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| <title> - RESCUING AMERICANS FROM THE FAILED HEALTHCARE LAW AND ADVANCING PATIENT-CENTERED SOLUTIONS</title> | |
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| [House Hearing, 115 Congress] | |
| [From the U.S. Government Publishing Office] | |
| RESCUING AMERICANS FROM THE | |
| FAILED HEALTHCARE LAW AND | |
| ADVANCING PATIENT-CENTERED SOLUTIONS | |
| ======================================================================= | |
| 6HEARING | |
| before the | |
| COMMITTEE ON EDUCATION | |
| AND THE WORKFORCE | |
| U.S. HOUSE OF REPRESENTATIVES | |
| ONE HUNDRED FIFTEENTH CONGRESS | |
| FIRST SESSION | |
| __________ | |
| HEARING HELD IN WASHINGTON, DC, FEBRUARY 1, 2017 | |
| __________ | |
| Serial No. 115-1 | |
| __________ | |
| Printed for the use of the Committee on Education and the Workforce | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Available via the World Wide Web: www.gpo.gov/fdsys/browse/ | |
| committee.action?chamber=house&committee=education | |
| or | |
| Committee address: http://edworkforce.house.gov | |
| _________ | |
| U.S. GOVERNMENT PUBLISHING OFFICE | |
| 23-826 PDF WASHINGTON : 2018 | |
| ____________________________________________________________________ | |
| For sale by the Superintendent of Documents, U.S. Government Publishing Office, | |
| Internet:bookstore.gpo.gov. Phone:toll free (866)512-1800;DC area (202)512-1800 | |
| Fax:(202) 512-2104 Mail:Stop IDCC,Washington,DC 20402-001 | |
| COMMITTEE ON EDUCATION AND THE WORKFORCE | |
| VIRGINIA FOXX, North Carolina, Chairwoman | |
| Joe Wilson, South Carolina Robert C. ``Bobby'' Scott, | |
| Duncan Hunter, California Virginia | |
| David P. Roe, Tennessee Ranking Member | |
| Glenn ``GT'' Thompson, Pennsylvania Susan A. Davis, California | |
| Tim Walberg, Michigan Raul M. Grijalva, Arizona | |
| Brett Guthrie, Kentucky Joe Courtney, Connecticut | |
| Todd Rokita, Indiana Marcia L. Fudge, Ohio | |
| Lou Barletta, Pennsylvania Jared Polis, Colorado | |
| Luke Messer, Indiana Gregorio Kilili Camacho Sablan, | |
| Bradley Byrne, Alabama Northern Mariana Islands | |
| David Brat, Virginia Frederica S. Wilson, Florida | |
| Glenn Grothman, Wisconsin Suzanne Bonamici, Oregon | |
| Steve Russell, Oklahoma Mark Takano, California | |
| Elise Stefanik, New York Alma S. Adams, North Carolina | |
| Rick W. Allen, Georgia Mark DeSaulnier, California | |
| Jason Lewis, Minnesota Donald Norcross, New Jersey | |
| Francis Rooney, Florida Lisa Blunt Rochester, Delaware | |
| Paul Mitchell, Michigan Raja Krishnamoorthi, Illinois | |
| Tom Garrett, Jr., Virginia Carol Shea-Porter, New Hampshire | |
| Lloyd K. Smucker, Pennsylvania Adriano Espaillat, New York | |
| A. Drew Ferguson, IV, Georgia | |
| Brandon Renz, Staff Director | |
| Denise Forte, Minority Staff Director | |
| ------ | |
| C O N T E N T S | |
| ---------- | |
| Page | |
| Hearing held on February 1, 2017................................. 1 | |
| Statement of Members: | |
| Foxx, Hon. Virginia, Chairwoman, Committee on Education and | |
| the Workforce.............................................. 1 | |
| Prepared statement of.................................... 6 | |
| Scott, Hon. Robert C. ``Bobby'', Ranking Member, Committee on | |
| Education and the Workforce................................ 7 | |
| Prepared statement of.................................... 14 | |
| Statement of Witnesses: | |
| Bollenbacher, Mr. Scott, CPA, Managing Partner, Bollenbacher | |
| and Associates, LLC, Portland, Indiana..................... 38 | |
| Prepared statement of.................................... 40 | |
| Eddy, Mr. Joe, President and Chief Executive Officer, Eagle | |
| Manufacturing Company, Wellsburg, West Virginia............ 24 | |
| Prepared statement of.................................... 26 | |
| Schlaack, Ms. Angela, St. Joseph, Michigan................... 32 | |
| Prepared statement of.................................... 34 | |
| Troy, Mr. Tevi, PH.D., Executive Officer, American Health | |
| Policy Institute, Washington, DC........................... 17 | |
| Prepared statement of.................................... 20 | |
| Additional Submissions: | |
| Adams, Hon. Alma S., a Representative in Congress from the | |
| State of North Carolina: | |
| Letter dated January 3, 2017, from Seven Children's | |
| Groups................................................. 130 | |
| Bonamici, Hon. Suzanne, a Representative in Congress from the | |
| State of Oregon: | |
| Letter December 28, 2016, from AARP...................... 71 | |
| Brat, Hon. David, a Representative in Congress from the State | |
| of Virginia: | |
| Chart: Hitting the Wall: When Health Care Costs are No | |
| Longer Manageable...................................... 96 | |
| Courtney, Hon. Joe, a Representative in Congress from the | |
| State of Connecticut: | |
| Article: Is healthcare law really going into a death | |
| spiral?................................................ 149 | |
| DeSaulnier, Hon. Mark, a Representative in Congress from the | |
| State of California: | |
| Article: One in Five 2014 Marketplace Consumers was a | |
| Small Business Owner or Self-Employed.................. 142 | |
| Espaillat, Hon. Adriano, a Representative in Congress from | |
| the State of New York: | |
| Prepared statement of from Cuomo, Hon. Andrew M., | |
| Governor of New York................................... 85 | |
| Article: AAMC Statement on President Trump's Executive | |
| Order on Immigration................................... 92 | |
| Chairwoman Foxx: | |
| Republican Subcommittee Assignments...................... 3 | |
| Key Facts on Obamacare................................... 169 | |
| Breaking Down the Uninsured.............................. 172 | |
| Polis, Hon. Jared, a Representative in Congress from the | |
| State of Colorado: | |
| Letter dated January 4, 2017, from Hickenlooper, Hon. | |
| John, Governor of Colorado............................. 64 | |
| Mr. Scott: | |
| Letter dated January 30, 2017, from the U.S. Department | |
| of Health and Human Services........................... 10 | |
| Report: Highlighting the Progress of the Affordable Care | |
| Act.................................................... 46 | |
| Prepared statement of from Pollack, Mr. Rick, President | |
| and CEO, American Hospital Association................. 172 | |
| Takano, Hon. Mark, a Representative in Congress from the | |
| State of California: | |
| Letter dated December 6, 2016, from the American Hospital | |
| Association and Federation of American Hospitals....... 79 | |
| Thompson, Hon. Glenn ``GT'', a Representative in Congress | |
| from the State of Pennsylvania: | |
| Submission for the record................................ 156 | |
| Mr. Troy: | |
| Briefing Paper: How the Implementation of the Affordable | |
| Care Act Will Affect Doctors........................... 112 | |
| Questions submitted for the record by: | |
| Barletta, Hon. Lou, a Representative in Congress from the | |
| State of Pennsylvania.................................. 174 | |
| Stefanik, Hon. Elise, a Representative in Congress from | |
| the State of New York | |
| Responses to questions submitted for the record: | |
| Mr. Barletta............................................. 177 | |
| Mr. Eddy................................................. 178 | |
| RESCUING AMERICANS FROM THE FAILED | |
| HEALTHCARE LAW AND ADVANCING | |
| PATIENT-CENTERED SOLUTIONS | |
| ---------- | |
| Wednesday, February 1, 2017 | |
| House of Representatives, | |
| Committee on Education and the Workforce, | |
| Washington, D.C. | |
| ---------- | |
| The committee met, pursuant to call, at 10:04 a.m., in Room | |
| 2176, Rayburn House Office Building, Hon. Virginia Foxx | |
| [chairwoman of the committee] presiding. | |
| Present: Representatives Foxx, Wilson of South Carolina, | |
| Roe, Thompson, Walberg, Guthrie, Rokita, Messer, Byrne, Brat, | |
| Bishop, Grothman, Stefanik, Allen, Lewis, Rooney, Mitchell, | |
| Smucker, Scott, Grijalva, Courtney, Fudge, Polis, Wilson of | |
| Florida, Bonamici, Takano, Adams, DeSaulnier, Norcross, Blunt | |
| Rochester, Krishnamoorthi, Shea-Porter, and Espaillat. | |
| Staff Present: Bethany Aronhalt, Press Secretary; Andrew | |
| Banducci, Workforce Policy Counsel; Courtney Butcher, Director | |
| of Member Services and Coalitions; Ed Gilroy, Director of | |
| Workforce Policy; Jessica Goodman, Legislative Assistant; | |
| Callie Harman, Legislative Assistant; Nancy Locke, Chief Clerk; | |
| Dominique McKay, Deputy Press Secretary; James Mullen, Director | |
| of Information Technology; Michelle Neblett, Professional Staff | |
| Member; Krisann Pearce, General Counsel; Brandon Renz, Staff | |
| Director; Molly McLaughlin Salmi, Deputy Director of Workforce | |
| Policy; Alissa Strawcutter, Deputy Clerk; Olivia Voslow, Staff | |
| Assistant; Joseph Wheeler, Professional Staff Member; Tylease | |
| Alli, Minority Clerk/Intern andFellow Coordinator; Austin | |
| Barbera, Minority Press Assistant; Michael DeMale, Minority | |
| Labor Detailee; Denise Forte, Minority Staff Director; | |
| Christine Godinez, Minority Staff Assistant; Carolyn Hughes, | |
| Minority Senior Labor Policy Advisor; Kevin McDermott, Minority | |
| Senior Labor Policy Advisor; Richard Miller, Minority Senior | |
| Labor Policy Advisor; Udochi Onwubiko, Minority Labor Policy | |
| Counsel; Veronique Pluviose, Minority Civil Rights Counsel; | |
| Arika Trim, Minority Press Secretary; and Elizabeth Watson, | |
| Minority Director of Labor Policy. | |
| Chairwoman Foxx. Good morning. A quorum being present, the | |
| Committee on Education and the Workforce will come to order. | |
| Before we turn our attention to this morning's hearing, I'd | |
| like to take care of an administrative matter. Today, both the | |
| Republicans and Democrats have completed assigning members to | |
| the subcommittees. I ask unanimous consent on behalf of myself | |
| and Ranking Member Scott to submit those assignments for the | |
| record. | |
| Hearing no objection, the subcommittee assignments are | |
| made. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Next, I recognize myself for an opening | |
| statement. | |
| I want to again say good morning to my colleagues and | |
| guests. I want to welcome our witnesses. We appreciate that you | |
| took time out of your busy schedules to be with us today. | |
| It is no coincidence that our first hearing is focused on | |
| our efforts to rescue Americans from a fatally flawed | |
| healthcare law and transition to a patient-centered system. | |
| There's an urgent need to address the challenges facing working | |
| families and small businesses under ObamaCare, and that's | |
| exactly what this hearing is about. | |
| For nearly seven years, Americans have struggled as they've | |
| seen their healthcare costs skyrocket, their plans canceled, | |
| and their choices and access to quality care diminished. That | |
| is why for nearly seven years Republicans have been fighting to | |
| provide the relief Americans desperately need. | |
| This has never been about politics. The fight to repeal and | |
| replace ObamaCare has always been about people. | |
| It has been about people like Steve from my congressional | |
| district. Steve resides in West Jefferson, and he and his wife | |
| are paying 225-percent-higher premiums than they were four | |
| years ago. | |
| Scott from Hickory, North Carolina, has had his healthcare | |
| plan canceled three times because of the law and today has | |
| access to only one insurance provider. | |
| Michael from Winston-Salem has an $800 monthly premium for | |
| him and his daughter, and their deductible is over $14,000. | |
| Terry, a 70-year-old retiree from Advance, is working part- | |
| time just to help pay his wife's $900 monthly premium. | |
| These stories aren't unique to North Carolina. Working | |
| families across the country are suffering under a failed | |
| government takeover of health care. | |
| Remarkably, the consequences extend beyond higher insurance | |
| costs and limited plan options to fewer jobs and suppressed | |
| wages. In fact, a recent study by the American Action Forum | |
| found ObamaCare has destroyed 300,000 small-business jobs and | |
| cost small-business employees $19 billion a year in wages. An | |
| estimated 10,000 small businesses were even forced to close | |
| their doors because of the law's burdensome regulations. | |
| All of these individuals, families, and small-business | |
| owners were promised far different. They were promised lower | |
| costs, more choices, and more competition. What they got was | |
| the exact opposite. | |
| The reality is the 2010 healthcare law is completely | |
| unsustainable. It's collapsing as we speak. We cannot stand by | |
| as the law creates even more havoc in the lives of the American | |
| people. That's why we're on a rescue mission to deliver the | |
| relief people need, and this committee will play an important | |
| part in the process. We have already taken steps to repeal | |
| ObamaCare, and the Trump administration is actively working to | |
| stabilize health insurance markets. | |
| Once the law is repealed, there will be a stable transition | |
| to a patient-centered system. At least 4.7 million Americans | |
| have already been kicked off their healthcare plans under | |
| ObamaCare, and the last thing Republicans want is to disrupt | |
| more people's coverage. | |
| We're going to do this the right way. There won't be a | |
| massive bill that no one has read and is jammed through | |
| Congress in the dead of night. Instead, we will tackle the | |
| challenges of our broken healthcare system through step-by-step | |
| solutions that provide lower costs, more choices, and protect | |
| the most vulnerable among us. | |
| We will put patients in control of their healthcare | |
| decisions. That means eliminating one-size-fits-all rules that | |
| drive up costs and restrict choices. All Americans should have | |
| the freedom to select a healthcare plan that meets their needs. | |
| After years of costly federal mandates, we will empower | |
| small businesses to band together and provide affordable | |
| coverage for their employees. Additionally, we will preserve | |
| employee wellness plans that have been under attack in recent | |
| years by Washington bureaucrats. | |
| Undoing the damage of ObamaCare and achieving real | |
| healthcare reform won't happen overnight. We will continue to | |
| hold hearings just like this one, and we will continue to | |
| receive input from Governors, insurance commissioners, workers, | |
| and employers across the country. | |
| Today's discussion is an important step in this process. We | |
| look forward to hearing from all of you on how we can provide a | |
| better way forward on health care for the American people. | |
| With that, I yield to Ranking Member Scott for his opening | |
| remarks. | |
| [The statement of Chairwoman Foxx follows:] | |
| Prepared Statement of Hon. Virginia Foxx, Chairwoman, Committee on | |
| Education and the Workforce | |
| It is no coincidence that our first hearing is focused on our | |
| efforts to rescue Americans from a fatally flawed health care law and | |
| transition to a patient-centered system. There is an urgent need to | |
| address the challenges facing working families and small businesses | |
| under Obamacare, and that's exactly what this hearing is about. | |
| For nearly seven years, Americans have struggled as they've seen | |
| their health care costs skyrocket, their plans canceled, and their | |
| choices and access to quality care diminished. That is why for nearly | |
| seven years, Republicans have been fighting to provide the relief | |
| Americans desperately need. | |
| This has never been about politics. The fight to repeal and replace | |
| Obamacare has always been about people. It's been about people like | |
| Steve from my congressional district. Steve resides in West Jefferson, | |
| and he and his wife are paying 225 percent higher premiums than they | |
| were four years ago. Scott from Hickory, North Carolina, has had his | |
| health care plan canceled three times because of the law, and today he | |
| has access to only one insurance provider. | |
| Michael from Winston-Salem has an $800 monthly premium for him and | |
| his daughter, and their deductible is over $14,000. Terry, a 70-year | |
| old retiree from Advance, is working part-time just to help pay his | |
| wife's $900 monthly premium. | |
| These stories aren't unique to North Carolina. Working families | |
| across the country are suffering under a failed government takeover of | |
| health care. Remarkably, the consequences extend beyond higher | |
| insurance costs and limited plan options to fewer jobs and suppressed | |
| wages. | |
| In fact, a recent study by the American Action Forum found | |
| Obamacare has destroyed 300,000 small business jobs and cost small | |
| business employees $19 billion each year in wages. An estimated 10,000 | |
| small businesses were even forced to close their doors because of the | |
| law's burdensome regulations. | |
| All of these individuals, families, and small business owners were | |
| promised far different. They were promised lower costs, more choices, | |
| and more competition. What they got was the exact opposite. | |
| The reality is the 2010 health care law is completely | |
| unsustainable. It's collapsing as we speak. We cannot stand by as the | |
| law creates even more havoc in the lives of the American people. | |
| That's why we are on a rescue mission to deliver the relief people | |
| need, and this committee will play an important role in the process. We | |
| have already taken steps to repeal Obamacare, and the Trump | |
| Administration is actively working to stabilize health insurance | |
| markets. | |
| Once the law is repealed, there will be a stable transition to a | |
| patient-centered system. At least 4.7 million Americans have already | |
| been kicked off their health care plans under Obamacare, and the last | |
| thing Republicans want is to disrupt more people's coverage. | |
| We're going to do this the right way. There won't be a massive bill | |
| that no one has read and is jammed through Congress in the dead of the | |
| night. Instead, we will tackle the challenges of our broken health care | |
| system through step-by-step solutions that provide lower costs, more | |
| choices, and protect the most vulnerable among us. | |
| We will put patients in control of their health care decisions. | |
| That means eliminating one-size-fits-all rules that drive up costs and | |
| restrict choices. All Americans should have the freedom to select a | |
| health care plan that meets their needs. | |
| After years of costly federal mandates, we will empower small | |
| businesses to band together and provide affordable coverage for their | |
| employees. Additionally, we will preserve employee wellness plans that | |
| have been under attack in recent years by Washington bureaucrats. | |
| Undoing the damage of Obamacare and achieving real health care | |
| reform won't happen overnight. We will continue to hold hearings just | |
| like this one, and we will continue to receive input from governors, | |
| insurance commissioners, workers, and employers across the country. | |
| Today's discussion is an important step in this process. We look | |
| forward to hearing from all of you on how we can provide a better way | |
| forward on health care for the American people. | |
| ______ | |
| Mr. Scott. Thank you, Madam Chair. | |
| And I'd like to first, before we begin, introduce one new | |
| member who's here, Adriano Espaillat, who represent New York's | |
| 13th Congressional District. He wasn't here when we introduced | |
| new members before. He represents the same district as the past | |
| chair of this committee, Adam Clayton Powell. He served in the | |
| State Senate and State Assembly in New York. | |
| We have another member, Carol Shea-Porter, who was | |
| appointed to the Committee. She is from New Hampshire and | |
| previously served on this committee. | |
| I'd like to welcome our witnesses and thank them for their | |
| testimony. This is our first hearing of the 115th Congress. | |
| Unfortunately, this hearing is part of a larger agenda to | |
| repeal the Affordable Care Act root and branch, despite the | |
| fact there's no credible plan to deal with the chaos that | |
| repeal would create. | |
| I'd first like to remind our Republican colleagues once | |
| again where we were when we passed the Affordable Care Act. | |
| Healthcare costs were skyrocketing. If you lost your job or | |
| wanted to start a new business and had a preexisting condition, | |
| you were out of luck. Women were paying more than men. Seniors | |
| had no help for paying for prescription drugs when they landed | |
| in the notorious doughnut hole. The miners suffering from lung | |
| disease struggled to get access to health benefits because of | |
| complicated requirements that made it almost impossible to | |
| prove eligibility. And every year millions of people were | |
| losing their insurance altogether. | |
| The so-called damage caused by the Affordable Care Act | |
| includes women no longer paying more for insurance than men. | |
| The costs have gone up but they've gone up at one-half the rate | |
| that they were going up before. Those with preexisting | |
| conditions can get insurance at the standard rate. We're | |
| closing the doughnut hole. We have helped miners get their | |
| benefits. And instead of millions of people losing their | |
| insurance every year, 20 million more people have insurance. | |
| And all Americans, even if they had insurance before, are | |
| enjoying consumer protections. Small businesses were exempt | |
| from virtually all of the mandates in the bill. | |
| And this progress will be reversed if the ACA is repealed. | |
| We know, for example, that 30 million Americans would lose | |
| coverage, with the vast majority in working families. Workers | |
| with job-based plans could lose out on ACA's consumer | |
| protections, such as prohibitions against annual and lifetime | |
| limits. They could lose out on access to free preventive | |
| services which keeps the American workforce healthier and on | |
| the job. | |
| These meaningful protections have improved the lives of | |
| people around the country, protections that are being | |
| threatened. | |
| The collateral damage won't stop there. The individual | |
| market could all but collapse if there's a repeal without a | |
| credible replacement, making it likely that nobody will be able | |
| to buy insurance at an affordable rate. Costs for uncompensated | |
| care will skyrocket, but those costs won't disappear. When | |
| people go to the hospital and don't pay, those costs have to be | |
| paid by somebody. When we passed the Affordable Care Act, that | |
| cost was about $1,000 on a family policy, covering | |
| uncompensated care. Coal miners who now benefit from enhanced | |
| protections and benefits provided by the ACA could lose them. | |
| Now, another important item to both workers and employers: | |
| employment. Repeal would devastate communities around the | |
| country, particularly rural areas that already face employment | |
| challenges. The American Hospital Association and the | |
| Federation of American Hospitals sent a letter to congressional | |
| leaders warning of massive job losses if the ACA is repealed. | |
| The letter noted a specific threat to rural communities, | |
| pointing out that hospitals are often the largest employers in | |
| many communities. Estimates show that repeal would result in a | |
| loss of 2.6 million jobs almost immediately. | |
| Over the last seven years, we have heard a lot of | |
| complaints about the Affordable Care Act, but we haven't seen a | |
| plan that would actually make things better. Just last week, | |
| our colleagues on the Budget Committee held a hearing where | |
| healthcare experts from the Urban Institute estimated that, if | |
| the GOP were to replace the ACA coverage expansion with tax | |
| credits at the inadequate level pushed by the new HHS Secretary | |
| nominee, the healthcare deductibles could skyrocket to $25,000 | |
| for individuals and $50,000 for family plans. | |
| Today, we are likely to hear about some other plans that, | |
| frankly, just won't work or won't do anything. And there's no | |
| strategy or interest in protecting the millions of Americans | |
| who now benefit from the ACA. | |
| If a credible replacement plan were possible, we obviously | |
| would have seen it by now. But there's no legislation pending | |
| that has significant support, and there's no reason to believe | |
| that a replacement plan could be produced that would actually | |
| work. | |
| Now, some of the initiatives already taken by this | |
| administration have been proven to be counterproductive. For | |
| example, the administration took action to threaten the | |
| marketplace by pulling advertisements for coverage in the final | |
| days of the open enrollment period. It is well-known that those | |
| who wait till the last minute tend to be younger and healthier. | |
| And fewer of them signing up just means higher premiums for | |
| everybody else. | |
| And I ask unanimous consent to insert into the record a | |
| letter sent by three ranking members of House committees with | |
| healthcare jurisdiction to the Department of Health and Human | |
| Services asking for further details on the impact of this | |
| decision. | |
| Chairwoman Foxx. Without objection. | |
| Mr. Scott. Thank you. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Scott. Even President Trump's recent immigration order | |
| not only runs afoul of American values and our Constitution, | |
| essentially creating a religious test for entry into the United | |
