The Cost of Inaction on Health Care Reform

The Cost of Inaction on Health Care Reform

Mr. Merkley

Mr. President, we stand at a critical juncture today as we grapple with how to fix our broken health care system.  Rapidly escalating health care costs are compounding the current economic crisis in America.  Families and businesses across the country are struggling to afford increased premiums, co-payments and deductibles.  Premium increases are taking an increasing portion of workers’ wages and more firms are under pressure to reduce or possibly eliminate health care coverage for their workers. 

Helping middle class families and small businesses afford health care coverage is a critical component of improving the nation’s economy.  Mr. President, families and business owners in Oregon have told me at length how concerned they are about the rising cost of health care.  Those families who have health care are concerned about losing it and they’re concerned about the rising cost of the premiums and the co-pays.

And those citizens without health care and nearly 47 million Americans are unable to afford the cost of health care, those citizens are worried about getting sick, or they’re sick and they’re worried about how to pay for the drugs and treatments to get well.  And under this system, our small businesses who are working hard to provide health care coverage for their employees are worried that they won’t be able to continue, that they’ll have to raise the share of the cost that the workers carry. Or maybe they’ll have to eliminate the health care plan altogether. 

Mr. President, I want to share with you the experience of one of my constituents, Jeanette Hall of Milwaukie, Oregon.  She was employed but she could not afford health insurance.  Jeanette had a mole on her arm and it was a mole that she thought should be looked at and her friends and families urged her to have it looked at.  Finally she went to the emergency room to have it examined.  The diagnosis was melanoma, but Jeanette could not afford to have the surgery to address it. 

Now, sometimes one gets a fortunate turn in life and Jeanette got such an example.  She was interviewed by a local news station that was doing a story about the plight of the uninsured.  Jeanette says she is only alive today because of that moment when a news station covered her story because after that story aired, she received a call from a local hospital that offered to help.  They basically said that in exchange for being the subject of an observational surgery for medical students, the hospital would cover the cost of the surgery.  And so Jeanette is now cancer free and she feels very blessed about that.  What is more, she now has a job where she has health insurance and that certainly puts a brighter horizon in place for her. 

But while she’s pleased about her personal health and her personal health insurance, she’s worried about health insurance for families and friends and health coverage system for all Americans in this broken health care system.  Her brother is very ill.  Her brother does not have health insurance.  Her brother needs an operation to save his life but he’s not getting that operation.  And she anticipates that his life expectancy is very short now as a result so she sees it very personally, very directly.  And just as she hopes for health care for her and her family and for American citizens, so do citizens across this nation.  Citizens like Jeanette are not looking for a government handout.  They don’t expect something for free.  But what they do want is access, choice, quality health coverage, affordable health coverage for their families and their workers.

We need to offer citizens like Jeanette a lifeline in these hard economic times.  As a member of the Senate Health, Education, Labor and Pensions Committee, I am very proud of the bill that we passed out two weeks ago which puts us a significant stride closer to providing health care, affordable quality health care for every American.  It’s a plan that will lower costs, provide consumers with more choices and increase competition.  That act, the Affordable Health Choices Act, is a landmark bill.  It gives every American a full range of health insurance options, including a community health plan.  It ensures that those who like their current health care coverage can keep it, and it guarantees that no American will be denied coverage because of pre-existing conditions.

That act makes sound investments in disease prevention, in health promotion and it strengthens the health care workforce.  The Affordable Health Choices Act gives small businesses better choices for high-value health insurance by creating a new health insurance market place, or gateway as it’s called, which will help lower costs and increase competition.  In fact, let me explain this a little bit more. 

Right now, in America, if you are an individual trying to get health care, you have to pay an extraordinary premium because you don’t bring any market share clout to the negotiating table.  And, right now in America if you are a small business, you don’t get a good deal because you don’t bring any market clout to the negotiation.  So, this health care bill at its heart, addresses this problem.  It creates an exchange where you would go and purchase health care not as an individual, but as a group of hundreds of thousands of fellow citizens.  And, that health care plan would bring the combined negotiating clout of those hundreds of thousands or even millions of individuals so that you get a much better deal as an individual and you get a much better deal as a small business.

