[Congressional Record Volume 155, Number 157 (Tuesday, October 27, 2009)]
[Senate]
[Pages S10744-S10747]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                           HEALTH CARE REFORM

  Mr. GRASSLEY. Mr. President, with the words ``health care reform,'' 
everybody would expect costs to go down, premiums to level off, and 
more people being served. But it seems as though the proposals that are 
before the Senate are going to increase taxes, cut Medicare, and 
increase health insurance premiums. I think anybody hearing that would 
say that is not health care reform or at least not the health care 
reform they expected Congress to pass.
  So we are here in the Congress, soon about to consider a single bill 
that will personally affect the lives of every single American. Not 
often do we pass a bill that affects the lives of every single 
American, and not often do we pass a bill that restructures 17 percent 
of the U.S. economy--maybe never before.
  As one Washington Times editorial pointed out--and I am going to 
quote from it, and it is here for the audience to read:

       [The U.S. health care system] is bigger than Great 
     Britain's entire economy. Imagine five bickering 
     Congressional committees trying to redesign the British 
     economy successfully in just a few weeks. No wonder people 
     are getting nervous.

  It is true, people are getting nervous. As I travel around Iowa, I 
hear a lot of concern about out-of-control government spending and a 
massive government takeover of our health care system. People are 
worried that health care reform will result in lower quality, less 
access, and government bureaucrats deciding what health insurance they 
can or can't have. On top of all of that, Gallup released a poll last 
week saying 49 percent of Americans believe their personal costs will 
get worse--yes, worse--after health care reform is enacted. The poll 
also reported that only--and I emphasize ``only''--22 percent actually 
think costs will go down. Less than one-quarter of the people polled 
actually thought health reform would accomplish its top priority: 
making health care more affordable.
  I can't speak for my colleagues. I don't know what they are hearing 
from their constituents. But I know Iowans can't afford to pay more for 
health care. Costs are already rising three times faster than the rate 
of inflation. Costs are straining family budgets, and they are making 
it increasingly difficult for employers to offer health insurance.
  The nonpartisan Congressional Budget Office, the Joint Committee on 
Taxation, and even the Office of the Actuary at the U.S. Department of 
Health and Human Services have told us what the American people already 
know: These massive partisan health care reform bills are going to make 
the problem worse.
  Let me emphasize for the American people who might be listening that 
the people at the Congressional Budget Office, the Joint Committee on 
Taxation, and the Office of Actuary at the Department of HHS are 
professional, not political. They don't change from time to time when 
the makeup of Congress changes. They are there over a long period of 
time studying things in an intellectually honest way to tell it like it 
is. This is what they are saying: These massive partisan health care 
reform bills are going to make the problem worse.
  So I wish to go to some analyses we have already received from these 
nonpartisan, intellectually honest organizations.
  According to a September 22 letter from CBO to Chairman Baucus about 
the Finance Committee bill:

       Premiums in the new insurance exchanges would tend to be 
     higher than the average premiums in the current-law 
     individual market.

  So according to CBO, after these bills spend $1 trillion, many of the 
people struggling to afford their premiums today will actually end up 
seeing those premiums go up if this bill is enacted. The Congressional 
Budget Office also commented on how the tax increases would also raise 
premiums.
  During the Finance Committee markup, Senator Cornyn asked this 
question:

       Would the new fees on health insurers be passed down to 
     health care consumers?

  Dr. Elmendorf, Director of CBO, responded by saying:

       Our judgment is that, [the new fees] would raise insurance 
     premiums.

  The Joint Committee on Taxation confirmed that they came to the same 
conclusion during the markup. Mr. Barthold, the director there, said:

       Basic economics is that that fee will be reflected in 
     higher premium costs.