| States and denying due process, but it also has an impact on | |
| health care in the United States. The Association of American | |
| Medical Colleges, one of the many groups to express concern | |
| over the Executive Order, released a statement explaining that | |
| the Executive Order could disrupt education and research and | |
| have a damaging long-term impact on patients and health care. | |
| So we do have a few options moving forward. We could choose | |
| to move to a single-payer system, or we can improve upon the | |
| ACA. Going back to the days where a preexisting condition meant | |
| you couldn't get insurance should not be an option. | |
| Now, since this is our first hearing in Congress, let me be | |
| clear about our shared priorities and the vision of Democrats | |
| on this committee. We are here to strengthen the economic | |
| security of Americans and to protect health care in this | |
| country. This is more that we need to do to improve access and | |
| affordability in health care, and Democrats are willing to work | |
| on a responsible improvement. | |
| If the goal is to replace, then repeal, we can work | |
| together. But you cannot count on our support if the first step | |
| is to create total chaos by repealing without any replacement | |
| in sight. | |
| In fact, Democrats are skeptical that there will ever be | |
| any replacement. We are reminded that the majority of the | |
| Republicans in Congress did not support Medicare. We know that | |
| over 60 votes have been taken in the House to repeal all or | |
| parts of the Affordable Care Act without any replacement in | |
| sight. And we have already missed the legislative deadline | |
| under the reconciliation. The two committees were given | |
| instructions to come up with changes in the Affordable Care | |
| Act, and they've missed that deadline. And so we're skeptical | |
| that there will be any replacement if there is a repeal. | |
| So it is my hope that we can focus our efforts on the | |
| financial security of American families by working to improve | |
| health care instead of turning the clock backwards and ruining | |
| health care possibly for everybody. | |
| Thank you, Madam Chair, and I yield back. | |
| [The statement of Mr. Scott follows:] | |
| Prepared Statement of Hon. Robert C. ``Bobby'' Scott, Ranking Member, | |
| Committee on Education and the Workforce | |
| Thank you, Chairwoman Foxx. I would like to welcome and introduce | |
| the newest Democratic members to the Committee. | |
| Congresswoman Carol Shea-Porter represents New Hampshire's first | |
| congressional district and is serving her fourth term in Congress, and | |
| I am pleased to welcome her back to the Committee. | |
| Congressman Adriano Espaillat represents New York's thirteenth | |
| congressional district, the same district as the esteemed past-chairman | |
| of this Committee - Adam Clayton Powell, Jr. He previously served as a | |
| member of the New York State Senate and as a member of the New York | |
| State Assembly. | |
| Welcome to the both of you. | |
| I would now like to welcome our witnesses and thank them for their | |
| testimony. This is our first hearing in the 115th Congress and this | |
| hearing will likely lay out our Committee's agenda for the coming weeks | |
| and months. Unfortunately, this hearing is also part of a larger agenda | |
| to repeal the Affordable Care Act, root and branch, despite the fact | |
| that there is no credible plan to deal with the chaos that this repeal | |
| will create. | |
| I'd first like to remind my Republican colleagues once again of | |
| where we were when we passed the ACA. Health care costs were | |
| skyrocketing and if you lost your job, or wanted to start a new | |
| business and you had a preexisting condition, you were out of luck. | |
| Seniors had no help paying for prescription drugs when they landed | |
| in the Part D ``donut hole''. Miners suffering from lung disease | |
| struggled to get access to health benefits because of complicated | |
| requirements that made it almost impossible to prove eligibility. | |
| Yes, the cost of health coverage remains a challenge for both | |
| employers and workers. But although costs in employer-provided health | |
| coverage have gone up, they have gone up much more slowly than they | |
| were prior to the ACA. Today, we are releasing a report that highlights | |
| all of the ACA's benefits to the American people, particularly those | |
| with job-based health coverage, and why repeal is so dangerous for our | |
| country and families' health and economic security. | |
| The ACA fixed many of these problems. Despite, Republicans' nonstop | |
| attacks on the ACA, we have made great progress in improving the | |
| nation's health care system. And because of those efforts, the rate of | |
| uninsured adults and the rate of uninsured children are at an all-time | |
| low. | |
| If my Republican colleagues continue on the course to repeal, we | |
| know that thirty million Americans will lose coverage, with the vast | |
| majority of those millions in working families. Workers with job-based | |
| plans could lose out on the ACA's consumer protections - such as | |
| prohibitions on annual and lifetime limits. They could lose out on | |
| access to free preventive services which keeps the American workforce | |
| healthier and on the job. These are meaningful protections that have | |
| improved the lives of people in this country - protections that the | |
| Republicans are threatening to take away. And the collateral damage | |
| won't stop there. The individual market will all but collapse, making | |
| it likely that nobody will be able to buy insurance at an affordable | |
| rate. Uncompensated costs will skyrocket and those costs won't | |
| disappear - they will be absorbed by other payers. Coal miners, who now | |
| benefit from the enhanced protections and benefits provided in the ACA, | |
| could lose them. | |
| Another item of importance to both workers and employers is jobs. | |
| Repeal would devastate communities across the country, particularly | |
| rural areas that already face employment challenges. The American | |
| Hospital Association and the Federation of American Hospitals sent a | |
| letter to Congressional leaders warning of ``massive job losses'' if | |
| the ACA is repealed. The letter noted the specific threat to rural | |
| communities, pointing out that, ``hospitals are often the largest | |
| employer in many communities.'' Estimates show that repeal would result | |
| in a loss of 2.6 million jobs across all states almost immediately; | |
| while a third of those lost jobs would be in health care, the impact | |
| would be felt across industries. | |
| Over seven years we have heard a lot of complaints about the | |
| Affordable Care Act, but we have not seen a plan that would make things | |
| better. Just last week, our colleagues in the Budget Committee held a | |
| hearing where a health care expert from the Urban Institute estimated | |
| that if the GOP were to replace the ACA coverage expansion with tax | |
| credits at the inadequate levels pushed by HHS Secretary nominee | |
| Congressman Tom Price, health care deductibles could skyrocket to | |
| $25,000 for individual and $50,000 for family plans. Today, we are | |
| likely to hear about some of the old, discredited, and highly | |
| inadequate ideas around health reform. But there is no strategy or | |
| interest in protecting the millions of Americans who now benefit from | |
| the ACA. If a credible replace were possible, we would have seen it by | |
| now, and yet there is no legislation pending that has Republican | |
| support and there is no reason to believe that a replacement would | |
| actually work. | |
| Unfortunately, the conversation around health care has now taken on | |
| an even more troubling tone. The new Administration has taken action to | |
| threaten the Marketplace by pulling advertisements for coverage in the | |
| final days of the open enrollment period, making no secret about its | |
| intention to subvert Marketplace enrollment. I ask unanimous consent to | |
| insert into the record a letter sent by the three Ranking Members of | |
| the House Committees with health care jurisdiction to the Department of | |
| Health and Human Services asking for further details on the impact of | |
| this decision. | |
| Further, President Trump's recent immigration executive order runs | |
| afoul of American values and our constitution by essentially creating a | |
| religious test for entry into the United States and denying due process | |
| to green card holders who have been unable to reenter the country. The | |
| impact of this order is being felt by communities across the country, | |
| and is particularly detrimental to students who wish to pursue their | |
| education in the United States. The Association of American Medical | |
| Colleges - one of the many groups to express concern over the executive | |
| order - released a statement explaining that the executive order could, | |
| ``disrupt education and research and have a damaging long-term impact | |
| on patients and health care.'' I trust that my colleagues on the other | |
| side of the aisle are as outraged as I am at the executive order, both | |
| because of its lack of humanity and its detrimental impact on the | |
| health care sector in this country. | |
| So we have a few options moving forward. We can choose to move to a | |
| single payer system or we can improve upon the ACA. Going back to the | |
| days where a preexisting condition meant you didn't get insurance is | |
| not an option. | |
| Since this is our first hearing of the Congress, let me be clear | |
| about our shared priorities and the vision of the Democrats on this | |
| Committee. We are here to strengthen the economic security of Americans | |
| and to protect the health of this country. There is more that we need | |
| to do to improve access and affordably in health coverage, but setting | |
| the stage for a repeal vote that will take benefits away from | |
| hardworking Americans is irresponsible and morally reprehensible. | |
| Similarly, banning the best and brightest talent in the medical | |
| community from studying at our universities and practicing medicine in | |
| our hospitals is irresponsible and morally reprehensible. | |
| It is my hope that we can refocus our efforts to the financial | |
| security of American families, instead of turning the clock backward. | |
| Thank you. | |
| ______ | |
| Chairwoman Foxx. Thank you, Mr. Scott. | |
| Pursuant to committee rule 7(c), all members will be | |
| permitted to submit written statements to be included in the | |
| permanent hearing record. Without objection, the hearing record | |
| will remain open for 14 days to allow such statements and other | |
| extraneous material referenced during the hearing to be | |
| submitted for the official hearing record. | |
| We will now turn to introductions of our distinguished | |
| witnesses. | |
| Dr. Tevi Troy is the chief executive officer of the | |
| American Health Policy Institute. Previously, Dr. Troy held | |
| numerous positions in the Federal Government, including serving | |
| as Deputy Secretary of Health and Human Services beginning in | |
| 2007, where he oversaw all operations, including Medicare and | |
| Medicaid, public health, medical research, food and drug | |
| safety, welfare, child and family services, disease prevention, | |
| and mental health services. | |
| Mr. Joe Eddy is president and chief executive officer of | |
| Eagle Manufacturing Company and will testify on behalf of the | |
| National Association of Manufacturers. In addition to his work | |
| at Eagle Manufacturing, Mr. Eddy also serves on the Advisory | |
| Board of the McDonough Center for Leadership in Business at | |
| Marietta College and the Foundation Board at West Virginia | |
| Northern Community College. | |
| Ms. Angela Schlaack is a widow, mother of two children, and | |
| a student at Siena Heights University pursuing a bachelor's | |
| degree in Communications. She is an educated grief group | |
| facilitator at Lori's Place in St. Joseph, Michigan. Lori's | |
| Place serves children and adults who suffered a death or are | |
| dealing with anticipatory grief. She is active also in | |
| fundraising for the Leukemia and Lymphoma Society. | |
| Mr. Scott Bollenbacher is the creator and managing partner | |
| of Bollenbacher & Associates, LLC, a certified public | |
| accounting firm serving mainly small to midsize business in | |
| north-central Indiana and western Ohio. As a CPA, Mr. | |
| Bollenbacher provides accounting and tax services to clients in | |
| manufacturing, agricultural, retail, and professional services | |
| trades, as well as not-for-profits and individuals. Mr. | |
| Bollenbacher is testifying on behalf of the National Federation | |
| of Independent Business. | |
| I will now ask our witnesses to raise your right hand. | |
| [Witnesses sworn.] | |
| Chairwoman Foxx. Let the record reflect the witnesses | |
| answered in the affirmative. | |
| Before I recognize each of you to provide your testimony, | |
| let me briefly explain our lighting system. We allow five | |
| minutes for each witness to provide testimony. When you begin, | |
| the light in front of you will turn green. When one minute is | |
| left, the light will turn yellow. At the five-minute mark, the | |
| light will turn red, and you should wrap up your testimony. | |
| Members will each have five minutes to ask questions. | |
| Now I recognize Dr. Troy for five minutes. | |
| TESTIMONY OF TEVI TROY, PH.D., CHIEF EXECUTIVE OFFICER, | |
| AMERICAN HEALTH POLICY INSTITUTE, WASHINGTON, D.C. | |
| Mr. Troy. Chairwoman Foxx, Ranking Member Scott, and | |
| members of the committee, thank you all for the opportunity to | |
| testify today on the effects of the Affordable Care Act on | |
| large employers and their employees, as well as how to advance | |
| patient-centered solutions going forward. | |
| My name is Dr. Tevi Troy. I am CEO of the American Health | |
| Policy Institute, a nonprofit research organization focusing on | |
| employer-sponsored healthcare benefits. I also served, as you | |
| mentioned, as a senior White House aide in the George W. Bush | |
| administration and Deputy Secretary of HHS. | |
| While the public debate over the ACA appropriately focuses | |
| on the 20 million Americans who are receiving coverage through | |
| its exchanges, Medicaid expansion, and other provisions, the | |
| ACA also significantly and in many cases unnecessarily | |
| increased the regulatory requirements and burdens on | |
| employment-based health care that covers more than 177 million | |
| Americans. | |
| Too little attention has been focused on this important | |
| aspect of the law. In this time of transition on health care, | |
| it is important to protect those who have gained coverage under | |
| the ACA, but it is also a critical priority to protect those | |
| who are covered by employers. | |
| There is clear evidence that the ACA has both directly and | |
| indirectly increased the cost of employer healthcare benefits. | |
| In 2014, an American Health Policy Institute study found that | |
| over the next decade the cost of the ACA to large employers -- | |
| 10,000 or more employees -- will be about $4,800 to $5,900 per | |
| employee over a decade. | |
| My written testimony includes other studies showing how the | |
| ACA has increased employer costs, and I ask that they be | |
| submitted for the record. | |
| Furthermore, the regulatory burden the ACA imposes on | |
| businesses and individuals should not be underestimated. Since | |
| the ACA was enacted, 106 regulations implementing the law have | |
| been published. These regulations will cost the private sector | |
| more than $51 billion and require 173 million hours of | |
| paperwork in order to comply. These cost increases come from a | |
| number of ACA provisions that have a direct impact on employees | |
| and employers and on the cost of their health plans. | |
| Going forward, I believe that we should move toward a more | |
| patient-centered healthcare system and look to the private | |
| sector to lead transformation efforts. In order for the private | |
| sector to be innovative, it is imperative to protect the tax | |
| exclusion on employer-sponsored healthcare benefits as well as | |
| the ERISA preemption. | |
| For more than 60 years, employer-provided health benefits | |
| have been excluded, without limit, from income and payroll | |
| taxes. Over time, this benefit has helped make employer- | |
| sponsored care a basic building block of our healthcare system. | |
| Given the role of employer-sponsored health insurance in | |
| providing stability and coverage to so many Americans, making a | |
| substantial change to the tax treatment of employer-provided | |
| health care could cause a significant disruption. | |
| We strongly support the bipartisan effort to repeal the | |
| ACA's 40-percent Cadillac tax on employer-sponsored health | |
| benefits and urge Congress to repeal this tax, along with other | |
| ACA taxes and fees. We have seen how problematic the tax | |
| approach is by its opposition from both business and labor. We | |
| are glad that the tax has been delayed until 2020 and hope to | |
| see it repealed soon. | |
| Reducing or eliminating the tax exemption on employer- | |
| sponsored health care would raise the same problems as the | |
| Cadillac tax. It would serve as a middle-class tax hike, drive | |
| up the health insurance costs for millions of American | |
| employees, and eliminate the strong incentives currently in | |
| place that constantly pressure large purchasers of health to | |
| demand more efficient, affordable, and effective health care | |
| from the marketplace. | |
| Getting rid of or reducing the tax preference would also | |
| harm efforts to maintain strong risk pools and to cover the | |
| maximum number of people. As we have learned from experience | |
| with the ACA, encouraging people to get coverage is a costly | |
| and challenging endeavor, and risk pools are difficult to | |
| maintain as well. Employers, however, are both good at getting | |
| people covered and at maintaining manageable risk pools. Public | |
| policy should aim to encourage these important goals. As | |
| economist Peter Nelson has said, ``Employers do get people | |
| covered -- they very successfully get people covered.'' | |
| A second key issue is the ERISA preemption. ERISA is the | |
| foundation of employer-sponsored health benefits, and we | |
| encourage you to strengthen the protections in the law. | |
| The longstanding preemption provision is vital to multi- | |
| state employers because it enables them to offer uniform, | |
| nationwide healthcare benefits at the lowest possible cost to | |
| employers no matter what state they live in. This leads to | |
| better benefit design and reduction in administrative costs | |
| through economies of scale, increased purchasing power, and | |
| greater innovation. Without it, an employer doing business in | |
| 50 different States would be required to comply with 50 | |
| different State healthcare laws, something that would make | |
| administrating a healthcare plan a complex nightmare. | |
| In conclusion, I appreciate the opportunity to testify here | |
| today about the importance of employer-sponsored coverage and | |
| its importance to our system. Going forward, our policy should | |
| not be to increase the burdens or costs on employers and the | |
| 177 million employees and dependents who get coverage through | |
| the employer-based system but to encourage that coverage for | |
| the benefit of our system as a whole. | |
| Thank you for having me here today. | |
| [The statement of Mr. Troy follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Mr. Eddy. | |
| TESTIMONY OF JOE EDDY, PRESIDENT AND CHIEF EXECUTIVE OFFICER, | |
| EAGLE MANUFACTURING COMPANY, WELLSBURG, WEST VIRGINIA, ON | |
| BEHALF OF THE NATIONAL ASSOCIATION OF MANUFACTURERS | |
| Mr. Eddy. Thank you. Good morning, Chairwoman Foxx, Ranking | |
| Member Scott, and distinguished members of the committee. I | |
| thank you for the opportunity to appear here today before you | |
| and for holding this hearing. | |
| My name is Joe Eddy, and I am president and CEO of Eagle | |
| Manufacturing Company in Wellsburg, West Virginia. I'm | |
| currently on the board of directors of the National Association | |
| of Manufacturers, also known as NAM, and also serve on their | |
| Small and Medium Manufacturers Group. The NAM is the Nation's | |
| largest industrial trade association and a voice for more than | |
| 12 million men and women who make things here in America. | |
| Eagle Manufacturing Company is a family-owned business | |
| established in 1894. We employ approximately 195 employees and | |
| are a prime manufacturer of safety cans, safety cabinets, | |
| secondary spill containment products, poly drums, and material- | |
| handling products. At Eagle, we design and manufacture all of | |
| our own products. We are a respected brand name across the | |
| world for consistent quality and value, and all of our products | |
| are still made in the United States. | |
| Manufacturers have a proud tradition of providing health | |
| insurance for their employees. At Eagle, our tradition has been | |
| to cover 100 percent of medical costs. We have done this | |
| because it's the right thing for our employees and our | |
| community. No government policy or mandate leads us to provide | |
| this generous benefit. We often hear that people specifically | |
| want to come to work at Eagle because of our reputation for | |
| taking care of our employees. We live by our mission statement: | |
| Protecting people, property, and the planet. | |
| Unfortunately, the last few years under the Affordable Care | |
| Act have made it more difficult to live up to our own | |
| standards. Rising healthcare costs have forced us to make some | |
| difficult choices, and the ACA has further limited our options. | |
| In 2009, prior to the ACA, we were paying about $13,500 per | |
| year per employee, and by 2013 those costs increased to over | |
| $15,800 per year per employee. The additional taxes, paperwork, | |
| fees, and mandates of the ACA cost us nearly $1,000 per year | |
| per employee. As much as we work to keep costs down, our plan | |
| now costs over $22,800 per year per employee. | |
| We do not think that our benefits are excessive. They are | |
| necessary to attract, retain, and maintain a strong, quality, | |
| and healthy workforce. And I am not alone. Ninety-eight percent | |
| of NAM members offer health insurance to employees, and the | |
| cost of health care remains a top business concern for both | |
| large and small manufacturers. These rising healthcare costs | |
| impact all facets of any company: hiring new workers, | |
| maintaining competitive pay rates, making capital investments, | |
| as well as our decisions in researching and developing new | |
| products. | |
| Part of the challenge that the ACA ushered in was the | |
| paradigm shift in healthcare choices available to manufacturers | |
| and other businessowners. More specifically, the insurance that | |
| we had for more than 10 years was no longer available. Many of | |
| our employees had to find new doctors, and we had to learn to | |
| manage an entirely new system. Furthermore, the new product we | |
| purchased was more expensive, driving our healthcare costs up | |
| that year an additional $4,000 per year per employee. | |
| Unhappy with the outcomes of this change, we switched | |
| carriers again to another insurer. We are hopeful that our | |
| situation has stabilized, but businesses such as ours need | |
| flexibility and competitive options so that we can always find | |
| the best and most cost-effective plan for our employees. | |
| Perhaps the most challenging part of the ACA is the effect | |
| that it's had on our employer-employee relations. As I | |
| mentioned earlier, Eagle has 195 employees, but it should be | |
| noted that 150 of those are unionized through the United | |
| Steelworkers Union. We have traditionally had a strong | |
| relationship with the union and our employees. However, last | |
| year, during contract negotiations, for the first time in our | |
| history, we had to negotiate a cost-sharing arrangement with | |
| the union. The union members now have to contribute $35 per | |
| pay, or $910 per year, towards monthly healthcare premiums. As | |
| you would imagine, those were not easy negotiations, tending to | |
| break down the trust and partnership that we had established | |
| through the many years between the company and our employees. | |
| The years following the passage of the ACA have been | |
| costly, disruptive, and distracting from the things that we are | |
| really good at doing as manufacturers. Moreover, the dose of | |
| uncertainty delivered to us over seven years ago still has not | |
| been fully resolved. | |
| Eagle is very proud of our 123 years in West Virginia, | |
| manufacturing innovative, quality products for our customers. | |
| As a leader in the Wellsburg community, we strive to provide | |
| healthcare benefits that allow for a strong, healthy workforce, | |
| but it is a struggle given the limits, restrictions, and | |
| mandates of the Affordable Care Act. | |
| I know that my struggle is not unique and that many | |
| manufacturers across the country are facing the same | |
| challenges. I very much look forward to working with you to | |
| find a workable solution that will help control outrageous | |
| costs and provide the flexibility for employers to continue to | |
| provide the benefits their employees deserve. | |
| Thank you for inviting me to testify before you today, and | |
| I am happy to answer any questions. Thank you. | |
