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Public Statements

Health Care

Floor Speech

Location: Washington, DC


Mr. HATCH. Madam President, I rise today, along with my colleague from Tennessee, to discuss two pieces of legislation we introduced to restore liberty and to protect jobs. The first bill, S. 40, the American Liberty Restoration Act, would repeal ObamaCare's unconstitutional individual mandate. The second bill, S. 399, the American Job Protection Act, would repeal Obama's job-killing employer mandate. These two provisions were included in the President's health law for the purpose of raising revenues--an attempt to pay for all of the new spending under ObamaCare--and to garner support from the private insurance industry.

I would ask Senator Alexander, has the so-called Affordable Care Act lived up to the promises President Obama made during the health care reform debate to maintain personal freedom, reduce health care costs, and decrease unemployment?

Mr. ALEXANDER. Madam President, I thank the Senator from Utah for his leadership on these two pieces of legislation, and the answer is: No, the new health care law hasn't lived up to the promises.

Let me cite an example. The President promised in the debates leading up to the health care act that if someone wanted to keep the insurance they had, they would be able to do that. I am afraid it is not working out that way, and here is why.

What happens is that businesses around the country are finding out when the health care law goes into effect fully they will either have to supply a certain type of health care insurance, which in many cases--as many as half the cases according to some studies--is a better policy and more expensive policy than they are now offering their employees, or they will have to pay a $2,000 tax, to the Internal Revenue Service. That means the employee, if the business decides to do that, will go into the exchange and lose the employer insurance they had.

Based on my experience in talking to many businesses, there is going to be a massive rush, by small businesses in particular and by many large businesses, to stop offering employer-sponsored health insurance to their employees and, instead, pay the $2,000 penalty, or tax, which means all of those employees--most of them lower income employees or middle-income employees--will lose the insurance they had and be in the exchanges looking for a new insurance policy.

Mr. HATCH. Madam President, I agree with my colleague and thank him for his comments.

I would also argue the individual mandate is unconstitutional. When the law was being debated here in Congress, and later when it was being litigated in the courts, proponents repeatedly argued the individual mandate was constitutional under the commerce clause. Well, that simply isn't the case. While the Supreme Court ultimately upheld the law on other grounds, the majority of Justices agreed the individual mandate was not a proper exercise of Congress's power to regulate interstate commerce.

I have to say I agree with that conclusion. Indeed, I say it is simply common sense the power to regulate interstate commerce does not include the power to compel individuals to engage in commerce, which is precisely what the individual mandate does.

Despite the Court's overall decision, the American people see the individual mandate for what it is--an affront to individual liberty. Indeed, the vast majority of the American people know it violates our constitutional principles and that it cedes too much power to the Federal Government. That is why, in poll after poll, the majority of Americans support repealing the mandate.

I would also ask the distinguished Senator from Tennessee, Mr. Alexander, to share his views about the individual mandate, if he has any additional views.

Mr. ALEXANDER. I agree with the Senator from Utah. I think he stated clearly what the constitutionality is and he has been a most forceful advocate of that.

As I think about the legislation we are talking about, I am thinking also about the employer mandate and the requirement that, as I mentioned earlier, employers pay $2,000 if they do not offer insurance or a $3,000 penalty if they offer the wrong kinds of insurance.

I would say to the Senator from Utah that we are making it more difficult to lower the unemployment rate in this country, which has stayed too high, with 12 million people unemployed, when we keep loading up employers with costs that make it more expensive to hire an employee. If we make it more expensive to hire an employee, we don't give the employer an incentive to hire more people. In fact, we discourage the employer from hiring more people.

I wonder if I might ask the Senator, in thinking about the employer mandate, if he agrees that employers across the country are considering reducing their number of employees, having more part-time employees in order to deal with this new cost of the employer mandate which is part of the health care law.

Mr. HATCH. I would say to the distinguished Senator from Tennessee that is certainly the case. There are various reports and analyses of this that indicate a significant number of employers would rather pay the penalty and not have to deal with the particular requirements the Affordable Care Act seems to require.