And I know that every individual and small business in America who has gone through this process of trying to get a fair, decent health care plan knows exactly what I’m talking about.  And, that’s the heart of this reform.  But even as we make historic progress on guaranteeing affordable, quality health care for all, there are powerful forces underway to halt this effort. 

There are those that favor the status quo, and they’re working on their talking points.  They’re rallying their special interests.  They’re doing polls to see what phrase will most scare Americans from changing.  They want to defeat this historic march towards quality, affordable health care for every single citizen.  But, Madam, Mr. President, one thing is clear, we cannot afford to fail.  Maintaining the status quo is not an option.  The last time we attempted to tackle the problem, in 1992, health care spending was $849 billion.  Today health care spending in America is $2.2 trillion and growing by over 10% a year.  So march it forward , next year it will be over $2.4 trillion, the year after that, $2.7 trillion, the year after that, $3 trillion and so forth.  We’ll be spending nearly $40 trillion under the status quo over the next ten years. 

Premiums in the early 1990s were 7% of a family income.  Today premiums eat up 17% of a family’s budget.  In 1996, employers paid about $3,700 toward a family plan.  Now that is well over $10,000 and growing and workers are picking up an increasing share of the cost.  Today under the status quo, 60% of personal bankruptcies are due to health care costs.  More than half, more than half of personal bankruptcies are due to health care.  And what’s more, more than half of those personal bankruptcies due to health care are with folks who have health care insurance, but their health care insurance simply wasn’t adequate to cover the extraordinary costs of a medical emergency.  75% indeed of those individuals who are going through bankruptcy due to health care costs had health insurance. 

Mr. President, if we look to the future, the consequences of inaction are even more dire.  But, despite all of that, every day we hear from special interests, we hear from their allies, who are standing up using their poll-tested phrases like “government takeover” in order to scare the American people into rejecting health reform. 

So here are citizens who know firsthand, firsthand the challenge and the stress of health care, but they’re being manipulated – an effort to manipulate them by powerful special interests that want to scare them, to turn them against reform and change.  Now, the opponents of reform, they have a health strategy.  And their strategy is the status quo.  And why do they like the status quo so much?  Because the special interests are making so much money with the current health care system.  Huge profits for insurance companies, huge profits for other health care players.

But here’s the problem, soaring profits for health care companies equates to out of control unaffordable premiums for America’s working families.  Now, let’s examine the status quo program put forward by the opponents of reform.  Under the opponents’ status quo strategy, the premiums that are paid by a family would go from about $13,000 a year, now just eight years in the future, $24,000, nearly double in a short period of time.  If you want out of control premiums, then support the opponents’ status quo efforts. 

Second, under the opponents’ status quo plan, the cost of health care for a small business would more than double and the cumulative costs are extraordinary.  We see the costs here starting and then in billions of dollars in 2009, $156 billion, the cost imposed on small businesses soaring to $2.4 trillion by 2018, the cumulative costs.  So, over a ten year period, small businesses carrying a multi-trillion dollar burden under the status quo. 

Third, under the opponents’ status quo plan, the number of uninsured Americans increases, and why is that?  It’s very simple.  Families can’t afford these premiums.  Small businesses can’t afford these premiums.  Even large businesses may not be able to afford these premiums.  Even large businesses may not be able to afford this more than 10% per year increase in premiums.  Indeed, under one study, the uninsured Americans, under the status quo opponents’ plan would reach 66 million Americans over the next ten years, up from about 47 right now, it’s a huge increase.

Fourth, under the opponents’ status quo plan, our community hospitals would see uncompensated care go through the roof.  Why is that? Because we’ll have more uninsured.  They have to go to the emergency room to get their care and so the hospitals end up carrying that burden.  What does that do?  That results in a cost shift from those who don’t have insurance and go to the emergency room, those costs gets shifted on to those with insurance, continues the death spiral in soaring insurance premiums that we have right now in America.