  Let's not forget that these new insurance fees begin next year, in 
the year 2010, 3 years before any of the reforms in the bill take 
effect. So it is irrefutable that premiums will go up for every single 
American starting next year as a result of a bill that came out of the 
Senate Finance Committee.
  The Office of the Actuary with the U.S. Department of Health and 
Human Services--another nonpartisan, highly regarded set of expert 
analysts, by the way--has also looked at some of the Democratic health 
reform proposals.
  In a memo released on October 21, the Department of Health and Human 
Services, Office of Actuary, provided an analysis of House bill H.R. 
3200. In the memo, the Health and Human Services actuary writes that 
the House bill does bend the growth curve, meaning the inflationary 
increase in health care costs. Of course, a top priority for Congress 
and the White House was to bend that curve. Unfortunately, the chief 
actuary says the Democratic leadership and the White House have failed 
to tell the American public it bends the curve in the wrong direction--
not downward but upward.

[[Page S10745]]

  According to the HHS memo, health care spending would actually 
increase if the House bill became law. The actuary writes it this way:

       In the aggregate, we estimate that for calendar years 2010 
     to 2019, national health expenditures would increase by $750 
     billion, or 2.1 percent, over the updated baseline 
     projection.

  While some of the supporters of these partisan bills may not want to 
tell their constituents, we all know that as national spending on 
health care increases, American families will bear a burden through 
increased health insurance premiums.
  Let me be very clear. As a result of the pending health care 
proposals, most Americans will pay higher premiums for health 
insurance.
  Some of my colleagues will try to refute this claim by mentioning the 
taxpayer-funded subsidies included in these health care bills. It is 
interesting that they don't even try to deny, in the process of talking 
about taxpayer-funded subsidies, that premiums will still go up. They 
don't deny that. They just say the government--or let's say the 
taxpayers--are going to pick up the tab.
  It is true the proposals we have seen so far include about $\1/2\ 
trillion in cuts to Medicare and massive tax increases to pay for this 
new entitlement program. But once again, some of my colleagues fail to 
mention that most Americans would not qualify for these subsidies. Most 
Americans--about 160 million--get their health care through their 
employer.
  But if you are one of those people who get their health care through 
an employer, you don't qualify for any subsidy until you spend 10 
percent of your income on health care premiums.
  The ACTING PRESIDENT pro tempore. The Senator has used 10 minutes.
  Mr. GRASSLEY. I ask unanimous consent for an additional 7 minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. GRASSLEY. The other side plans to throw much of your hard-earned 
dollars at it to make premiums appear affordable. But even with their 
$1 trillion in spending, the Congressional Budget Office has confirmed 
that in 2019 only about 7 percent of those insured will be getting 
government subsidies.
  So even though there will be a huge new taxpayer-funded subsidy 
program to help pay for these premium increases, most people would not 
actually qualify for any of that help. They will just be stuck with 
higher taxes--yes, higher taxes--less choices--yes, less choices--and 
higher health insurance premiums.
  Some people may wonder what parts of the bill are driving up these 
costs. We have already identified the new insurance fee.
  One analyst of the Federal policy group concluded that the insurance 
fee alone could raise premiums up to $500 per year per family. Then 
there are the new benefit requirements.
  Under the proposals we have seen so far, the Federal Government is 
now defining what kind of insurance you can buy anywhere in the United 
States. This means it will be illegal for insurers to sell or for you 
to buy many of the policies people are currently enrolled in.
  By law, it will be illegal to buy policies that don't meet an 
actuarial value of 65 percent and cover a long list of mandated 
benefits.
  The consulting firm Oliver Wyman has said that since this new Federal 
minimum standard is higher than many of the policies sold today, new 
enrollees will have to pay about 10 percent more to meet the new 
government benefit standard.
  This is just under the Finance Committee bill. That 10-percent 
increase in premiums would be much higher under any of the House bills 
and the Senate HELP Committee proposals.
  Once again, the other side of the aisle will point to a 
grandfathering policy that, as the President has said, will let you 
keep what you have. But they fail to mention that this grandfathering 
policy doesn't count if you ever plan to move or, two, your insurer 
stops offering coverage or, three, you want to change your policy to 
add vision or dental coverage.
  If you meet any one of those criteria, the promise that you will be 
able to keep what you have doesn't apply to you.
  Another factor that will drive up premiums is the new age rating 
rules. These rules set limits on the amount premiums can vary between 
younger and older enrollees.
  Some of the proposals being considered would tighten this variation 
so much it will drive up premiums by almost 70 percent for younger, 
healthier enrollees. So all those so-called young invincibles we need 
to get into the health insurance pool, all the recent college 
graduates, will be hit hardest by the increase in premiums because of 
the proposed market reforms.
  Taking all these factors into account, Oliver Wyman actuaries also 
concluded that individuals would pay as much as 73 percent more as a 
result of the policies in the Finance Committee bill. Small businesses 
could face about a 20-percent increase, which will lead to about 2.5 
million less people getting coverage through their small business.
  We can certainly debate all these numbers. Some may question whether 
rates will increase by that much. I am sure some will question the 
sources of these studies, although I should note we didn't take these 
estimates at face value. In fact, ever since the Gang of 6 meetings, we 
have had some of the best independent actuaries and insurance experts 
analyzing this data.
  But even the people who want to debate the sources do not deny the 
fact that health insurance premiums will go up as a result of the bills 
we are considering. I am beginning to understand the game. I am 
actually beginning to wonder if the reason no one is denying it is 
because this is intentional.
  If these bills drive up premiums in the private market, it is going 
to make it a lot easier to push for a government-run insurance program 
or a new entitlement program.
  A Washington Post story over the weekend reinforced this concern:

       [Senator] Reid's original inclination was to leave the 
     public option out of the final bill . . . but his liberal 
     colleagues began urging him two weeks ago to reconsider, 
     after insurance industry forecasts that premiums would rise 
     sharply under the Finance Committee bill.

  Let's hope the Democratic leadership and the White House aren't 
willing to push a bill that forces 200 million people to pay higher 
premiums unless they enroll in a new government entitlement insurance 
program. But that is certainly what it sounds like.
  Whatever the motive may be, the facts are undeniable. Health 
insurance premiums will increase for every individual and small 
business as early as next year as a result of the pending health bills. 
It will hit young, healthy people the hardest. It will cause small 
business to stop offering health insurance premiums. We have heard it 
from Joint Tax, we have heard it from CBO, and we have heard it from 
the Office of the Actuary within the U.S. Department of Health and 
Human Services.
  I wish to make sure all the American people hear it.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Wyoming is 
recognized.
  Mr. ENZI. Mr. President, this health plan being forced on America 
under phony, tight timelines bites off too much, fails to deliver on 
promises, and passes the costs on to hard-working Americans.
  When the 85 percent of Americans who already have health insurance 
hear the term ``health care reform,'' they expect Washington to do 
something that lowers the cost of their health insurance premiums. That 
reaction should not be surprising, since the President and 
congressional leaders have explicitly promised that reform would lower 
health care costs to the average American family.
  Unfortunately, the bills Congress has developed will do the exact 
opposite. These bills will increase health care costs.
  Several recent reports have highlighted what I and some of my 
colleagues have been saying for months. The combination of increased 
taxes, expensive mandates, and new regulations in these bills will 
actually increase the cost of health care for most Americans. 
Unemployment is higher than it has been in decades. The housing market 
is in distress. There is an out-of-control Federal debt and deficit. 
More and more middle-class Americans are feeling squeezed by 
irresponsible decisions being made here in Washington. Unfortunately, 
the health care

[[Page S10746]]

