[Congressional Record (Bound Edition), Volume 155 (2009), Part 17]
[Senate]
[Pages 22363-22364]
[From the U.S. Government Publishing Office, www.gpo.gov]




                           PUBLIC OPTION LITE

  Mr. KYL. Mr. President, a September 17, 2009, editorial in the Wall 
Street Journal, ``Public Option Lite,'' clearly and concisely describes 
how the Finance Committee chairman's health care plan would result in a 
near total government takeover of the health care industry.
  Because it does not include the public option, the chairman's plan 
has been touted as a more moderate proposal than other bills before 
Congress. But, as the Journal writes, the absence of the public option 
``is a political offering without much policy difference. His plan 
remains a public option by other means.''
  Near total government control would be achieved through the bill's 
two main mechanisms: an individual mandate for all Americans to 
purchase government-approved insurance and the regulatory insurance 
``exchange.'' The inevitable outcomes of these mechanisms would be 
``vast new insurance regulation'' and ``a vast increase in the 
government's share of U.S. health spending, forcing doctors, hospitals, 
insurance companies, and other health providers to serve politics, as 
well as, or even over and above patients.'' Thus, power would be 
centralized with politicians and bureaucrats, rather than patients and 
doctors.
  Along the way, as the editorial points out, the bill would increase 
the cost of insurance through new taxes and mandates, reduce consumer 
choice, and ultimately ration health care in an attempt to keep costs 
under control.
  The editorial also explains that most of the Medicare cuts used to 
help pay for this plan ``come from supposedly automatic cuts that a 
future Congress is unlikely to ever approve, that is, until this 
entitlement spending swamps the entire federal budget.'' Then, ``The 
government will have no choice but to raise taxes to European welfare-
state levels or impose drastic restrictions on patient care. Or likely, 
both.''
  The article concludes that this plan is ``a recipe to ruin 
healthcare'' and ``bankrupt the country.''
  I ask unanimous consent to have this article printed in the Record 
and urge my colleagues to consider the facts and arguments contained in 
this editorial.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

               [The Wall Street Journal, Sept. 17, 2009]