| [The statement of Mr. Eddy follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Thank you very much. | |
| Ms. Schlaack, you are now recognized for five minutes. | |
| TESTIMONY OF ANGELA SCHLAACK, ST. JOSEPH, MICHIGAN | |
| Ms. Schlaack. Good morning, Chairwoman Foxx, Ranking Member | |
| Scott, and the members of the committee. Thank you very much | |
| for inviting me to attend the session today. | |
| My name is Angela Schlaack, and I am originally from | |
| central Texas but have been a longtime resident of St. Joseph, | |
| Michigan. I'm here today to share with you a little bit about | |
| how the Affordable Care Act has impacted my life and the lives | |
| of my family. Never could I have imagined the life-changing | |
| events that would bring me here today. | |
| In November 2013, my husband, Michael Schlaack, suddenly | |
| had three days of extreme fever, headaches, and sweating. | |
| Michael was diagnosed with the most aggressive form of acute | |
| myeloid leukemia, and he had mere days to live. He was 44, | |
| exercised, did not smoke, got routine medical checkups, and had | |
| no prior health issues. | |
| He was admitted to the University of Chicago Medical | |
| Center's Leukemia Intensive Care Unit that night, as our local | |
| hospital does not have the ability to treat this type of | |
| disease. | |
| The University of Chicago is about 90 miles from our home, | |
| and the distance created an additional hardship on our lives. | |
| This diagnosis meant he was forced to take an extended leave | |
| from work, as living with AML is a full-time job in itself. His | |
| employer, Whirlpool Corporation, was supportive and, | |
| thankfully, very generous in their benefits. Little did we know | |
| at that point the cost of treating leukemia and how valuable | |
| our health insurance would be. | |
| The only cure as of now for AML involves chemotherapy and | |
| donor stem cell transplant. Not only were we responsible for | |
| Michael's medical expenses, but patients are also responsible | |
| for those of their donor. | |
| After six weeks of chemotherapy to keep the leukemia under | |
| control and preparation for transplant in place, Michael was | |
| able to return home for a few weeks before returning for | |
| another minimum six weeks inpatient. In those weeks at home, we | |
| still had to return to his hematology oncologist two to three | |
| times per week. At this point, we were beginning to realize the | |
| financial magnitude of what treatment for leukemia entails. Our | |
| bills were exceeding a million dollars already. | |
| Within three months of his stem cell transplant, Michael's | |
| leukemia relapsed with a vengeance. At this point, the only | |
| options were clinical trial therapies. We spent the next four | |
| months in and out of the hospital in Chicago, and he needed | |
| blood transfusions every few days. One bag of blood, which he | |
| was receiving multiple units of per week, was over $1,500 each. | |
| In addition to the 20 or so prescriptions he was taking, the | |
| constant trips for doctor visits to Chicago, we still had to | |
| maintain our household financially. | |
| With the extreme physical, mental, and emotional stress | |
| that came with this journey, one thing we did not have to worry | |
| about was the fact that we knew our insurance would not cut us | |
| off after any lifetime maximum. Hoping Michael would survive, | |
| we knew, despite this now preexisting condition, he would stay | |
| covered and not be discriminated for something he had no | |
| control over. | |
| The provisions of the Affordable Care Act kept us from | |
| filing bankruptcy and losing what we had built up in our over | |
| 20-year marriage. The expenses incurred in a matter of 10 | |
| months were nothing any health savings account could properly | |
| fund. We had peace of mind knowing Whirlpool's insurance would | |
| take care of us. | |
| In September 2014, Michael died at age 45 of AML. As I had | |
| been a full-time caregiver to him, in addition to trying to | |
| maintain some normalcy for our family, I was not employed. I | |
| was a stay-at-home mom to our then-10-year-old daughter. Our | |
| young adult son was in graduate school at the time and was | |
| entering the Peace Corps after graduation. Whirlpool graciously | |
| covered the three of us under their insurance for the rest of | |
| the calendar year. | |
| Though offered COBRA benefits beginning in 2015, the | |
| premiums were beyond anything I could afford. I was able to | |
| take advantage of something I never expected to need, the | |
| healthcare marketplace. | |
| Knowing I needed to continue to provide for myself and | |
| daughter from here on out, I decided to go back to college to | |
| complete my degree. Having access to the marketplace gave me | |
| the ability to provide excellent coverage for us at an | |
| extremely low monthly rate and not have to return to work yet | |
| simply to have the benefit of health insurance. We were able to | |
| keep our same doctors, and while dealing with our grief and | |
| this new life, the ability to have full coverage, including | |
| mental health benefits, was one less worry. | |
| Though I am just a common person from a small town in the | |
| Midwest, I know my experience with devastating health issues | |
| and having my whole world turned upside down in the blink of an | |
| eye is not uncommon, and anyone can be one illness away from | |
| losing everything they have. Our bills were nothing a health | |
| savings account could have remotely covered. Had Michael | |
| survived, he would have had a major preexisting condition. And | |
| being that AML has genetic links, our family is at risk for | |
| facing similar situations down the road. | |
| The Affordable Care Act has helped keep my life moving | |
| forward. It's given me the ability to continue a healthy life | |
| with access to routine care and without worry that one hospital | |
| admission could cost me everything. | |
| I implore you to please consider the benefits that the | |
| Affordable Care Act has provided. Whether through an employer | |
| or the marketplace, everyone deserves that peace of mind. | |
| Thanks for your willingness to hear my voice. | |
| [The statement of Ms. Schlaack follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Bollenbacher, you're recognized for five minutes. | |
| TESTIMONY OF SCOTT BOLLENBACHER, CPA, MANAGING PARTNER, | |
| BOLLENBACHER & ASSOCIATES, LLC, PORTLAND, INDIANA, ON BEHALF OF | |
| THE NATIONAL FEDERATION OF INDEPENDENT BUSINESS | |
| Mr. Bollenbacher. Good morning, Chairwoman Foxx, Ranking | |
| Member Scott, and members of the committee. My name is Scott | |
| Bollenbacher, and I'm a managing partner of Bollenbacher & | |
| Associates, a CPA firm serving individuals and small-business | |
| clients, most of which are family-owned. | |
| I started the business in 2004 with six employees serving | |
| 400 clients. We have grown to 11 full-time employees and six | |
| part-time employees serving 1,600 clients. I am pleased to be | |
| here on behalf of the NFIB to discuss how the ACA has impacted | |
| our business and our clients at today's hearing. | |
| As a small business, we are a close-knit family. Our | |
| employees are much more than employees; they are our friends. | |
| We care deeply for them. We care for their families. We want to | |
| provide for them -- provide benefits and help in any way we | |
| can. We know that our success as a business depends on our | |
| team. Most of our employees have been with us for 10 or more | |
| years. | |
| From 2004 to 2014, our firm maintained a high-deductible | |
| health insurance plan accompanied by a health savings account. | |
| The firm paid the entire premiums and funded up to $3,000 per | |
| year to the employees' HSA. This plan worked well for the | |
| business and our employees. We saved tax-preferred funds for | |
| predictable and unforeseen medical expenses. | |
| In late 2014, we learned that our policy no longer | |
| qualified under the ACA because it did not cover the essential | |
| health benefits package, specifically pediatric dental | |
| coverage. I requested the benefit be added but was unable to do | |
| so, and we lost our plan. | |
| We did not know what to do, and we had little time to | |
| choose a new option, but we explored all the available options | |
| with a consultant. We considered purchasing insurance through | |
| the SHOP exchange. However, the plan would have cost over 50 | |
| percent more than our previous plan with less coverage. We | |
| considered dropping health insurance altogether and increasing | |
| the employees' salary to help them purchase insurance on their | |
| own. IRS restrictions made this very difficult. We considered a | |
| healthcare sharing ministry called Medi-Share, and we | |
| considered self-insuring. | |
| The only feasible option at the time was a partially self- | |
| funded plan. I believe our firm was the smallest group they | |
| accepted at the time. The premiums were similar to our previous | |
| plan, but the coverage was not as good. It carried a higher | |
| deductible and did not cover vision care. It did not cover my | |
| family doctor. | |
| We have maintained this coverage for two years. In the fall | |
| of 2016, we learned that our carrier no longer wanted to offer | |
| self-funded health plans to small businesses, so they proposed | |
| to raise our premiums by 156 percent. We could either pay the | |
| increase or leave. We left. Essentially, our plan was canceled | |
| again. As with most small businesses, we must watch our | |
| expenses. A 156-percent increase is not possible. | |
| Once again, we worked with our benefit consultant to | |
| explore all options. Shopping for the right plan is complicated | |
| for us because the firm is close to the Indiana and Ohio | |
| border. Our employees live in both states. We must find a | |
| policy that is accepted by doctors and hospitals on both sides | |
| of the state line. | |
| We finally settled on another fully insured plan at a 78- | |
| percent increase. It was our only available option. Most of our | |
| employees liked the HSA option we maintained for 12 years, but | |
| this plan is not HSA-eligible. | |
| The experience has been frustrating and stressful. The | |
| increases and cancellations are unsustainable for a small | |
| business like ours. | |
| Many clients experience similar disruption with premium | |
| increases and plan cancellations: | |
| A church could no longer provide three ministers with tax- | |
| preferred money to purchase coverage in the individual market | |
| due to IRS guidance. The pastors ended up purchasing coverage | |
| on the individual exchange that was twice as expensive because | |
| they did not qualify for a subsidy. | |
| A cabinet manufacturer with 25 employees could no longer | |
| contribute the entire premium to their employees after a 44- | |
| percent increase to their 2017 plan. | |
| A pallet manufacturer with 110 employees who could neither | |
| afford the $500,000 insurance nor the $70,000 employer mandate | |
| penalty was forced to terminate 80 employees and subcontract | |
| some of the work. | |
| A farmer couple who earns just above the subsidy had to pay | |
| a 38-increase after their plan was canceled. | |
| And a single, female businessowner suffered a policy | |
| cancellation, forcing her onto the individual exchange | |
| marketplace, where her premiums doubled without a subsidy. | |
| I want you all to know what's going on in the real world | |
| with average Joes and Janes. We work very hard. I brought a | |
| picture of our team today so that you see that we're real | |
| people. We've been hurt badly by the cost increases caused by | |
| the ACA and request your assistance in fixing this. As you | |
| consider repealing and replacing ACA, I encourage you to focus | |
| on lowering the costs and increasing flexibility for small | |
| businesses. | |
| Thank you again for allowing me to share my story today, | |
| and I'm happy to answer any questions. | |
| [The statement of Mr. Bollenbacher follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Thank you very much. | |
| Thanks to all of our witnesses. | |
| And now we'll recognize members for five minutes of | |
| questioning, and I'll begin with Dr. Roe. | |
| Mr. Roe. Thank you, Dr. Foxx. | |
| And, first of all, Ms. Schlaack, I want to offer you my | |
| condolences for your loss. Two years ago today, I was sitting | |
| home with my wife, who was dying of cancer. So, certainly, my | |
| sympathy goes out to you and your family, and I share your | |
| grief. | |
| Ms. Schlaack. Thank you. | |
| Mr. Roe. You know, we had a promise from the | |
| administration, when we started debating the Affordable Care | |
| Act, to increase access and lower cost. And I think certainly | |
| everybody agreed with that. I know on our side of the aisle I | |
| did. And you all don't know me, but I'm a doctor that practiced | |
| medicine for over 31 years before I ran for Congress. | |
| And so what did we get? We got some increased access, but | |
| at what cost? And I know at our local hospital at home, 60 to | |
| 70 percent of the uncollectible debt -- now, it's a billion- | |
| dollar healthcare system -- are people with insurance. | |
| And, certainly, we agreed on the preexisting conditions -- | |
| everybody on this dais agreed with that -- and lifetime limits. | |
| I think that certainly was something that we all agreed on, | |
| because health care is more sophisticated and costs more money | |
| than it used to. | |
| And we created this incredibly complex plan. And I said | |
| this seven years ago in an article I wrote. I could have done | |
| three-fourths of what the ACA did in two paragraphs. And I've | |
| just heard the data that once again proved that. Mr. Scott | |
| pointed out that 20 million people who weren't covered are. | |
| Over half of them are Medicaid. We could have expanded Medicaid | |
| and allowed 26-year-olds to stay on their parents' healthcare | |
| plan. That would have covered, along with the 5 million people, | |
| almost, who lost their insurance, including me -- I had | |
| perfectly good healthcare insurance and lost it and had to go | |
| on the ACA. You ended up with 80 percent. All these regulations | |
| and things that these three witnesses have talked about could | |
| have been avoided easily. | |
| In my own state, almost as many people pay a penalty, a | |
| tax, a fee, whatever Judge Roberts labeled it, as get a | |
| subsidy. And for the people who get a subsidy, it's a good | |
| deal. The problem with it is there are millions of other people | |
| out there with small businesses who are being harmed by this. | |
| I was a mayor of my local community before I got elected, | |
| and we had to pay a $180,000 fee so that insurance companies | |
| would stay in the market. Eighteen of the 23 co-ops, one in the | |
| state of Tennessee, went broke to the tune of billions of | |
| dollars of costs of -- really, no health care got provided. | |
| Just the taxpayers were on the hook for this. | |
| And I can tell you flatly, we went through this over 20 | |
| years ago in our state, healthcare reform. I could have written | |
| the epitaph of what's happening. We don't do something, we | |
| cannot not do something, because no one is going to be able to | |
| afford health insurance coverage any longer if we don't. I | |
| mean, Bill Gates won't be able to buy a health insurance | |
| policy. When you're talking about $22,000, that makes you not | |
| competitive with other people in foreign countries, and | |
| eventually you will lose your business. | |
| And, Mr. Bollenbacher, you mentioned one of the things you | |
| want to do is go across the state lines. I have a city in my | |
| district, Bristol, Tennessee/Virginia. I mean, the center | |
| street of that, one side you're in Virginia, one side you're in | |
| Tennessee, but you can't purchase health insurance. | |
| Mr. Scott mentioned there are no plans. There are. I've | |
| written one, and it has 130 cosponsors. It's been submitted, | |
| and we'll have some version of that. | |
| What I want to know from you all at the dais is what can we | |
| do, what would you expect us to do. When we rewrite this | |
| policy, what could we do to help you lower the cost and | |
| increase access, which was the premise of the ACA to begin | |
| with? | |
| Anyone can take it. | |
| Mr. Troy. I'll step in. Thank you for your statement, Mr. | |
| Roe. | |
| So we believe that the way to approach this is to try and | |
| incentivize the purchase of health care by lowering costs | |
| overall. What the ACA did, as you so cogently said, was to | |
| increase the costs for everyone and subsidize a select few. I | |
| think a better approach would be to try and make it cheaper | |
| overall to reduce costs. | |
| And there have been a number of Republican plans that have | |
| done this: the HSAs, health savings accounts, purchase across | |
| State lines, tort reforms, and association health plans that | |
| would allow people to get the tax benefits not just through | |
| their employer. And a combination of those things have been | |
| scored by the Congressional Budget Office as having the effect | |
| of reducing overall premiums. | |
| Mr. Roe. And Ms. Schlaack mentioned -- I use a health | |
| savings account and have since the day they came out. And for | |
| most people -- for her, she's right; it would only have covered | |
| part of the cost of that, not this astronomical cost. But for | |
| most of the care, it would work just fine. | |
| And the cost of the ACA -- a personal testimonial. I had | |
| major back surgery in September of this year. I looked at all | |
| the bills I got for the doctor, for the hospital, for the | |
| anesthesia, the MRIs, all of that. At the cost of the ACA, they | |
| still made money on me this year. My premiums were that | |
| expensive. And so I can pay that, but the average person where | |
| I live in rural Appalachia, which is what I represent, cannot. | |
| With that, I'll yield back. | |
| Chairwoman Foxx. Mr. Scott, you're recognized for five | |
| minutes. | |
| Mr. Scott. Thank you, Madam Chair. | |
| Madam Chair, I'd like unanimous consent to enter into the | |
| record a report prepared by the committee staff on the | |
| Democratic side showing the benefits of the Affordable Care | |
| Act. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Scott. I'd like to ask all the witnesses if any support | |
| a total repeal of the Affordable Care Act without any credible | |
| replacement. | |
| Anybody? | |
| Let the record reflect that nobody volunteered. | |
| Does anybody propose -- we have a mandate that individuals | |
| buy coverage. Do any of the witnesses propose to eliminate that | |
| individual mandate? | |
| Mr. Troy. I don't think the individual mandate is | |
| effective, sir. | |
| And then, also, on your previous statement, I want to make | |
| sure that it's the -- we oppose the repeal without any | |
| alternative, but I think there will be an alternative. | |
| Mr. Scott. Okay. Well, if you eliminate the mandate for | |
| individuals, could you cover those with preexisting conditions? | |
| Mr. Troy. I think there are a number of proposals that look | |
| at covering people with preexisting conditions, especially | |
| those who maintain continuous coverage, and then also having | |
| high-risk pools to address those people, if it's designed | |
| correctly. | |
| Mr. Scott. Has that ever worked anywhere, covering those | |
| with preexisting conditions, without an individual mandate? | |
| Mr. Troy. We are obviously going into new places in health | |
| care and new directions, so I'm not aware of any -- | |
| Mr. Scott. Well, that's not a new direction because they | |
| tried it in New York, and when the Affordable Care Act came in, | |
| the individual prices in the individual market were cut 50 | |
| percent. The Governor of Washington State has indicated they | |
| tried it in Washington, and they had to repeal the whole thing | |
| because nobody could buy insurance if you didn't have the | |
| individual mandate. So it's not real new. | |
| Now, some of the witnesses have talked about the costs | |
| going up since the Affordable Care Act. We didn't hear much | |
| about the costs going up before the Affordable Care Act. | |
| If the witnesses could present, Mr. Eddy and Mr. Troy, what | |
| your cost increases were the 10 years before the Affordable | |
| Care Act, I would appreciate to see that. Because all the | |
| studies have shown that the cost increases since the Affordable | |
| Care Act have been on average about half of what the increases | |
| were before. | |
| Could you provide that for us? | |
| Mr. Troy. Yes. We actually prepared that, sir. From 1999 to | |
| 2005, employer-provided healthcare costs for family coverage | |
| were increasing by an annual average of about 11.1 percent. | |
| From 2006 to 2010, we saw a number of steps by employers to | |
| reduce costs, including the implementation of CDHPs, consumer- | |
| directed health plans, wellness programs, and other benefit | |
| plan innovations. And, as a result, the annual increase dropped | |
| to 4.8 percent -- still high, but much lower. | |
| And then in the intervening period from 2010 to 2016, the | |
| annual increase has been 4.7 percent. And this reflects the net | |
| costs increases and decreases from the ACA and additional cost | |
| savings innovations by employers. And we believe that without | |
| the cost increases by the ACA that 4.7 percent figure would be | |
| even lower. | |
| So it is absolutely true that costs have been going up over | |
| time, and we're looking for ways to continue to moderate those | |
| costs through innovative programs. | |
| Mr. Scott. Okay. Well, if you could show us that 11 | |
| percent, because that's consistent with what most increases | |
| were before the Affordable Care Act. And the 4 percent is | |
| consistent with what most of the -- closer to what the | |
| increases have been since the Affordable Care Act. | |
| So complaining about the costs going up without pointing | |
| out that they were going up a lot faster before the Affordable | |
| Care Act tends to be a little misleading. | |
| Some of the plans that have been referred to point out that | |
| you can reduce costs, but all of those plans appear to just | |
| shift the cost to the patient by cutting benefits, that the | |
| patient's going to be just as sick, probably going to get the | |
| same kind of treatment, just have to pay more. | |
| Ms. Schlaack, can you say where you would be without the | |
| Affordable Care Act? | |
| Ms. Schlaack. I'd probably still be paying bills from three | |
| years ago. My daughter and I wouldn't have been able to afford | |
| any health insurance if we wouldn't have had the marketplace to | |
| go to. Where my COBRA payments were going to be $1,000 a month | |
| for the two of us, with the marketplace our premiums were under | |
| $100 a month. We had deductibles that were possibly $500 a | |
| month the first year, and the second year they were lowered. | |
| We very well could have been bankrupt from well over the | |
| million dollars that my husband's medical expenses racked up | |
| in, again, just 10 months' time. | |
| Mr. Scott. You mentioned the lifetime cap. What did you | |
| mean by that? | |
| Ms. Schlaack. I know prior to the ACA, some insurance | |
| companies, once you hit a million dollars, you could be | |
| penalized and not be able to get insurance ever again. And had | |
| he survived, he could've possibly not ever been able to get | |
| coverage from anyone. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| Mr. Walberg, you're recognized for five minutes. | |
| Mr. Walberg. Thank you, Madam Chairman, and I appreciate | |
| this hearing. | |
| Of course, what we desire is that people, in general, | |
| across the spectrum, be covered and have better opportunities | |
| for health care. We appreciate the fact that some have had good | |
| results, but we want to do this for all. And so we need to take | |
| this seriously here. | |
| Dr. Troy, you cited several studies in your testimony | |
| predicting that the ACA would increase the cost of offering | |
| coverage for large employers. These studies were conducted in | |
| 2012, 2014, and even 2016. Has this prediction come to be? | |
| Mr. Troy. Thank you for that question, sir. | |
| So two points on that. First, number one is the study in | |
| 2012 and our study in 2014 that I mentioned that would increase | |
| costs $4,800 to $5,900 for an employee over a 10-year period, | |
| these were numbers that were produced by teams, benefit teams, | |
| at large employers that were reflecting what the CEOs and CFOs | |
| were looking at in making their determinations. So it is very | |
| important to look at those projections in saying that these | |
| affected how employers looked at the plans going forward. | |
| The second thing, there has been a recent study that found | |
| large costs associated with general ACA administrative costs, | |
| reporting disclosure and notification costs, costs associated | |
| with benefit plan design changes related to the ACA, costs of | |
| adjusting benefits to keep up with the ACA affordability | |
| requirements, and PCORI fees. So those are some of the biggest | |
| recurring costs. | |
| One cost that has not come to fruition at this point is the | |
| Cadillac tax, which was delayed in a bipartisan effort, which | |
| we applaud, and would impose extremely large costs on employers | |
| if it were to be instituted going forward. And so we would like | |
| to see its repeal. | |
| Mr. Walberg. So, basically, costs did increase, as you | |
| suggested in the studies. What were the biggest contributing | |
| factors to those increases? | |
