health insurance, or the 
premiums are so high, employees cannot afford to pay their share.
  When small companies are allowed to band together, they can take 
advantage of the same economies of scale that large companies have 
enjoyed for years. The costs of insurance are spread out over a larger 
pool of individuals. By spreading the cost of insurance among a larger 
number of employees, we make health insurance affordable for working 
families.
  The Congressional Budget Office has estimated that small businesses 
that participate in AHPs will save an average of 9 to 25 percent of 
their healthcare costs. CBO also concluded that AHP legislation would 
cover up to 2 million uninsured American workers, with no cost to the 
government.
  It is simply not fair that individuals who work for a small business 
do not have the same access to healthcare that they would if they 
worked for a large corporation. I am proud to support this fair, 
common-sense bill and I urge my colleagues to do the same.
  Mr. RUPPERSBERGER. Mr. Speaker, I rise in opposition to this bill 
because it will negatively impact my home state of Maryland. To 
paraphrase what was in Governor Ehrlich's letter to Chairman Boehner, 
this legislation will undue what the state of Maryland has worked so 
hard on for the past 10 years.
  The rising cost of health care is a concern for all Americans. We 
need to find ways to make sure that we help people reduce their 
healthcare cost. We need to find a way to provide insurance for the 44 
million Americans without any coverage at all.
  Association Health Plans has many benefits such as allowing a group 
of shared interest businesses and individuals to purchase health 
insurance at a group rate. However, what we should be working toward is 
a solution where everyone benefits. One of my concerns with Association 
Health Plans is one I also have with the prescription drug bill that is 
law. My concern is that AHP's will be able to skim off the healthiest 
individuals leaving those most in need without coverage. Also, the 
legislation would allow the AHP's to not comply with state health 
mandates.
  I would be more supportive of tax credits for businesses to purchase 
health insurance and also allow for states to establish insurance pools 
like we have in Maryland. Again, we need to make sure the states and 
businesses have the tools to address this issue. We cannot have a 
forced federal mandate that will hurt what the state of Maryland has 
already done.
  The SPEAKER pro tempore (Mr. Simpson). All time for debate on the 
bill has expired.


      Amendment in the Nature of a Substitute Offered by Mr. Kind

  Mr. KIND. Mr. Speaker, I offer an amendment in the nature of a 
substitute.
  The SPEAKER pro tempore. The Clerk will designate the amendment in 
the nature of a substitute.
  The text of the amendment in the nature of a substitute is as 
follows:

       Part B amendment in the nature of a substitute printed in 
     House Report 108-484 offered by Mr. Kind:
       Strike all after the enacting clause and insert the 
     following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Small 
     Employer Health Benefits Program Act of 2004''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title.
Sec. 2. Establishment of Small Employer Health Benefits Program 
              (SEHBP).

            ``Part 8--Small Employer Health Benefits Program

``Sec. 801. Establishment of program.
``Sec. 802. Contracts with qualifying insurers.
``Sec. 803. Additional conditions.
``Sec. 804. Dissemination of information.
``Sec. 805. Subsidies.
``Sec. 806. Authorization of appropriations.

     SEC. 2. ESTABLISHMENT OF SMALL EMPLOYER HEALTH BENEFITS 
                   PROGRAM (SEHBP).

       (a) In General.--Subtitle B of title I of the Employee 
     Retirement Income Security Act of 1974 is amended by adding 
     after part 7 the following new part:

        ``Part 8--Small Employer Health Benefits Program (SEHBP)

     ``SEC. 801. ESTABLISHMENT OF PROGRAM.

       ``(a) In General.--The Secretary shall establish, in 
     accordance, with this part, a program under which--
       ``(1) qualifying small employers (as defined in subsection 
     (b)) are provided access to qualifying health insurance 
     coverage (as defined in subsection (c)) for their employees, 
     and

[[Page H2977]]

       ``(2) such employees may elect alternative forms of 
     coverage offered by various health insurance issuers.
       ``(b) Qualifying Small Employer Defined; Other 
     Definitions.--For purposes of this part:
       ``(1) Qualifying small employer.--
       ``(A) In general.--The term `qualifying small employer' 
     means a small employer (as defined in paragraph (2)) that--
       ``(i) elects to offer health insurance coverage provided 
     under this part to each employee who has been employed by 
     that employer for 3 months or longer; and
       ``(ii) elects, with respect to an employee electing 
     coverage under qualified health insurance coverage, to pay at 
     least 50 percent of the total premium for qualifiing health 
     insurance coverage provided under this part.
       ``(B) Elections.--Elections under sub paragraph (A) may be 
     filed with the Secretary during the 180-day period beginning 
     with the first enrollment period occurring under section 803 
     and during open enrollment periods occurring thereafter under 
     such section. Such elections shall be filed in such form and 
     manner as shall be prescribed by the Secretary.
       ``(C) Part-time employment.--Under regulations of the 
     Secretary, in the case of an employee serving in a position 
     in which service is customarily less than 1,500 hours per 
     year, the reference in subparagraph (A) (ii) to `50 percent' 
     shall be deemed a percentage reduced to a percentage that 
     bears the same ratio to 50 percent as the number of hours of 
     service per year customarily in such position bears to 1,500.
       ``(2) Small employer.--The term `small employer' means, 
     with respect to a year under the program, an employer who 
     employed an average of fewer than 100 employees on business 
     days during the preceding calendar year and who employs at 
     least 1 employee on the first day of such year under the 
     program.
       ``(3) SEHBP.--The term `SEHBP' means the small employer 
     health benefits program provided under this part.
       ``(c) Qualifying Health Insurance Coverage.--For purposes 
     of this part, the term `qualifying health insurance coverage' 
     means health insurance coverage that meets the following 
     requirements:
       ``(1) The coverage is offered by a health insurance issuer.
       ``(2) The benefits under such coverage are equivalent to or 
     greater than the lower level of benefits provided under the 
     service benefit plan described in section 8903(l) of title 5, 
     United States Code.
       ``(3) The coverage includes, with respect to an employee 
     that elects coverage, coverage of the same dependents that 
     would be covered if the coverage were offered under FEHBP.
       ``(4) (A) Subject to subparagraph (B), there is no 
     underwriting, through a preexisting condition limitation, 
     differential benefits, or different premium levels, or 
     otherwise, with respect to such coverage for covered 
     employees or their dependents.
       ``(B) The premiums charged for such coverage are community-
     rated for employees within any State and may vary only--
       ``(i) by individual or family enrollment, and
       ``(ii) to the extent permitted under the laws of such State 
     relating to health insurance coverage offered in the small 
     group market, on the basis of geography.
       ``(d) Other Terms.--
       ``(1) Health insurance coverage; health insurance issuer; 
     health status-related factor.--The terms `health insurance 
     coverage', `health insurance issuer', `health status-related 
     factor' have the meanings provided such terms in section 733.
       ``(2) Small group market.--The term `small group market' 
     has the meaning provided such term in section 2791(e)(5) of 
     the Public Health Service Act (42 U.S.C. 300gg-91(e)(5)).
       ``(3) FEHBP.--The term `FEHBP' means the Federal Employees 
     Health Benefits Program under chapter 89 of title 5, United 
     States Code.
       ``(e) Treatment of Partnerships and Self-Employed 
     Individuals.--For purposes of this part, and for purposes of 
     applying section 3 to this part and to part 5 as it applies 
     to this part, in any case in which qualifying health 
     insurance coverage is, or is to be, provided under a plan, 
     fund, or program to individuals covered thereunder--
       ``(1) if such plan, fund, or program is maintained by a 
     partnership, the term `employer' (as defined in section 3(5)) 
     includes the partnership in relation to the partners, and the 
     term `employee' (as defined in section 3(6)) includes any 
     partner in relation to the partnership; and
       ``(2) if such plan, fund, or program is maintained by a 
     self-employed individual, the term `employer' (as defined in 
     section 3(5)) and the term `employee' (as defined in section 
     3(6)) shall include such individual.

     ``SEC. 802. CONTRACTS WITH QUALIFYING INSURERS.

       ``(a) In General.--The Secretary shall enter into contracts 
     with health insurance issuers for the offering of qualifying 
     health insurance coverage under this part in the States in 
     such manner as to offer coverage to employees of employers 
     that elect to offer coverage under this part. Nothing in this 
     part shall be construed as requiring the Secretary to enter 
     into arrangements with all such issuers seeking to offer 
     qualifying health insurance coverage in a State.
       ``(b) Continued Regulation.--Nothing in this part shall be 
     construed as preempting State laws applicable to health 
     insurance issuers that offer coverage under this part in such 
     State.
       ``(c) Coordination With State Insurance Commissioners.--The 
     Secretary shall coordinate with the insurance commissioners 
     for the various States in establishing a process for handling 
     and resolving any complaints relating to health insurance 
     coverage offered under this part, to the extent necessary to 
     augment processes otherwise available under State law.