On top of the unconstitutional individual mandate, this job-killing employer mandate is a real problem. Under the President's health law, employers with more than 50 full-time employees are required to offer coverage, as the distinguished Senator said, that meets a minimum value or pay a penalty of $2,000 per employee. The distinguished Senator from Tennessee explained this well. If the employer does offer coverage but that coverage does not meet the minimum value, employers must pay $3,000 per employee. I have never heard such a ridiculous approach toward business. Not surprisingly, the penalty under this provision costs less than offering coverage. According to the Kaiser Family Foundation annual survey of employer-sponsored health insurance, average annual premiums are $5,615 for single coverage and $15,745 for family coverage. Once again, the penalty for an employer who doesn't offer health insurance is only $2,000 per employee. That being the case, the law does not incentivize employers to offer the employees health insurance. Instead, it does exactly the opposite. Rather than footing the full cost of providing health coverage, many employers are going to take the less expensive route and simply pay the penalty, as the distinguished Senator from Tennessee has mentioned. Even worse, many employers that currently do offer their employees health benefits under current law will likely drop the benefits and, instead, choose to pay the penalty.

Studies are already showing this is the case, and this will be the case. An employer survey done by McKinsey and Company found that ``30 percent of respondents who said their companies offered employer-sponsored health insurance said they would definitely or probably drop coverage in the years following 2014.''

So despite the President's claim to the contrary, ObamaCare has not preserved the employer-sponsored health insurance market. It dismantles it. As a result, the President's promise that those who like their health insurance would be able to keep it falls by the wayside.

I believe Senator Alexander is also concerned about the fact the President's law defines small employers as those with less than 50 employees. In addition, I thought this law was supposed to create jobs. The President claimed it would. So again, I would turn to my colleague from Tennessee and ask: Does he think that has been the case? Does he think the President has been right about that?

Mr. ALEXANDER. No, I would say to my friend from Utah, I am afraid the President was mistaken about that. And we have talked about some specifics, but let me give some very specific examples of why I believe that is true.

Some time ago I met with a large group of chief executive officers of restaurant companies in America. The service and hospitality industries are the largest employers in America. Restaurant companies are the largest employer of low-income, young, usually minority people. These are Americans who are often getting their first job or they are Americans of any age who are trying to work their way up the economic ladder, starting with a lower paying job, a job that doesn't require as many skills, and hoping that instead of having a minimum wage they will end up someday with a maximum wage. But in order to get that maximum wage they have to get on the ladder. They have to start somewhere.

Here is what I was told. The chief executive officer of Ruby Tuesday, Incorporated, which has about 800 restaurants, said to me--and he didn't mind being quoted--that the cost to his company of implementing the new health care law would equal his entire profit for the company last year and that he wouldn't build anymore new restaurants in the United States as a result of that. He said he would look to expand outside.

Another, even larger restaurant company, said because of their analysis of the law, instead of operating their stores with 90 employees, they would try to offer it through stores with 70 employees. So that means fewer employees and it means fewer employees receiving employer health care.

Then almost every other restaurant said they were looking for ways to have more part-time employees so they didn't have to incur the expense of the new health care law.

So at least with that industry and those low-income, usually minority, often young employees, the jobs are going away because of the health care law. And with those jobs goes whatever employer health care insurance was being offered by those companies.

Mr. HATCH. I have heard the same complaints by the restaurant industry, and by a lot of small businesses that are looking to not hire more than 50 people, and also are looking to cut their employees' work hours down to below 30 hours a week in order to avoid these massive costs that would incur to them.

The employer mandate is a drag on our economy, forcing too many of our Nation's job creators to stop hiring and growing their businesses in order to comply with the onerous provision in the President's health law. Instead of letting the Federal Government dictate how employers should allocate resources, we should repeal this job-killing mandate and let businesses freely manage their personnel needs.

Mr. ALEXANDER. I certainly agree with the Senator from Utah, and that is the purpose of our legislation. We could offer more examples. The Wall Street Journal article of February 22 of this year said:

Many franchisees of Burger King, McDonalds, Red Lobster, KFC, Dunkin' Donuts and Taco Bell have started to cut back on full-time employment, though many are terrified to talk on the record.

These are the kinds of companies I was talking about.

