WASHINGTON – Now that the House has passed a health insurance reform package and the Senate is beginning its debate, it is important that the facts are separated from the myths, spin, and misinformation. An op-ed published in The Record on Wednesday, Nov. 25 grossly misrepresents the Affordable Health Care for America Act, passed by the House on Nov. 7th, and I want to take this opportunity to set the record straight.
Rep. Bill Pascrell Jr.’s defense of the House vote to pass the health care bill (“A step toward affordable health coverage care for all,” Other Views, Nov. 10) is filled with generalities and partisan attacks on alternatives that disagree with his position. It was especially notable for what he did not tell us about the bill.
What I find makes me wonder if Pascrell had read the bill before voting on it, or if had he read it and voted for it anyway.
Response: The legislation for which I voted on Nov. 7th was the culmination of months and months of open discussion, dialogue, and debate – including many hearings and several sessions to write and revise the bill revisions. Those hearings and sessions were open to the public. This year, Congress has spent nearly 100 hours in hearings on health reform, heard from 181 witnesses (both Democratic and Republican), spent 83 hours in committees reviewing and debating the legislation, and considered a total of 239 amendments to the bill.
I have spent months explaining and discussing with my constituents exactly what is in the bill—precluding a need for an exhaustive discussion of these very same items in my Nov. 10th op-ed in The Record.
Below is just a sampling of items Pascrell skipped. It is verified by the Congressional Budget Office, the bill’s own words, and independent health care legislation analysts:
Response: My colleagues in Congress and I have unabashedly promoted that one of the underlying principles of this legislation is shared responsibility. To make our health insurance system work efficiently, individuals, businesses and the government each have a responsibility to uphold. Individuals will be responsible for purchasing health insurance coverage. Most employers will be responsible for offering coverage, and the government will ensure the affordability of coverage.
Claiming that individuals who fail to buy insurance will face five years in jail is utterly misleading. Individuals who can afford insurance but, for some reason, do not purchase it, simply pay a fee designed to cover their costs when they use the health care system. The IRS—which is responsible for the administration of the fee—may use the civil process to settle any delinquent penalties and taxes—an authority NOT established by this bill. Only in extremely rare circumstances would any kind of criminal prosecution be pursued. In 2008, there were 156 million individual tax returns filed in the U.S.—of those there were only 100 criminal prosecutions for willful failure to pay taxes.
- If we have private insurance and any benefits or co-pays change, we must move to the government approved “exchange” plans. These comprehensive plans will be a one-size-fits-all with no ability to select only the coverage desired, and therefore will cost more. Many young adults and families who wish to be insured for very serious or life-threatening illnesses will not have that option. They will be forced to pay for the more expensive government insurance.
- Want to be able to pay from your own pocket for routine and less costly physician visits? Nope. You must get the more expensive “government approved” policies.
Response: The Affordable Health Care for America Act establishes standards to ensure that all plans in the new Health Insurance Exchange cover a comprehensive set of necessary benefits that any American would expect in a health insurance plan. This “essential benefits package” is not a one-size-fits-all approach. Instead, it sets a reasonable minimum for benefits so that individuals actually have access to a health plan that meets their needs. This is an important and necessary step in reforming our health insurance system and reining in health care costs.
Today, many Americans purchase insurance plans with a reasonable expectation that those plans will cover the services they need. Often times, one visit to the doctor or one unexpected accident will reveal that their plan has gaping holes and fails to meet their needs. This couldn’t be better illustrated than by the fact that over 60 percent of the 1.5 million individuals filing for bankruptcy in 2007 did so because of medical bills, and nearly 80 percent of those individuals actually had insurance.
A guaranteed set of benefits means that Americans will no longer face out-of-pocket expenses for the preventive care they need to keep healthy. Americans will also enjoy annual caps on out-of-pocket spending so that no one faces bankruptcy from health costs.