     ``SEC. 803. ADDITIONAL CONDITIONS.

       ``(a) Limitation on Enrollment Periods.--The Secretary may 
     limit the periods of times during which employees may elect 
     coverage offered under this part, but such election shall be 
     consistent with the elections permitted for employees under 
     FEHBP and shall provide for at least annual open enrollment 
     periods and enrollment at the time of initial eligibility to 
     enroll and upon appropriate changes in family circumstances.
       ``(b) Authorizing Use of States in Making Arrangements for 
     Coverage.--In lieu of the coverage otherwise arranged by the 
     Secretary under this part, the Secretary may enter an 
     arrangement with a State under which a State arranges for the 
     provision of qualifying health insurance coverage to 
     qualifying small employers in such manner as the Secretary 
     would otherwise arrange for such coverage.
       ``(c) Use of FEHBP Model.--The Secretary shall carry out 
     the SEHBP using the model of the FEHBP to the extent 
     practicable and consistent with the provisions of this part, 
     and, in carrying out such model, the Secretary shall, to the 
     maximum extent practicable, negotiate the most affordable and 
     substantial coverage possible for small employers.

     ``SEC. 804. DISSEMINATION OF INFORMATION.

       ``The Secretary shall widely disseminate information about 
     SEHBP through the media, the Internet, public service 
     announcements, and other employer and employee directed 
     communications.

     ``SEC. 805. SUBSIDIES.

       ``(a) Employer Subsidies.--
       ``(1) Enrollment discount.--
       ``(A) In general.--In the case of a qualifying small 
     employer who is eligible under subparagraph (B), the portion 
     of the total premium for coverage otherwise payable by such 
     employer under this part shall be reduced by 5 percent. Such 
     reduction shall not cause an increase in the portion of the 
     total premium payable by employees.
       ``(B) Employers eligible for discounts.--A qualifying small 
     employer is eligible under this subparagraph if such employer 
     employed an average of fewer than 25 employees on business 
     days during the preceding calendar year.
       ``(2) Employer premium subsidy.--
       ``(A) In general.--The Secretary shall provide to 
     qualifying small employers who. are eligible under 
     subparagraph (C) and who elect to offer health insurance 
     coverage under this part a subsidy for premiums paid by the 
     employer for coverage of employees whose individual income 
     (as determined by the Secretary) is at or below 200 percent 
     of the poverty line (as defined in section 673(2) of the 
     Community Services Block Grant Act (42 U.S.C. 9902(2)), 
     including any revision required by such section) for an 
     individual.
       ``(B) Subsidy scaled according to size OF employer.--The 
     subsidy provided under subparagraph (A) shall be designed so 
     that the subsidy equals, for any calendar year--
       ``(i) 50 percent of the portion of the premium payable by 
     the employer for the coverage, in the case of eligible 
     qualifyng small employers who employ an average of fewer than 
     11 employees on business days during the preceding calendar 
     year;
       ``(ii) 35 percent of the portion of the premium payable by 
     the employer for the coverage, in the case of eligible 
     qualifying small employers who employ an average of more than 
     10 employees but fewer than 26 employees on business days 
     during the preceding calendar year; and
       ``(iii) 25 percent of the portion of the premium payable by 
     the employer for the coverage, in the case of eligible 
     qualifying small employers who employ an average of more than 
     25 employees but fewer than 51 employees on business days 
     during the preceding calendar year.
       ``(C) Employers eligible for premium subsidy.--A qualifying 
     small employer is eligible under this subparagraph if such 
     employer employed an average of fewer than 50 employees on 
     business days during the preceding calendar year.
       ``(b) Employee Subsidies.--
       `` (1) In general.--The Secretary shall provide subsidies 
     to employees of qualifying small employers in any case in 
     which the family income of the employee (as determined by the 
     Secretary) is at or below 200 percent of the poverty line (as 
     defined in section 673(2) of the Community Services Block 
     Grant Act (42 U.S.C. 9902(2)), including any revision 
     required by such section) for a family of the size involved.
       ``(2) Amount of subsidy.--Such subsidies shall be in an 
     amount equal to the excess of the portion of the total 
     premium for coverage otherwise payable by the employee under 
     this part for any period, over 5 percent of the family income 
     (as determined under paragraph (1) (A)) of the employee for 
     such period.
       ``(3) Coordination of subsidies.--Notwithstanding paragraph 
     (1), under regulations of the Secretary, an employee may be 
     entitled to subsidies under this subsection for any period 
     only if such employee is not eligible for

[[Page H2978]]

     subsidies for such period under any Federal or State health 
     insurance subsidy program (including a program under title V, 
     XIX, or XXI of the Social Security Act). For purposes of this 
     paragraph, an employee is `eligible' for a subsidy under a 
     program if such employee is entitled to such subsidy or 
     would, upon filing application therefore, be entitled to such 
     subsidy.
       ``(4) Authority to expand eligibility.--The Secretary may, 
     to the extent of available funding, provide for expansion of 
     the subsidy program under this subsection to employees whose 
     family income (as defined by the Secretary) is at or below 
     300 percent of the poverty line (as determined under 
     paragraph (1)).
       ``(c) Limitations.--For purposes of this section--
       ``(1) Restrictions on treatment of employment 
     relationship.--Section 801(e) shall not apply.
       ``(2) Requirement of multiple employees.--A small employer 
     shall not be treated as a qualifying small employer with 
     respect to an applicable year unless the employer employs at 
     least 2 employees on the first day of such year.
       ``(d) Procedures.--The Secretary shall establish by 
     regulation applications, methods, and procedures for carrying 
     out this section, including measures to ascertain or confirm 
     levels of income.

     ``SEC. 806. AUTHORIZATION OF APPROPRIATIONS.

       ``There are authorized to be appropriated, for the period 
     beginning with fiscal year 2005 and ending with fiscal year 
     2014, $50,000,000,000 to carry out this part, including the 
     establishment of subsidies under section 805.''.
       (b) Report on Offering National Health Plans.--Not later 
     than 18 months after the date of the enactment of this Act, 
     the Secretary of Labor shall report to Congress the 
     Secretary's recommendations regarding the feasibility of 
     offering national health plans under part 8 of subtitle B of 
     title I of the Employee Retirement Income Security Act of 
     1974, as added by subsection (a).
       (c) Clerical Amendment.--The table of contents in section 1 
     of the Employee Retirement Income Security Act of 1974 is 
     amended by inserting after the item relating to section 734 
     the following new items:

        ``Part 8--Small Employer Health Benefits Program (SEHBP)

``Sec. 801. Establishment of program.
``Sec. 802. Contracts with qualifying insurers.
``Sec. 803. Additional conditions.
``Sec. 804. Dissemination of information.
``Sec. 805. Subsidies.
``Sec. 806. Authorization of appropriations.''.