                           Public Option Lite

       Senate Finance Chairman Max Baucus finally unveiled his 
     health-care plan yesterday to a chorus of bipartisan jeers. 
     The reaction is surprising given that President Obama all but 
     endorsed the outlines of the Baucus plan last week But the 
     hoots are only going to grow louder as more people read what 
     he's actually proposing.
       The headline is that Mr. Baucus has dropped the unpopular 
     ``public option,'' but this is a political offering without 
     much policy difference. His plan remains a public option by 
     other means, imposing vast new national insurance regulation, 
     huge new subsidies to pay for the higher insurance costs this 
     regulation will require and all financed by new taxes and 
     penalties on businesses, individuals and health-care 
     providers. Other than that, Hippocrates, the plan does no 
     harm.
       The centerpiece of the Obama-Baucus plan is a decree that 
     everyone purchase heavily regulated insurance policies or 
     else pay a penalty. This government mandate would require 
     huge subsidies as well as brute force to get anywhere near 
     the goal of universal coverage. The inevitable result would 
     be a vast increase in the government's share of U.S. health 
     spending, forcing doctors, hospitals, insurance companies and 
     other health providers to serve politics as well as or even 
     over and above patients.
       The plan essentially rewrites all insurance contracts, 
     including those offered by businesses to their workers. 
     Benefits and premiums must be tailored to federal 
     specifications. First-dollar coverage would be mandated for 
     many services, and cost-sharing between businesses and 
     employees would be sharply reduced, though this is one policy 
     that might reduce health spending by giving consumers more 
     skin in the game. Nor would insurance be allowed to bear any 
     relation to risk. Inevitably, costs would continue to climb.
       Everyone would be forced to buy these government-approved 
     policies, whether or not they suit their needs or budget. 
     Families would face tax penalties as high as $3,800 a year 
     for not complying, singles $950. As one resident of 
     Massachusetts where Mitt Romney imposed an individual mandate 
     in 2006 put it in a Journal story yesterday, this is like 
     taxing the homeless for not buying a mansion.
       The political irony here is rich. If liberal health-care 
     reform is going to make people better off, why does it 
     require ``a very harsh, stiff penalty'' to make everyone buy 
     it? That's what Senator Obama called it in his Presidential 
     campaign when he opposed the individual mandate supported by 
     Hillary Clinton. He correctly argued then that many people 
     were uninsured not because they didn't want coverage but 
     because it was too expensive. The nearby mailer to Ohio 
     primary voters gives the flavor of Mr. Obama's attacks.
       And the Baucus-Obama plan will only make insurance even 
     more expensive. Employers will be required to offer 
     ``qualified coverage'' to their workers (or pay another 
     ``free rider'' penalty) and workers will be required to 
     accept it, paying for it in lower wages. The vast majority of 
     households already confront the same tradeoff today, except 
     Congress will now declare that there's only one right answer.
       The subsidies in the Baucus plan go to people without a 
     job-based plan and who earn under three times the federal 
     poverty level, or about $66,000 for a family of four. Yet 
     according to a Congressional Budget Office analysis we've 
     seen, the plan isn't much of an improvement over the current 
     market.
       Take a family of four making $42,000 in 2016. While 
     government would subsidize 80% of their premium and pay 
     $1,500 to offset cost-sharing, they'd still pay $6,000 a year 
     or 14.3% of their total income. A family making $54,000 could 
     still pay 18.1% of their income, while an individual earning 
     $26,500 would be on the hook for 15.5%, and one earning 
     $32,400 for 17.3%. So lower-income workers would still be 
     forced to devote huge portions of their salaries to expensive 
     policies that they may not want or be able to afford.
       Other Democrats want to make the subsidies even bigger, but 
     Mr. Baucus told reporters on Monday that, ``We're doing our 
     very best to make an insurance requirement as affordable as 
     we possibly can, recognizing that we're trying to get this 
     bill under $900 billion total.'' Another way of putting this 
     is that he is hiding the real cost of his bill by pinching 
     pennies to meet a less politically toxic overall spending 
     number. In that sense, the House health bill which clocked in 
     at $1.042 trillion because it was more generous upfront was 
     more honest, though not by much.
       Like the House bill, Mr. Baucus uses 10 years of taxes to 
     fund about seven years of spending. Some $215 billion is 
     scrounged up by imposing a 35% excise tax on insurance 
     companies for plans valued at more than $21,000 for families 
     and $8,000 for individuals. This levy would merely be added 
     to the insurers' ``administrative load'' and passed down to 
     all consumers in higher prices. Ditto for the $59 billion 
     that Mr. Baucus would raise by taxing the likes of clinical 
     laboratories and drug and device makers.
       Mr. Baucus also wants to cut $409 billion from Medicare, 
     according to CBO, though the only money that is certain to 
     see the budget ax is $123 billion from the Medicare Advantage 
     program. Liberal Democrats hate Advantage because it gives 
     10.2 million seniors private options. The other ``savings'' 
     come from supposedly automatic cuts that a future Congress is 
     unlikely to ever approve that is, until this entitlement 
     spending swamps the federal budget. Then the government will 
     have no choice but to raise taxes to European welfare-state 
     levels or impose drastic restrictions on patient care. Or, 
     most likely, both.
       To sum up, the Baucus-Obama plan would increase the cost of 
     insurance and then force

[[Page 22364]]

     people to buy it, requiring subsidies. Those subsidies would 
     be paid for by taxes that make health care and thus insurance 
     even more expensive, requiring even more subsidies and still 
     higher taxes. It's a recipe to ruin health care and bankrupt 
     the country, and that's even before liberal Democrats see Mr. 
     Baucus and raise him, and then attempt to ram it all through 
     the Senate.

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