- How expensive are these policies? According to CBO, for an individual earning $44,000, this policy will cost $7,300 or 17 percent of your income. A family earning $102,100 a year will have to pay a $15,000 premium plus an estimated $5,300 out of pocket, for a $20,300 total, or 20 percent of its pre-tax income. Is this relief for the middle class?
Response: The writer’s presentation of CBO’s numbers is misleading without a better understanding of the full picture. Let us first consider the status quo. Today, an average family premium costs $13,375—a 5% increase over 2008—which does not include out-of-pocket costs. The CBO numbers cited by The writer are estimates for 2016. This means that the premium for a family earning $102,000 would grow by less than 2 percent each year—significantly below the growth we’ve seen in premiums in recent years. In fact, without reform, family premiums are estimated to grow to $24,000 by 2016—well above the $15,000 the CBO estimates for families under reform. There is no doubt that this is relief for the middle class.
- CBO estimates that most of $1.3 trillion in new spending goes into these government-run “exchanges,” to be funded by $767 bill in new taxes and fees and $693 billion in cuts, mainly Medicare.
Response: The Congressional Budget Office estimates that the net cost of expanding coverage to 96% of all Americans is $894 billion, which is comprised of the costs of providing affordability credits to low and moderate income families and the cost of Medicaid expansions. These costs are more than offset by new revenue generated from a surcharge on the top 0.3% of earners and changes to Medicare that encourage more efficient delivery of care and strengthen the fiscal health of the program, without cutting benefits.
- Health care benefits for illegal immigrants? Pascrell tells us no, but then voted against having an effective tool (E-verify) in the bill to identify if a person is an illegal immigrant. Without such an identification tool, anyone can gain access.
Response: The Affordable Health Care for America Act specifically prohibits eligibility for individuals who are not legally present in the U.S. The bill establishes a verification process that all applicants must undergo in order to receive affordability credits—including a mandated follow-up investigation by the Government Accountability Office to ensure effectiveness in excluding illegal immigrants from government subsidies (page 228-235). Utilizing unnecessarily strict verification requirements—such as those included in the amendment against which I voted in the House Ways and Means Committee’s review of the legislation—serve as needless barriers to enrollment for the poorest Americans who need assistance the most.
- New Jersey will be forced into more debt by incurring its share of $34 billion in mandated Medicare expansion.
Response: The Affordable Health Care for America Act achieves near universal coverage, in part, by expanding Medicaid eligibility to all individuals making less than 150% of the poverty level. The federal government will pay 100% of the costs of Medicaid coverage for this population in 2013 and 2014. Beginning in 2015, the federal government will continue to cover 91% of these costs.
It is important to note that there is additional relief to states provided in the Affordable Health Care for America Act—including a 100 percent federally-funded bolster to Medicaid payments provided to primary care doctors and an extension of the Medicaid relief provided to states in the American Recovery and Reinvestment Act.
Major factors in health care costs to us are the huge physician-paid medical liability premiums. Reduced these premiums, and health care costs to us are reduced.
Medical liability reform (tort reform) is generally accepted by independent analysts to accomplish this. Pascrell has stated “show me tort reform that can bring down premiums, I’ll take a look at it.” That’s politician talk for “You do the research but my mind’s made up anyway.”
But apparently he was not interested enough to check out Texas, which implemented such reforms and has seen significant decreases in premiums as well as reductions of doctors leaving the profession or moving to other states.
Response: Each year, preventable medical errors kill as many as 98,000 Americans and injure another 15 million. For this reason, I do not support caps on damages, which limit patients’ ability to seek damages for legitimate harm caused by preventable errors.
Furthermore, I have yet to see concrete evidence that tort reform will actually bring down premiums. Forty-six states have enacted tort reform laws, yet health care costs continue to soar. In fact, family health insurance premiums in Texas grew by 87 percent between 2000 and 2007--compared to a 71 percent increase for New Jersey, a state without tort reform.