  The SPEAKER pro tempore. Pursuant to House Resolution 638, the 
gentleman from Wisconsin (Mr. Kind) and the gentleman from Ohio (Mr. 
Boehner) each will control 30 minutes.
  The Chair recognizes the gentleman from Wisconsin (Mr. Kind).
  Mr. KIND. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, first of all I want to recognize the gentleman from New 
Jersey for the fine work and the leadership that he has shown on such 
an important issue. This is an important issue.
  It has been said that the definition of insanity is doing the same 
thing over and over again without any change in the result. Yet that is 
what we have been having this week in Congress, bills that have already 
been debated and deliberated upon and voted upon last year coming back 
again for another kick at the can, which is fine. In an issue as 
important as this, I think it is important for the Congress to take a 
moment and start talking about the plight of small businesses and 
family farmers across the country who are suffering under rising health 
care costs and fearful of the inability of being able to provide 
coverage for their families or their employees because of the cost of 
insurance today.
  This is such a fundamental and crucial issue if we want to be serious 
about economic growth, if we want to be concerned about the 43-million-
plus uninsured that exist in this country. As I travel through my 
congressional district in western Wisconsin meeting with small business 
owners and their employees, meeting with family farmers, the number 
one, chief concern that they continuously raise is the expensive health 
care and accessing the quality system that exists in this country right 
now on an affordable basis.
  It is a travesty that 20 percent of my dairy farmers in Wisconsin 
have no health coverage at all for themselves or their families, one of 
the more dangerous occupations in the entire country. It is a travesty 
that as I talk to small business owners who would like nothing better 
than to provide some health coverage for their employees, tell me that 
they cannot because they cannot afford it. In a country as great and as 
powerful and as wealthy as ours, we have got to do better and we have 
to get serious.
  What we are about to talk about in the remaining minutes of the 
duration of this debate is there is a better way. The gentleman from 
New Jersey and I have drafted a substitute to what is being offered 
before the House today. It is one based in common sense, in reality in 
regards to what will work and what will not, what will extend coverage 
to the uninsured and what will not; what will bring more affordability 
to the health care system, to these small business owners, their 
employees and to our family farmers, and what will not.
  Our bill is very simple. It is based on the Federal Employee Health 
Plan. It does establish national purchasing pools but it goes through 
State-licensed insurers so we do not have Federal preemption of State 
law over such crucial areas as cancer screening, whether it is 
mammograms, breast cancer, cervical cancer screenings, whether it is 
emergency care or maternity care, issues that the States have wrestled 
with with themselves and found it important enough to pass law on a 
State-to-State basis to provide coverage for these important services. 
And also to cover autism health care. I am proud that the State of 
Wisconsin is one of 17 that does mandate the coverage of autism health 
care for our citizens in the State, one that is exploding right now and 
very expensive for society. Health care experts and those affected by 
autism, those families of autistic children, realize that the key to 
effective treatment is early identification. If we allow this AHP plan 
to pass, which preempts State law, that says, hey, insurers, you don't 
have to provide coverage even though the State of Wisconsin says this 
is the right policy to do, it is only going to exacerbate the system in 
this country in regard to effective autistic treatment for children in 
our communities.
  That is what this debate is all about. It is a very simple, 
commonsense approach to dealing with what is a national crisis and, I 
view, a national emergency.
  Rather than offering a piece of legislation where the American 
Academy of Actuaries, where Mercer has released a study indicating that 
it would increase rather than decrease the rolls of the uninsured by 1 
million people, our substitute version that provides national 
purchasing options, that provides subsidy payments to employers with 50 
or fewer employees in order to keep those health care premiums down and 
our ability to potentially extend health care coverage to the 43 
million uninsured to an additional 33 million Americans, we think this 
is the best approach to take. This is not an issue about who supports 
small business or family farmers more or who is more concerned about 
the plight of the uninsured. This is about what will work and what will 
not work. That is why we have the National Governors Association, the 
Republican and Democratic Governors Association, the National 
Association of Attorneys General and Insurance Commissioners, over 
1,000 organizations including 66 chambers of commerce who are saying 
that the majority AHP plan will not work. Not because they desire some 
power grab and to maintain their own State regulations, but because it 
is based on reality and an independent and objective study of what will 
and what will not work.
  That is why I would hope that my colleagues, before they ultimately 
make up their mind and cast their vote today, that they have a chance 
to quickly look at the actuary study, to quickly look at the Mercer 
study and to pause before we embark upon a road that could potentially 
lead to another million uninsured in our society. Enough is enough.

                              {time}  1500

  We need to be going in the opposite direction rather than where I 
fear the AHP bill would go. The substitute that the gentleman from New 
Jersey (Mr. Andrews) and I are offering offers that hope and that 
potential to achieve that, and I would encourage my colleagues to 
support the substitute, vote ``no'' on the AHP bill, and let us move 
forward together on something that has the potential of working very 
well for small businesses and family farmers throughout the country.
  Mr. Speaker, I reserve the balance of my time.

[[Page H2979]]

  Mr. BOEHNER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Nebraska (Mr. Osborne), one of the active members of our committee.
  Mr. OSBORNE. Mr. Speaker, I thank the chairman for yielding me this 
time.
  Mr. Speaker, I represent a district that is entirely rural and has 
nothing but small businesses in it. The number one complaint that I 
hear is about the cost of health insurance. These businesses employ 
more employees than all of the other industries in the country. They 
are the driving force behind it; and more and more of these 
individuals, as has been mentioned in the previous debate, are simply 
having to reduce or eliminate their health care coverage because it is 
going up 15, 20 percent every year and they simply cannot afford it.
  I would like to give one personal example. I have a son-in-law who is 
managing a small franchise company, has 130 franchises in roughly 30, 
40 States, and he says that this is the number one priority they have 
as far as health insurance, that if they could have an association of 
health plans, this would certainly cut their costs and enable them to 
maintain their health insurance at the present level.
  So I realize that there are some problems with some of the States; 
but from my perspective and from what I have heard, I would say this is 
certainly a good bill. I appreciate the authors of the substitute. I 
think they are thoughtful people. I am sure they have done a good job 
at doing their homework, but at this point I would certainly have to 
oppose the substitute and support the underlying bill.
  Mr. KIND. Mr. Speaker, I yield 3 minutes to the gentlewoman from the 
Virgin Islands (Mrs. Christensen), a true champion of small business 
owners and their employees.
  Mrs. CHRISTENSEN. I thank the gentleman for yielding me this time.
  Mr. Speaker, this is Insure the Uninsured Week, and for me as a 
physician and Chair of the Health Brain Trust of the Congressional 
Black Caucus, ensuring health coverage to everyone is a priority every 
day.
  And so I want to be very clear that I rise in strong support of 
providing small businesses and their employees access to high-quality 
health insurance that is truly affordable. That is why I oppose H.R. 
4281, the Association Health Plan bill, and support the Kind-Andrews 
substitute.
  We in the minority caucuses have spent a great deal of time looking 
at the issue of insurance, of how we can allow small business 
associations to come together to pool their purchasing power to buy 
quality health coverage at the lowest possible cost. We examined the 
AHPs. I did not originally sign on to the bill, but after a closer look 
at what it would do and as a physician who understands how important it 
is to do no harm, I removed my name from what I consider a harmful 
bill.
  In H.R. 4281, the base bill, AHPs would be exempt from State 
insurance regulations and consumer protections. They would increase 
health care costs for most small business employees, cause premiums to 
rise for those outside of the AHP market, and eventually not lower, but 
increase, the number of uninsured in small business firms.
  While AHP supporters will insist that this will not happen, by 
removing these important protections, the major harm this bill can do 
is too great a risk to take. We are talking about workers' health; we 
are talking about their lives. There is a better way to provide this 
insurance which will not harm, and that is the Kind-Andrews substitute. 
It would establish an employer health benefit plan similar to the 
Federal employees' health benefits, which would contract with state-
licensed health insurers to offer an insurance package for employees of 
businesses of fewer than 100 employees.
  Unlike the underlying bill, this better Democratic substitute will 
keep these small employer plans subject to State health insurance and 
consumer regulations and protections. It would provide small businesses 
and their employees access to high-quality health coverage; and by 
ensuring that the risk is spread, that everyone is included, not 
keeping sicker employees out, it keeps it truly affordable.
  As a member of the Committee on Small Business since coming to this 
Congress, I am for helping small businesses. This substitute does that. 
H.R. 4281 will not.
  I urge my colleagues to join the more than 150 organizations, 
including all of the prominent civil rights organizations, in opposing 
H.R. 4281. Instead, I urge them to vote for the Kind-Andrews 
substitute. Let us make sure we cover this important group who are over 
60 percent of all the uninsured; and above all, let us do no harm.
  Mr. BOEHNER. Mr. Speaker, I yield 2 minutes to the gentleman from 
Oklahoma (Mr. Sullivan).
  Mr. SULLIVAN. Mr. Speaker, I would like to commend the gentleman from 
Ohio (Chairman Boehner) for his hard work on this very important 
legislation.
  I rise in support of this commonsense legislation which will deliver 
quality health care to millions of Oklahomans. One of the greatest 
challenges the State of Oklahoma faces is our uninsured population. 
With 650,000 uninsured, Oklahoma ranks fourth in the number of 
uninsured across the country. This is a shocking statistic, an 
unacceptable situation; and today I am proud to take action to fix this 
problem.
  Association Health Plans will allow small businesses to group 
together with their national trade associations to utilize their 
collective buying power when dealing with large insurance companies. 
AHPs will bring quality health care to Oklahomans covering specific 
diseases, maternal and newborn hospitalization, and mental health. With 
the enactment of this legislation, up to 8.5 million uninsured 
Americans will gain coverage immediately.
  Nationwide, 44 million Americans are uninsured; and 60 percent of 
those uninsured are employed by small businesses who will benefit. AHPs 
will cut an average of 13 percent, up to 25 percent, off insurance 
premiums.
  This is smart legislation that will bring better health care to 
American families. It is time that 5th Avenue benefits find their way 
to shops on Main Street. I urge my colleagues to support this 
legislation.
  Mr. KIND. Mr. Speaker, I yield 3 minutes to the gentleman from 
Arkansas (Mr. Ross), an expert in the health care field and one who 
does not want to embark upon a course of adding an additional 1 million 
people to the uninsured ranks.
  Mr. ROSS. Mr. Speaker, in America we have 44 million people today 
without health insurance. We are the only industrialized nation in the 
world where people go without health insurance. And who are they? It is 
the folks that are trying to do the right thing and work. 
Unfortunately, they are working jobs with no benefits.
  Nearly 80 percent of the uninsured are the working poor and often 
work in small businesses. They have jobs and are trying to do the right 
thing, but cannot afford a policy, an insurance policy, for themselves 
or for their families.
  Each weekend as I go back home to Arkansas, I meet more and more 
small business owners, and I understand this because my wife and I are 
small business owners. We provide health insurance for our employees 
back home. And just as it is for us, I learn it is for so many small 
business owners across this Nation. They are struggling to be able to 
continue to afford the premiums, not only for their employees but for 
themselves as well.
  Association Health Plans, quite frankly, are not the answer. It would 
do little to help the 44 million uninsured Americans. In fact, Mercer 
Consulting analyzed the Association Health Plans proposal and found 
that the number of the uninsured would increase by over 1 million as a 
result of coverage losses among workers in small firms and their 
dependents.
  I support the Kind substitute that truly addresses the problem of the 
uninsured in this country. It is fully paid for. It will not preempt 
State law, and it offers meaningful and immediate help to small 
businesses.
  The substitute legislation would create a Small Employer Health 
Benefits Plan similar to the Federal Employee Health Benefit Plan and 
would offer coverage to all small businesses with fewer than 100 
workers.
  This legislation works with existing State laws and does not preempt 
State laws regarding health care coverage.