bill being put together by the majority leader behind closed doors--and 
not on the Web yet--is another example of irresponsible policies.
  It is important for the American people to understand how these bills 
will actually increase their health care costs. I wish to highlight 10 
specific ways these bills will increase premiums for Americans and 
individuals. Taken together, these provisions will increase costs, they 
will stifle competition, and they will take choices away from families, 
individual Americans, and small businesses.
  Here are the top 10 ways the bills before Congress increase health 
care costs:
  No. 1, the two committee bills rely on taxing the young to pay for 
the old is what the number crunchers call adjusted community rating. 
This means the premium charged to a healthy 22-year-old will have to 
increase to be much closer to the premiums charged to someone who is 
much older and sicker. This means young people will pay a lot more for 
health insurance premiums than they do today.
  Over 40 percent of the uninsured are between the ages of 18 and 34, 
the same age group that will be hit the hardest, with the highest price 
increases, if this bill passes. Experts estimate that in most States, 
premiums for the youngest 30 percent of the population will increase by 
69 percent under the tight age bands being considered in one of the 
Senate bills. These extreme price increases will force the young and 
healthy out of the market. Most young people will probably do the math 
and decide, let's see, I can pay the $750-a-year tax penalty rather 
than pay $5,000 a year more for health insurance. If they get sick 
later, they can enroll in health insurance later.
  No. 2, premiums will increase because of the new federally mandated 
requirements on health plans. The bill will mandate that most health 
care plans have to meet new, higher specified actuarial values. If you 
don't know the term ``actuarial value,'' you are not alone. Let me put 
this as simply as I can. Actuarial value is a technical term that 
describes the amount of total health care spending that is paid for by 
the health plan; in other words, all the benefits and enrollee cost-
sharing provisions a health care plan covers. Typically, as actuarial 
values increase, premiums increase and the cost-sharing requirement 
decrease. If you are healthy, you cannot opt for lower premiums or for 
higher copays than your government will tell you or you will pay the 
penalty.
  The bottom line is, experts estimate that 50 percent of the 
individual market policies purchased today and about 20 percent of the 
policies purchased by small businesses today have actuarial values that 
are lower than what the Democrats think you should have, which means 
millions of Americans will be forced to buy more expensive 
plans. Compliance with these benefit requirements could cause premiums 
for the new purchasers to increase by about 10 percent for individuals 
and about 3 percent for small businesses. For small businesses, 3 
percent is a high rate of profit.

  No. 3, premiums will increase because of the new federally mandated 
benefit packages. All plans must include a long list of benefits 
regardless of what Americans need or want. Why should a 30-year-old 
single man be required to pay for ovarian cancer screening? 
Additionally, at least every year the Secretary of Health and Human 
Services will be required to define and update--perhaps increase--the 
categories of covered treatments, items, and services.
  Not surprising, what this will mean is that the list of mandated 
benefits will inevitably get longer and further increase costs. If 
these bills are enacted, every disease advocacy group, drug 
manufacturer, and health care provider will hire more lobbyists to see 
that all health plans are required to cover their unique diseases, 
treatments, and procedures.
  That is no way to run a health care program. I believe consumers 
rather than lobbyists should decide the benefits package that best 
meets their needs. Otherwise, there will be more mandates and higher 
costs.
  If this bill becomes law, I would not be surprised if every plan in 
America is required to cover massages and acupuncture. I am not saying 
people should not get massages or acupuncture if they want to pay for 
them, but I don't think all Americans should be required to enroll in a 
plan that covers every single benefit.
  No. 4, premiums will increase because of new excise taxes on medical 
devices and drugs. The official scorekeepers at the Congressional 
Budget Office and the Joint Committee on Taxation have been clear in 
stating that these taxes will be passed on to patients. That means 
consumers will see the prices of everything from power wheelchairs to 
pacemakers to prescription drugs, such as Prilosec, significantly 
increase. These price increases will also ultimately increase health 
insurance premiums for the millions of Americans who already have 
health insurance.
  You don't use any of those? Remember, insurance is spreading the 
risks so you get to pay, too.
  No. 5, premiums will increase because of the new excise tax on health 
insurance providers. The Congressional Budget Office and the Joint 
Committee on Taxation have said these taxes will be passed on to people 
in the form of higher premiums. This tax alone could raise premiums for 
a family by $487 a year.
  No. 6, premiums for health insurance will increase when 14 million 
more Americans are enrolled in the Medicaid Program. Several studies 
have highlighted how Medicaid's inadequate payments to doctors and 
hospitals directly increase costs to everybody else by forcing these 
providers to make up for their losses under Medicaid by shifting those 
costs on to private purchasers.
  The current health reform bills include the biggest expansions of the 
Medicaid Program since it was created in 1965, while doing nothing to 
address Medicaid's inadequate doctor and hospital payment rates. If 
someone cannot see a doctor, they do not have insurance. This will mean 
billions of dollars in additional costs would have to be shifted on to 
individuals who already have health insurance, thereby driving up their 
premiums. Nearly 40 percent of doctors will not see Medicaid patients 
because of the low reimbursement rates.
  As I said, if someone does not see a doctor, they do not have health 
care.
  No. 7, premiums will increase for so-called Cadillac plans because of 
the new 40-percent excise tax. Companies will respond to this new tax 
by shifting the costs on to individuals who are the insured or by 
reducing the value of the health care benefits they provide. 
Eventually, this tax will start hitting the Chevys and the Buicks, not 
just the Cadillacs.
  Experts estimate that in many metropolitan areas the lowest option 
bronze plan--that is what we require--under the Finance Committee bill 
will be considered a so-called Cadillac plan as early as 2016. This 
does not even go into effect until 2013.
  No. 8, premiums will increase because of the new fee to sell plans in 
the mandated exchanges. The Congressional Budget Office estimates plans 
would have to pay a surcharge to sell on the exchange, which would add 
about 3 percent to premiums.
  No. 9, premiums will increase because of the new reinsurance program. 
This new program will cost Americans $20 billion, and those costs will 
be passed on to someone, most like the healthy enrollees.
  No. 10, premiums will increase because of the new tax for comparative 
effectiveness research. Washington bureaucrats will tax patients so the 
government can decide which treatments are acceptable and which 
treatments are denied. Rationing? We have seen this story before in 
other countries such as England. We know this will lead to the delay 
and denial of care for our seniors. It is no wonder that a recent 
Rasmussen poll noted that 59 percent of our Nation's seniors oppose the 
current legislation.
  Taken together, the 10 policies I just described will cumulatively 
increase health insurance premiums for millions of Americans who 
currently have health insurance. It is another squeeze on our Nation's 
middle class.
  In my home State of Wyoming, a healthy 35-year-old man can currently 
buy a high-deductible policy for about $90 a month. The scorekeepers at 
the Congressional Budget Office estimate the silver plan under the 
Finance Committee bill will be $392 a month.