What is more, under the opponents’ status quo approach, we get the same failure to invest in prevention and disease management.  You know, insurance companies don’t really have an incentive to invest in disease management because that might make you healthier 10 years from now or 20 years from now.  We get the same investment in a fee system, in a cost-plus system that is driving up the cost of health care.  Let me make this very clear.  If you have any form of expense in which the compensation is cost-plus, the person providing those services is going to provide as many services as possible.  If you’re building a fighter and you say, we’ll pay your costs plus 10% - those costs – they’re going to make sure that fighter plane is as expensive as possible.  And the same is true in health care.  Yet, that model of compensation is the dominant model in the health care system today.

We need to invest in an integrated, integrated approach, like the Mayo Clinic does, where the doctors are not motivated by profits but by providing health care to their patients.  They have no incentive to run you through that M.R.I. machine four or five times.  Their only incentive is to help you get well.  That’s a very different approach, an approach we need to expand on here in America.  An approach that says, we need an integrated health care system, not a cost plus fee system. 

So, when opponents of reform try to scare you and say we don’t need to change anything, just remember how scary their plan is.  And I know that you understand what I’m talking about because you see it every day.  The opponents are saying, it’s okay if insurance companies routinely deny necessary medical care and cancel policies in order to increase their profits.  The opponents are saying they prefer an America where parents will lie awake at night worried if they can afford health care their children need because they don’t have health insurance for their children.   

The opponents want an America where a worker is just one pink slip away from losing their job and their health care.  That’s a double calamity that strikes millions of families in America every year.  The opponents are arguing for an America where a would-be entrepreneur who has worked hard and may want to open a business may not do so because he or she cannot health insurance in a volatile, expensive small business market.  The opponents want an America where small businesses who do offer insurance are faced with double-digit, budget-straining premiums that strengthen the economic viability of that small business.  I want to see our small businesses thrive.  Our small businesses are incredibly creative, far more patents per capita than large businesses.  Our small businesses expand and grow and absorb more workers.  We want them to thrive and a major challenge they have today in thriving is our broken health care system. 

Mr. President, I do not accept that vision for America, the vision put forward by the opponents of health care reform.  We need to create a simple health care exchange where individuals and small businesses can go and be part of a large pool so they can negotiate a fair deal.  Today we don’t have that fair deal.  Tomorrow we will. 

We need a health care system that invests in prevention and disease management.  We need a health care system that works to expand the health care workforce because we have a big challenge.  Many of our health care workers in America, our doctors and our nurses, they’re retiring.  They’re baby boomers.  They’re reaching retirement age.  So we’re going to have increased demand for health care services as our baby boomers get older and we’re going to have fewer providers. 

The bill we put forward works to address that discrepancy.  Because otherwise that by itself, greater demand and lower supply will drive the cost of health care up.  And we need to create a system that eliminates an insurance that doesn’t cover pre- conditions.  What kind of health care do you have if you have a bad back, but your bad back is not covered?  What kind of health care system do we have if you have Melanoma, like Jeanette does or did before her operation, and you can’t get it covered because it’s a preexisting condition?

This bill changes that.  I believe we need to create a health care system that expands citizens’ choices instead of constraining them, as our current system does, where you have many markets in America that only have a single dominant provider.  And we need to create a community health care plan to hold the feet of insurance companies to the fire.  Competition – competition in the marketplace, a 100% apple pie American concept is needed in health care to help control costs. 

Madam President, Americans across the country are counting on us to work together to find a solution, to help ease the burden of health care costs on family and business budgets and create more affordable health care options.  I urge my colleagues to set their partisanship aside, set aside the goal of trying to torpedo America’s future because you want to torpedo the Presidency of Barack Obama. 

Think about the quality of health care for our working families and what we in this chamber could do to make that quality of life far better.  The costs of inaction, the costs of our broken status quo system are just too great to fall to petty, bitter, partisan bickering.  Let’s come together.  Let’s fight for a brighter future for America’s families. 