[[Page H2980]]

Also, this legislation goes far beyond vague words and empty promises 
and actually commits Federal funds to aid small businesses in offering 
insurance to its employees by offering to help subsidize the cost of 
insurance for small businesses to the tune of 50 percent of the cost of 
the premiums.
  I urge my colleagues to support the Kind substitute and oppose H.R. 
4281.
  Mr. BOEHNER. Mr. Speaker, I yield myself such time as I may consume.
  I believe that the underlying bill does, in fact, address the needs 
of many of our uninsured, and I am concerned about the substitute that 
we have before us. And I know that the gentleman from Wisconsin (Mr. 
Kind) and the gentleman from New Jersey (Mr. Andrews), my good friends 
from the committee, have worked hard on this. But I have to take issue 
with the comment that was just said that this commits the Congress to 
spend money. It does not.
  There is a $50 billion price tag on the substitute that we have 
before us, and all we do here is authorize it. It still has to go 
through the entire appropriation process, no guarantee that it is going 
to be appropriated; but even more troubling is that the substitute that 
is being offered would allow the Secretary of Labor to set up this 
national risk pool, but they would still be subject to every state-
mandated benefit in each of the States, over 1,500 state-mandated 
benefits from one coast to the next. And on top of that, even if the 
Congress were to appropriate the money and the Secretary were to set up 
the plan, employers would still have to pay 50 percent of the premium 
cost, and they would have to cover every employee who was there as 
little as 3 months.
  If we begin to look at how this plan would work, I think that the 
Members will find that it would actually be cheaper for those companies 
to get health insurance in their own States without this national 
bureaucracy.
  But even more disturbingly, when we look at this substitute, it will 
not cover any of the self-employed individuals across the country, and 
whether they be Realtors, whether they be salesmen of some sort, small 
business people who operate by themselves, the self-employed, no 
coverage under this plan. Unlike under the underlying plan where if 
these self-employed people belong to some association, some State 
association, national association, local association, they would, in 
fact, be able to work through their associations to get high-quality 
coverage at competitive prices.
  There has been a lot said about who is supporting the underlying bill 
and who is opposing the underlying bill. I have got pages and pages 
here of national associations and State associations that are 
supporting the underlying bipartisan bill. And I would remind my 
colleagues that this is the fourth time we have had this bill on the 
floor in the last 8 years, still waiting for the other body to deal 
with it. All three times previously that this bill has been on the 
floor, it has passed with broad bipartisan majorities, and I would 
suspect today we will see the same benefit.
  Mr. Speaker, I include in the Record the list of companies and 
associations that are supporting the underlying bill.


                         groups supporting AHPs

     Adhesive and Sealant Council
     Air Conditioning Contractors of America
     American Alliance of Service Providers
     American Association of Advertising Agencies
     American Association of Engineering Societies
     American Association of Small Property Owners
     American Composites Manufacturers Association
     American Concrete Pumping Association
     American Council of Engineering Companies
     American Disc Jockey Association
     American Electronics Association
     American Furniture Manufacturers Association
     American Institute of Chemical Engineers
     American International Automobile Dealers Association
     American Hotel and Lodging Association
     American Lighting Association
     American Nursery and Landscape Association
     American Rental Association
     American Road and Transportation Builders Association
     American Small Businesses Association
     American Society of Association Executives
     American Society of Civil Engineers
     American Society of Home Inspectors
     American Society of Mechanical Engineers, Board on Member 
         Interests & Development
     American Textile Machinery Association
     American Veterinary Medical Association
     American Wholesale Marketers Association
     AOMALLIANCE
     Archery Trade Association
     Associated Builders and Contractors
     Associated General Contractors of America
     Associated Prevailing Wage Contractors, Inc.
     Association for Manufacturing Technology
     Association of California Water Agencies
     Association of Equipment Manufacturers
     Association of Independent Maryland Schools
     Association of Ship Brokers and Agents
     Association of Suppliers to the Paper Industry
     Automotive Aftermarket Industry Association
     Automotive Aftermarket Association Southeast
     Automotive Service Association
     Automotive Undercar Trade Organization
     Automotive Wholesalers Association of New England
     Automotive Wholesalers Association of Texas
     California Motor Car Dealers Association
     California Society of CPAs
     California/Nevada Automotive Wholesalers Association
     Center for New Black Leadership
     Central Service Association
     Chesapeake Automotive Business Association
     Cleveland Automobile Dealers Association
     Club Managers Association of America
     Christian Schools International
     Coca Cola Bottlers Association
     Communicating for Agriculture
     Consumer Specialty Products Association
     Deep South Equipment Dealers Association
     Electronics Representatives Association Insurance Trust
     Far West Equipment Dealers Association
     Farm Equipment Manufacturers Association
     Financial Executives International
     Financial Planning Association
     First Health Group Corporation
     Food Marketing Institute
     GrassRoots Impact
     Hearth, Patio and Barbecue Association
     Hispanic Business Roundtable
     Independent Electrical Contractors
     Independent Office Products & Furniture Dealers Association
     Independent Stationers, Inc.
     Institute of Electrical and Electronics Engineers--United 
         States of America
     International Association of Professional Event Photographers
     International Foodservice Distributors Association
     International Franchise Association
     Iowa Automobile Dealers Association
     Iowa-Nebraska Equipment Dealers Association
     The Latino Coalition
     Mason Contractors Association
     Material Handling Equipment Distributors Association (MHEDA)
     Metal Manufacturers' Education and Training Alliance
     Midwest Automotive Industry Association
     Midwest Equipment Dealers Association
     NAMM, the International Music Products Association
     National Association for the Self-Employed
     National Association of Chemical Distributors
     National Association of Community Health Centers
     National Association of Convenience Stores
     National Association of Home Builders
     National Association of Manufacturers
     National Association of Plumbing-Heating-Cooling Contractors
     National Association of Realtors
     National Association of Theatre Owners
     National Association of Wholesaler-Distributors
     National Association of Women Business Owners
     National Automobile Dealers Association
     National Black Chamber of Commerce
     National Burglar and Fire Alarm Association
     National Cattlemen's Beef Association
     National Club Association
     National Concrete Masonry Association
     National Council of Agricultural Employers
     National Federation of Independent Business
     National Franchisee Association
     National Funeral Directors Association
     National Lumber and Building Material Dealers Association
     National Newspaper Association
     National Office Products Alliance
     National Paint and Coating Association
     National Portable Storage Association
     National Precast Concrete Association
     National Rental Association
     National Retail Federation
     National Restaurant Association
     National Roofing Contractors Association
     National Spa and Pool Institute
     National Society of Accountants
     National Society of Professional Engineers
     National Sporting Goods Association
     National Tile Contractors Association
     National Tooling & Machining Association
     National Utility Contractors Association
     Nebraska New Car and Truck Dealers Association
     New Mexico Automotive Parts and Service Association
     New York State Automotive Aftermarket Association
     North American Die Casting Association

