As you may know, I voted against the Affordable Health Care for America Act (H.R. 3962) when it passed the House of Representatives on November 7th. This bill is simply bad policy that does little to assist the middle class. And while the flaws within the bill are numerous, some of the specific provisions have been glazed over by the press. Because the facts often best speak for themselves, I want you to know that:
H.R. 3962 is Bad for the Middle Class:
* H.R. 3962 requires individuals to purchase health insurance, but fails to define what qualifies as health insurance. That will be decided by a new "Health Choices Commissioner" who will be appointed by President Obama. Individuals who don't purchase "acceptable health care coverage" will be forced to pay a tax of 2.5% of modified adjusted gross income.
* According to the non-partisan Congressional Budget Office (CBO), H.R. 3962 will increase premiums. A new $2 billion tax on insurance policies, $20 billion tax on devices, and various new insurance regulations will be drive up the cost for patients of all ages in the form of higher premiums.
* H.R. 3962 also eliminates Health Savings Accounts (HSAs). Under the bill, the minimum cost sharing actuarial equivalence for health plans is 70%. However HSAs cost sharing structures are anywhere from 55%-65%, thus essentially outlawing HSAs as a "qualified plan".
* H.R. 3962 also eliminates the Private Individual Market. Despite the claim that current health care plans are "grandfathered" in, if an individual's current insurance company makes any additions to its plan (such as including more people or adding a newly found cure for cancer), it would trigger the mandate to have a government approved plan. After five years, all plans (including employer sponsored plans) must then meet a new federal definition for a "qualified" health care plan.
* The final bill omits language to protect individuals from government rationing. H.R. 3961 no longer contains a provision that states that the Health Benefits Advisory Committee - created to establish minimum benefit standards - should "ensure that essential benefits coverage does not lead to rationing of health care."
H.R. 3962 is Bad for Senior Citizens:
* H.R. 3962 cuts Medicare Advantage. If senior citizens like the Medicare Advantage plan they have now, they certainly won't be able to keep it -- the cuts to Medicare Advantage mean that the 22% of Medicare beneficiaries (11 million American senior citizens) enrolled in a Medicare Advantage plan will see their benefits cut. According to the CBO, the House bill "could lead many plans to limit the benefits they offer, raise their premiums, or withdraw from the program". The CMS Actuary Report finds that "Medicare Advantage enrollment would decrease by 64% (from a projected level of 13.2 million to 4.7 million under the proposal.)"
* H.R. 3962 increases Medicare Part D premiums. Despite the claim that the bill will close the Medicare Part D "donut hole", the CBO has stated that changes will raise Medicare Part B premiums by $25 billion and Part D premiums by 20 percent.
H.R. 3962 is Bad for Small Business:
* H.R. 3962 may force businesses to hire fewer workers, cut workers' hours, reduce the growth of wages or other benefits, and layoff current employees or pass along the costs to consumers. Companies with a payroll of $500,000 or more must offer health coverage to employees (regardless of whether they can afford to or not), or pay a penalty of at least 2% of payroll. If an employer with a payroll greater than $750,000 does not pay 72.5% of a single employee's health premium (65 percent of a family employee's), then the employer must pay an excise tax equal to 8% of average wages.
* The bill also contains $135 billion in new taxes for failure to comply with the "pay-or-play" employer mandate. It denies a tax deduction for employer health plans coordinating with Medicare Part D, delays for 9 years the implementation of the Worldwide Allocation of Interest, a corporate tax relief provision from the American Jobs Creation Act, overrides U.S. treaties for certain payments such that it increases taxes on U.S. employers with overseas operations and codifies of the "Economic Substance Doctrine", which allows the IRS to disallow a tax deduction or other tax relief simply because the IRS deems that the motive of the taxpayer was not primarily business-related (as opposed to tax-related).
* The bill provides a further penalty of $100 per employee per day for non-compliance with the "pay-or-play" mandate--subject only to a limit of $500,000 per year for unintentional failures on the part of the employer. Allows the new Commissioner to conduct audits of health benefits plans (paid for by the benefit plans).
I want you to know that I will continue to do all that I can to make sure that H.R. 3962 does NOT become law. As I have stated before, I do support commonsense reforms to our healthcare system but I refuse to vote for legislation that will ration care, lead to a government takeover of health care, allow government bureaucrats to stand between patients and their doctors and jeopardize the coverage of millions of people.