The Affordable Health Care for America Act does, however, include new options to combat defensive medicine, including a voluntary state incentive grants program designed to encourage states to develop and implement alternatives to traditional medical malpractice litigation. Health reform also provides resources to create better standards of care and best practices to guide health care providers and significant reforms that generate system-wide savings.
I would note, however, that medical malpractice litigation makes up only 0.6 percent of our nation’s health care costs, and actual medical malpractice payments are less than 0.2 percent of costs.
How about Medicare? CBO estimates the project cuts would include Medicare Advantage, used by many seniors. Pascrell tells us there would be no impact on services. Yet the plan warns this will result in benefit reductions in optional vision and dental care.
Response: The Affordable Health Care for America Act restores equity between traditional Medicare and Medicare Advantage. When the Medicare Advantage program was first created by Congress, private insurers argued that they could provide more care for less than it costs Medicare to provide the same set of services. In fact, to prove their point, they even agreed to be paid 5 percent less than traditional Medicare. Today, these same companies are paid 14 percent more than it costs to provide care through the traditional Medicare program. This overpayment is $12 billion per year and exceeds $1,000 per MA enrollee—a cost that is not only picked up by all taxpayers, but is also passed onto Medicare beneficiaries not enrolled in MA plans via higher premiums.
The Affordable Health Care for America Act phases out these overpayments beginning in 2011 so that MA plans will be paid on a level playing field with traditional Medicare. The MA plans that are able to operate efficiently, will offer their enrollees value and continue to flourish. If MA plans choose to leave the market because they no longer receive a taxpayer-funded profit windfall, seniors will continue to be able to choose among other MA plans in their area or be guaranteed to receive the care they need by a strengthened, improved traditional Medicare program.
Pascrell rails against the insurance companies but votes for penalties and fines forcing millions of us to buy insurance that in turn puts big bucks into insurance coffers. For this the insurance companies will mute their opposition to the bill.
Response: It is true that I take issue with many of the practices of private insurance companies, but I respect the fact that my constituents value the benefits of privately-administered health insurance options. As such, I support the Affordable Health Care for America Act because it preserves and bolsters the private market—while taking critical steps to end the practices that can be harmful for patients and infusing competition and greater choice through the availability of a public health insurance option.
And finally, Pascrell tells us by his vote, “Trust me. We will give you the savings sometime after 2013, but we must tax and fine you now.”
I say if you are so confident about the savings, give us the promised savings now and then you won’t have to tax and fine us later. “Trust me, I’m from the government and I’m here to help you” is a laugh line, not a serious appeal.
Response: First, I want to make it clear that the writer has put words into my mouth that I never uttered.
That being said, this is not the first time I’ve heard call for an incremental approach to health reform. However, our health insurance system in America is extremely complicated with a litany of problems that requires a comprehensive approach. I believe that we have failed the American people if we pass a health insurance reform package that does not address cost and affordability.
To do that, we need to expand health insurance coverage, make available a public health insurance option, and reform our delivery system – all of which are vital components included in the Affordable Health Care for America Act.
We need to expand health insurance coverage to insure the uninsured. The uninsured cannot pay for their health care, so they do not seek preventative or primary care. When their conditions worsen to the point that they need emergency care, their illnesses or injuries have advanced and the cost of caring for them is much greater. Treating diseases and illnesses is more expensive than preventing them or catching them earlier. These bills are ultimately picked up by taxpayers – in the form of Medicare and Medicaid uncompensated care payments – and by those who have health care insurance in the form of higher premiums.
We need a public health insurance option to encourage widespread implementation of the payment reforms to cut costs and encourage necessary reforms to our health care delivery system. Because private plans will have to directly compete with this plan, there will be an incentive for private plans to adopt similar, perhaps even better, payment structures to drive down costs.
Finally, we need reforms to the health care delivery system, including bundling costs for a single episode of care into one single payment. Incentives should also be provided for preventative care and wellness to reduce hospital readmissions. Both of these are included in the Affordable Health Care for America Act.}