[[Page H2981]]

     North American Equipment Dealers Association
     North American Retail Dealers Association
     North Dakota Automobile and Implement Dealers Association
     Northeastern Retail Lumber Association
     Office Furniture Dealers Alliance
     Ohio Valley Automotive Aftermarket Association
     Outdoor Industry Association
     Piano Technicians Guild
     Precision Machine Products Association
     Precision Metalforming Association
     Printing Industries of America
     Printing Industries of Maryland
     Process Equipment Manufacturers' Association
     Professional Golfers' Association of America
     Professional Photographers of America
     Retailers Bakery Association
     Service Station Dealers of America and Allied Trades
     Self Insurance Institute of America
     Small Business Survival Committee
     Specialty Equipment Market Association (SEMA)
     Society of American Florists
     Society of the Plastics Industry
     Society of Professional Benefit Administrators
     Southern Equipment Dealers Association
     Southeastern Equipment Dealers Association
     Southeastern Farm Equipment Dealers Association
     Southwestern Association
     Snack Food Association
     Student Photographic Society
     Textile Rental Services Association of America
     The Association Healthcare Coalition
     Timber Operators Council Management Services
     Timber Products Manufacturers Association
     Tire Industry Association
     U.S. Chamber of Commerce
     U.S. Hispanic Chamber of Commerce
     U.S. Pan Asian America Chamber of Commerce
     Vermont Automobile Dealers Association
     Virginia Bankers Association
     Washington Area New Automobile Dealers Association
     Western Growers Association
     Women Impacting Public Policy
     Wisconsin Automobile & Truck Dealers Association

  Mr. Speaker, I reserve the balance of my time.
  Mr. KIND. Mr. Speaker, I yield myself 30 seconds.
  With all due respect to the chairman of our committee, and I have 
great respect and admiration for him and I think he is well motivated 
with this underlying bill, but our bill does, in fact, cover self-
employed. Under the definition of what constitutes an employer, an 
individual who is self-employed would also be covered. So I just wanted 
to clarify the record in that regard.
  Mr. Speaker, I yield such time as he may consume to the gentleman 
from New Jersey (Mr. Andrews), the co-author of our substitute bill 
before us.
  (Mr. ANDREWS asked and was given permission to revise and extend his 
remarks.)

                              {time}  1515

  Mr. ANDREWS. Mr. Speaker, I would like to begin by thanking my 
coauthor, the gentleman from Wisconsin (Mr. Kind), for what has now 
been more than a year of hard work on this effort, a very practical, 
commonsense solution that would not have been possible without him; and 
I thank him for his effort.
  It is important to understand how this proposal works. If a small 
employer, and we define that as an employer with 100 or fewer 
employees, chooses, only if he or she chooses, they may enroll their 
employees in a plan that would operate similarly to the Federal 
Employees Health Benefit Plan. It would create the largest purchasing 
pool of small businesses ever in the history of the country. It would 
achieve the economies of scale that the majority attempts to achieve in 
the underlying bill. But there are some important differences.
  The first difference is that we believe our plan would in fact save 
money for that employer. In my home State, a small business pays about 
$12,000 or $13,000 a year to insure an employee and his or her family. 
The average cost under the Federal Employees Health Benefit Plan is 
slightly over $9,000. We believe a similar price reduction would occur 
by the option of joining this plan.
  Secondly, under our plan, for very small employers, those with 25 and 
under, they would receive a 5 percent premium discount. That is to say, 
their premium would only be 95 percent of the premium paid by the 
others in the pool.
  Thirdly, very small employers with a lot of low-income employees, 
those who are most likely to be uninsured, are offered additional 
subsidies that are drawn from the budget resolution passed by the 
majority. This fits within the majority's budget resolution.
  So the first important difference is our version, our plan, would add 
to the rolls of the insured rather than subtracting from it the way the 
majority's plan would.
  Second, under our plan, none of the protections that people enjoy, 
the right to a mammogram, the right to women's health services, the 
right to mental health services, guaranteed under State laws around the 
country, none of those rights would be lost or forfeited under our 
plan.
  Third, the risks of insolvency, unpaid creditors, uninsured insurers 
that the majority's plan proposes, would be avoided here, because you 
would have a large plan under the regulatory jurisdiction of the 
Federal Government that would be solvent and would be prepared to meet 
its obligations because it is properly regulated.
  This is a commonsense idea. We believe in pooling as well. Frankly, I 
think that the majority has half of a good idea. The idea of permitting 
small employers to pool their employees to get a better deal from the 
health insurance marketplace is a very good idea. The problem is that 
the majority's plan also includes the repeal and forfeiture of 
protections like mammogram coverage, like diabetic care, like women's 
health services; and that is both unnecessary and undesirable.
  Second, the majority's plan does not include any subsidies or special 
incentives for small business. A lot of small businesses in my State, 
even if you dropped the price of the coverage from $12,000 to $11,000 
or $10,000, could still not afford it. It does not do them any good.
  Our plan, unlike the majority plan, puts some subsidy into this in 
the form of premium discounts for very small employers and even deeper 
discounts for small employers who hire many, many lower-compensated 
employees.
  We have said a lot of critical things about the majority's plan 
because we believe they are right; but we also understand, Mr. Speaker, 
it is our responsibility to put forward a positive alternative. The 
work that the gentleman from Wisconsin (Mr. Kind) has done, that I am 
proud to join in, is such a positive alternative. It would offer real 
benefits in a meaningful way for the small business community of the 
country.
  I would urge my colleagues to vote for its adoption.
  Mr. BOEHNER. Mr. Speaker, I am pleased to yield 3 minutes to the 
gentleman from Pennsylvania (Mr. Peterson).
  Mr. PETERSON of Pennsylvania. Mr. Speaker, I thank the chairman for 
yielding me time.
  Mr. Speaker, let us put some competition into the marketplace. We 
just have a proposal now that says we will have a government-subsidized 
program, and we all know where that will take us. The taxpayers will 
pay and pay.
  Here is the problem: 50 percent of America has one insurer. That 
means you have a monopoly, and that is where we are getting 20, 30, and 
40 percent increases annually, and businesses are straining. But when 
you only have one insurer, the new pharmacy plan, we have guaranteed 
everybody two. But in health care, over half of America have one.
  Associated Health Plans would, I think, change the marketplace 
dramatically, because you would bring lots of competition to the 
marketplace. The monopolies would no longer rule. A lot of other 
companies that are not monopolies do not want health care either. Why? 
It is going to be competition. Whenever America is successful, we bring 
competition into the marketplace.
  Yes, those monopolies are leaving community rating; yes, they are 
cherry-picking today. And State mandates are part of the problem, 
because 50 States have different mandates and we guarantee everybody 
gets a Cadillac plan. That means a lot of people cannot afford a plan 
at all, because you only can deliver a Cadillac plan. That is the 
system we have.
  In rural areas, where monopolies exist, businesses, individuals and 
governments pay measurably more for

[[Page H2982]]