| Mr. Troy. So I mentioned a number of those, so I'll be a | |
| little more specific. | |
| So the H26 dependent coverage, which I recognize is | |
| popular, one company said that it could cost about $69 million | |
| over 10 years. Another one estimated about $56 million over 10 | |
| years. | |
| In terms of the transitional reinsurance fee, estimated | |
| cost of $15.3 million from 2014 to 2016. | |
| One-hundred percent coverage of prevention services and | |
| other benefit mandates, one company said that this would cost | |
| them about $36.5 million over 10 years. | |
| And, again, the big five are the ACA administrative costs, | |
| the reporting disclosure and notification costs, the costs | |
| associated with plan design changes, the costs of adjusting | |
| benefits, and the PCORI fee. | |
| Mr. Walberg. Okay. These are things we need to work on. | |
| Mr. Eddy, thank you for your testimony, and it's admirable | |
| that your company traditionally paid 100 percent of the medical | |
| costs for your employees. And it was your desire to continue | |
| doing that, as a good number of businesses I've interviewed in | |
| my district as well, who literally at times with tears in their | |
| eyes, with their insurance agent sitting next to me, talked | |
| about what this would mean to them, to change a process that | |
| they felt they wanted to continue because of the family, as | |
| they called it. It was the right thing to do. | |
| It's understandable that it was not sustainable under ACA. | |
| And it's no surprise that your colleagues in the manufacturing | |
| business continue to cite the cost of health care as a top | |
| business concern, according to the National Association of | |
| Manufacturers. | |
| Could you tell the committee more about the difficult | |
| choices ACA forced you to make in breaking with the tradition | |
| of providing this type of coverage for your employees? | |
| Mr. Eddy. Yes, sir. Thank you, Congressman. | |
| You know, the difficult decisions really started with the | |
| implementation of the ACA during the tough times of a really | |
| bad recession, and it couldn't have been a more worse time. And | |
| the decisions that we've had to make, now we seem to focus more | |
| on how we're going to try to manage things like hiring people | |
| that we need and, you know, how soon people have to retire now. | |
| Every decision that we make now revolves around the costs and | |
| the uncertainties really afforded to us by the Affordable Care | |
| Act. | |
| So the tough thing we had to do -- we always like to try to | |
| take care of our employees, and that's not only with good | |
| salary but also good benefits. We've always had that as a | |
| company philosophy. Asking them to participate in health care, | |
| as you said, it has really disrupted the relationship between | |
| management and union, management and the salary group, as well, | |
| because they pay more than the union does for their health | |
| coverage now. It's just a matter of trying to keep them | |
| accountable and realize the additional burdens that we've had | |
| to take on here. | |
| Really, the bad part for the union and the company is I | |
| truly believe we could have added another 20 to 25 people in | |
| the last five to seven years if we didn't have the additional | |
| burden of the Affordable Care Act. I'm not sure where the | |
| increases would have taken, but we didn't see the major | |
| increases. | |
| Now, as an employer, we look for flexibility. That's all we | |
| can ask you, as you're working on the ACA, to give us some more | |
| flexibility as an employer, as well as options. And without | |
| that, the uncertainty going forward, it really delays any | |
| options for hiring people, developing new products. It's really | |
| created a major burden. | |
| Thank you for your question. | |
| Chairwoman Foxx. Thank you. | |
| Mr. Walberg. Thanks for your response. | |
| And my time has expired. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| Mr. Polis, you're recognized for five minutes. | |
| Mr. Polis. Thank you, Madam Chair. I thank the chairwoman | |
| for yielding and the witnesses for coming. | |
| We're here today to discuss the Affordable Care Act and its | |
| repeal. This committee has held a number of hearings in this | |
| area, in particularly to highlight the dangers of repealing the | |
| Affordable Care Act without a replacement that improves and | |
| builds upon it. | |
| Of course, I would note that the title of the hearing is | |
| somewhat deceptive. It's called ``Rescuing Americans from the | |
| Failed Healthcare Law and Advancing Patient-Centered | |
| Solutions.'' Obviously, we hope that we can move forward in way | |
| to improve upon the healthcare law and leave something in its | |
| place that's better. | |
| It has been six years since the law passed. Before the | |
| passage of the Affordable Care Act, about 48 million Americans | |
| had no insurance, and now that number has fallen to 28 million. | |
| For the first time, being a woman is no longer a preexisting | |
| condition; a diagnosis in childhood doesn't preclude coverage | |
| as an adult; and cancer survivors can't be sent a bill for | |
| their radiation after hitting their coverage ceilings for the | |
| year. As was indicated in the testimony, medical bankruptcies | |
| can be avoided. The statistics bear that out as well. | |
| In my home state of Colorado, I'd like to submit a letter | |
| from our Governor Hickenlooper urging this body to protect | |
| healthcare coverage for 600,000 Coloradans. Without objection, | |
| Madam Chair, I'd like to add that to the record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Polis. And I would also like to share a couple stories | |
| as well. | |
| A few weeks ago, Elizabeth Robinson, a constituent of mine, | |
| called my office in Boulder. She works as a homeless navigator | |
| for Boulder Municipal Court. For Elizabeth, the expansion of | |
| Medicaid that Colorado and 31 states took advantage of has been | |
| absolutely critical for serving the homeless population with | |
| which she works. She urged me specifically to oppose repealing | |
| the law because of the dramatic consequences to the most | |
| vulnerable. | |
| I also received an email from Dorothy, who shared her | |
| story. She's from Louisville, Colorado, 63 years old, self- | |
| employed, earns less than $20,000 a year. Thanks to the | |
| subsidies on the individual marketplace, she finally has | |
| coverage that's affordable as she waits for her Medicare | |
| eligibility. | |
| Elizabeth is an advocate, Dorothy is a patient, but both of | |
| them believe strongly the Affordable Care Act is working for | |
| them. | |
| My first question is for Ms. Schlaack. | |
| According to January reports from The Commonwealth Fund, | |
| repeal would cost $54 million in gross State product and $1.8 | |
| million for Michigan alone in local and state tax revenues. | |
| In addition to your personal responsibilities, are you also | |
| concerned about this negative fiscal impact on your State the | |
| repeal would produce? | |
| Ms. Schlaack. Well, sure, Michigan being a lot of | |
| manufacturing facilities that struggle as it has been for a | |
| while. Also, like, the area where I live is right on Lake | |
| Michigan, and it's a heavy tourist economy. And when people | |
| don't have jobs, they don't have extra money to spend, and the | |
| tourist economy is going to suffer. And the small community | |
| where I live, a lot of it is based around tourism. | |
| Mr. Polis. Thank you. | |
| And, Dr. Troy, I appreciated in your written testimony | |
| where you said it's important to protect those who've gained | |
| coverage under the ACA. What concerns me is the CBO has made | |
| clear that repealing the ACA would cause over 30 million | |
| Americans to lose their insurance. | |
| Would your organization oppose legislation that doesn't | |
| maintain those coverage gains made by the Affordable Care Act | |
| in some way, shape, or form? | |
| Mr. Troy. Thank you, Congressman, for the question. | |
| As I said earlier in my testimony, I do believe it is | |
| important to protect the 20 million who have coverage via the | |
| ACA. I think the CBO study suggests that just if you repeal it | |
| and do nothing in its place, you would have a number of people | |
| without coverage, and I think that would be a problem. | |
| So we want to build on the existing building blocks of | |
| American health care, the successful ones, such as employer- | |
| sponsored care, and make sure that we can expand coverage and | |
| maintain coverage for all. | |
| Mr. Polis. So I think you said it would be a problem if it | |
| didn't maintain that coverage. Is that what you said? | |
| Mr. Troy. We absolutely would like to maintain coverage | |
| levels, yeah. | |
| Mr. Polis. Mr. Eddy, you mentioned some of the -- this is | |
| on the pay-for side, the way that the Affordable Care Act was | |
| paid for. You mentioned in particular the so-called Cadillac | |
| tax. There's other aspects, like a tax on unearned income, | |
| medical device tax. I'm not aware of your organization's | |
| position on all of those, but certainly you've made it clear | |
| you oppose the Cadillac tax. | |
| Do you have other ideas for how to pay for an ACA | |
| replacement? And whatever takes the place of it, have you put | |
| other potential pay-fors on the table that are acceptable to | |
| you? | |
| Mr. Eddy. No, Congressman, I have not seen anything else | |
| that's -- | |
| Mr. Polis. Does your organization propose any, or do you | |
| simply oppose the current ones? | |
| Mr. Eddy. There are some provisions of the ACA that -- | |
| Mr. Polis. Pay-fors, pay-fors. The ways that it's paid for. | |
| The revenues. | |
| Mr. Eddy. Well, I don't support the fact that it's a | |
| mandate and has to be paid with penalties if not. And I | |
| understand why there are the mandates and the health insurance | |
| industry fees. The fees are really what -- the pay-fors, the | |
| additionals -- | |
| Mr. Polis. Right. | |
| Mr. Eddy. -- where that amount could have gone to health | |
| coverage for our employees. | |
| Mr. Polis. My time has expired, but, in concluding, I would | |
| just say, you know, it's fine to oppose particular ways of | |
| paying for it, like fees and certain taxes, but, obviously, | |
| something has to be paid for. So maybe you can put, in the | |
| future, some on the table -- we'll be happy to submit that to | |
| you in writing after the hearing -- as to how you would like to | |
| pay for the replacement for the ACA. | |
| And I yield back the balance of my time. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| Mr. Rokita, you're recognized for five minutes. | |
| Mr. Rokita. I thank the chairwoman. | |
| I also thank the witnesses for your testimony today. I | |
| learned a lot from each of you. | |
| I want to start by commenting on some of the comments made | |
| by the Ranking Member, a dear friend of mine, Mr. Scott, who | |
| talked in his opening statement about a Budget Committee | |
| hearing. I happen to be an officer on that committee. And I | |
| just want to say, while I don't dispute that there was some | |
| testimony given at that committee hearing along the lines of | |
| what Mr. Scott was talking about, the overwhelming testimony | |
| last week in the Budget Committee was that -- and these were | |
| experts in the field of health care and the economy and both -- | |
| was that ObamaCare was roundly criticized, that, in fact, if it | |
| was left to go on, it would implode, that the fact that you had | |
| another major government control in people's lives only meant | |
| that costs were going up and choices were going down. | |
| So that was the takeaway from the Budget Committee | |
| witnesses last week when we examined this. And it's not any | |
| different than the other examinations we've had on ObamaCare | |
| over the last several years. | |
| Mr. Scott also talked about some misleading figures, about | |
| the increase in costs and whether or not the increase in costs | |
| actually went down with ObamaCare or whether, if we didn't have | |
| ObamaCare, the costs would've continued to increase at a higher | |
| rate. | |
| What I find to be misleading about the 6 years or so that | |
| we've had ObamaCare is statements like this: If you like your | |
| doctor, you can keep your doctor. That, in fact, is wrong. If | |
| you like your healthcare plan, you can keep your healthcare | |
| plan. That, in fact, is wrong. There are over 1,000 counties in | |
| the United States right now that have one choice on the | |
| exchange for a healthcare provider. In fact, it's gotten worse. | |
| Then the cost was told to us to not be more than $2,500 per | |
| family or something along those lines. And, of course, we've | |
| blown through that figure almost immediately. | |
| So where are we today? | |
| I'd like to recognize my fellow Hoosier, Mr. Bollenbacher. | |
| I'm glad to see you here. I'm very familiar with your area of | |
| the State from when I served as Indiana Secretary of State. | |
| Can you explain a little bit about how a small accounting | |
| firm owner from northern Indiana winds up testifying before | |
| this committee on this issue? Did you ever think that would be | |
| the case? And can you go into a little bit more detail? | |
| Mr. Bollenbacher. Thank you. | |
| In the fall of 2016, we received a renewal for our health | |
| insurance of 156 percent, and it just blew me away. Many of my | |
| clients -- I was expecting a 40- to 50-percent increase based | |
| on the number my clients had been receiving. When I received | |
| 156, I just shook my head. I had no idea what we were going to | |
| do. | |
| My team members are my family. You know, I want to care for | |
| them, I want to take care of them. So I wrote a letter to | |
| President Obama just explaining to him about our 156-percent | |
| increase. And I sent that also to the NFIB, and they contacted | |
| me to come speak today, which I'm grateful for. | |
| Mr. Rokita. Well, you're not alone. I mean, in Indiana | |
| alone, 31 percent of small businesses offered coverage in 2010, | |
| and by 2015, the most recent year that I could find data, only | |
| 23 percent of those same businesses were able to offer | |
| coverage, a decrease of 26 percent in the number of offerings. | |
| And your reason, just to be clear for the record, for this | |
| reduced coverage among small-business owners? | |
| Mr. Bollenbacher. The costs have been increasing. It's just | |
| increasing out of control. | |
| Mr. Rokita. When you described how your insurance was | |
| canceled the first time, you said there were some less ideal | |
| options. One of those was Medi-Share, I heard from your | |
| testimony, and some other things. Could you go into a little | |
| bit more detail there? | |
| Mr. Bollenbacher. We looked at a number of options. Medi- | |
| Share is called a church plan. I have a number of clients that | |
| have gone to that. It's usually a half or a third of what even | |
| on the exchange it would cost them. And that was one of the | |
| options that we looked at. | |
| Mr. Rokita. But that's not working? | |
| Mr. Bollenbacher. For those clients that have gone to Medi- | |
| Share, they are still on it. It is working for them. | |
| Mr. Rokita. Okay. Thank you. | |
| And then, Mr. Troy, I think with the 30 seconds I have | |
| remaining, I'd just like to ask you, at the risk of this | |
| committee losing jurisdiction over the issue, why do employers | |
| have to be involved in the insurance market? I mean, I | |
| understand the history and all that, but why couldn't if we | |
| changed or modified the Tax Code could we not incentivize | |
| individuals to enter directly into a competitive marketplace? | |
| Why does the employer have to be involved? | |
| Mr. Troy. I don't think the employer has to be involved per | |
| se. I just think that is the way the system has evolved, and to | |
| change it precipitously would be to cause large disruptions. As | |
| we saw with the Affordable Care Act, the disruptions are often | |
| quite problematic. Somebody mentioned the 5 million people who | |
| lost their individual plans via the ACA. | |
| So I think the best way to go forward is to try and avoid | |
| disruptions and focus on what is working. And you have 177 | |
| million people getting health care through employers. If you | |
| were to disrupt that, the government would have an even larger | |
| hole to fill in terms of covering people. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| Ms. Bonamici, you're recognized. | |
| Ms. Bonamici. Thank you, Chairwoman Foxx and Ranking Member | |
| Scott. | |
| And thank you so much to all of our witnesses for being | |
| here today and testifying. | |
| I wanted to just follow up on what Mr. Rokita said about | |
| employer-provided health care. And also Dr. Roe mentioned, as | |
| well, that insurance costs make us noncompetitive with other | |
| countries. And I want to point out that that's not necessarily | |
| a function of the Affordable Care Act. | |
| I was born in Detroit, Michigan, many years before the | |
| Affordable Care Act. And everyone knew in Detroit, Michigan, | |
| that if you make something in Detroit or if you go across the | |
| bridge and make it in Windsor, Ontario, you have very different | |
| cost considerations, because in Windsor, Ontario, they don't | |
| have employer-provided health care, because Canada, like | |
| basically every other industrialized country, has universal | |
| health coverage. | |
| So it's not necessarily a function of the Affordable Care | |
| Act that healthcare costs are making us unaffordable. And if we | |
| want to have a conversation about that in another hearing, I'd | |
| welcome that. | |
| Madam Chairwoman, I ask unanimous consent also to insert | |
| into the record a letter from the AARP supporting the | |
| Affordable Care Act and expressing concerns about the effects | |
| of repeal. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Ms. Bonamici. The AARP also mentioned in the letter that | |
| Medicaid is the only safety net for millions of children with | |
| disabilities, adults, and seniors in need of critical long-term | |
| services and supports. | |
| I want to point out that, in Oregon, the Kaiser Family | |
| Foundation estimates that more than 546,000 Oregonians could | |
| lose coverage if the ACA Medicaid expansion is repealed. Also, | |
| in Oregon, we have been doing some great innovations with care. | |
| We have CCOs improving care and reducing costs with patient- | |
| centered primary care homes. It's really working well to | |
| provide that preventive care. | |
| And I've heard from hundreds of constituents in Oregon. In | |
| fact, thousands showed up recently at a townhall meeting that I | |
| did with our Senators about this issue. They're terrified about | |
| losing their coverage. | |
| And Debra from Rainier shared her story with me. She called | |
| my office. She's worried that she's going to lose her care if | |
| the ACA is repealed. She's in the final stages of pancreatic | |
| cancer. She's not yet eligible for Medicare. She's worried that | |
| her cancer will prevent her from obtaining coverage without the | |
| Affordable Care Act. So she's spending her remaining time | |
| advocating for those who have benefited from health reform and | |
| doing what she can to prevent the repeal of this important law. | |
| And I know her fears are shared with millions of Americans | |
| in districts all across the country. And I hope my colleagues | |
| will keep her, as well as you, Ms. Schlaack, in mind as we | |
| debate this repeal. | |
| And, Ms. Schlaack, thank you so much for being here to | |
| share your story. I know it's not easy to come forward and talk | |
| about something so personal. | |
| But you mentioned that the type of leukemia your husband | |
| was diagnosed with has genetic links so your family might be at | |
| risk. Can you discuss how the repeal might affect your family | |
| if individuals with preexisting conditions are no longer | |
| protected under the ACA? And if you might mention, what would a | |
| high-risk pool do? Do you think that's an acceptable | |
| alternative for your family? | |
| Ms. Schlaack. No, not -- I mean, a high-risk pool, not at | |
| all. I mean, actually, the University of Chicago continues to | |
| work with samples from my husband to further educate | |
| themselves. And I've learned from my own family about some of | |
| the genetic links. | |
| And being that I have a young daughter who previously was | |
| almost a preexisting condition for being a female, the thought | |
| that 30, 40 years down the road, if she sees the same thing, | |
| she won't possibly have the choice of buying prescriptions or | |
| paying for groceries. | |
| Ms. Bonamici. Thank you, and I hope we can keep your story | |
| and others in mind. | |
| Mr. Eddy, you stated in your testimony your business had | |
| experienced some significant challenges as the health coverage | |
| you offered your employees changed, but you are hopeful your | |
| situation is stabilized. So can you talk a little bit about how | |
| the repeal of the Affordable Care Act without a credible | |
| alternative would affect your current situation? | |
| There's a lot of uncertainty now. I know the President has | |
| said there's going to be insurance for everybody. I don't know | |
| how that plan would work. We haven't seen that yet. But how | |
| would the uncertainty of repeal and replace, how would that | |
| affect your business and business owners like you? | |
| Mr. Eddy. Thank you, Congresswoman. | |
| For the answer to that, I will reference a study that the | |
| NAM has completed called ``Shaping Up.'' The NAM took a hard | |
| look at the challenges as well as the opportunities for | |
| employers concerning healthcare insurance coverage. They were | |
| really looking at three broad themes with that: controlling | |
| costs, such as eliminating burdensome taxes and paperwork; | |
| expanding coverage options, such as providing flexibility for | |
| employers to cater their health insurance options; and access | |
| to better information in the form of improved healthcare IT and | |
| information sharing. | |
| I think that document would maybe tend to give some | |
| additional, broader perspective than my own personal. I think | |
| that I would reference that, and that would be made available | |
| to you. | |
| Ms. Bonamici. Thank you, Mr. Eddy. | |
| And I see my time has expired. Thank you, Madam Chairman. | |
| Chairwoman Foxx. Thank you. The gentlewoman's time has | |
| expired. | |
| Mr. Guthrie, you are recognized for five minutes. | |
| Mr. Guthrie. Thank you, Madam Chairman, for the | |
| recognition. Thank you all for testifying. I appreciate you all | |
| being here. | |
| And, Mr. Bollenbacher and Mr. Eddy, you mentioned in your | |
| testimony about your small businesses. And I have heard from | |
| families in my district. Right when we first got back to the | |
| session, a lot was going on in January, and I got a call, my | |
| office got a call from a young lady. And I called her back. I | |
| wanted to talk to her personally. And she has a special needs | |
| son, and she was really concerned -- and she's on the exchange | |
| in Kentucky -- extremely concerned about the idea that she | |
| might lose her health care as a lot of stuff has been reported. | |
| So I wanted to assure her, we're going to have a transitional | |
| plan and an ability for her to move forward. | |
| But then we started talking about her plan. In Owensboro, | |
| Kentucky, on the exchange, you have one insurance choice. She | |
| said her husband works for a small business, less than 50 | |
| people, didn't get health care now through that business, had | |
| to go on the exchange, only one choice. Her child has special | |
| needs. We have great physicians in Kentucky, all over our | |
| state, but there was a particular physician for her child's | |
| needs in Cincinnati at the Children's Hospital and he was not | |
| in network. | |
| So we started walking her through, after we talked about | |
| you're going to be able to continue your current coverage, the | |
| things that we want to do in our replacement plan that will | |
| have her have better coverage. One is, well, if it's a small | |
| business, associated health plans for small business will have | |
| better opportunities to provide health insurance, if she can | |
| buy out-of-state plans, if she needed a doctor in Ohio, because | |
| they had special skills for her child. | |
| So we started walking through that, and she became more | |
| confident as we moved forward that we can improve the situation | |
| that she's in instead of being stuck in an exchange with one | |
| plan. | |
| But my question. So I've actually put the Employee | |
| Protection Act that would allow small businesses, because what | |
| we are going to do with small business -- because the people | |
| who are really trapped in this are people that are single | |
| employers, small businesses trying to buy on the individual | |
| market or small market. And what I want in this bill, and I | |
| want to see how this would help you, that you could actually | |
| offer pre-ObamaCare plans, pre-ACA plans. If you could go back | |
| and offer a plan like that to your employees, would that help | |
| you? | |
| I think, Mr. Bollenbacher, you're a smaller business, I | |
| believe. | |
| Mr. Bollenbacher. Yes, sir. It sure would. We feel like we | |
| have no options right now. We have a cookie-cutter plan that we | |
| have to pick, and that's it. And before the ACA, we had the | |
| ability to pick the plan that best fit our particular needs. | |
| Mr. Guthrie. Mr. Eddy. | |
