Statements On Introduced Bills And Joint Resolutions

Floor Speech

STATEMENTS ON INTRODUCED BILLS AND JOINT RESOLUTIONS -- (Senate - May 03, 2007)

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Mr. REED. Mr. President, I join my colleague, Senator Kerry, in introducing the Reinsure America's Businesses Act of 2007. This legislation represents a critical step forward in bringing affordable health care to the uninsured and lowering the ever increasing costs of health care for families and businesses.

The bill that we are introducing today proposes that the Federal Government assume responsibility for the most burdensome risk for employers, and in doing so helps to provide greater access to lower priced health care. Under our legislation, the Federal Government will reimburse employers for a significant portion of the costs of their most ill employees--75 percent of medical bills in excess of $50,000. In exchange, employers agree to offer all of their workers preventative care and quality coverage.

At the heart of this bill lies the fact that 1 percent of patients account for 25 percent of health care costs, and 20 percent of the population that is catastrophically ill accounts for 80 percent of the costs. Planning for the unfortunate chance that one falls into one of these categories is precisely why individuals have health insurance. Yet it is also the primary reason why many employers, particularly small businesses where one critically ill individual can have a tremendous influence on the overall cost, do not offer their employees health insurance. Through reinsurance, the Federal Government has an opportunity to absorb a large portion of this risk and encourage more affordable and meaningful employer sponsored health coverage. This legislation also eases the burden on health insurance companies by making rate determinations more predictable.

Federal reinsurance is an efficient use of Federal dollars because it spreads the burden across employers, the Federal Government, and employees, thereby lowering costs and increasing access to quality health care. Reinsurance reduces health insurance premiums for everyone; some estimates suggest as much as 10 percent. Actions to decrease the cost of health care and improve access to care are crucial if we are to combat ever-rising health care costs in this country. In Rhode Island, from 2000 to 2006, premiums increased 75 percent while median earnings went up only 23 percent. Uninsured rates have also grown in Rhode Island with more than 13 percent of residents under age 65 with no health insurance, up from 8.1 percent in 1999. Rhode Island is not unique; the entire country bears the burden of high health care costs and increasingly declining access. This legislation lays the groundwork for achieving our goal of making health care more affordable and more accessible to every American.

I am pleased to join with my colleague in introducing this important initiative and hope the Senate will give it prompt consideration.

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