health insurance than neighboring counties. In my district, I have 
school districts and counties who will pay $650 for a family plan. Two 
counties away they pay $1,100 for the same insurance coverage under the 
current system. Why? Because there is no competition there.
  Now, the hospitals, the doctors and providers under these monopolies 
get paid less too, because they have no bargaining power with the big 
insurance giants that are the monopolies.
  The current system will change dramatically with Associated Health 
Plans, because, for the first time, all parts of America will have many 
people who they can purchase insurance from. Yes, maybe if I am a 
restaurateur, I will be part of a national restaurant association who 
has a plan tailored for restaurants.
  I was a supermarket operator for 26 years. I probably, if I were back 
in that business, would have a plan that works well for super markets. 
But when you put them all in the same box, you put all kinds of 
employers in the same box, as we currently do with State mandates.
  Let us give our businesses and our government service agencies 
choices. Let us give them Associated Health Plans, not another 
government-subsidized program. But let us turn the competitiveness of 
American ingenuity, and we will solve the uninsured problem in this 
country.
  Mr. KIND. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, again, this debate really is about two very distinct and 
different options: one that, again, through independent analysis and 
review, indicates could lead to an increase of 1 million more uninsured 
in this country, as opposed to the substitute that the gentleman from 
New Jersey (Mr. Andrews) and I are offering today; one that is based on 
reality and supported by a host of organizations throughout the Nation, 
including the Governors Association, the Attorneys General, and the 
insurance commissioners, those who work with this on a day-to-day basis 
and see the real impact it is having on real people in their individual 
States.
  Our plan is simple. It also talks about establishing a national 
purchasing pool, but one working with state-licensed insurers, so we do 
not preempt State law and the judgment being made by State legislatures 
and local decisionmakers on what is or is not appropriate health care 
coverage in that particular State.
  I am proud of many of the coverages that the State of Wisconsin has 
chosen to include under the State regulations. I am also proud of the 
fact that the State legislature and Governor are signing into law and 
setting up model programs of this purchasing pool concept in Wisconsin, 
allowing small business owners and family farmers to join cooperatives 
with a menu of health options, but under State regulation, not 
exempting them and not preempting what the State has already done.
  I have a feeling that that is going to work, and work very well, if 
the demand that exists from back home is any indication of the desire 
to enter into these pilot programs.
  That is the identical version that the gentleman from New Jersey (Mr. 
Andrews) and I are offering and talking about today, allowing this 
purchasing pool concept to go forward under State law, so that 
important health care services and screening does not get preempted and 
lead to a diminution in the quality of care that citizens in States 
have come to expect and desire.
  Why is this important? 44 million uninsured is a travesty and a 
blemish on our national character. It gets to the real root and basis 
of us and what we are all about as a Nation. Being able to access 
quality and affordable health care is something that affects all of us, 
from businesses large and small, from individuals to small business 
owners, to farmers, to us here in Congress; and the fear we see in 
constituents' eyes back home when they know they do not have health 
coverage for their families and their children, it is real.
  And when they do not have coverage and they do get sick or they do 
get hurt, they still are able to access the health care system, just 
through more expensive means, typically through the emergency door. And 
those costs then are shifted on to private plans that do have coverage, 
which contributes to the rising premium expenses that are sweeping the 
Nation today.
  So I think it is in our fundamental national interest to do what we 
can to make sure that the 43 million or 44 million currently uninsured 
receive coverage, so we have better preventive care up front, so the 
children of our Nation have a way to access the health care system, 
which can save us money and pay dividends in the long run.
  I think this is an objective that we share in a bipartisan fashion, 
but it is one that I think can better be achieved through the Kind-
Andrews substitute.
  It is paid for within the budget resolution that the majority party 
has passed in this session of Congress. It does offer premium support 
payments to employees with 50 or fewer employees, because the gentleman 
from New Jersey (Mr. Andrews) is correct, even if we have some savings 
in premium expenses, your average small business employer probably is 
still prohibited from being able to access an insurance pool and being 
able to pick up the expense and providing coverage for their employees.
  We are saying we can do better by offering them some of this premium 
price assistance to make it more affordable and to create the 
incentives so we have small business owners who I believe want 
desperately to be able to provide coverage, to be in a position to 
better afford that type of coverage.
  This is what we need to try to achieve. This should be a dream we all 
hold in this Congress. Because unless and until we fix this fundamental 
flaw in the health care system in our country, we are not going to see 
the robust job growth that we desperately need today. We are not going 
to see businesses, either large or small, anxious for additional hires 
for fear of incurring the additional health care expense. I think it is 
one of the reasons why we have not seen the explosion of job growth 
over the last couple of years, even though the administration has been 
fond of pointing to expanding economic conditions in this country. It 
is the health care system, and it needs to be addressed.
  I think we desperately need to do it, and I think we have the 
opportunity today to make a significant step in that direction.
  I would encourage my colleagues to vote ``no'' on the majority 
Associated Health Plan and support a real plan that can work for real 
Americans, the Kind-Andrews substitute.
  Mr. Speaker, I yield back the balance of my time.
  Mr. BOEHNER. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I have great respect for my two committee colleagues, 
the gentleman from Wisconsin (Mr. Kind) and the gentleman from New 
Jersey (Mr. Andrews), and their thoughtful approach to bringing their 
substitute to the floor.
  As the gentleman from Wisconsin (Mr. Kind) pointed out, there are 
some similarities here. We both create large pools of small employers 
in order to increase their purchasing power so that they can go into 
the marketplace like a large company or union and get as good a quality 
plan at a competitive price. But once you get beyond the big picture, 
that we are creating large pools in both the substitute and the 
underlying bill, there are a few differences.
  The first difference I would say is that the underlying bill allows 
the private sector to create those large pools. Whether they be State 
associations, national associations, whatever, they will in fact create 
their own pools, while the substitute offered by the gentleman from 
Wisconsin (Mr. Kind) and the gentleman from New Jersey (Mr. Andrews) 
has the government creating this large pool.
  Now, we all know when the government gets involved, it is just a 
matter of time before the government begins to believe, well, we have 
this large pool, we have got employers signed up in it, maybe we ought 
to require them to do X or Y or Z. I do not think anyone wants to take 
that risk.
  Secondly, I would point out that the substitute pool will cost $50 
billion of taxpayer funds in order to set up and to provide subsidies, 
while the underlying bill has no Federal taxpayer money involved in it 
in any way, shape, or form.
  I am a big believer that we need to do something to reach out to help 
the uninsured gain better access to high-quality, affordable health 
insurance. I

[[Page H2983]]

think the underlying bill does it. It has passed on a broad bipartisan 
basis on a number of occasions here in the House. I urge my colleagues 
here today to reject the Kind-Andrews substitute and support the 
underlying bill.
  Mr. HOLT. Mr. Speaker, I rise in support of the substitute 
legislation offered by Mr. Kind and Mr. Andrews and in opposition to 
H.R. 4281.
  Across this great nation, over 40 million people continue to lack 
adequate health insurance coverage. This is a problem that merits 
immediate Congressional action.
  Moreover, small businesses across my district in central New Jersey 
come to me all the time, telling me how difficult it is to continue 
providing health care to their employees. I am glad that so many of 
them believe in providing good benefits to their workers, but I know 
they are really hurting.
  Unfortunately, the House leadership is more interested in scoring 
political points than in helping small businesses continue to provide 
quality health care for their employees. The very fact that we are 
poised to pass a bill that is virtually identical to what we did here 
last June is a clear indication that we are here to play partisan 
games, not to find a real solution.
  I hope my colleagues do not believe the hype we're hearing today. 
H.R. 4281 is not a realistic way to help small businesses with their 
health care costs.
  It looks like a good idea at first glance. Under this bill, small 
businesses could join together to form ``associations'' that will 
leverage their collective buying power to get lower-cost health 
insurance for their employees.
  I certainly support the concept of companies working together 
collectively to control costs. It's an idea that has worked within 
individual states.
  That is why I urge my colleagues to vote for the Kind-Andrews 
substitute. This legislation commits actual federal funds--the $50 
billion allocated in the budget--to form Small Employer Health Benefit 
plans similar to our oft-cited Federal Employee Health Benefit plans. 
This would create a realistic, workable way for small businesses to use 
their collective buying power to lower costs and increase coverage.
  Kind-Andrews would expand coverage for the uninsured and will help 
small businesses deal with the rising costs of insuring their 
employees. Moreover, it is fully paid for and will not preempt state 
law, maintaining the kind of minimum benefit levels that ensure quality 
coverage for beneficiaries and their dependents.
  H.R. 4281, on the other hand, expands ERISA to preempt state law. 
States have traditionally taken the lead on insurance regulation, and 
they have implemented rules to protect beneficiaries and ensure minimum 
coverage levels. This bill would allow AHPs to avoid all of these 
regulations.
  Most states require that any health plan cover some basic items such 
as mammograms, contraception, prostate cancer screenings, and many 
mental health services. H.R. 4281 would allow ``associations'' to avoid 
having to offer these basic benefits, to the detriment of 
policyholders.
  For example, under this bill, I could create a plan that covers 
nothing but ingrown toenail surgery. It would certainly be the cheapest 
plan out there, but how much would it actually help beneficiaries?
  Several of my colleagues and I tried to amend H.R. 660, the first 
iteration of the bill before us, in both subcommittee and full 
committee to ensure that AHPs would indeed have minimum benefit 
requirements. I offered one amendment requiring parity between physical 
and mental health benefits and another requiring coverage for oral 
contraception. Despite the fact that these common-sense minimum 
requirements are law in a number of states, my amendments were shot 
down by the majority.
  So we're still left with a bill that brings a real possibility of the 
creation of comically inadequate health plans, which is rather 
disturbing.
  What's even more alarming is the effect that this legislation will 
have on the overall health care environment.
  The danger is, of course, cherry-picking. While AHPs may work well to 
help insure generally healthy, young people, the sickest of our 
population--those most in need of health care coverage--will be left 
with higher premiums. What kind of an effect will this have on our 
current health care environment? Could this actually take us farther 
away from covering the uninsured in this country? One study, in fact, 
said that AHPs would actually cause premiums to rise for the vast 
majority of small businesses and their employees.
  Here's another important question. Exactly how many of the uninsured 
would get coverage from these new types of AHPs? CBO has estimated that 
about 8.5 million people might get coverage through the types of plans 
proposed under H.R. 4281. That sounds pretty good--until you realize 
that only 620,000 of them would come from the ranks of the uninsured, 
while the other 7.9 million would be in firms switching from 
traditional coverage. That means we'd be extending coverage to a 
miniscule fraction of the uninsured in this country.
  The bottom line is that more than forty million Americans lack health 
insurance--a serious crisis that needs to be addressed. But H.R. 4281 
won't do much good, and could very well make a bad situation even 
worse.
  I urge my colleagues to oppose H.R. 4281 and vote for the Kind-
Andrews substitute.
  Ms. WOOLSEY. Mr. Speaker, as we once again celebrate Cover the 
Uninsured Week, I rise to support a sensible legislative proposal that 
will do just that: Cover the Uninsured.
  I know that I've heard from constituents who wish they had the 
opportunity to purchase the same kind of high quality health insurance 
that we enjoy as Federal Employees. And they are right. The Federal 
Employee Health Benefits Program is an excellent model for effective 
health care coverage.
  That's why I rise to proudly support the Kind-Andrews Substitute, 
which would give small businesses and their employees the opportunity 
to purchase coverage similar to ours.
  The Small Employer Health Benefits Program created by this substitute 
would not ask employees to sacrifice the guaranteed coverage and 
protections provided by State law.
  Small businesses and their employees would have real health coverage 
that provides them with access to the care they need--not sham 
insurance that serves only those who are healthy.
  We've talked a great deal about how to expand health coverage to the 
uninsured this week, and I urge my colleagues to support their words 
with action by supporting this sensible substitute.
  Mr. BOEHNER. Mr. Speaker, I yield back the balance of my time.