| Mr. Eddy. Yes, Congressman, we run into the same issues. We | |
| are in the northern panhandle of West Virginia, so we are about | |
| a mile from Ohio and five miles from Pennsylvania. | |
| One of the issues as far as going backwards is the fact | |
| that we don't have several of the carriers that used to | |
| represent West Virginia. The ACA has weakened and some of them | |
| have actually been taken over. So our options now are somewhat | |
| limited to three carriers in the northern Ohio Valley. And we | |
| would like to maybe move some of the provisions back that would | |
| give us more options and flexibility that we talked about. So, | |
| yes, that would be important. | |
| Mr. Guthrie. And we think what we want to propose will give | |
| her more options for her son, and that's what we hope to | |
| certainly accomplish. | |
| Mr. Bollenbacher, I think Mr. Rokita -- I was out but just | |
| coming back -- asked you about a letter that you sent to the | |
| President. Can you talk about the response you got on the | |
| letter -- or from the administration? I didn't expect him to | |
| personally respond, but from the administration what did you? | |
| Mr. Bollenbacher. Sure. A month or so after I sent the | |
| letter, somebody from the SHOP Marketplace called me, just to | |
| talk about the plans that they had available on the SHOP | |
| network, which really wasn't any benefit to us. | |
| Mr. Guthrie. Okay. Well, thanks. | |
| And then, Dr. Troy, in your testimony you mentioned that | |
| innovations in large employer-sponsored healthcare benefits | |
| helped to reduce healthcare costs for employees, retirees, and | |
| dependents. Can you share with the committee some of the ways | |
| employer coverage is reducing costs? | |
| Mr. Troy. Thank you. So as I was saying earlier, that we | |
| were seeing reductions in employer-sponsored costs in that | |
| period, 2006 to 2010, before the ACA went into effect, and it | |
| was a result of program design changes and plan design changes | |
| on the part of employers, which included the implementation of | |
| consumer-directed health plans, wellness programs, which have | |
| been shown in many cases to reduce costs and actually improve | |
| the health of employees, which is really what we are trying to | |
| get at, and other significant plan innovations. | |
| And, again, combined, these really dropped the annual | |
| increase from 11.1 percent in the period before 2006 to from | |
| 2006 to 2010 to 4.8 percent. And we believe that additional | |
| innovations by employers could reduce costs even further in the | |
| years ahead. Employers are now taking this issue very | |
| seriously. | |
| Mr. Guthrie. Thank you. | |
| Thank you, Madam Chair. I yield back my time. | |
| Chairwoman Foxx. Thank you so much. | |
| Mr. Takano, you are recognized for five minutes. | |
| Mr. Takano. Thank you, Madam Chair. | |
| Madam Chair, before I begin, I would like to ask unanimous | |
| consent to insert into the record a letter from the American | |
| Hospital Association and Federation of American Hospitals | |
| raising grave concerns with repealing the Affordable Care Act. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Takano. Thank you, Madam Chair. | |
| I'm disappointed that my colleagues are yet again seeking | |
| to undermine a law that has helped millions of Americans get | |
| health coverage while creating a more just and compassionate | |
| healthcare system for hundreds of millions more through | |
| consumer protections. | |
| Before I get to my questions, I want to speak briefly about | |
| the impact of the Affordable Care Act on my constituents. When | |
| I took office in 2013, a quarter of my constituents were | |
| uninsured. By 2015, the uninsured rate was cut in half to less | |
| than 12 percent, and nearly 90,000 people were newly insured. | |
| People like my constituent and childhood friend Heather | |
| Froehly. Heather had a preexisting condition, and for years | |
| before the ACA she was priced out of the insurance market and | |
| denied coverage. She contacted me during the first enrollment | |
| period in 2014 to let me know that she had successfully | |
| purchased a plan and was thrilled to be covered for the first | |
| time in years. The law's subsidies ensured here coverage was | |
| not only accessible but affordable. | |
| Soon after, Heather was diagnosed with stage two breast | |
| cancer. In the following months she underwent treatment, and | |
| I'm happy to report Heather is now cancer free and doing well. | |
| Heather has told me without hesitation that the Affordable Care | |
| Act saved her life. Had she not been able to obtain coverage, | |
| she would not have been able to go to that appointment where | |
| the doctors first discovered her cancer. She was fortunate to | |
| catch the cancer before it progressed further. I don't want to | |
| think what she would have done without the ACA. | |
| Now, we know the costs of repealing the ACA: 30 million | |
| people will lose their insurance, including nearly 5 million | |
| Californians. It would cost my State nearly 150,000 jobs. But | |
| more than that, we know that stories like Heather's or Ms. | |
| Schlaack's can be found in every district represented here | |
| today. Democrat and Republican districts share the same | |
| predicament. | |
| Cancer does not recognize red states and blue states. We | |
| have to take off our partisan blinders and acknowledge where | |
| the ACA has succeeded and where it must be improved. And I hope | |
| we can agree that it would be a terrible mistake to repeal a | |
| law that has saved so many American lives. | |
| Now, Ms. Schlaack, first of all, I want to thank you for | |
| your courage this morning and sharing your family story. And | |
| I'm incredibly sorry for our loss and appreciate your | |
| willingness to speak here today. | |
| Now, my colleagues on the other side of the aisle seem to | |
| be in a great rush to repeal a law that insures millions of | |
| Americans and that they have any access at all to lifesaving | |
| care. And it seems in their illogical haste to score political | |
| points and make good on an ill-informed promise to repeal the | |
| ACA that they have ignored the impact of their actions, | |
| especially for families who are dealing with a significant | |
| healthcare crisis. | |
| Can you help us understand what it must be like for those | |
| families, on top of the deep concern for their loved one's | |
| health, to be scared about Republican attempts to dismantle a | |
| law that is working to ensure that they maintain lifesaving | |
| care? Can you help us understand? | |
| Ms. Schlaack. Thank you. | |
| Well, like I had mentioned before, I mean, when you're | |
| going through this treatment, whether you're the patient or | |
| caregiver or family friend, your focus is on wellness. And the | |
| bills keep coming in regardless of what's going on, and the | |
| fact that you don't have to worry about whether you're going to | |
| be covered or not is one less worry. | |
| Mr. Takano. Tell us more about the annual or lifetime caps, | |
| the fact that there were no caps annually. | |
| Ms. Schlaack. Right. | |
| Mr. Takano. How would that have affected you and your | |
| husband? | |
| Ms. Schlaack. Well, for instance, my husband had to have -- | |
| in a 10-month period he had 12 bone marrow biopsies. Those are | |
| four grand apiece. Blood transfusions multiple times a week. An | |
| ambulance arrived from our house to the hospital, which | |
| happened three times, $2,000. This is not counting the doctors, | |
| the medical staff, the hospital admissions. Easily before he | |
| was even halfway through his treatment would have maxed out a | |
| lifetime million-dollar maximum like it used to be. | |
| Mr. Takano. So this consumer protection was key. And if I | |
| had more time, I would want to ask Mr. Eddy and Mr. | |
| Bollenbacher whether their policies had any lifetime or annual | |
| caps and that might have made them more affordable to them. But | |
| I don't have the time. My time expired. So I don't want to | |
| yield back, but my time has expired. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Rooney, you are recognized for five minutes. | |
| Mr. Rooney. Thank you, Chairwoman Foxx, and thank the | |
| witnesses for being here today. I've got questions for Dr. Troy | |
| and Mr. Eddy. | |
| People throughout southwest Florida have expressed many of | |
| the frustrations shared here today. According to Forbes | |
| magazine, an average 64-year-old woman in Lee County, Florida, | |
| has seen her insurance premiums and costs jump 135 percent. | |
| Under these exchanges, due to the failure of competition, most | |
| southwest Floridians now have one choice for their health | |
| insurance. Many of them are on a fixed income. | |
| So my question for Dr. Troy is, if the failed experiment of | |
| ObamaCare continues as is, what chance do our average southwest | |
| Floridians have to see their healthcare costs go down? | |
| Mr. Troy. I am, too, sir, concerned about the lack of | |
| choices on the ACA exchanges, and we are having an increasing | |
| number of exchanges with only one option, as you were saying. | |
| The cost trend suggests that the chance for the average | |
| Floridian of seeing cost reductions under the ACA are very low. | |
| Mr. Rooney. Thank you. | |
| Mr. Eddy, thank you for being here as well. Glad to see | |
| another businessperson here who has firsthand experience with | |
| this disaster on our employees. | |
| According to the American City Business Journals, Lee | |
| County, Florida, is the third-best place for small businesses. | |
| Employer mandates have prevented many of our small-business | |
| owners from hiring new employees. And as I think you've | |
| mentioned as well, many have had to reduce the hours worked to | |
| deal with the cost increases of ObamaCare. | |
| Can you share with us some insights on how the employer | |
| mandates have curbed jobs and wage growth? | |
| Mr. Eddy. Yes, Congressman. Thank you. | |
| The obvious first one is the cost. As it restricts our | |
| hiring capability, the costs per year, if you look at just the | |
| costs related to the mandates and the health insurance industry | |
| fees, those two alone really represent about three full-time | |
| equivalent employees for us. | |
| The restrictive parts of the ACA really, as I said earlier, | |
| dictate a lot of different business decisions that we make, | |
| including capital investments. Looking to the future, we have | |
| to, any time we make a capital investment for growth, we have | |
| to hire and plan on hiring new employees. | |
| So this has, as I said, become one of our most critical | |
| decisionmaking parts. And it's not just the costs and fees, | |
| it's the future. It's the uncertainty. The Cadillac tax, for | |
| example, is of critical concern because of our -- the curve on | |
| the costs right now by 2018 would possibly put us into that 40 | |
| percent additional tax rate. | |
| So it's fully encompassing, to say the least, for all of | |
| our business decisions. | |
| Mr. Rooney. Well, I appreciate that response. Like I say, | |
| I'm an employer too, and I'm used to satisfying customers, as | |
| you are. And maybe we ought to think about a system that puts | |
| the patient first, patient-centric care, where they get to make | |
| the choice instead of a top-down government mandate. What do | |
| you think about that? | |
| Mr. Eddy. I can tell you, I'm no healthcare expert, but | |
| without change -- and I want everybody to know that we are all | |
| compassionate to the needs of the people. That's why we employ | |
| and try to take great care of our employees. But I'm very | |
| concerned about the long-term sustainability of health care in | |
| general if we don't make a major change. I'm supportive of | |
| that, yes. Thank you. | |
| Mr. Rooney. Thank you very much. | |
| Again, thank you all for being here. | |
| And I yield back. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Espaillat, you're next for five minutes. | |
| Mr. Espaillat. Thank you, Madam Chair. | |
| Dr. Troy, I appreciate in your written testimony that you | |
| stated, and I quote, ``It is important to protect those who | |
| have gained coverage under the ACA.'' However, I am concerned | |
| that about 30 million individuals are projected to lose health | |
| insurance if the ACA is repealed. Specifically, New York State | |
| Governor Cuomo, Andrew Cuomo, has stated that over 2.7 million | |
| New Yorkers would lose coverage, with Republicans offering no | |
| guarantee to protect this coverage. | |
| I ask for unanimous consent to include Governor Cuomo's | |
| statement announcing the impact of the ACA repeal on the | |
| record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Espaillat. Dr. Troy, I appreciate that in your written | |
| testimony, you stated that employers, and I quote, ``however, | |
| are both good at getting people covered and maintaining | |
| manageable risk pools. Public policy should be aimed at | |
| encouraging these important goals.'' You also mentioned the | |
| risk pools are difficult to maintain. Employer risk pools for | |
| the chronically ill is a central tenet of Speaker Ryan's ``A | |
| Better Way'' paper. | |
| I would like to know how you will separate the healthy from | |
| the ill. And considering that high-risk pools are more | |
| expensive to buy by consumers, more expensive to administer, | |
| and generally provide less coverage, how do you propose to | |
| implement these high-risk pools without taking a real hit on | |
| consumers and patients across the country? | |
| Mr. Troy. Thank you, sir, for your question. And as a | |
| native New Yorker, I congratulate you for your joining Congress | |
| and joining the committee. | |
| In terms of risk, managing risk is a crucial part of how to | |
| handle any possible healthcare plan going forward. It's a | |
| crucial part of healthcare reform. One of the things about | |
| employers and why I said in my testimony that they are good at | |
| managing risk is that they have large pools of people who work | |
| for them and therefore the risk pools generally tend to be | |
| better. You don't have the same kind of options such as you | |
| have in the ACA exchanges in which you have the young and | |
| healthy people choosing not to participate. And we, too, have | |
| evidence that the percentage of the young people in the ACA | |
| exchanges are younger than needs to be to maintain an | |
| acceptable risk pool. So I think -- | |
| Mr. Espaillat. Aren't they generally more expensive to buy? | |
| Aren't they more expensive to administer and provide less | |
| coverage? | |
| Mr. Troy. Are you saying employer-sponsored plans? No, we | |
| have not found that to be -- | |
| Mr. Espaillat. High-risk pool. | |
| Mr. Troy. We have not found that to be the case. | |
| In terms of high-risk pools, the idea is to minimize the | |
| number of people who would be in them. And that's why employer- | |
| sponsored health care is an important building block, as would | |
| be, perhaps, association health plans that would allow other | |
| people to join what are effectively risk pools by joining with | |
| their civic organization or their union or their religious | |
| organization and then get the tax-preferred benefit. So the | |
| idea is to minimize the number of people in high-risk pools. | |
| But, yes, of course, you are right that the specific high- | |
| risk pools that these programs that would establish, the | |
| specific high-risk pools programs would establish are more | |
| expensive because we're dealing with a group by its nature that | |
| is high risk. The idea is to minimize the number of people in | |
| those pools. | |
| Mr. Espaillat. Dr. Troy, the Trump administration's recent | |
| immigration executive order has made it impossible for many | |
| foreign-born physicians and students to enter the United | |
| States. On your blog in December 2013, you discussed the | |
| worrisome expected doctor shortages. And in 2012, while a | |
| fellow at the Hudson Institute, you wrote a piece that | |
| commented on the physician shortage that this country already | |
| faces. | |
| As a healthcare policy matter, does it make sense for the | |
| administration to make it more difficult for the United States | |
| to meet the health needs of our population by restricting the | |
| number of doctors we recruit and train? | |
| Mr. Troy. Thank you very much for that question. As a | |
| healthcare policy nerd, I guess, as you said, who wrote this | |
| paper four years ago, I'm flattered that people are reading the | |
| paper, and I hope it has an important public policy impact. I | |
| absolutely think that we do have concerns about a doctor | |
| shortage. I've always been in favor of an immigration system | |
| that works to bring in people who are willing to work and | |
| willing to help improve our economy, and I worked in the Bush | |
| administration on the immigration reform plans that would have | |
| helped bring more doctors into the country. | |
| Mr. Espaillat. So you support an exemption for doctors and | |
| healthcare professionals from those countries that are | |
| currently being hit with the ban? | |
| Mr. Troy. I would like to see our immigration policy have | |
| plans to allow more doctors to come into the country, | |
| absolutely. | |
| Mr. Espaillat. Madam Chair, the statement from the | |
| Association of American Medical Colleges expresses deep | |
| concerns about this new immigration policy. I ask unanimous | |
| consent to insert this in the record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. And the gentleman's time has expired. | |
| Mr. Espaillat. I yield my time. | |
| Chairwoman Foxx. Mr. Brat, you're recognized for five | |
| minutes. | |
| Mr. Brat. Thank you very much, Madam Chairman. | |
| Thank you all very much for being with us today. | |
| I'm on the Budget Committee, and so I like to kind of zoom | |
| in on the mandatory spending problem this country faces, and a | |
| lot of that is going to be impacted by increasing healthcare | |
| costs over the years. And so that's where I'm headed. | |
| And so we all appreciate the concerns shared across the | |
| aisle on uninsured, the costs. We want to get it right. But the | |
| amazing thing I never hear and that the media, unfortunately, | |
| never covers is the impact on our children with the programs, | |
| Medicare, Social Security, et cetera, going forward. So I'll | |
| just share a few facts. | |
| And then I don't know whether you all have this in your | |
| planning horizon or not, because it is 10 to 20 years off. But | |
| just the basic fact, everyone -- I taught economics for a 18 | |
| years -- everyone wants everything in the short run, right? I | |
| mean, utility maximization, et cetera, and we're pushing stuff | |
| off when it comes to the debt, et cetera. So in Virginia, | |
| healthcare costs are going up by 20 percent, and that's pretty | |
| typical. Some States, 50 or more percent increase in premiums. | |
| So, number one, is that sustainable? | |
| Two, Kaiser recently has come out with just the standard | |
| premium rates, about $17,000 for a family of four in Virginia | |
| or across the country. That's just the new family of four | |
| premiums, $17,000. Is that sustainable? | |
| Average family income in my counties is about $65,000 for | |
| family. Family income 65, 17 health care. Is that sustainable? | |
| Deductibles are over 5,000 typically now for silver, bronze | |
| plans, right, not just high deductible. It is across the board. | |
| Is that sustainable? | |
| And then my commentary is what I know is not sustainable. | |
| So currently we are 20 trillion in debt. And if you go out to | |
| CBO, the trendline is in 10 years we're going to add another 10 | |
| trillion. Likely, we'll be at 30 trillion in debt. When does | |
| the bond market call that in? Is that sustainable? I don't | |
| think it is. | |
| The flip side of that is what's driving that debt? A lot of | |
| the pressure is coming from the mandatory spending programs. | |
| Medicare and Social Security are both insolvent in 15 years, | |
| roughly speaking. In 50 years, it's not clear whether our kids | |
| will have those programs at all. | |
| And healthcare costs are, of course, probably the main | |
| driver of those programs, of Medicare, Social Security, | |
| Medicaid, veterans, et cetera. And I haven't heard enough | |
| analysis of that. This is a huge ethical issue and an ethical | |
| tradeoff of current generations versus the next generation. So | |
| everyone's talking about what we would all like right now, but | |
| the facts look to me, with Medicare and Social Security | |
| insolvent in 15 years and maybe nonexistent in 50 years when | |
| our kids retire, is anyone taking that into account? | |
| And so what goes with that, the main graph out at CBO also | |
| shows in 10 years all Federal revenues will go only to | |
| mandatory spending programs, right? So all Federal revenues | |
| will only go to mandatory spending programs, Medicare, Social | |
| Security, Medicaid, Bush prescription drug plan, et cetera. | |
| Right? So that means there's no money left for the military, | |
| education, transportation, everything we believe in across the | |
| aisle. | |
| And the mirror image of that same statement, that there's | |
| no Federal revenues left, is the deficit in 10 years is | |
| expected to be $1.2 trillion, which fully funds the | |
| discretionary budget, right? So we will be deficit financing | |
| the entire discretionary budget in 10 years. | |
| So this is just CBO facts, most of it related to | |
| mandatories. And I just want to open it up to your comments. | |
| Why don't we just work down the -- Dr. Troy, why don't you lead | |
| off, just on the sustainability. And, sorry, I've left you | |
| probably with probably way too little time. | |
| Mr. Troy. That's, fine, sir. I will be brief. | |
| We have a chart that we've prepared. It's called ``Hitting | |
| the Wall,'' and it talks about the period from 2025 to 2030 | |
| when we're going to have Medicaid spending hit over a trillion | |
| dollars. All of the baby boomers will have retired. The | |
| Medicaid trust fund, as you say, will be insolvent. And we are | |
| very concerned about all those trends going forward. | |
| We are also concerned about recent public policy which puts | |
| more people onto government-sponsored healthcare programs and | |
| fewer on private programs. So we would like to see more | |
| reliance on this employer-sponsored care as a way to address | |
| these issues going forward. And I would like to submit that | |
| chart for the record. | |
| Mr. Brat. Right. Thanks. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Brat. Mr. Eddy, please. | |
| Mr. Eddy. Yes. I think I would refer back to the concern | |
| about sustainability not only of the healthcare plan, but also | |
| of the tax base if this continues to damage small companies. A | |
| large part of the tax base, has to be remembered, comes from | |
| the small businesses. As our friend Adam Smith said, there's | |
| only three ways to create new wealth in any culture: | |
| agriculture, manufacturing, and resource extraction. And a lot | |
| of those companies that support those industries are small | |
| businesses now. So without change, I really am concerned about | |
| our sustainability even with the tax system. Thank you. | |
| Mr. Brat. Thank you for bringing in Adam Smith. | |
| Thank you all very much. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Grijalva, you are recognized for five minutes. | |
| Mr. Grijalva. Thank you very much, Madam Chair. | |
| I think it's important, kind of, to remind as we deal with | |
| ACA and have this discussion in this panel -- and thank you for | |
| being here -- and as we stumble or edge toward TrumpCare in the | |
| foreseeable future, it's important to remember that there were | |
| 60-plus votes for repeal in this House. And at the time it was | |
| a messaging vote. Now reality bites, that we have issues to | |
| deal with and how do we keep commitments that, perhaps, are | |
| contradictory to even some of the testimony that I read from | |
| the witnesses here today. | |
| For example, President Trump said that he wanted health | |
| care for everyone, he mentioned that, and that he wanted it to | |
| be great, affordable care for everyone. The commitment not to | |
| touch Medicare and not to touch Social Security. Congressional | |
| leaders on the Republican side have talked about dealing with | |
| the popular parts of ObamaCare, no prohibition of preexisting | |
| conditions, no gender discrimination in terms of costs, | |
| preventive mandated examinations for wellness issues, no | |
| maximum caps, sons and daughters remain until they're 26. | |
| And Mr. Troy, Mr. Eddy, those two are doable in your | |
| professional, learned experience, to do what the President said | |
| had to be done and to keep the essential programs that are | |
| popular with the public? That's why the public is demanding a | |
| replacement, just not merely a repeal. Are they doable at all? | |
| Mr. Troy. Thank you for the question, sir. | |
| First of all, I'd like to state that I am not a | |
| spokesperson for the Trump administration or the Obama | |
| administration. | |
| Mr. Grijalva. Nobody is. That's not the point here. | |
| Mr. Troy. And I was happy to reclaim my First Amendment | |
| rights when I left government 7 years ago. | |
| But I would like to make the point that there are a number | |
| of serious plans that would reduce the overall cost of premiums | |
| on average according to CBO analysis, and I think that is the | |
| best way to go forward in order to incentivize people to | |
| purchase health care on their own without subsidies for some | |
