Statement On Comprehensive Health Insurance Reform

H.R. 4872, the Reconciliation Act of 2010

This is the dawn of a new day of hope for tens of millions of Americans who have fallen through the cracks – or who worry with good reason that they may fall through the cracks -- of our broken health insurance system. 

The signing into law of comprehensive health insurance reform by President Barack Obama is a defining moment in our history, ranking with the creation of Social Security and Medicare.

Reforming the health insurance system has been talked about for decades.  This has been an arduous process, but it has proven that change is possible, even with the pitched opposition of entrenched and powerful special interests.  America again has risen to meet one of its foremost challenges and to renew its promises.

America has some of the best health care in the world, if you can afford it.  Millions of families in Vermont and across the nation worry that they are just one paycheck away from medical and financial disaster.  This is a new dawn for them.

Wherever I travel in Vermont I am often stopped in the grocery store, at church, on the street or at the gas station to listen to personal, wrenching stories, like the woman from Winhall who needs to spend $500 a month on prescriptions but who would be uninsured if not for her husband’s job.  She is working two jobs just to make ends meet and to afford their health care costs.  Or the small business owner who works six and seven days a week but still can’t afford the blood tests her doctor recommended.  If she becomes sick she will lose her business and her home.  Or the man from central Vermont who told me of his sister-in-law who lost parts of both her feet because she did not have health insurance. When she needed medical attention, she waited, hoping things would get better.  By the time her family was able to step in, she had to be rushed to the emergency room for amputations.  This is a new dawn for them.

I grew up in my family’s small business in Montpelier.  I know that business owners want to attract and keep good workers and many want to be able to offer health insurance options.  Spiraling insurance costs are rapidly taking that option away.  Some of the most immediate and far-reaching reforms in this new law are the tax credits that will help small businesses continue to offer insurance to their employees.  This is a new dawn for small business owners and for those who are self-employed.

This week the Senate is already working on improvements to this legislation.  These include closing the Medicare ‘doughnut hole’ in the next several years, making coverage more affordable, and creating a more equitable distribution of Medicaid reimbursements to states like Vermont that have acted early on reform.

Health insurance reform has prevailed through the grueling gauntlet of obstructionism erected by defenders of the status quo.  One remaining gauntlet remains in the Senate, where partisan opposition has prompted an effort to derail these further improvements to this law – improvements that many of these opponents say they support.  Opponents of reform already have wasted much of the public’s time over the last year by provoking arguments over their distortions about what health reform really means.  Last summer the American people endured myths about “death panels” and other falsehoods about what reform would mean for families across the country. 

It is no wonder that while Americans vastly support the individual components of these bills they remain skeptical when asked about the hazy concept of “comprehensive reform.”

The building blocks of health reform are more popular than the sum of the plan’s parts.  Polls show public unease about the hazy concept of “comprehensive health reform” but solid support for what’s in the plan.

This paradox recently was put to a real life test, with a vote on a reform I proposed to repeal health insurance companies’ antiquated exemption from the antitrust laws.  These are the pro-competition rules that apply to virtually all other businesses, to help promote vibrant markets and consumer choice.  Competition and choice help lower costs, expand access and improve quality.

I launched this effort last fall, built a hearing record to examine its merits and worked to build bipartisan support.  House leaders late last year added it to their plan.  And last month it became the first stand-alone part of the health reform package to pass on its own, in a strong bipartisan vote of 406 to 19.  To me this is the latest proof that, appearances aside, there is much common ground in the health reform plan – more than partisan opponents or the insurance industry would have the public believe.

Insurance companies of course will continue to lobby like crazy to keep from being covered by the antitrust laws.  No surprise there.  The rules they have operated under have been stacked in their favor.

Some have argued that doing nothing is the “safe,” option, but it is anything but safe.  Health policy experts and economists across the political spectrum agree that the rapidly increases in health costs will hurt everyone – costing us more, driving up Medicare’s budget, cutting back coverage, and preventing businesses from being able to afford offering insurance to their workers.  Without reform, in the next decade half of all non-elderly adults at some point will find themselves without coverage.  If we do nothing, the same insurance coverage a family had in 2008 will nearly double to $24,291 by 2016, soaking up a whopping 45 percent of median family incomes.

We have seen all too well what would have happened if we had not acted to pass comprehensive reform.  Just last month, insurance companies planned a series of premium hikes as large as 39 percent in one state.  Last year the five largest for-profit insurance companies booked $12.2 billion in profits, and they raised the average family premium three times faster than wages.  One company alone, WellPoint, is hiking rates by double digits in 11 states, while their profits are up 91 percent.  Meanwhile, even with soaring profits, insurers continue to drop sick people from their rolls, spend less on care, and avoid competition.

Vermont, a State that has led the way on many health insurance reforms is not immune from the rising costs of health insurance.  On Town Meeting Day a few weeks ago in Vermont, town officials in Hartford reported that the community’s health insurance rates last year jumped by a third, forcing them to lay off town workers. 

Despite dire warnings of “government takeovers” and other charged rhetoric, this bill in reality is a solidly American solution to our health insurance crisis.  The new law largely builds upon our current system and reforms parts that are not working well, while maintaining much of what Americans like. 

Now that this bill is law, annual caps on coverage are eliminated.  Insurance companies are now barred from dropping people from their plans, even if they have paid their premiums, simply because they have gotten sick.  Denying children health insurance coverage because of pre-existing conditions is now illegal, and parents are now allowed to keep their children on their health insurance policy until a child’s 26th birthday.  And now that comprehensive reform has become law, a down payment has been made toward completely closing the so-called “doughnut hole” for seniors on Medicare, by providing a $250 rebate for those in the Medicare Part D coverage gap.