                              {time}  1530

  The SPEAKER pro tempore (Mr. LaTourette). Pursuant to House 
Resolution 638, the previous question is ordered on the bill and on the 
amendment by the gentleman from Wisconsin (Mr. Kind).
  The question is on the amendment in the nature of a substitute 
offered by the gentleman from Wisconsin (Mr. Kind).
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.
  Mr. KIND. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The vote was taken by electronic device, and there were--yeas 193, 
nays 224, not voting 16, as follows:

                             [Roll No. 172]

                               YEAS--193

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Chandler
     Clay
     Clyburn
     Conyers
     Cooper
     Costello
     Crowley
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Frank (MA)
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (CO)
     Udall (NM)
     Van Hollen
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

[[Page H2984]]



                               NAYS--224

     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carson (OK)
     Carter
     Case
     Castle
     Chabot
     Chocola
     Coble
     Cole
     Collins
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     DeLay
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Emerson
     English
     Everett
     Feeney
     Ferguson
     Flake
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Kucinich
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     McCotter
     McCrery
     McHugh
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shaw
     Shays
     Sherwood
     Shuster
     Simmons
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Upton
     Velazquez
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--16

     Aderholt
     Deal (GA)
     DeGette
     DeMint
     Filner
     Ford
     Hulshof
     Israel
     Majette
     McInnis
     Nethercutt
     Reyes
     Scott (GA)
     Shadegg
     Shimkus
     Tauzin


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. LaTourette) (during the vote). Members 
are advised 2 minutes remain in this vote.

                              {time}  1554

  Ms. VELAZQUEZ and Mr. SAXTON changed their vote from ``yea'' to 
``nay.''
  So the amendment in the nature of a substitute was rejected.
  The result of the vote was announced as above recorded.
  Stated for:
  Mr. FILNER. Mr. Speaker, on rollcall No. 172, I was attending to 
official business in my Congressional District, and I missed the vote. 
Had I been present, I would have voted ``yea.''
  The SPEAKER pro tempore. The question is on engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.


        Motion to Recommit Offered by Mrs. Mc Carthy of New York

  Mrs. McCARTHY of New York. Mr. Speaker, I offer a motion to recommit.
  The SPEAKER pro tempore. Is the gentlewoman opposed to the bill?
  Mrs. McCARTHY of New York. Yes, I am, Mr. Speaker.
  The SPEAKER pro tempore. The Clerk will report the motion to 
recommit.
  The Clerk read as follows:

  Ms. McCarthy of New York moves to recommit the bill H.R. 4281 to the 
Committee on Education and the Workforce with instructions to report 
the same back to the House forthwith with the following amendment:

       Page 13, insert after line 7 the following:
       ``(e) Protection of Existing Group Health Plan Coverage.--
       ``(1) In general.--The requirements of this section are not 
     met with respect to an association health plan if--
       ``(A) during the 1-year period preceding the date of the 
     enactment of the Small Business Health Fairness Act of 2004, 
     any participating employer of the plan maintained another 
     group health plan providing a type of coverage described in 
     paragraph (2), and
       ``(B) such association health plan does not provide such 
     type of coverage.
       ``(2) Types of coverage.--A type of coverage is described 
     in this paragraph if it consists of--
       ``(A) coverage for breast cancer screening and tests 
     recommended by a physician,
       ``(B) coverage for the expenses of pregnancy and 
     childbirth,
       ``(C) coverage for well child care, or
       ``(D) direct access to those obstetric or gynecological 
     services which are provided by the plan.
       ``(3) Predecessors and controlled groups.--For purposes of 
     this subsection, a predecessor of an employer or any member 
     of the employer's controlled group shall be treated as the 
     employer. For purposes of this paragraph, the term 
     `controlled group' means any group treated as a single 
     employer under subsection (b), (c), (m), or (o) of section 
     414 of the Internal Revenue Code of 1986.

  Mrs. McCARTHY of New York (during the reading). Mr. Speaker, I ask 
unanimous consent that the motion to recommit be considered as read and 
printed in the Record.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from New York?
  There was no objection.
  The SPEAKER pro tempore. The gentlewoman is recognized for 5 minutes 
on her motion.
  Mrs. McCARTHY of New York. Mr. Speaker, this motion to recommit is 
very simple. The motion ensures that the bill does not preempt State 
regulations regarding coverage for breast cancer, pregnancy and 
childbirth, and well-child OB/GYN services.
  Mr. Speaker, this bill, the National Republican Governors 
Association, the Democratic Governors Association, they are all against 
it. Forty-one State Attorneys General are against it. There is a reason 
for that, going back many years ago, when the insurance companies were 
not giving health care insurance to those that would carry it.
  Mr. Speaker, this bill undermines health care legislation in 48 
States, including New York. As patients and advocates across the Nation 
quickly discovered that their basic health care needs were not being 
served by their insurance companies, they demanded the State step in 
and protect them.
  Mr. Speaker, 48 States responded overwhelmingly and gave basic health 
care to their citizens. Today, we are undermining the State's efforts. 
Today, we are saying that basic health care does not matter.
  As a nurse, my policy is ``first do no harm.'' Mr. Speaker, this bill 
does harm to millions of patients across the country. Mr. Speaker, a 
reduction in health insurance in any form is a reduction in health 
care. It is just that simple.
  Almost every State has recognized the need to cut down the cost of 
health care and still provide basic health care to their citizens. The 
States know that without guaranteeing basic health care patients will 
not get the health care they desperately need. They will only seek help 
when they are very sick, thus requiring much more expensive medical 
care for their diseases, putting their lives and the lives of their 
children at risk.
  Let us just look at what it would mean for breast cancer, which is so 
high in New York State.
  According to the American Cancer Society, over 211,000 new cases of 
breast cancer will be diagnosed in the United States this year. In my 
State of New York, there will be 2,000 new cases of breast cancer 
diagnosed alone. Breast cancer is a fatal, but eminently treatable, 
disease. However, early detection is the key to proper treatment of the 
disease.
  Mammogram screenings are essential for the early detection of cancer. 
Timely screening can prevent approximately 15 to 30 percent of all 
deaths from breast cancer among women over the age of 40. Currently, 
New York and 48 States require insurance companies to cover mammogram 
screenings. However, under this bill associated health plans would be 
exempt from having to provide this critical benefit. This amendment 
would at least prevent a reduction of health care services to those who 
already have this benefit.
  Preserving the coverage of mammogram screenings will help save the 
lives of our wives, our mothers, and