| and an overall mandate. Thank you. | |
| Mr. Grijalva. Yeah. Let me follow up, if I may. | |
| Mr. Troy, part of what you also hear is that we have to | |
| eliminate the mandate, we have to eliminate the subsidy, we | |
| have to eliminate the medical device tax, high-end fees and | |
| taxes, and we have to eliminate issues that are revenue | |
| generation that allow many of the important things, like Indian | |
| health care that's part of the Affordable Care Act, that would | |
| go out the window. Community health centers and the trust fund | |
| established for community health centers that are essential in | |
| rural America and in poor America for services, those would all | |
| go out the window. | |
| So how can on a wish that costs of premiums will go down, | |
| when in reality the balance of revenue and program offerings | |
| under ACA are intrinsically tied together? How do you eliminate | |
| all the revenue generation and still have a program? | |
| Mr. Troy. So we do oppose elimination of many of the taxes, | |
| including the Affordable Care Act, the Cadillac tax in the | |
| Affordable Care Act. In terms of CBO projections being a wish, | |
| that is how public policy is made. We make projections based on | |
| what CBO assumes that the policies will do and that's how | |
| they're voted on. And I was pleased to see that this one | |
| particular CBO study showed that the costs would be reduced if | |
| a number of these programs in totem would be put together to | |
| lower the costs on individuals and their premiums. | |
| Mr. Grijalva. I'm sorry, Mr. Eddy, but if you have any | |
| comment on either one of those points. | |
| Mr. Eddy. Thank you, Congressman. | |
| I really tell myself I should have no comment here, but | |
| what I would like to say is I think we've all learned a good | |
| bit about what works and what doesn't work in the last five | |
| years, six, seven years of ACA. You know, from my standpoint as | |
| a small-business owner, I would hope that there could be a | |
| balance created between this group, actually, to work towards | |
| what does work better. I have no answer for you on that, | |
| though. Thank you. | |
| Mr. Grijalva. I appreciate it. | |
| I yield back, Madam Chair. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Bishop, you're recognized for five minutes. | |
| Mr. Bishop. Thank you, Madam Chairwoman, and thank you for | |
| the opportunity to be a part of this committee hearing today. | |
| Thank you to all the panelists. A special thank you to Ms. | |
| Schlaack, a fellow Michigander. Also, I want you to know as a | |
| parent, husband, my heart goes out to you and your family. I do | |
| want you to know that your testimony here today makes a | |
| difference. And oftentimes people don't think that, but your | |
| being here today, your personal story makes a difference, and I | |
| want to thank you for that. | |
| Higher premiums and uncovered out-of-pocket expenses for | |
| the most part are devastating families and entrepreneurs and | |
| everyday Americans of all backgrounds. The ACA has caused | |
| cancelled policies, rising costs, poor coverage, and lack of | |
| choices for families, business owners, and employees alike. | |
| Many Americans simply can't afford health insurance. In | |
| fact, in 2015, 8 million Americans chose to pay the individual | |
| mandate tax penalty rather than to purchase insurance at all. | |
| I hear from constituents every day and business owners. I | |
| have spent the last couple of years traveling the state. And | |
| just reflecting what I'm seeing in Michigan, plans in Michigan | |
| exchanges saw deductibles go up an average of $492 in 2017. | |
| ObamaCare exchange rates will jump nearly 17 percent in | |
| Michigan regardless of what Congress does this year. Insurers | |
| are leading the exchanges, private practices are folding over, | |
| and our doctors are being forced into retirement because they | |
| cannot afford the cost to stay in practice to comply with all | |
| of the incredible regulation. | |
| Nationally, those who currently have a plan under the | |
| exchange can expect an average premium increase of 73 percent, | |
| while individuals who are now just joining will see a 96 | |
| percent increase in premiums. The average cost to the new | |
| consumer in the individual market is expected to rise $1,800 | |
| per year. | |
| We often hear, as we absolutely did here today, the | |
| argument that if ObamaCare isn't implemented, costs would rise | |
| anyway. And I know, Dr. Troy, you've answered that question on | |
| more than one occasion. And just building on what Mr. Guthrie | |
| had asked you, as a healthcare policy expert, can you tell me - | |
| - obviously, prices would continue to increase. But would the | |
| cost of health care increase at the same rate under the | |
| previous system but for the implementation of ObamaCare? | |
| Mr. Troy. So the healthcare inflation rate continues to be | |
| higher than the overall inflation rate. There has been some | |
| moderation in the healthcare inflation rate. So it's still | |
| higher than overall inflation in the last couple of years. CBO | |
| has looked at this and wondered what the effect of -- or the | |
| cause of this was. It looked at the ACA as one possibility, but | |
| it said that the biggest factor was the lingering effects on | |
| the recession in terms of moderating the healthcare inflation | |
| rate. Also, some of the premium hikes that we have seen in the | |
| last couple of years in the ACA exchanges suggest that new | |
| studies going forward might find even higher rates. | |
| And then the other thing I would say is that employers have | |
| done a lot of work in recent years to try and bring the down | |
| costs. And we've seen some improvement in the costs in | |
| employer-sponsored care even as they face the additional | |
| effects of the ACA costs. | |
| Mr. Bishop. Okay. We could have a lot of this conversation | |
| for many days. | |
| Doctor shortage. You just were asked -- you were just | |
| brought into that discussion as well, the fact that the current | |
| immigration plan may have an impact on that. But can you share | |
| with me the extent to which the result of rising costs on the | |
| current practitioners and the current costs with regulation | |
| compliance has an impact on the number of our doctors, | |
| especially those freestanding specialists who are leaving the | |
| practice of medicine? | |
| Mr. Troy. I'm glad you raised that, because that study that | |
| I wrote back at Hudson Institute in 2013 did talk about the | |
| cost of the Affordable Care Act on our medical profession and | |
| suggested that we might have problems filling the number of | |
| doctors we need as a result of the costs imposed by the ACA, | |
| but also the lack of discretion imposed on doctors of the ACA. | |
| Doctors want to see that they actually have the ability to make | |
| decisions, and the more their decisions are constrained, the | |
| less likely they are to go into the profession. | |
| Mr. Bishop. What exactly is, what's the biggest regulation | |
| that doctors face that is causing the most consternation among | |
| the practitioners that's making them leave the practice almost | |
| overnight? | |
| Mr. Troy. So I hear a lot of doctors complain to me about | |
| the electronic medical records and the way that it forces them | |
| to look at the screen instead of at the patient. And when you | |
| look at the patient, that's when you get to make better | |
| decisions about the patient's health. But I would, also, I know | |
| we're short on time, I would ask that entire paper that I wrote | |
| about the ACA's impact on doctors be submitted for the record. | |
| Thank you. | |
| Mr. Bishop. Thank you very much, Dr. Troy. | |
| And I yield back. | |
| Chairwoman Foxx. If the gentleman from Michigan would like, | |
| we can insert that study into the record. | |
| Mr. Bishop. I would. And I move to admit that to the | |
| record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Ms. Adams, you're recognized for five | |
| minutes. | |
| Ms. Adams. Thank you, Madam Chair, and thank you, Ranking | |
| Member Scott, for hosting today's hearing. | |
| And thank you to all of the panelists. | |
| Much of what has been discussed today includes the impact | |
| of ACA on the health and economic security of our country. | |
| Repealing it would take away vital health insurance, as we've | |
| heard, for nearly 30 million Americans, and with more than 129 | |
| million Americans with preexisting conditions would be denied | |
| coverage. | |
| Madam Chair, I'd like to ask unanimous consent to enter | |
| into the record a letter from seven children's groups. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Ms. Adams. Thank you very much. | |
| Ms. Schlaack, first of all, you've experienced a terrible | |
| tragedy. Again, I want to add my thought and sympathy to you | |
| and your family and commend you for having the strength to | |
| share your story. | |
| You describe in detail the impact of ACA in terms of | |
| coverage both for your daughter and your son, and in your | |
| testimony you mention that having ACA allowed you to have | |
| coverage for your daughter without having to quickly go back to | |
| work simply to get the benefit of health insurance. | |
| So it does sound like ACA allowed you to be flexible with | |
| deciding when to go back to work after your husband's death. Is | |
| that the case? | |
| Ms. Schlaack. That's correct. | |
| Ms. Adams. Okay. I also want to raise with you, you know, | |
| oftentimes with great personal tragedy comes the need to access | |
| mental health services. Under ACA, more individuals have access | |
| to such services. As someone who has experienced personal | |
| tragedy and currently working with those who have, how | |
| important is that mental health service, such as grief | |
| counseling, how important is that to be accessible and covered | |
| under health plans? | |
| Ms. Schlaack. Thank you. Not only for myself to be able to | |
| effectively parent and continue on with my life, but also for | |
| my daughter. | |
| It is statistically shown that children who suffer a loss | |
| of a parent or live with a parent with a serious illness often | |
| have difficulty processing that, and it then translates into | |
| school issues, behavioral issues beyond their young years, well | |
| into college, making not necessarily the best choices. And the | |
| fact that she and I are both able to continue with counseling, | |
| therapy for our own mental health has been invaluable because | |
| it is a very expensive service that we couldn't have afforded | |
| otherwise. | |
| Ms. Adams. Okay. And so after actually working in this | |
| field, you believe it's important for other families to access | |
| it as well? | |
| Ms. Schlaack. Very much so. I work with groups, peer | |
| groups, and many times that's not quite enough. A lot of times, | |
| especially children don't want to talk about things like this | |
| with their parents, with someone in their home, and they need a | |
| third party who they can express what they're feeling and help | |
| them work through the emotions that they often don't even | |
| understand. | |
| Ms. Adams. Right. Okay. Thank you. | |
| So you talked about your son -- or you mentioned it in your | |
| written testimony -- who was able to stay covered under an | |
| employer-sponsored plan after serving in the Peace Corps. What | |
| has it meant to him to have the coverage a young adult starting | |
| out in the world? | |
| Ms. Schlaack. Well, as he was right out of -- he finished | |
| his bachelor's program, went straight to a master's program, as | |
| we were able to continue to cover him then, so he didn't have | |
| to work full time and go to school. And then in the interim, | |
| between graduating and starting the Peace Corps, which he did | |
| have full coverage from the government as a Peace Corps | |
| employee, but then once that service was up, he transitioned | |
| back into the U.S., his benefits stopped. | |
| And until he was able to attain his own full-time | |
| employment, which thankfully he does have, I was able to keep | |
| him covered. So it was one less thing that he -- because, | |
| frankly, the medical care he could get in Mongolia where he was | |
| serving wasn't exactly stellar, and he was able to come back | |
| and have the coverage he had in the past and before he started | |
| out on his own as an independent adult. | |
| Ms. Adams. Thank you. And as his mom, I know you have peace | |
| of mind. | |
| Thank you very much. I yield back, Madam Chair. | |
| Ms. Schlaack. Yes. Thank you. | |
| Chairwoman Foxx. Mr. Byrne, you are recognized for five | |
| minutes. | |
| Mr. Byrne. Thank you, Madam Chairman. | |
| Lady and gentlemen, thank you for being here today. | |
| Most people expect to get their health insurance through | |
| their employer. Most people work for small businesses. So the | |
| topic we've been talking about today and the impact on small | |
| business is a big deal. | |
| I represent southwest Alabama. We don't have too many big | |
| employers. Virtually everybody works for a small business. | |
| Between 2015 and 2016, for the urban county in my district, | |
| Mobile County, the increase for small businesses for their | |
| insurance premiums is 14 percent. That turns out to be about | |
| $2,000 per employee in 1 year. For small businesses, that's a | |
| big hit. | |
| And, Mr. Bollenbacher, I'm informed that you actually had a | |
| 156 percent increase and that you wrote President Obama about | |
| that. So I would like to ask you, sir, did you hear back from | |
| President Obama? Have you received any subsidy from the Federal | |
| Government to help you with that increase? And if you don't | |
| receive a subsidy and you get an increase of that magnitude, | |
| what do you, as a small-business owner, what do other small- | |
| business owners that you work with, what do you all do with | |
| that? | |
| Mr. Bollenbacher. Yes. I don't think my microphone is | |
| working. | |
| Chairwoman Foxx. Turn on your mike, please. | |
| Mr. Bollenbacher. Yes. I did write a letter to President | |
| Obama. | |
| Mr. Byrne. Did you hear back? | |
| Mr. Bollenbacher. I had somebody call me from the | |
| healthcare marketplace to the SHOP. | |
| Mr. Byrne. Did you hear back from the President that you | |
| wrote to? | |
| Mr. Bollenbacher. No, I did not, but 156 percent increase | |
| is not feasible. | |
| Mr. Byrne. Did you get a subsidy to help you with it from | |
| ObamaCare? | |
| Mr. Bollenbacher. No. | |
| Mr. Byrne. So how do small-business people deal with an | |
| increase with like that, if the President won't talk to him or | |
| write him back and won't give him a subsidy like he had given | |
| in other parts of the program? | |
| Mr. Bollenbacher. What we were forced to do is look at | |
| options, and there were no good options. Basically, there was | |
| one plan that we ended up having to pick, which was a 78 | |
| percent increase. I've had other companies, other clients I | |
| work with, have dropped their insurance altogether. They just | |
| cannot afford it. They've laid people off to get under the | |
| full-time employee equivalent. | |
| Mr. Byrne. And maybe, Dr. Troy, Mr. Eddy, make you all can | |
| answer this for me. As a result of this, have we seen a decline | |
| in the number of businesses and employees working for small | |
| businesses that have insurance? Have small businesses just | |
| said, ``Look, we can't afford it''? | |
| Mr. Troy. I'm not aware of statistics on that specifically, | |
| but I do know there are concerns among small businesses. And | |
| I've heard stories, including by some of your colleagues today, | |
| about limitation of hiring by small businesses as a result of | |
| the ACA. | |
| Mr. Byrne. How about you, Mr. Eddy? | |
| Mr. Eddy. Again, I agree with Dr. Troy. I don't have any | |
| specific statistics, but I know how it affects us, and it | |
| curtails our hiring capabilities as well as our capital | |
| investments, which lead to additional hiring. So we plan, as | |
| long as we can afford, to cover our employees with as much | |
| coverage as we can. You know, with the high deductibles that we | |
| have today and the continuing uncertainty in the future costs, | |
| I'm not sure how long that will be able to be sustained. Thank | |
| you. | |
| Mr. Byrne. Mr. Bollenbacher, I'm sorry you didn't hear back | |
| from the President of the United States. You wrote him. You're | |
| a citizen of this country. You have a legitimate concern. And | |
| you had a right to get a response. He's not President anymore, | |
| so there's nothing we can do about that. | |
| Madam Chairman, I really do worry about what's going to | |
| happen to all these employees in America that work for small | |
| businesses and want to get their health insurance, expect to | |
| get their health insurance through their employer, and their | |
| employers have just gotten to the point where they can't afford | |
| it. | |
| And so the employers are left with one or two choices. | |
| Either they continue to pay the high cost of this, in which | |
| case they've got to figure out a way to recoup that somewhere | |
| else, and my fear there is there will be less hiring, fewer | |
| jobs; or we figure out a way to get some real relief to small | |
| businesses by getting this incredibly expensive burden off of | |
| them and let small businesses do what they've done through the | |
| history of this country, which is grow and prosper and hire and | |
| provide benefits and good wages to the people of America. | |
| And I yield back. | |
| Chairwoman Foxx. The gentleman yields back. | |
| Ms. Shea-Porter, you're recognized for five minutes. | |
| Ms. Shea-Porter. Thank you. | |
| And, Ms. Schlaack, first, let me say I'm sorry for your | |
| loss, and I understand how challenging it is when there's | |
| somebody in your family, because I had a family member who had | |
| decided -- he was a registered nurse, and he decided that he | |
| wanted to do ministry with music. He's a gifted musician, and | |
| he wanted to go to nursing homes and work with Alzheimer's | |
| patients. And so he was able to do that with the Affordable | |
| Care Act. And then shortly thereafter, he was diagnosed with | |
| advanced prostate cancer. And the Affordable Care Act saved his | |
| life, because he had access to treatment. So while our outcome | |
| was certainly better, it was a terrifying time. | |
| I am also concerned about small businesses, and so I urge | |
| my colleagues on the other side to work with us to help to | |
| reduce the costs and figure out more. The fact that we haven't | |
| been able to work together I think is a tragedy. | |
| But since the Affordable Care Act began expanding access to | |
| health insurance in my home State of New Hampshire, 63,000 | |
| people who didn't have it before have gained that peace of mind | |
| that we have all been talking about and the financial security | |
| that coverage provides. Now, their coverage and many others is | |
| at risk. | |
| Despite the fact that Republicans have had seven years to | |
| come up with a so-called replacement plan, the current plan | |
| looks like repeal and collapse. Insurers make decisions over | |
| the coming months about whether to offer plans for next year | |
| and you're still hearing the story, the dog ate my homework. | |
| The stakes cannot be higher. | |
| If congressional Republicans go down this road, the Urban | |
| Institute estimates that 118,000 people in my State alone could | |
| lose coverage and 30 million nationwide. Just yesterday, the | |
| Economic Policy Institute released a report that repeal would | |
| cost 4,600 jobs in New Hampshire. This wouldn't just erase the | |
| gains that we've made, that would send us backward, and I don't | |
| believe anybody wants to go backwards here. | |
| My constituents are deeply concerned, and rightfully so. | |
| I'd like to read some testimony from two of them. First is | |
| Jameson from Somersworth, New Hampshire, who shared this, and I | |
| quote: ``The ACA gave me the opportunity to purchase affordable | |
| health care when I needed it most. It allowed me to get the | |
| medical service I needed without me going into more debt or | |
| standing up time after time after time just waiting in the | |
| emergency room. Although I'm not a profitable insurance | |
| policyholder, I surely am a grateful one. Repealing the ACA | |
| would be inhumane, irresponsible, and outright foolish.'' | |
| And there's Jack from Rollinsford, New Hampshire, who said | |
| ``Before the ACA, I was uninsured due to a preexisting genetic | |
| condition and high medical costs, struggling to afford even the | |
| most basic tests to keep myself healthy. Today, I have great | |
| affordable coverage and the help I need to live a long, | |
| productive life.'' | |
| So my question to you, Dr. Troy is, today's hearing | |
| concerns the quote, unquote, ``failed health law.'' What | |
| benchmarks would you allow Jameson and show Jameson and Jack to | |
| defend your allegation the healthcare law has failed in New | |
| Hampshire and around the country? The uninsured rate? Average | |
| medical debt? The number of plans that have comprehensive | |
| substance abuse treatment? The number of issuers offering | |
| coverage in our individual market? Because all of those have | |
| shown dramatic improvement. | |
| You work with numbers. Are there any statistics you could | |
| show Jack and Jameson about access to coverage and care in New | |
| Hampshire that could possibly support the idea that this law | |
| has somehow failed to improve health care for my constituents? | |
| Mr. Troy. Thank you very much for that question. | |
| I believe and I've written that there are three basic | |
| metrics for judging whether the law is a success. Number one is | |
| coverage. While you say that the law has increased the number | |
| of people covered, that is absolutely true, more people are | |
| covered subsequent to the ACA, but, A, not as many as the law | |
| said it would or CBO projected that it would cover. And we | |
| still do not have the level of universal coverage that I | |
| believe that we should strive for in this country. | |
| Number two is costs. President Obama said that the law | |
| would reduce costs, bring down costs for individuals, bend the | |
| cost curve down. As Dr. Brat was saying earlier, our long-term | |
| costs are still quite high, and we've seen very high increases | |
| in the premiums at the exchanges in recent years. | |
| And then the third, and I think really the key question | |
| that will determine whether the American people believe the law | |
| is a success, is President Obama's promise if you like your | |
| health care you can keep it. And we have seen disruptions in | |
| the individual markets that some people have not had the | |
| coverage they had previously as a result of the ACA. | |
| And then there are questions that the costs we were talking | |
| about throughout this hearing imposed on employers. And if | |
| employers are changing the health care they're providing as a | |
| result of the costs of the ACA, then the answer to the question | |
| of that is no. | |
| Ms. Shea-Porter. Okay. Well, let me stop you there, because | |
| I'm running out of time. But first of all, the fact that the | |
| coverage isn't 100 percent but so much closer hardly seems a | |
| reason for you to complain. It seems to me you would want to | |
| say, well, that's wonderful, we've expanded coverage and let's | |
| do even better and get 100 percent. | |
| And your second point, where the costs have not dropped, | |
| can you point out anything anywhere, starting from your sale of | |
| your home or whether you rent or whether you buy groceries, | |
| anywhere where the costs have dropped? We all know that the | |
| rate of increase has dropped. And you, yourself, introduced | |
| some of those numbers earlier in your testimony. | |
| So I'm not sure what you're saying here. If you're saying | |
| that I didn't get everything I wished for, and that's how it | |
| sounds here, I didn't get everything I wished for yet, what | |
| would be the purpose of going backwards and taking away when | |
| you've acknowledged that the increase of people who are covered | |
| went much higher? What is wrong here? | |
| Chairwoman Foxx. Ms. Shea-Porter, your time has expired. | |
| And we'll ask Mr. Troy to submit his answer for the record. | |
| Mr. Troy. I will. | |
| Ms. Shea-Porter. Thank you. And I yield back. And I would | |
| very much appreciate an answer to that. And thank you. | |
| Chairwoman Foxx. Mr. Allen, you're recognized for five | |
| minutes. | |
| Mr. Allen. Thank you, Madam Chair. | |
| And, again, I appreciate the panel participating today. I, | |
| too, have learned a little bit about what you're dealing with. | |
| Just 2-1/2 years ago I sat in your seat, Mr. Eddy, as a | |
| small business and dealing with not only the economy but the | |
| increase in benefit costs and stagnant wages, which is still a | |
| major problem. I think that probably, too, we should understand | |
| that really health insurance benefits came out of the business | |
| community. In fact, it exploded during World War II when there | |
| were wage controls and the war board allowed the companies to | |
| extend benefits, health benefits and other benefits, to compete | |
| for employers. And, of course, now the government is heavily | |
| involved. | |
| And we know that, again, costs are increasing. In fact, I | |
| have met with lots of groups that are involved in the markets. | |
| And, of course, the health insurers are getting a little bit -- | |
| well, they're getting a bad rap because they are blamed for the | |