Mr. President, we stand at a critical juncture today as we grapple with how to fix our broken health care system.  Rapidly escalating health care costs are compounding the current economic crisis in America.  Families and businesses across the country are struggling to afford increased premiums, co-payments and deductibles.  Premium increases are taking an increasing portion of workers’ wages and more firms are under pressure to reduce or possibly eliminate health care coverage for their workers. 

Helping middle class families and small businesses afford health care coverage is a critical component of improving the nation’s economy.  Mr. President, families and business owners in Oregon have told me at length how concerned they are about the rising cost of health care.  Those families who have health care are concerned about losing it and they’re concerned about the rising cost of the premiums and the co-pays.

And those citizens without health care and nearly 47 million Americans are unable to afford the cost of health care, those citizens are worried about getting sick, or they’re sick and they’re worried about how to pay for the drugs and treatments to get well.  And under this system, our small businesses who are working hard to provide health care coverage for their employees are worried that they won’t be able to continue, that they’ll have to raise the share of the cost that the workers carry. Or maybe they’ll have to eliminate the health care plan altogether. 

Mr. President, I want to share with you the experience of one of my constituents, Jeanette Hall of Milwaukie, Oregon.  She was employed but she could not afford health insurance.  Jeanette had a mole on her arm and it was a mole that she thought should be looked at and her friends and families urged her to have it looked at.  Finally she went to the emergency room to have it examined.  The diagnosis was melanoma, but Jeanette could not afford to have the surgery to address it. 

Now, sometimes one gets a fortunate turn in life and Jeanette got such an example.  She was interviewed by a local news station that was doing a story about the plight of the uninsured.  Jeanette says she is only alive today because of that moment when a news station covered her story because after that story aired, she received a call from a local hospital that offered to help.  They basically said that in exchange for being the subject of an observational surgery for medical students, the hospital would cover the cost of the surgery.  And so Jeanette is now cancer free and she feels very blessed about that.  What is more, she now has a job where she has health insurance and that certainly puts a brighter horizon in place for her. 

But while she’s pleased about her personal health and her personal health insurance, she’s worried about health insurance for families and friends and health coverage system for all Americans in this broken health care system.  Her brother is very ill.  Her brother does not have health insurance.  Her brother needs an operation to save his life but he’s not getting that operation.  And she anticipates that his life expectancy is very short now as a result so she sees it very personally, very directly.  And just as she hopes for health care for her and her family and for American citizens, so do citizens across this nation.  Citizens like Jeanette are not looking for a government handout.  They don’t expect something for free.  But what they do want is access, choice, quality health coverage, affordable health coverage for their families and their workers.

We need to offer citizens like Jeanette a lifeline in these hard economic times.  As a member of the Senate Health ,Education, Labor and Pensions Committee, I am very proud of the bill that we passed out two weeks ago which puts us a significant stride closer to providing health care, affordable quality health care for every American.  It’s a plan that will lower costs, provide consumers with more choices and increase competition.  That act, the Affordable Health Choices Act, is a landmark bill.  It gives every American a full range of health insurance options, including a community health plan.  It ensures that those who like their current health care coverage can keep it, and it guarantees that no American will be denied coverage because of pre-existing conditions.

That act makes sound investments in disease prevention, in health promotion and it strengthens the health care workforce.  The Affordable Health Choices Act gives small businesses better choices for high-value health insurance by creating a new health insurance market place, or gateway as it’s called, which will help lower costs and increase competition.  In fact, let me explain this a little bit more. 

Right now, in America, if you are an individual trying to get health care, you have to pay an extraordinary premium because you don’t bring any market share clout to the negotiating table.  And, right now in America if you are a small business, you don’t get a good deal because you don’t bring any market clout to the negotiation.  So, this health care bill at its heart, addresses this problem.  It creates an exchange where you would go and purchase health care not as an individual, but as a group of hundreds of thousands of fellow citizens.  And, that health care plan would bring the combined negotiating clout of those hundreds of thousands or even millions of individuals so that you get a much better deal as an individual and you get a much better deal as a small business.

