Providing Meaningful, Stable And Secure Health Insurance For All Americans

Floor Speech

BREAK IN TRANSCRIPT

Mr. PALLONE. I want to thank my colleague from Ohio who is here almost every night, it seems, talking about how important this health reform legislation is and explaining it very well, I must say, in commonsense terms. Your comments made me think about, actually, one of our Republican colleagues in the Rules Committee much earlier today--I was there for 6 hours--who basically talked about this bill in ideological terms and referred to it as socialism or a government takeover of health care. I explained in the Rules Committee, and I would like to explain now, how untrue that really is.

Basically, we're just building on the basic system and using a lot of the framework, if you will, that exists now in both the private and the public sectors. What I point out is that for people who get their health insurance through their employer, private health insurance, they keep it, and the majority of Americans will continue to get their health insurance through their employer. Nobody's changing anything in terms of the process for that. A lot of other Americans, if they're seniors or disabled, get their insurance through Medicare, which is a government program, and then those who are below a certain income get their health insurance through Medicaid, which is another government program.

And I could mention other government health programs. The Indian Health Service, the Veterans program, whatever. What's new here, really, is that for those Americans who have no health insurance because they can't access it, it's not affordable or they have all these discriminatory practices based on their preexisting health conditions or their gender or whatever, now we are establishing a health exchange. It is just basically an opportunity for to you go to your computer or to some office where the government will entertain, if you will, private health insurance companies to come in and say, Look, if you offer a certain benefit package that includes what we think should be included and you're willing to offer it through this exchange, you can.

The government will make this exchange available, and people can buy health insurance through the exchange. They would have a basic benefit package where they can pay for other things that are not in the package, you know, dental care or whatever.

But the advantage is now that this acts as a very large group plan. The reason that employers, you know, oftentimes are able to offer insurance is because they buy it through a large group plan that brings costs down, but for individuals or small businesses that try to buy health insurance privately right now, it's hard because if you buy it individually or you have a very small group of employees, it becomes much more expensive because insurance becomes cheaper the larger the pool is.

So if the government is now offering this exchange where all these private insurers come in and offer insurance, it's essentially like a group plan, and the cost comes down considerably because it acts that way.

Now within this health exchange, we're also going to offer a public option, which you can compare to Medicare or Medicaid if you'd like, and that's going to compete with these private insurance companies. So in addition to costs coming down in this exchange because it's like a group plan, costs also come down because there is now not competition between a public option, like Medicare, and all these private insurance companies. But, again, there is no ideology here that the public option is like Medicare and Medicaid. The private insurers are the same private insurers that offer insurance now but, because it's a large group plan, the costs come down. So there is no radical change here in the way we're doing business.

We're not taking over health insurance. We're offering a public and private option. Now the third way that the costs come down is if you're below a certain income and you buy your insurance in this exchange, we offer you a major subsidy, and that can be 80 percent of the cost of your premiums if you're maybe making about $25,000 or $30,000 a year or maybe only 10 percent if you are making, say, $80,000 a year. So we're bringing costs down using innovative methods but methods that don't really take away from the private sector.

And for anybody to say this is a government takeover, this is socialism, this is radical--you know, I don't know what you want to call it, it's just not true. This is just a different way of doing things that I believe works and that I think collectively will cover everyone and make it affordable so that you don't have to worry that if you lose your insurance, you don't have a place to go.

Within this context, we're eliminating all the discriminatory practices so that insurance companies can't charge more because of a preexisting health condition or because you are a woman versus a man. They can't say that in the course of a year they'll only pay out a certain amount of money or in the course of your lifetime they'll only pay a certain amount of money. They can't drop you because you get sick. All of these discriminatory practices are very difficult and make it difficult for a lot of my constituents, I know, to find insurance. Those practices will all go away.

I yield back to the gentlewoman from Florida.

BREAK IN TRANSCRIPT

Mr. PALLONE. I want to thank all of you for what you have been contributing to this debate.

I was on C-SPAN this morning where they ask you questions. These are questions that I get from some of my constituents who initially at least were opposed to the bill. One question is from people who say, Well, why should I help contribute through subsidies, for example, to help pay for health insurance for people who don't have insurance? And another, I am young. I am healthy. This guy got on and said, Why should I have to have insurance at all if I don't want it?

The bottom line is, right now, a significant portion of your premium, whether you get it through your employer or you get it by buying it on the individual market, as well as a significant portion of Medicare and Medicaid, is paying for people that have no insurance. So when that person who has no insurance goes to the emergency room and they rack up a bill of $10,000 or $20,000, you end up paying for it if you have insurance. It could be 2 or $3,000 a year of your premium is actually paying for that uncompensated care.