The article also references a 2011 Hudson Institute study that estimates the employer mandate will cost the franchise industry $6.4 billion and put 3.2 million jobs at risk.

Mr. HATCH. I couldn't agree more with the distinguished Senator from Tennessee, and I ask unanimous consent to have printed at this point in the Record an article under Politico's banner, titled: ``Under ACA, Employer Mandate Could Mean Fewer Jobs.''


Mr. HATCH. Again, I thank my colleague from Tennessee for working with me on these two critical issues that impact every American. I will conclude with a quote from a Utah employer. This is a small business owner who is concerned about what the company will do come January 1 if these mandates remain in place. This employer wrote to me saying this about ObamaCare:

We will have to choose who will work 30 or less hours a week, which in turn is bad for our business because we have to train more people to do one job. It is bad for our customers because they will have to interact with different employees who may not know the customer's needs as well, and it is most devastating for the employee because the employee's hours will be cut.

If we want to turn this economy around, government decrees such as the employer mandate must be repealed.

Our job creators cannot grow and innovate with these heavy-handed regulations coming from Washington bureaucrats who have no clue how to run a business.

We must work together on this important issue for the sake of the individuals working three jobs at a time to make ends meet, for employers trying to keep workers on the payroll and contributing to the economy, and for our Nation as a whole to put our economy on the right track and to keep us globally competitive. At least that is my viewpoint, and it is certainly the viewpoint of my small business colleagues there in Utah.

Mr. ALEXANDER. I thank the Senator from Utah for this opportunity to have a colloquy with him, and I ask unanimous consent to have printed in the Record following my remarks letters from the National Restaurant Association, Chamber of Commerce of the United States, and the National Retail Federation, each of which strongly supports our legislation and makes the points we have made about the employer mandate.


Mr. ALEXANDER. Madam President, I see the Senator from Maryland is waiting, and I wonder, if we are through with our colloquy, if the Senator would allow me 2 or 3 minutes to correct a mistake I made on the floor of the Senate last week.

Confessing error: I came to the floor following the vote on the Hagel nomination to point out the difference between a vote against a premature motion to cut off debate--which I thought the majority leader made--and an effort to kill a nomination with a filibuster, which are two different things. I pointed out--correctly--that in the history of the Senate, we have never denied to a district judge nominee his or her seat because of a failed cloture vote, and I don't believe we should. I pointed out we have never denied a Cabinet nominee his or her seat because of a filibuster, with the possible exception of John Bolton, whom the Democrats filibustered. Some Presidents count that nomination to the U.N. in their Cabinet and some don't.

I then went on to say--incorrectly--that on appellate judges, the Democratic majority had filibustered and killed 10 of President Bush's nominations, and Republicans had in response denied two appellate judge seats by filibuster. Senator Schumer of New York--ever wary of what I might say--corrected me and said it was less than that. So I have consulted with him and his staff, and the score is actually 5 to 2.

The correct result is that before George W. Bush became President--and the Senator from Utah knows this story very well--there were no instances of an appellate Federal judge being denied his or her seat because of a filibuster. Then our friends on the Democratic side invented the idea of filibustering circuit judges and voted against a whole series of President Bush's nominees just as I came to the Senate: Miguel Estrada, Charles Pickering, William Pryor, Priscilla Owen, Carolyn Kuhl, Janice Brown, and then four more in 2004: William Myers, David McKeague, Henry Saad, and Richard Griffin.

But then we had a cooling of tempers and a coming to our senses and a bipartisan Gang of 14 said we don't want to make this a new precedent, and we agreed--there was a consensus, anyway--that only in a case of extraordinary circumstance would there be a denial of a nominee of an appellate judge by a cloture vote. So then 5 of those 10 Bush nominees were approved.

So the Schumer staff and my staff agreed with this--and if anybody thinks it is wrong, I would like to know--that only in five cases have Democrats denied a Republican President an appellate judge nominee by filibuster and only in two cases have Republicans denied a Democratic President's nominee by filibuster in the case of appellate judges. As I said when I began, the answer is never in the case of district judges and never in the case of Cabinet members, with the possible exception of John Bolton.

I am glad to come to the floor and correct the record. I thank Senator Schumer for his diligence in noting my error.


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