[[Page H2985]]

their daughters. I urge all of my colleagues to vote ``no,'' and as I 
said earlier, the National Association of Governors, Democratic 
Governors, Republican Governors are against this legislation.
  Mr. Speaker, I yield the balance of my time to my colleague, the 
gentlewoman from Wisconsin (Ms. McCollum).
  Ms. McCOLLUM. Mr. Speaker, I am pleased to join the gentlewoman from 
New York (Mrs. McCarthy) in offering this motion to recommit.
  To protect the health benefits that women and children currently have 
today, we must not allow association health plans to deny necessary 
care for women and their children.
  This motion to recommit stops association health plans from refusing 
to cover state-mandated health benefits for well-child care visits and 
maternity coverage or other types of care that is vital to our 
families. Children deserve a healthy start in life.
  In Minnesota and 30 other States, children are guaranteed regular 
visits to their pediatricians to get the necessary care they deserve. 
Well-child care ensures that children get the vaccinations and 
immunizations that they need to protect themselves from preventable 
diseases like measles and mumps.
  Regular doctor visits for newborns are absolutely critical. Thirty-
three children are born every day with severe hearing loss. If caught 
early through preventative doctor visits, we can make a positive 
difference in the lives of our children, and we can save future dollars 
spent on special education.
  Having early access to adequate health care can prevent illness, 
identify disabilities and reduce future health costs.
  The motion we are offering ensures that families who have health 
coverage that protects the health of women and children today will not 
lose it tomorrow.
  Today, we should be considering legislation to ensure quality 
comprehensive health care for our Nation's working families, not 
cutting basic benefits.
  I urge my colleagues to support the motion to recommit and to protect 
important State laws that protect the health of women and children.

                              {time}  1600

  Mr. BOEHNER. Mr. Speaker, I rise in opposition to the motion to 
recommit.
  Mr. Speaker, AHPs that would self-insure are exempted from State 
insurance mandates exactly like large company plans and union plans all 
over the country. We all know that health insurance mandates drive up 
the cost of health insurance. When the cost of health insurance goes up 
for small employers, it is their employees who lose coverage.
  The underlying bill attempts to help the 44 million Americans who do 
not have health insurance have a better chance of getting health 
insurance. And small employers, just because of their size, should not 
be denied the right to group together to get a better-quality product 
at a more competitive price for their employees.
  I urge my colleagues to reject the motion to recommit, the same 
motion to recommit this House rejected last year, and to support the 
underlying bill.
  Mr. Speaker, I yield back the balance of my time.
  The SPEAKER pro tempore (Mr. LaTourette). Without objection, the 
previous question is ordered on the motion to recommit.
  There was no objection.
  The SPEAKER pro tempore. The question is on the motion to recommit.
  The question was taken; and the Speaker pro tempore announced that 
the noes appeared to have it.


                             Recorded Vote

  Mrs. McCARTHY of New York. Mr. Speaker, I demand a recorded vote.
  A recorded vote was ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, this 15-
minute vote on the motion to recommit will be followed by 5-minute 
votes on the question of passage, if ordered, the motion to suspend the 
rules and pass House Joint Resolution 91, and adoption of House 
Concurrent Resolution 414.
  The vote was taken by electronic device, and there were--ayes 196, 
noes 218, not voting 19, as follows:

                             [Roll No. 173]

                               AYES--196

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Chandler
     Clay
     Clyburn
     Conyers
     Cooper
     Costello
     Cramer
     Crowley
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Ford
     Frank (MA)
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     John
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McIntyre
     McNulty
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rangel
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (CO)
     Udall (NM)
     Van Hollen
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                               NOES--218

     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carter
     Case
     Castle
     Chabot
     Chocola
     Coble
     Cole
     Collins
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     DeLay
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Dreier
     Duncan
     Dunn
     Ehlers
     Emerson
     English
     Everett
     Feeney
     Ferguson
     Flake
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Jenkins
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     LoBiondo
     Lucas (OK)
     Manzullo
     McCotter
     McCrery
     McHugh
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Rahall
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shaw
     Shays
     Sherwood
     Shuster
     Simmons
     Simpson
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Upton
     Velazquez
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                             NOT VOTING--19

     Aderholt
     Deal (GA)
     DeGette
     DeMint
     Filner
     Granger

[[Page H2986]]


     Hulshof
     Israel
     Linder
     Majette
     McInnis
     Meehan
     Nethercutt
     Reyes
     Scott (GA)
     Shadegg
     Shimkus
     Smith (MI)
     Tauzin


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (Mr. LaTourette) (during the vote). Members 
are advised 2 minutes remain in this vote.

                              {time}  1620

  So the motion to recommit was rejected.
  The result of the vote was announced as above recorded.
  Stated for:
  Mr. FILNER. Mr. Speaker, on rollcall No. 173, I was attending to 
official business in my Congressional District, and I missed the vote. 
Had I been present, I would have voted ``aye''.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. CARDIN. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. This will be a 5-minute vote.
  The vote was taken by electronic device, and there were--yeas 252, 
nays 162, answered ``present'' 1, not voting 18, as follows:

                             [Roll No. 174]

                               YEAS--252

     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Bell
     Bereuter
     Biggert
     Bilirakis
     Bishop (GA)
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boucher
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Burton (IN)
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carson (OK)
     Carter
     Case
     Castle
     Chabot
     Chocola
     Clay
     Clyburn
     Coble
     Cole
     Collins
     Cooper
     Costello
     Cox
     Cramer
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis (AL)
     Davis (TN)
     Davis, Jo Ann
     Davis, Tom
     DeLay
     Diaz-Balart, L.
     Diaz-Balart, M.
     Dooley (CA)
     Doolittle
     Dreier
     Duncan
     Dunn
     Edwards
     Ehlers
     Emerson
     English
     Everett
     Feeney
     Ferguson
     Flake
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Frost
     Gallegly
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Gonzalez
     Goode
     Goodlatte
     Goss
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Hall
     Harman
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     John
     Johnson (CT)
     Johnson (IL)
     Johnson, E. B.
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     Lipinski
     LoBiondo
     Lucas (KY)
     Lucas (OK)
     Manzullo
     Marshall
     Matheson
     McCotter
     McCrery
     McHugh
     McIntyre
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Moran (VA)
     Murphy
     Musgrave
     Myrick
     Neugebauer
     Ney
     Northup
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (MN)
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Rahall
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Rothman
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shaw
     Shays
     Sherwood
     Shuster
     Simmons
     Simpson
     Smith (NJ)
     Smith (TX)
     Snyder
     Souder
     Stearns
     Stenholm
     Sullivan
     Sweeney
     Tancredo
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thompson (MS)
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Turner (TX)
     Upton
     Velazquez
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wynn
     Young (AK)
     Young (FL)

                               NAYS--162

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Becerra
     Berkley
     Berman
     Berry
     Bishop (NY)
     Blumenauer
     Boswell
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Chandler
     Conyers
     Crowley
     Cummings
     Davis (CA)
     Davis (FL)
     Davis (IL)
     DeFazio
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Doyle
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Ford
     Frank (MA)
     Gephardt
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Jackson (IL)
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lofgren
     Lowey
     Lynch
     Maloney
     Markey
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McNulty
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Pomeroy
     Price (NC)
     Rangel
     Rodriguez
     Ross
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tanner
     Tauscher
     Thompson (CA)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Van Hollen
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu

                        ANSWERED ``PRESENT''--1

       
     Norwood
       

                             NOT VOTING--18

     Aderholt
     Deal (GA)
     DeGette
     DeMint
     Filner
     Granger
     Hulshof
     Israel
     Majette
     McInnis
     Meehan
     Nethercutt
     Reyes
     Scott (GA)
     Shadegg
     Shimkus
     Smith (MI)
     Tauzin


                Announcement by the Speaker Pro Tempore

  The SPEAKER pro tempore (during the vote). Members are advised 2 
minutes remain in this vote.

                              {time}  1629

  Mr. LEVIN, Mr. MOLLOHAN and Ms. KAPTUR changed their vote from 
``yea'' to ``nay.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Stated against:
  Mr. FILNER. Mr. Speaker, on rollcall No. 174, I was attending to 
official business in my Congressional District, and I missed the vote. 
Had I been present, I would have voted ``no''.
  The SPEAKER pro tempore. Pursuant to section 4 of House Resolution 
638, the text of H.R. 4280 and H.R. 4281 will be appended to the 
engrossment of H.R. 4279; and H.R. 4280 and H.R. 4281 shall be laid on 
the table.

                          ____________________