In addition to the immediate improvements to our health insurance system, over time this bill will make further improvements and also will eventually insure 95 percent of our population, while making a substantial investment in our economic vitality in the years ahead.  In addition to ending the discriminatory insurance company practices of denying coverage because of pre-existing conditions and canceling coverage when beneficiaries get sick, the new law will lower costs for small businesses and will help prevent medical bankruptcies by removing any arbitrary limit on annual or lifetime “caps” on medical expenses.  This bill also is the largest deficit reduction measure many in Congress have ever cast votes on.  The Congressional Budget Office estimates that comprehensive reform will reduce the federal deficit by $143 billion through 2019, and by more than $1 trillion in the decades to come.

These comprehensive reforms also will test ways to reduce health care costs while improving quality.  The bill contains pilot initiatives for efforts like Vermont’s Blueprint for Health, under which patient care is coordinated to reduce unnecessary hospital visits and to keep patients healthy.  Other programs will test various ways to pay doctors and hospitals that could be more efficient than the current fee-for-service structure.  A greater emphasis on prevention -- long championed by the late Senator Edward Kennedy and Senator Tom Harkin on the Health, Education, Labor and Pensions Committee -- will reduce preventable deaths and hospitalizations.  

I am also proud that the bill explicitly prohibits discrimination on the basis of race, color, national origin, sex, disability or age in any health program or activity receiving federal funds.  These protections were necessary to remedy the shameful history of invidious discrimination and the stark disparities in outcomes in our healthcare system based on traditionally protected factors such as race and gender.  The non-discrimination provision makes clear that the enforcement mechanisms from other statutes prohibiting discrimination in federally funded programs, such as Title VI of the Civil Rights Act of 1964 and Title IX of the Education Amendments of 1972, apply with equal force to federally funded health programs and activities.  I worked closely with Majority Leader Reid to include these protections in the Senate bill to ensure that all Americans are able to reap the benefits of health insurance reform equally, without discrimination.

The bill the President signed into law and that I supported is not without its problems.  But it succeeds in adhering to the core principles I sought at the beginning of this debate.  It gives Americans affordable access to health care coverage, it reduces costs for families, businesses and government, and it protects consumers’ ability to choose doctors, hospitals and insurance plans. Many other substantial social policy reforms such as Medicare and Social Security were improved through actual experience after they were first enacted.  For instance Social Security as passed did not contain disability insurance — a significant oversight, which was rightly remedied later.  While this plan might not make every reform we think necessary, we have the ability to modify and improve it in the months and years ahead.  

In fact, the Reconciliation Bill now before the Senate includes a series of improvements to comprehensive reform that I strongly support.  The bill will fully close the prescription “doughnut hole” that forces thousands of seniors across the country and in Vermont to pay out-of-pocket for necessary prescriptions until their expenditures reach a catastrophic level.  Immediately, Medicare beneficiaries who fall within the hole will receive a $250 rebate in 2010.  By 2020 the “doughnut hole” will be closed completely, and beneficiaries will receive 75 percent discounts on brand-name and generic drugs.  The Reconciliation package eases the cost-sharing for individuals purchasing insurance on the exchange, and it offers more generous tax credits for those with the lowest incomes who still have trouble affording health insurance.  The largest employers will be fined more heavily for the failure to offer insurance to their workers. 

The Reconciliation package furthers the strong anti-fraud provisions Senator Kaufman and I worked to incorporate into the Senate-passed bill.  Among other steps, it increases our investment in fighting health care fraud by providing $250 million over the next decade to investigate and prosecute the people who drain our health care system of billions of dollars each year, driving up costs and risking patient lives.  It also streamlines procedures to review Medicare payments before they are made to ensure that we identify and stop fraud as quickly as possible.  These anti-fraud initiatives build on the impressive steps the Obama Administration has already taken to improve health care fraud prevention and enforcement, and on the real progress represented by the anti-fraud provisions adopted by the Finance and HELP Committees.  I was pleased to be able to contribute to all of these efforts. 

Like many sweeping reforms of our history, this legislation will likely be improved in the coming years as these reforms are implemented.  For example, I will continue to push for a public option and for repeal of the health insurance industry’s anti-trust exemption, in order to promote competition, choice and lower prices.

The people of Vermont have given me the honor of representing them in the Senate for 35 years.  I have joined in many debates that were contentious, yet ultimately productive.  As we leaf through the pages of history, we can read of the many times when Congress has shown its remarkable ability to rise up to reflect the conscience of the Nation. 

As many here have noted, our dear friend Senator Ted Kennedy would have been remarkably proud of the President and this Congress for passing reform that was unachievable for so many before us.  Ted reminded all of us in a letter written to President Obama what the stakes are in this debate.  He wrote, “What we face is above all a moral issue; that at stake are not just the details of policy, but fundamental principles of social justice and the character of our country.” 

When the dust settles and emotions are calmed, I believe this effort will be viewed as a credit to this good and great Nation and its people. This President and this Congress have responded to a pressing national issue and have proven once again our ability rise above partisanship and act with the purpose of advancing a pressing national interest.

I am proud of this latest proof that change is possible in this great country when a pressing national interest is at stake.  And I am proud to have had the honor that Vermonters have given me to represent and advance their interests in this effort.

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