The bottom line is, if everyone has insurance, even if you are subsidizing it in some way through your tax dollars, that brings your cost down because now that person, instead of going to the emergency room, they go to a doctor on a regular basis. They don't get sick and run up the costs of having to be hospitalized or put into a nursing home, and so the system saves money and you save money.

The next thing, what about the guy who was on C-SPAN this morning: I am 25 years old. I don't want to buy health insurance. Why should I buy it? I don't need it. I can probably stay around for another 10 years until I have any serious problem.

Again, it is the same thing that I mentioned before. The only way that insurance becomes cheaper is if more and more people are included in the insurance pool. So if you have this health exchange and you want to make insurance under this health exchange affordable, you have to have all of the people in it. Then you have the healthy and the young people, the older and the sick people, and you have a larger pool that essentially brings costs down because everyone is in it.

I think it is important to dispel some of these arguments about why should I help the other guy or why should I have to have insurance. The only way this works to bring costs down is if everyone is covered and everyone has access to a doctor on a regular basis and

[Page: H12568]

everyone pays into the system. Either their employer pays or they buy it through the health exchange. That is the beauty part of this. Everyone gets covered and everyone contributes and the cost goes down and we emphasize prevention, not having people get sick and not having to go to the hospital because they don't have enough preventive care.

We could go on and talk about the idea of prevention

and wellness, which is an important part of this system, but I yield back.

BREAK IN TRANSCRIPT

Mr. PALLONE. If I can talk about small businesses, a lot of people don't understand that the way that this bill is set up in the bill that we are going to vote on in the next few days, small businesses, when they try to buy health insurance, like individuals, because the individual is only buying for himself or the members of his immediate family, the cost is high because he is not part of a large insurance pool.

The same is true for small business. In other words, if you have only five or ten employees and you try to buy a health insurance policy on the open market, you have the same problem. You are only insuring two, three, four, five, maybe up to ten people, and you are not part of a large insurance pool and so your costs are very prohibitive.

What we do in this bill is say that not only can an individual go to this health exchange and be part of this large insurance pool, but also a small business can do it. If a small business can't afford a small group policy or has one but it is increasing, the costs of the premiums are going up, they can go into the exchange. They don't have to have all of their individual employees and their family go into the exchange policy. They can go into the exchange and buy a small group policy, and it will probably be a better benefit package than they have now. So they are essentially buying a small group policy that is part of a larger pool that brings the cost down.

That hasn't really been brought up very much. What you mostly hear is, is my employer going to continue with his insurance or is he going to send me into this health exchange? The reality is that the business can buy a group policy for a lot less and with better benefits in the health exchange. I think you are going to find a lot of small businesses do that because they are going to get additional tax credits for it and it is just a better package.

So many people today complain not only about the cost of health insurance, but when they actually buy it, it doesn't cover anything, or it covers very few things and there are a lot of out-of-pocket expenses. So we are also trying to eliminate those problems, that you can buy a basic benefit package that has good coverage and that doesn't have a lot of deductibles and co-pays as well. That is an important part of the reform as well.

BREAK IN TRANSCRIPT

Mr. PALLONE. The major reason why the AMA, which is the major doctors association of this country, I believe supports the bill is two reasons: first of all, right now under Medicare the reimbursement rate for physicians as well as hospitals is rather low; it doesn't pay for the actual cost of their delivery services under Medicare. So we have a major increase in here for provider payments, in other words, both hospitals and physicians.

Part of the problem under Medicare is, I know in New Jersey it's not hard yet, but it's starting to get more difficult to find a doctor who will actually take Medicare. If you're on Medicaid, it's almost impossible because the reimbursement rate under Medicaid is about 30 percent of actual cost in New Jersey, and we increase that rate as well.

With regard to hospitals, by eliminating the uncompensated care, because now everybody is covered, they are getting more money for Medicare, more for Medicaid, and we have eliminated the people that don't have any insurance, which basically, you know, they have to sort of eat that, it goes into their balance sheet. So we're going to make it a lot easier for hospitals to stay open. I've had two close in my district in the last 10 years because they were too dependent on Medicare and Medicaid, and they had too many people who didn't have health insurance.

I yield back.

BREAK IN TRANSCRIPT

Mr. PALLONE. Well, I will just say, I don't want to call it a jobs bill because that's not the major focus of it, but it essentially is.

This is an economic issue. We are creating jobs, and we are certainly making it a lot easier for businesses to function because they don't have all these additional costs that are associated with more expensive health insurance.

So this bill actually addresses a lot of economic problems in a significant way. I would characterize it as a jobs bill, and in some ways as an economic recovery package as well. And, again, I yield back. Thank you.

Source