[[Page S10747]]

  The ACTING PRESIDENT pro tempore. The Senator has consumed 10 
minutes.
  Mr. ENZI. Mr. President, I ask for 5 additional minutes.
  The ACTING PRESIDENT pro tempore. There is only 3 minutes on the 
Senator's time.
  Mr. ENZI. I ask for 3 additional minutes.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.
  Mr. ENZI. The scorekeepers at the Congressional Budget Office 
estimate the silver plan under the Finance Committee bill will increase 
to $392 a month. That is over a 300-percent increase. None of the folks 
I talked with from Wyoming can afford to pay 300 percent or more for 
their health insurance. In another economic time, this policy would be 
bad enough. In today's climate, it is irresponsible.
  We all agree the health insurance market is broken and needs to be 
fixed. Everyone who wants health insurance should be able to get it, 
and they should not have to spend their hard-earned dollars to get it.
  No American should be denied health insurance because they have 
cancer, diabetes, acne, or some other preexisting condition. No one 
should lose their health insurance because they forgot about an old 
injury when they filled out a form. No one should be denied health 
insurance, period.
  These reforms are very important and long overdue. However, we can do 
better. These goals should be implemented in a way that drives down 
costs for the majority of Americans who already have health insurance. 
Congress needs to learn from the experiences of the States that have 
already enacted these types of reforms. The States did not pass reforms 
with the goal of increasing costs for a majority of their residents, 
but that is precisely what has happened over time.
  We need to enact reforms that will actually reduce costs and make 
health insurance more affordable. That is what the American people want 
but, unfortunately, that is not what the current bills do.
  I yield the floor.
  The ACTING PRESIDENT pro tempore. The Senator from Rhode Island.
  Mr. REED. Mr. President, I wish to speak for up to 10 minutes in 
morning business.
  The ACTING PRESIDENT pro tempore. Without objection, it is so 
ordered.

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