And I know that every individual and small business in America who has gone through this process of trying to get a fair, decent health care plan knows exactly what I’m talking about.  And, that’s the heart of this reform.  But even as we make historic progress on guaranteeing affordable, quality health care for all, there are powerful forces underway to halt this effort. 

There are those that favor the status quo, and they’re working on their talking points.  They’re rallying their special interests.  They’re doing polls to see what phrase will most scare Americans from changing.  They want to defeat this historic march towards quality, affordable health care for every single citizen.  But, Madam, Mr. President, one thing is clear, we cannot afford to fail.  Maintaining the status quo is not an option.  The last time we attempted to tackle the problem, in 1992, health care spending was $849 billion.  Today health care spending in America is $2.2 trillion and growing by over 10% a year.  So march it forward , next year it will be over $2.4 trillion, the year after that, $2.7 trillion, the year after that, $3 trillion and so forth.  We’ll be spending nearly $40 trillion under the status quo over the next ten years. 

Premiums in the early 1990s were 7% of a family income.  Today premiums eat up 17% of a family’s budget.  In 1996, employers paid about $3,700 toward a family plan.  Now that is well over $10,000 and growing and workers are picking up an increasing share of the cost.  Today under the status quo, 60% of personal bankruptcies are due to health care costs.  More than half, more than half of personal bankruptcies are due to health care.  And what’s more, more than half of those personal bankruptcies due to health care are with folks who have health care insurance, but their health care insurance simply wasn’t adequate to cover the extraordinary costs of a medical emergency.  75% indeed of those individuals who are going through bankruptcy due to health care costs had health insurance. 

Mr. President, if we look to the future, the consequences of inaction are even more dire.  But, despite all of that, every day we hear from special interests, we hear from their allies, who are standing up using their poll-tested phrases like “government takeover” in order to scare the American people into rejecting health reform. 

So here are citizens who know firsthand, firsthand the challenge and the stress of health care, but they’re being manipulated – an effort to manipulate them by powerful special interests that want to scare them, to turn them against reform and change.  Now, the opponents of reform, they have a health strategy.  And their strategy is the status quo.  And why do they like the status quo so much?  Because the special interests are making so much money with the current health care system.  Huge profits for insurance companies, huge profits for other health care players.

But here’s the problem, soaring profits for health care companies equates to out of control unaffordable premiums for America’s working families.  Now, let’s examine the status quo program put forward by the opponents of reform.  Under the opponents’ status quo strategy, the premiums that are paid by a family would go from about $13,000 a year, now just eight years in the future, $24,000, nearly double in a short period of time.  If you want out of control premiums, then support the opponents’ status quo efforts. 

Second, under the opponents’ status quo plan, the cost of health care for a small business would more than double and the cumulative costs are extraordinary.  We see the costs here starting and then in billions of dollars in 2009, $156 billion, the cost imposed on small businesses soaring to $2.4 trillion by 2018, the cumulative costs.  So, over a ten year period, small businesses carrying a multi-trillion dollar burden under the status quo. 

Third, under the opponents’ status quo plan, the number of uninsured Americans increases, and why is that?  It’s very simple.  Families can’t afford these premiums.  Small businesses can’t afford these premiums.  Even large businesses may not be able to afford these premiums.  Even large businesses may not be able to afford this more than 10% per year increase in premiums.  Indeed, under one study, the uninsured Americans, under the status quo opponents’ plan would reach 66 million Americans over the next ten years, up from about 47 right now, it’s a huge increase.

Fourth, under the opponents’ status quo plan, our community hospitals would see uncompensated care go through the roof.  Why is that? Because we’ll have more uninsured.  They have to go to the emergency room to get their care and so the hospitals end up carrying that burden.  What does that do?  That results in a cost shift from those who don’t have insurance and go to the emergency room, those costs gets shifted on to those with insurance, continues the death spiral in soaring insurance premiums that we have right now in America.