| increase. But I know for a fact that most of them submitted | |
| certain reforms to the administration that would drive down | |
| costs and they were totally ignored. | |
| And that brings me to my point here that I want to make | |
| today. And, again, I don't know if this is the first time | |
| you've testified here in Congress, but you obviously see the | |
| very partisan part of what -- in fact, I'm ashamed of it, | |
| really, of what happens here that we can't come together. We | |
| can send somebody to the moon, but we can't come together and | |
| do what's right for the American people, and that's sad. | |
| But we're going to work on it. We're going to continue to | |
| work on it. Your testimony is very important to us, and we | |
| thank you for that. | |
| With that, again, you've listened to us, and we've listened | |
| to you. Dr. Troy, I would like to start with you, and just | |
| we're getting to the end of this. Can you summarize in your | |
| mind where you see us going and what's best for the American | |
| people? | |
| Mr. Troy. Thank you for that question, and I applaud your | |
| call for bipartisanship. Before the ACA, every piece of major | |
| social welfare legislation in this country had passed on a | |
| bipartisan manner, and that's one of the reasons that these | |
| laws were accepted and the American people moved on | |
| subsequently. When you have a law passed in a unipartisan | |
| manner, you have this situation where there's continued | |
| contentiousness about the law seven years later. | |
| I would like to see some kind of bipartisan reform going | |
| forward so that it would be more lasting. I would like to see | |
| it along the lines of what we were talking about earlier in | |
| terms of building on the basic building blocks of American | |
| health care, which includes employer-sponsored care, which | |
| covers 177 million people, but also works to reduce the overall | |
| costs, thereby incentivizing people to purchase it on their own | |
| and not having to do it via mandate. Thank you. | |
| Mr. Allen. Now, what's important about what you said there | |
| is incentivize. I learned that in the business world, that the | |
| best way to get the production from your workforce is to give | |
| them incentives to do these things rather than mandates. | |
| Mr. Eddy, do you have any comments about how to solve this? | |
| Mr. Eddy. I'd be in Congress if I had the ability to solve | |
| it. | |
| Mr. Allen. Well, that's the reason I'm here. I'm not sure | |
| I'm getting anywhere. | |
| Mr. Eddy. As I said, I depend on you all to work together | |
| to do this. | |
| But along with the repeal of the taxes, I'd like to see us | |
| consider reducing some of the reporting requirements. The | |
| mandates generate a lot of reporting requirements, a lot of | |
| compliance issues. | |
| Also, the greater flexible. I'd like to see the proposals | |
| and see options and flexibility improved. | |
| Thank you. | |
| Mr. Allen. Ms. Schlaack, my heart goes out to you for your | |
| loss. | |
| Ms. Schlaack. Thank you. | |
| Mr. Allen. What is your recommendation knowing that we're | |
| $20 trillion in debt. And you've got a child. I have 12 | |
| grandchildren. How do we do this? | |
| Ms. Schlaack. Again, fortunately, I'm on this side and not | |
| yours -- your side of this table, I'll put it. | |
| But, I mean, to have a productive, efficient workforce you | |
| need healthy, happy employees, mentally and physically. And I | |
| know it's dollars and cents, but it comes down to loyal, | |
| healthy employees that you can count on to be at work and to | |
| maintain their job. | |
| Mr. Allen. Let the record show that maybe was the most | |
| important thing that was said here today at this hearing. | |
| Mr. Bollenbacher. | |
| Mr. Bollenbacher. I believe for small businesses we need | |
| options. We need flexibility. We need more than one choice to | |
| provide for our employees. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| Mr. Allen. I yield back. | |
| Chairwoman Foxx. Mr. DeSaulnier, you're recognized for five | |
| minutes. | |
| Mr. DeSaulnier. Thank you, Madam Chair. | |
| Let me start at the beginning, just agreeing to the | |
| comments by my friend from Georgia and by the chair. It would | |
| be wonderful if we could approach this more in a problem- | |
| solving perspective, acknowledging that we have philosophical | |
| differences as to how to accomplish that. And I say that from | |
| the perspective of being a small-business owner for over 35 | |
| years. | |
| Mr. Bollenbacher, I hesitate to use this phrase, but I feel | |
| your pain. I owned restaurants in the bay area for a long time. | |
| And before the ACA, one of the problems I had was the cost, | |
| that it was going up. So for my employees, who I was able to | |
| pay 100 percent of their costs, I found situations before the | |
| ACA where I had a manager come to me in tears because she | |
| couldn't afford the copay. I contributed the copay. | |
| So when we compare this and Dr. Troy, I would like to go | |
| back to the ranking member's comments and how we get to a | |
| perspective of more problem solving in a bipartisan fashion as | |
| you affirmed would be preferable. | |
| But in addition to owning a small business, Ms. Schlaack, I | |
| also have great empathy for your perspective as a survivor, so | |
| far, of incurable blood cancer. I, fortunately, had insurance | |
| that I paid for, that has helped me pay for the very large | |
| costs for my treatment. | |
| I will say, and I'd be curious about your experience, but | |
| perhaps just personally, as to the question about electronic | |
| records. There's somewhat of a joke about those of us who have | |
| gone through treatment, and I tease my oncologist that I see | |
| more of his back as he looks at my CAT scans and my blood. But | |
| he will say, but that's where the information is. | |
| So understanding that there's a process to introducing | |
| technology and understanding that we should have done it faster | |
| when it came to electronic records, there's still a long term | |
| and a short-term benefit for me. I'm an example of it. | |
| And at some point, a wonderful book, ``Rise of the | |
| Robots,'' where they talk about automization. And for | |
| specialists in the medical field, I always ask when I go out to | |
| research facilities: How much is the oncologist in my case | |
| interpreting the results of my examinations and how much is a | |
| computer interpreting it and telling him or her what the | |
| diagnosis should be and what the treatment should be? And what | |
| I always get is over the course of time the computer is doing | |
| more and more of that work. | |
| So to Dr. Troy, to follow on the ranking member's, if we're | |
| going to be rational about this, more than opinion, an opinion, | |
| even research that's based on a biased perspective, from my | |
| experience it would be better to look at where other similar | |
| examples have worked historically and where they work right | |
| now. | |
| So in the industrialized world, one of the reasons I was so | |
| supportive of ACA and supportive of universal health care and | |
| Medicare for all, is that that's my perspective of who we | |
| compete with. And most of those countries that we compete with, | |
| their percentage of costs of health care is smaller than their | |
| GDP than the U.S. and their outcomes have historically been | |
| better -- Mongolia not included in this, by the way. | |
| So the ranking member's question about if your theories are | |
| in play right now and practiced in a similar industrialized | |
| community, where is it? What can we learn from that? And why | |
| can we be so certain that your suggestions will worked when | |
| they are applied to a very complex country? | |
| And I'll just say, lastly, from my perspective having been | |
| very involved in the implementation in California when I was in | |
| the legislature, we had huge struggles. We continue to have | |
| huge struggles. We worked with the California NFIB. We delayed | |
| some of the requests in the mandates on small businesses. As a | |
| small-business person, I wanted to make sure that they didn't | |
| incur undue burden, as my friend from Alabama said. | |
| So in the short time left, maybe you could just elucidate a | |
| little bit on your response from the ranking member. If you're | |
| going to be rational and evidence based and rely on as much | |
| empirical, nonbiased research as possible from either | |
| perspective, it would suggest to me that we go to places that | |
| have implemented health care, dealt with this, and either from | |
| your perspective, being more market based or more driven closer | |
| to universal health care, where has it worked and where hasn't | |
| it? | |
| Mr. Troy. Thank you very much for your question. I | |
| certainly try to avoid the word ``certainty'' when it comes to | |
| public policy, because I think it behooves us to have modesty | |
| in our approaches and not be completely certain about anything | |
| about the previous policies or going forward. | |
| One of the reasons we spend more on health care is that we | |
| are, in many ways, a more generous country. We spend dollars | |
| until the last minute of life in ways, and some of these | |
| countries, some of our Western allies do limit treatments at | |
| the last hours of life in ways that we don't. | |
| The results are certainly mixed. To some degree, we do have | |
| lower life expectancy, but part of that is unfortunately due to | |
| higher road deaths and higher gun deaths. So there are other | |
| factors at work. | |
| I don't have the perfect plan in another country. I have | |
| seen some positive results from Singapore, which does have | |
| people have some kind of catastrophic plan and also combines it | |
| with some kind of has that can be transferred generation to | |
| generation, and that has showed some impact in moderating | |
| healthcare costs. But, again, Singapore is a small homogeneous | |
| country, and obviously, we are a very large heterogeneous one. | |
| So it is, obviously, a difficult public policy conundrum. | |
| Mr. DeSaulnier. Thank you, Dr. Troy. | |
| And thank you for indulging me, Madam Chair. I have some | |
| articles on the Treasury report issued on January 12 that I | |
| would like to submit for the record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Mr. Grothman, you are recognized for five | |
| minutes. | |
| Mr. Grothman. Okay. Mr. Bollenbacher, you are kind of what | |
| I think was going to happen until the ACA stepped in. You are | |
| somebody who, the way it is described, for a relatively small | |
| employee -- what, 11 employees over there? -- you are doing a | |
| great job of managing your costs. | |
| I'd like to know what your costs per employee was or did | |
| you feel you had your costs per employee under control with a | |
| combination of HSAs and giving some money toward your | |
| employees? | |
| Mr. Bollenbacher. Yes, I do. We were seeing increases, you | |
| know, 8 to 12 percent. The health savings accounts the | |
| employees really liked. They were able to save money to put | |
| away for those future unexpected claims. It was manageable for | |
| us to continue that. | |
| Mr. Grothman. And your costs were still going up 8 or 9 | |
| percent? | |
| Mr. Bollenbacher. I'm sorry? | |
| Mr. Grothman. Your costs were still going up 8 or 9 | |
| percent? Or you felt you got your costs under control with a | |
| combination of HSAs and -- | |
| Mr. Bollenbacher. Yes, sir. | |
| Mr. Grothman. Okay. So you were happy to live with the 8 or | |
| 9 percent. | |
| Mr. Bollenbacher. A lot better than 156 percent. | |
| Mr. Grothman. Okay. And is that after the ACA kicked in or | |
| before? | |
| Mr. Bollenbacher. The 8 to 12 percent was before. We were | |
| seeing 156 percent last year. | |
| Mr. Grothman. Right. Okay. | |
| I'll go to Mr. Eddy. There are a variety of problems that | |
| business has. And I don't know whether I caught how you're | |
| handling your healthcare costs. But could you give us in | |
| general the type of plan you were offering your employees | |
| before the ACA kicked in? | |
| Mr. Eddy. It was a common plan with a thousand dollars for | |
| a single and a thousand-dollar deductible for the family plan. | |
| As I said, it was about $13,500 per year for the family plan. | |
| I'm not sure how to describe the plan, but it was full | |
| coverage. We paid the entire amount of the plan for our | |
| employees. | |
| Mr. Grothman. Okay. Do you know, and I guess this is either | |
| for you or Mr. Bollenbacher, have you or other people involved | |
| in NFIB -- are you with NAM? Is that what you're involved with? | |
| Mr. Eddy. Yes, I'm here with NAM. | |
| Mr. Grothman. Right. Stories of employees being conscious | |
| or other employers being conscious of both a desire to hold | |
| employees' hours below 30 hours or employees conscious of the | |
| cliffs in which they're going to lose their subsidies? Have you | |
| heard stories like that? | |
| Mr. Eddy. Well, I've heard the stories, but we don't -- you | |
| can't experience that. That's not something that I think is | |
| pretty common. | |
| Mr. Grothman. Okay. | |
| Mr. Bollenbacher. Yes, sir. I've been dealing with that | |
| almost on a daily basis where my self-employed clients, the | |
| farmers, the pastors at churches, where they're right at that | |
| cutoff, and it's a cliff. And if they go over that cliff, they | |
| may pay $7,000 or $8,000 back, and it hurts them badly. | |
| Mr. Grothman. Bingo. I'm glad you're a CPA. Because that's | |
| what we want. At first I was thinking I was asking you as an | |
| employer. But I'm not asking you as an employer. I'm asking you | |
| as a CPA. So you see that your customers, the people you fill | |
| out tax returns for, are conscious of the fact that they cannot | |
| make more money. Or, in other words, they are maybe | |
| artificially holding down their compensation to make sure that | |
| they don't hit the cliff. | |
| Mr. Bollenbacher. Absolutely. It's a big number for most of | |
| my clients. | |
| Mr. Grothman. Okay. And do you find employees sometimes | |
| conscious of that as well? | |
| Mr. Bollenbacher. Not as much as the self-employed. But, | |
| yes, I have had individuals where they're an employee, they get | |
| a paycheck, maybe they sell some stock, and it puts them over | |
| the cliff, and all of sudden they owe $2,000 or $3,000 back | |
| that they weren't expecting. | |
| Mr. Grothman. Okay. Mr. Troy, you talked about the | |
| different taxes out there. I think you talked about the -- oh, | |
| the Cadillac tax and that sort of thing. And you advocate | |
| repealing them. But what would happen if we repealed them? | |
| Would that make ObamaCare that much more fiscally impossible? | |
| Mr. Troy. I do believe that the Cadillac tax does not bring | |
| in nearly as much revenue as the CBO or the JCT, Joint | |
| Committee on Taxation, suggests it would. I think that the | |
| Affordable Care Act has a lot of spending itself. And so if the | |
| committee goes forward and the Congress goes forward with | |
| repealing it, along with the taxes, then it wouldn't make the | |
| ACA more fiscally responsible, but it would reduce both the | |
| costs and some of these revenues from taxes. | |
| Mr. Grothman. I guess the point I'm trying to make is if we | |
| repeal the taxes, the money is going to have to come from | |
| somewhere else, Right? | |
| Mr. Troy. If you maintain the ACA as it is, but just minus | |
| taxes. But I don't think that's a working plan on the table. | |
| Mr. Grothman. Right. But that is what would happen. I mean, | |
| when people talk about continuing the ACA, if you continued the | |
| ACA and got rid of these harmful taxes, the money would have to | |
| be made up from somewhere else, correct? | |
| Mr. Troy. As with any program, yes. | |
| Mr. Grothman. All right. Okay. Thank you for -- | |
| Chairwoman Foxx. Thank you. The gentleman's time has | |
| expired. | |
| Mr. Courtney, you're recognized for five minutes. | |
| Mr. Courtney. Thank you, Madam Chairman. | |
| So at midnight last night this enrollment period for 2017 | |
| came to a close. This morning I checked in with the folks in | |
| Hartford about how the final numbers came in. The answer that | |
| came back is that we just about pretty much held steady in | |
| terms of last year's enrollment. It was a little bit of a dip, | |
| partly because they didn't use insurance agents to help with | |
| enrollment, which they're going to reverse that for next year. | |
| That was a bad move they made. But nonetheless, I mean, it | |
| pretty much held steady. | |
| And I make that point just because we've heard a lot of | |
| talk today and over the last few weeks about whether or not the | |
| law is in a death spiral. There was an interview recently that | |
| was reported with the American Academy of Actuaries, which I | |
| think we would all stipulate doesn't have a partisan bone in | |
| its body, about whether or not in fact there is a death spiral | |
| going on, and Cori Uccello, the organization's senior health | |
| fellow, answered, ``I don't see any evidence of that happening | |
| right now. The problem with the argument,'' according to | |
| Uccello, ``is that ObamaCare's enrollment is actually holding | |
| steady and not dropping off.'' And we know that from the | |
| national exchange as well. A death spiral is when people really | |
| start running towards the exits, and it just concentrates the | |
| sickest in the pool. And as Uccello points out, the age | |
| distribution for 2017 is pretty much holding steady. | |
| In my district, which we've driven the uninsured rate down | |
| to 3.6 percent, I think it's almost the lowest of any member's | |
| district on this committee, and that's because of a grassroots | |
| effort with libraries, community health centers, hospitals, | |
| insurance agents up until last year, who really just flooded | |
| the zone in terms of trying to get people help and assistance | |
| that took place. | |
| And I would just share this, because as a former employer I | |
| think the description of your problem is exactly the sore spot | |
| that we need to address, Mr. Bollenbacher. But, frankly, it is | |
| not a monolithic story that's out there. | |
| Willimantic Waste, which is a trash hauler in my district, | |
| they have about 200 employees, I got a letter from the HR | |
| director who indicated to me, and I'll just read it quickly, | |
| ``I was skeptical about the claims that the ACA would help | |
| level out the cost of our company-sponsored health plan. But | |
| the numbers have come in, and over the past three years we have | |
| seen a decrease or no increase in our premiums every year. | |
| 2015, minus 2 percent. 2016, minus 1 percent. 2017, zero | |
| percent.'' | |
| And, again, I'm not saying that to diminish your comments. | |
| But the fact is it is really not monolithic that's out there. | |
| And what we ought to be doing is focusing on questions about | |
| whether to have a reinsurance mechanism, which was in the bill | |
| and unfortunately got stripped. It was part of the Republican | |
| Medicare Part D plan as a way of leveling off premiums through | |
| that. Very successful. We use it for flood insurance. | |
| Again, and this is coming from Connecticut where we have a | |
| lot of insurance companies, that's the biggest weakness that | |
| they identify in terms of why the 2017 spike increased. But | |
| Standard and Poor's even then said it appears to be just a one- | |
| year phenomenon. | |
| So, Madam Chairwoman, I would like to submit this story | |
| from the Academy of Actuaries, as well as Willimantic Waste | |
| paper for the record. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Courtney. Thank you. | |
| And just to go back to -- I mean, one bipartisan ray of | |
| hope here is on the Cadillac tax. As many know, we teamed up | |
| last year on a bipartisan basis, pushed it back to 2020. A | |
| bunch of us did it back in 2010 and pushed it out to 2018. But | |
| nonetheless, I mean, there is, again, a strong feeling that | |
| this is a really totally inefficient way of trying to | |
| accomplish some type of goal, which is really just to shift | |
| costs to businesses and employees. | |
| And I would just say, Dr. Troy, I mean, you point out that | |
| the CBO study, it really is not a traditional tax analysis. | |
| It's assuming an income windfall that will happen as employers | |
| don't incur as much costs in terms of paying higher premiums. I | |
| just wonder if you could comment in terms of really -- there | |
| really is no study that has ever really demonstrated that sort | |
| of backboard basket that they're describing, is it? | |
| Mr. Troy. Thank you so much for that question, Mr. | |
| Courtney, and I would like to applaud you for your bipartisan | |
| efforts to eliminate the Cadillac tax. Thank you for that. | |
| We have done a number of studies at the American Health | |
| Policy Institute about the deleterious impact of the tax, and | |
| we looked very carefully at this question of how much revenue | |
| it would supposedly raise. In doing so, we found that not only | |
| would it not bring in as much revenue as the CBO and the JCT | |
| projected, but also that to the extent that it is imposed and | |
| employers are trying to reduce costs in reaction to it, that | |
| the reduced costs are not necessarily going to employees as the | |
| CBO study projects or assumes. We talked to employers, and 71 | |
| percent said that it would not lead to increased wages. So I | |
| just think it's on unfounded assumptions. | |
| Thank you for your leadership. | |
| Mr. Courtney. Thank you. H.R. 173, and I think we could do | |
| it on the consent calendar if it was brought up tomorrow. Thank | |
| you. | |
| I yield back, Madam Chairman. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Thompson, you're recognized for five minutes. | |
| Mr. Thompson. Madam Chair, thank you for this hearing. | |
| As someone who arrived in Washington to serve in January of | |
| 2009 when this original -- and I won't say it was even a | |
| debate. I came here with 28 years of healthcare experience, | |
| nonprofit community healthcare experience. In my time off, I | |
| volunteered as an EMT, showing up at the homes of my neighbors | |
| at all times of the day and night -- or mostly the night when I | |
| was home -- to respond to healthcare needs. | |
| And there was no debate in 2009. In fact, those of us who | |
| came here, and there was a lot, my good friend from Tennessee, | |
| Dr. Roe, came here as a physician, there was a lot of us with | |
| healthcare experience. A lot of friends across the aisle who | |
| had great experience. None of us were welcomed to the table. | |
| And we wound up with this very partisan legislation that was | |
| shoved down the throats of the American people. | |
| So I appreciate this hearing. I think this is a part of a | |
| dialogue that we have had for some time with the American | |
| people, but also among ourselves. I respect that there are | |
| differences. But the fact that we are proceeding in a way with | |
| transparency to do better. | |
| I happen to believe that our Nation's healthcare policy | |
| should be one that promotes the healing and the health of all | |
| Americans without hurting millions. And that's not what we have | |
| today. | |
| And I also believe this debate should be conducted based on | |
| facts, not fear. So I really caution all my colleagues, and | |
| especially those across the aisle that I've heard just in the | |
| past few days, it's been about the fear, driving the fear. That | |
| doesn't help this process. | |
| One of the things I heard was that we have no plans. And so | |
| I want to -- I'm going to be offering this, request unanimous | |
| consent for the record. But this is a submission for the record | |
| I have. This is a compilation of replacement plans or | |
| improvement plans or whatever you want to call it, plans for | |
| health care. | |
| Just some of the titles on this first page: Patient Freedom | |
| Act, Obamacare Replacement Act, A Better Way: Our Vision for a | |
| Confident America. It's more of a vision. Patient Choice, | |
| Affordability, Responsibility and Empowerment Act. H.R. 5284, | |
| the World's Greatest Healthcare Plan Act. That was creative, I | |
| guess, in title. Empowering Patients First Act, which by the | |
| way, was a version of something that I had cosponsored back in | |
| 2009, before the Affordable Care Act came out of the back | |
| offices here in Washington, and that's been introduced in both | |
| the House and the Senate. And the American Health Care Reform | |
| Act, which actually the prime author of that is my good friend | |
| from Tennessee, Dr. Roe, that he referenced. That's page one of | |
| six. | |
| So I request unanimous consent to present this, a list of | |
| detailed plans on how to reform the health sector for Members | |
| of Congress. Some of these are from Presidential candidates, | |
| some scholars and think tank community, and other top | |
| conservative thought leaders. | |
| Chairwoman Foxx. Without objection. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Mr. Thompson. Thank you, Madam Chair. I really do | |
| appreciate that. | |
| I have some questions. I have some concerns in terms of | |
| access. My observation is just because you have coverage | |
| doesn't mean you have access to health care. And I think that | |
| was the flaw of the Affordable Care Act. It focused on health | |
| insurance, not health. And I just look at premiums and -- I'm | |
| sorry, deductibles. I mean, we can look at it all differently. | |
| But the deductibles, which we really haven't talked about | |