What is more, under the opponents’ status quo approach, we get the same failure to invest in prevention and disease management.  You know, insurance companies don’t really have an incentive to invest in disease management because that might make you healthier 10 years from now or 20 years from now.  We get the same investment in a fee system, in a cost-plus system that is driving up the cost of health care.  Let me make this very clear.  If you have any form of expense in which the compensation is cost-plus, the person providing those services is going to provide as many services as possible.  If you’re building a fighter and you say, we’ll pay your costs plus 10% - those costs – they’re going to make sure that fighter plane is as expensive as possible.  And the same is true in health care.  Yet, that model of compensation is the dominant model in the health care system today.

We need to invest in an integrated, integrated approach, like the Mayo Clinic does, where the doctors are not motivated by profits but by providing health care to their patients.  They have no incentive to run you through that M.R.I. machine four or five times.  Their only incentive is to help you get well.  That’s a very different approach, an approach we need to expand on here in America.  An approach that says, we need an integrated health care system, not a cost plus fee system. 

So, when opponents of reform try to scare you and say we don’t need to change anything, just remember how scary their plan is.  And I know that you understand what I’m talking about because you see it every day.  The opponents are saying, it’s okay if insurance companies routinely deny necessary medical care and cancel policies in order to increase their profits.  The opponents are saying they prefer an America where parents will lie awake at night worried if they can afford health care their children need because they don’t have health insurance for their children.   

The opponents want an America where a worker is just one pink slip away from losing their job and their health care.  That’s a double calamity that strikes millions of families in America every year.  The opponents are arguing for an America where a would-be entrepreneur who has worked hard and may want to open a business may not do so because he or she cannot health insurance in a volatile, expensive small business market.  The opponents want an America where small businesses who do offer insurance are faced with double-digit, budget-straining premiums that strengthen the economic viability of that small business.  I want to see our small businesses thrive.  Our small businesses are incredibly creative, far more patents per capita than large businesses.  Our small businesses expand and grow and absorb more workers.  We want them to thrive and a major challenge they have today in thriving is our broken health care system. 

Mr. President, I do not accept that vision for America, the vision put forward by the opponents of health care reform.  We need to create a simple health care exchange where individuals and small businesses can go and be part of a large pool so they can negotiate a fair deal.  Today we don’t have that fair deal.  Tomorrow we will. 

We need a health care system that invests in prevention and disease management.  We need a health care system that works to expand the health care workforce because we have a big challenge.  Many of our health care workers in America, our doctors and our nurses, they’re retiring.  They’re baby boomers.  They’re reaching retirement age.  So we’re going to have increased demand for health care services as our baby boomers get older and we’re going to have fewer providers. 

The bill we put forward works to address that discrepancy.  Because otherwise that by itself, greater demand and lower supply will drive the cost of health care up.  And we need to create a system that eliminates an insurance that doesn’t cover pre- conditions.  What kind of health care do you have if you have a bad back, but your bad back is not covered?  What kind of health care system do we have if you have Melanoma, like Jeanette does or did before her operation, and you can’t get it covered because it’s a preexisting condition?

This bill changes that.  I believe we need to create a health care system that expands citizens’ choices instead of constraining them, as our current system does, where you have many markets in America that only have a single dominant provider.  And we need to create a community health care plan to hold the feet of insurance companies to the fire.  Competition – competition in the marketplace, a 100% apple pie American concept is needed in health care to help control costs. 

Madam President, Americans across the country are counting on us to work together to find a solution, to help ease the burden of health care costs on family and business budgets and create more affordable health care options.  I urge my colleagues to set their partisanship aside, set aside the goal of trying to torpedo America’s future because you want to torpedo the Presidency of Barack Obama. 

Think about the quality of health care for our working families and what we in this chamber could do to make that quality of life far better.  The costs of inaction, the costs of our broken status quo system are just too great to fall to petty, bitter, partisan bickering.  Let’s come together.  Let’s fight for a brighter future for America’s families.