| today. | |
| It was reported to me about a constituent I have that was | |
| recently diagnosed with cancer, that because his deductibles | |
| are so high today, dramatically higher than what they were, | |
| grew faster than what they should have, he's made a conscious | |
| decision not to pursue care or treatment because when he looks | |
| at that annual deduction, at his age, he would really like to | |
| be able to pass something along to his children and | |
| grandchildren. That's an awful situation that we have put that | |
| individual in with these deductibles. And, again, you can have | |
| a card in your purse or your wallet that says you have | |
| coverage, but do you really have health? | |
| So I like this debate we're having, and I look forward to | |
| it. And I've managed to use all of my time, but Dr. Troy, you | |
| mentioned innovation and flexibility in employer-sponsored | |
| benefits can help reduce the cost of health care for employees, | |
| retirees, and dependents. Can you give me just one example of | |
| that innovation? | |
| Mr. Troy. Sure. So just one example, right now I have been | |
| working with a group of employers on something called the | |
| Health Transformation Alliance. This is a collection of over 30 | |
| employers who are working together, sharing data, looking at | |
| how to proceed based on actual facts and data -- we talked | |
| about that here in the panel -- in a way to improve the health | |
| of employees. And then they're going to go forward with a | |
| pharmaceutical initiative, a medical network initiative. And | |
| based on the data that they come together with, in order to get | |
| better results and better costs. | |
| Mr. Thompson. Thank you, Chairwoman. | |
| Chairwoman Foxx. The gentleman's time has expired. | |
| And I recognize now, Mr. Mitchell, who's been very patient. | |
| Mr. Mitchell. Thank you, Madam Chair. | |
| Actually the witnesses have been very patient, and we | |
| should commend you for your endurance if nothing else. Thank | |
| you for being here. | |
| I am from Michigan. We have 15 counties that have one | |
| insurance carrier right now. Another 25 have only two. Eighty | |
| percent of the plans in Michigan are much narrower now in terms | |
| of providers than they were in 2007. | |
| Dr. Troy, is there any mechanism within the ACA or any hope | |
| within ACA that situation will improve in Michigan, which is, | |
| in fact, a national phenomenon as well? Do you see anything | |
| coming out of ACA that could possibly fix that? | |
| Mr. Troy. I don't see anything coming out of ACA that would | |
| fix that. I mean, ACA is kind of a static thing right now, and | |
| the conversation right now is not about putting something, a | |
| new mechanism into ACA that would lead to those improvements | |
| that you're seeking. | |
| Mr. Mitchell. I'm not sure we could identify a new | |
| mechanism which would cure that. But, yes, I don't see anything | |
| there either. | |
| Before I joined this esteemed body, I was the CEO of a | |
| midsize company, not a small company, a little larger than | |
| yours. The impact, however, was similar in that year one, | |
| health insurance costs are going to go above 50 percent in year | |
| one, not quite 157 percent. | |
| Question for the two employers in the group. How did you | |
| manage the cost increase within your price and your operating | |
| structure? How did you manage that cost? I doubt you were able | |
| to pass that on down the chain. How did you manage that? | |
| Mr. Eddy. Again, the timing couldn't have been worse. As | |
| was stated, I've been with the company 21 years now, and I | |
| started as the new CEO, president and CEO, on January 1, 2009. | |
| I'd heard a lot about the potential for the Affordable Care Act | |
| coming. We saw our premiums, our deductibles, you know, the | |
| mandates, the costs. Again, I'm not sure how you manage without | |
| -- with uncertainty. I mean, you know, one of my sayings to my | |
| management group is, as we lose control, increase your options. | |
| Okay? And ACA took all of that away. So that really took one of | |
| my management philosophies away. | |
| But when you're looking at annual increases in the mandates | |
| and the health care, the health insurance industry fees, you | |
| know, 3 percent per year of our premium costs increasing, 2.5 | |
| percent per year from the mandates changes. And these have | |
| continued. It's not a one-time increase. These are annual | |
| increases. | |
| Mr. Mitchell. Were you able to just pass those costs along, | |
| Mr. Eddy, to your consumers? | |
| Mr. Eddy. We have not had the ability to increase our | |
| prices for the last five or six years because we haven't seen | |
| any GDP growth, so our company hasn't grown but maybe 2.5 to 3 | |
| percent on average. That's in revenues. Our profitability is | |
| down significantly. With the increase in the mandates and | |
| insurance and taxes and fees is one thing, but the others are | |
| the increases in premiums. It's taken away, as I said, I would | |
| like to have grown significantly more than we have. We have had | |
| the ability to increase our international markets, but we | |
| haven't been able to do that as fast as we would like to. | |
| Mr. Mitchell. Another question, Mr. Bollenbacher or Mr. | |
| Eddy. We talked a little bit briefly, a colleague talked about | |
| deductibles. We haven't talked about much of that here. I know | |
| I've seen the deductibles go wild for myself and the people | |
| close to me. What's been your experience in terms of deductible | |
| costs, the increases of the last several years? | |
| Mr. Bollenbacher. The deductibles I'm seeing have increased | |
| from 5 to 8, up to 12,000 recently. | |
| Mr. Mitchell. In your opinion, I mean, you're close to your | |
| employees, does that adversely impact their willingness or | |
| ability to actually access care? I agree with my compatriots | |
| that health insurance doesn't mean you can access health care | |
| these days. What impact does it have on your employees? | |
| Mr. Bollenbacher. It definitely does. It's a big hurt for | |
| them. | |
| Mr. Mitchell. Mr. Eddy, any feedback on that? | |
| Mr. Eddy. Well, we're a little different. Again, we have a | |
| fully employer-funded HRA, the Health Reimbursement Accounts. | |
| So it's a little different for our employees. We still cover | |
| 100 percent of the deductible. | |
| Mr. Mitchell. That's admirable and not commonplace, I don't | |
| think. | |
| Mr. Eddy. Again, it's admirable, and it creates a lot of | |
| challenges, and we know it's not sustainable. | |
| Mr. Mitchell. Thank you. | |
| And I'll yield back, Madam Chair. Thank you very much. | |
| Chairwoman Foxx. Thank you very much. | |
| Mr. Lewis, you're recognized for five minutes. | |
| Mr. Lewis. Thank you, Madam Chair. I'm so glad we're | |
| talking about employer-sponsored care today and the effects the | |
| ACA has. I do want to talk a little bit about the individual | |
| market that has been hit the hardest. If, in fact, you look at | |
| Minnesota, it's been hit the hardest. The State of Minnesota | |
| had to just do an emergency $310 million subsidized premium | |
| plan. We'll call it that. So when we look at what repeal and | |
| replace might look like or repeal and repair or fix might look | |
| like, we know what the status quo looks like. | |
| Before I came to Congress, I was a sole proprietor like | |
| many of your member businesses. I went through three insurers | |
| in 5 years. My premiums tripled to the point where we were | |
| paying $2,200 a month for a $10,000 deductible. A lot of folks | |
| here have said health insurance is not health care access, and | |
| that's certainly true. Has that been the experience of some of | |
| your members? | |
| Mr. Bollenbacher. Yes, it has. And I would add that before | |
| the ACA most of my clients had insurance, if not all of them | |
| had insurance, and many of them have been dropped from their | |
| insurance and been forced to go in the marketplace. | |
| Mr. Lewis. Let's talk a little bit about the employer- | |
| sponsored market, because it hasn't just been the individual | |
| market. The 10 essential wellness benefits, the minimum amount | |
| of coverage that came down from the ACA so that you as business | |
| men and women had to buy this particular plan that the ACA | |
| dictated. Repealing some of those, Mr. Eddy, would that solve | |
| some of the problem, repealing some of those mandates? | |
| Mr. Eddy. I believe that it would, Congressman, yes. Again, | |
| that is one of the options that we're looking to improve upon, | |
| having that as maybe another option that we can choose from. | |
| Mr. Lewis. You know, this committee and this Congress is | |
| dedicated to making certain no one slips through the cracks. | |
| We're going to have high-risk pools or some mechanism for | |
| people with preexisting conditions. But I want to get your take | |
| on portability and how that applies to people who have that | |
| very real problem of preexisting condition and can't get | |
| coverage. | |
| When people get their insurance at work and they work 30 | |
| years or 25 years, and then they get a little older like me and | |
| a little sicker, and then they lose their job, they're thrown | |
| into that individual market, and now they're trying to buy | |
| insurance for the first time and telling the insurance | |
| industry, well, I'm going to have a lot of claims here, but I'm | |
| just starting my premiums. If we could unlock some of that tax | |
| advantage from the corporate side to the individual side, would | |
| it increase portability and solve some of that problem? | |
| Dr. Troy, go ahead. | |
| Mr. Troy. Yes, as I was saying in my testimony earlier, | |
| that some of the Republican plans call for something along the | |
| lines of association health plans, which would allow | |
| individuals to band together and purchase health care in a tax- | |
| preferred way in mechanisms other than just through their | |
| employer. That would include your civic organization, your | |
| religious organization, perhaps your union. And I think that | |
| would help unlock the job lock you're talking about and also | |
| provide possible additional portability. | |
| Mr. Lewis. Mr. Eddy. | |
| Mr. Eddy. Obviously I think it's a good thing to be able to | |
| have portability supportive of the preexisting, you know, not | |
| having preexisting conditions. So, yeah, I think that would | |
| help tremendously. | |
| Mr. Lewis. And of course the best way for people to be able | |
| to afford health care is to have a good, robust, productive | |
| job. And to the degree that these sorts of regulations, | |
| including the ACA, have hindered the economy and hindered your | |
| ability and your members' ability to employ people, that has a | |
| real impact on health care access too, does it not? | |
| Thank you all. I yield back my time. | |
| Chairwoman Foxx. The gentleman yields back. | |
| We were expecting Mr. Smucker, I believe. And there he is. | |
| Mr. Smucker, you're recognized for five minutes. | |
| Mr. Smucker. Thank you, Madam Chair. | |
| I appreciate the testimonies from all of you. I can tell | |
| you businesses in my community, I've been out throughout the | |
| last year during a campaign talking to individuals and | |
| businesses, and then just recently during one of our weeks back | |
| in the district met with a few businesses, the Affordable Care | |
| Act and the impact on health insurance in their organizations | |
| and for their employees is top of the list in terms of their | |
| concerns about issues that will impact their ability to | |
| continue to do business as they have in the past. | |
| They're very worried -- I'm thinking of one husband and | |
| wife who own a company, about 15 employees, who see their | |
| employees as a family, and then being able to help provide for | |
| their medical needs is an important part of sort of how they | |
| feel about their employees and the makeup of the company. | |
| And so I'm glad that this is a top priority for us here, | |
| and I look forward to building a better healthcare system, | |
| working with everyone here to build a system that will work for | |
| everyone. | |
| Dr. Troy, as you know, ERISA is the backbone of the | |
| employer-sponsored healthcare system that we're talking about. | |
| Since 1974, it has allowed multistate employers to offer | |
| uniform benefits to their employees across the Nation, reducing | |
| costs and allowing for innovation. ERISA's preemption of State | |
| laws is a key component in the law and one that you said needs | |
| to be strengthened. As we consider reforms to the healthcare | |
| system, how would you recommend the committee strengthen the | |
| ERISA preemption? | |
| Mr. Troy. Thank you very much for that. A good question. | |
| First of all, ERISA significantly reduces administrative | |
| costs by allowing multistate employers who self-insure to offer | |
| a uniform set of health benefits that are generally not subject | |
| to the 50 different State laws. So in terms of strengthening it | |
| going forward, we have been concerned about the increase in | |
| State fees and taxes on self-insured health employer benefits | |
| in recent years. Some States have imposed fees on healthcare | |
| claims of self-insured employers, including Alaska, Kentucky, | |
| Maryland, Massachusetts, Rhode Island, Vermont. | |
| So we're concerned about those kinds of taxes going | |
| forward, and we want to make sure that as we talk in the ACA | |
| repeal and reform effort about ways to use State flexibility, | |
| which I applaud, that we make sure that we still maintain the | |
| ability for employers to have better ERISA preemption. | |
| Mr. Smucker. Thank you very much. I appreciate that. | |
| And, again, I'm very much looking forward to working with | |
| my colleagues and this committee, with the chair, and with | |
| other Members of the assembly to rebuild an effective | |
| healthcare system where everyone can have access to the health | |
| care that they need at a price that they can afford and with | |
| the doctor that they choose. | |
| Thank you. | |
| Chairwoman Foxx. Do you yield back? | |
| Mr. Smucker. I do. | |
| Chairwoman Foxx. Thank you very much. | |
| Well, even though I think I have the very best questions, I | |
| saved mine to the end so that if people want to be going other | |
| places, they can do that since I know I'm going to be here | |
| until the end. So I want to say again thank you to all of our | |
| witnesses for being here. | |
| Mr. Bollenbacher, yours is a story we've heard over and | |
| over again. The healthcare coverage you had as a small business | |
| before ACA was working for your company and what your employees | |
| wanted. However, the ACA forced you out of that coverage -- | |
| several times, in fact, as you've described -- and added costs | |
| and burdens of lesser coverage. | |
| Can you tell us what your employees liked about the | |
| previous coverage that you're not able to offer them today | |
| because of this failed law? | |
| Mr. Bollenbacher. The plan we had before met their needs. | |
| It was affordable. They really liked the health savings account | |
| feature. Most of my employees are fairly young, fairly healthy, | |
| and they were able to put money away. As an employer, we put in | |
| up to $3,000 per year to their accounts. Even when one lady had | |
| a baby, she had money in her has to help pay for that, so she | |
| had no money out of pocket. | |
| Chairwoman Foxx. So it sounds as though what they liked is | |
| having control, more control over their healthcare dollars and | |
| their healthcare costs than is available to anyone under the | |
| ACA? | |
| Mr. Bollenbacher. Yes, ma'am. That's correct. | |
| Chairwoman Foxx. That's wonderful. Thank you. | |
| Mr. Eddy, you mentioned in your testimony that one of the | |
| most challenging aspects of the ACA is the effect that it's had | |
| on your employee-employer relationship. Most employers fiercely | |
| protect that relationship and do not want to do anything to | |
| harm it. Can you talk about how the ACA forced this tension | |
| between you and your employees? Did your employees understand | |
| that it was the ACA and the Federal Government placing new | |
| requirements and costs on the company that was forcing you to | |
| make difficult decisions? | |
| Mr. Eddy. Of course I tried to educate our employees, but | |
| more specifically our United Steel Workers Union, that their | |
| best interests as always are our best interests and that we try | |
| to take care of them. | |
| The tension obviously arose when we were trying to | |
| negotiate an increase -- or actually not an increase, but for | |
| the first time ever that they would have to copay a little bit. | |
| And with that, they know because I told them that it was ACA, | |
| but they look to us to take care of them. So from their | |
| standpoint, it was a company responsibility to take care of | |
| that. | |
| We have had a situation where for years since I've been the | |
| CEO, I see every employee on the floor on their birthday, as | |
| well as many other days during the year, and they were | |
| impressed with that. But after the negotiations on our last | |
| contract and having to implement, and even with the staff rep | |
| agreeing to it, a little bit of copay, again, $35 per pay, | |
| there were several folks that felt that we let them down. And | |
| explaining to them that the cost increases were not -- we | |
| couldn't sustain as a company, obviously the union agreed to | |
| it. But we also had to increase their pay rate over the life of | |
| the contract 4 years to help offset those costs. So it cost us, | |
| but, again, we were trying to incorporate more accountability | |
| for them. | |
| Chairwoman Foxx. Thank you. | |
| Dr. Troy, there were some comments made about other | |
| societies in the world these days who provide, quote, ``free | |
| health care'' to their citizens. And you mentioned Singapore | |
| being a rather homogenous society, much smaller than we are. | |
| We're often compared to Switzerland. I don't know the exact | |
| population of Switzerland, 7 million people or something; | |
| Canada, 35 million people. We have about 300 million people. | |
| Is there any other similar culture to ours that provides | |
| free health care, quote, ``free health care'' to its citizens. | |
| Mr. Troy. Look, we are a unique Nation. I am a proud | |
| believer in American exceptionalism, and I know that we are | |
| different. We have also tried to be more reliant on private | |
| sector health care and market. We are not completely there | |
| because it's a mixed system. So I think it is hard to compare | |
| our approach to different countries and say we should adopt, | |
| let's say, the British model or the Canada model. Even though | |
| we are close friends with those nations, we have different | |
| systems, and I don't think their systems would work if imported | |
| here. | |
| Chairwoman Foxx. Thank you very much. | |
| I would like to thank again our witnesses for taking the | |
| time to testify before the committee today. Other members have | |
| said to you thank you and that being here does make a | |
| difference, and I would like to say that to you also. | |
| I would now like to recognize Ranking Member Scott for his | |
| closing remarks. | |
| Mr. Scott. Thank you, Madam Chair, and thank you for having | |
| this hearing. It gives us an opportunity to flesh out many of | |
| the problems. This one witness said we all want less cost and | |
| more flexibility. We have a plan, the Affordable Care Act, | |
| where the costs have gone up, but the studies have shown the | |
| costs have gone up at about one half the rate they've been | |
| going up before. People with preexisting conditions can get | |
| insurance at the standard rate. There are no lifetime or annual | |
| caps on coverage. Women aren't paying more than men. And | |
| instead of millions of people losing their insurance every | |
| year, 20 million more people have insurance than they did. | |
| There are improvements we know we can make. We could insert | |
| a public option so in those States where the competition isn't | |
| what it should be, you would at least have an opportunity to | |
| buy the equivalent of a Medicare card. Or you can go to a | |
| single-payer plan, which would get the health care out of the | |
| employer costs. There are a lot of things we can do. | |
| But we still have complaints about the present situation, | |
| but it's hard to debate when there is no credible alternative. | |
| One thing that is conspicuously omitted is, well, what could we | |
| do better? We have heard about the problems with small | |
| businesses. We didn't hear about the horror stories of small | |
| businesses if one of your employees happened to have diabetes | |
| or you had extremely high costs, you were unlikely to get | |
| affordable health care under the old days. Now you can get it | |
| at the standard rate. | |
| But what is the alternative? We haven't heard that. We have | |
| seen some initiatives taken by this administration that have | |
| been counterproductive. We had an executive order right after | |
| the inauguration which essentially suggested a repeal of the | |
| Affordable Care Act without details, causing great concern and | |
| confusion in the insurance market. We have the executive order | |
| on immigration which, as many of the hospital associations have | |
| indicated, disrupts their ability to get students and | |
| professionals from other countries. We had the ads pulled at | |
| the last minute, making it more likely that the healthy, | |
| younger enrollees might not get the word and might not enroll. | |
| That just increases the costs for everybody. | |
| So we have a lot of work to do. But until we have some | |
| credible alternatives, it's hard to have a coherent debate. I | |
| would just hope that we would agree that we're not going to do | |
| any repealing until we have a replace ready to go, and if that | |
| is the discussion, we have something to talk about. But if the | |
| idea is to repeal and inject total chaos in the insurance | |
| market, making it likely that nobody can buy insurance, we're | |
| not going to be very cooperative in that effort. | |
| So, Madam Chair, thank you for having the hearing and | |
| allowing these issues to be voiced. | |
| Chairwoman Foxx. Thank you, Mr. Scott. | |
| I also am going to enter into the record some facts about | |
| our situation before the Affordable Care Act and during the | |
| Affordable Care Act, key facts on ObamaCare and health care. | |
| There have been so many numbers tossed about here. Your | |
| members, you've just said 20 million more people have gotten | |
| health insurance, but your Members have thrown around the | |
| number 30 million are going to lose their insurance. So it's a | |
| little difficult to keep track of all of these numbers that are | |
| being thrown around. But I do intend to put a fact sheet into | |
| the record today. | |
| [The information follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| Chairwoman Foxx. Forty-eight million Americans did not have | |
| health care before the Affordable Care Act. I happen to have | |
| the numbers on that, and I'll be entering that into the record. | |
| I think I just heard you say again that there are no credible | |
| alternatives, and yet Mr. Thompson just sat here five minutes | |
| ago and presented six pages of bills that have been presented | |
| as credible alternatives. So I think we have to constantly do | |
| fact-checking around here to give the real facts about what's | |
| happening. | |
| Ms. Schlaack, I want to say, along with my colleagues, that | |
| we're sorry for your loss. But I was very intrigued in your | |
| comments that all of the examples you used about the great | |
| coverage that you got came under your employer-sponsored health | |
| care as a result of your husband's terrible illness and not as | |
| a result of the ACA, and yet it was implied that the coverage | |
| that you got came under the ACA. So we all want to share our | |
| concern and support for you in your loss. But I noted that in | |
| your written testimony, as well as in your spoken testimony. | |
| So I do think that the hearing today has been helpful and I | |
| think has brought out a lot of good information about the | |
| negative impact of the ACA, particularly on working people in | |
| this country. That's where I think the real problem has been. | |
| And I would like to thank you all for coming again and tell you | |
| that we look forward to working with you on an alternative to | |
| this. | |
| And with that I -- | |
| Mr. Scott. Madam Chair, may I make a brief comment, just | |
| very brief, because I think Ms. Schlaack's comment was she had | |
| employer-based coverage as well, but her husband died. | |
| Ms. Foxx. Right. | |
| Mr. Scott. She lost the employer, but had the marketplace | |
| as the safety net. | |
| Chairwoman Foxx. Thank you very much for that | |
| clarification, Mr. Scott. | |
| There being no further business, the committee stands | |
| adjourned. | |
| [Additional submissions by Mrs. Foxx follow:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| [Additional submission by Mr. Scott follows:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| [Questions submitted for the record and their responses | |
| follow:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| [Responses to questions submitted for the record follow:] | |
| [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] | |
| [Whereupon, at 1:01 p.m., the committee was adjourned.] | |
| <all> | |
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