Statement of Congresswoman Hirono In Support of H.R. 3962

Congresswoman Hirono
The Affordable Health Care for America Act

Washington, Nov 7

Madam Speaker:

The U.S. Congress has been grappling with how to provide all our citizens with access to affordable, quality health care since the time of President Harry Truman.  H.R. 3962 represents a critical milestone in the effort to reform our health care system.

For those who have it, health insurance is not something you can take for granted.  Every day 14,000 Americans lose their health insurance coverage.  A recent U.S. Treasury Department report noted that approximately half of all Americans under the age of 65 will lose their health insurance coverage at some point over the next ten years.  Thousands are denied coverage because of pre-existing conditions like asthma, pregnancy, arthritis, or diabetes.  Millions more have no health insurance at all, including 54,000 people who live in Hawaii’s Second Congressional District.

In his health care speech before Congress and the nation, President Obama appealed to the best part of us – to act unselfishly, and to put ourselves in the shoes of others.  He asked us to imagine what it must be like for those who don’t have insurance – to live in a state of helplessness should illness strike you or the ones you love.

H.R. 3962 is a bill that will provide for comprehensive health care reform that will protect consumers, hold insurance companies accountable, rein in health care costs, reduce the deficit, and cover 36 million uninsured Americans.  In supporting this bill, I want to highlight three key points.  First, for Hawaii the bill includes the Hirono Amendment that provides an exemption for Hawaii’s Prepaid Health Care Act of 1974, which is our nation’s first and only employer mandate law of its kind.  Second, the bill will provide health insurance coverage for an unprecedented number of Americans while still reducing our deficit.  And third, the bill strengthens and improves the Medicare program for our seniors.

First, there is a mistaken perception that everything and everyone in Hawaii is exempted under H.R. 3962.  That is not so.  The Hirono Amendment only exempts Hawaii’s Prepaid Health Care Act (PHCA) and those who come under it (certain full-time employees and their employers).   PHCA does not apply to part-time employees, seniors on Medicare, those without health insurance, government employees, or those covered by collective bargaining agreements.  Therefore, H.R. 3962 would apply to them.  I know it is easier to talk in terms of the State of Hawaii being exempt from the bill, but that is wrong.  The distinction between PHCA being exempt and the whole state being exempt is a critical distinction to make.

PHCA requires employers to contribute at least 50 percent of the premium cost for single health care coverage, and the employee must contribute the balance, provided the employee’s share does not exceed 1.5 percent of his or her wages.  Because of rising health care costs, Hawaii employers on average cover 94 percent of the premium cost because of the second part of Hawaii’s law limiting employees’ share.  Hawaii employers may cover the full cost of the health insurance premium and many do cover 100 percent of the cost of single coverage.   H.R. 3962 would require employers to cover 72.5 percent of premium costs for single health care coverage.

Hawaii consistently ranks among the highest nationally in terms of insurance coverage and lowest in regard to the number of uninsured.  This is largely due to PHCA.  Private and public health insurance cover an estimated 92 percent of our population of 1.3 million people.  Of those with private insurance, 93 percent are covered through employment-based plans.

Lawrence Boyd, an economist at the University of Hawaii, estimates that per capita health expenditures in Hawaii are seven percent lower than the national average. Dr. Boyd believes that wider health insurance coverage and support for preventive health care lead to this outcome.
The Hirono Amendment will provide maximum flexibility for Hawaii once a federal health care reform bill becomes law.  Hawaii will be able to decide for itself to retain PHCA or come completely under the new federal law.

Second, H.R. 3962 will ensure that 96 percent of Americans will have health insurance coverage.  The non-partisan Congressional Budget Office (CBO) estimates that the cost of enacting H.R. 3962 will be $894 billion, consistent with the $900 billion limit established by President Obama.  The bill is fully paid for.  About half of the cost of H.R. 3962 is paid for by targeting waste, fraud, and inefficiency in the federal Medicaid and Medicare programs. The other roughly half of the cost of the bill is paid for through a surcharge on the wealthiest Americans – those with incomes above $1 million for couples and $500,000 for singles; therefore, 99.7 percent of Americans will not be touched by this surtax.

While H.R. 3962 will be paid for, CBO also estimates that the bill reduces the deficit by over $100 billion in the first 10 years, and continues to reduce the deficit in subsequent years.  Leading economists from educational institutions across our nation have concurred with CBO’s findings and support the idea that health care reform promotes our country’s economic health.

Finally, I want to address the importance of health care reform to seniors.  Some of the most damaging misinformation that has circulated over the past several months on health care reform is the use of scare tactics targeted at seniors. The cynical irony is that the misinformation targeting seniors is largely perpetuated by the same people who fought the establishment of Medicare and wanted to privatize Social Security.

The truth is that H.R. 3962 will lower prescription drug costs for people in the doughnut hole; give the Secretary of Health and Human Services the authority to negotiate lower drug prices on behalf of Medicare beneficiaries; and extend the solvency of the Medicare Trust fund by five years.

Closing the doughnut hole is an especially critical issue for Hawaii, as we have the nation’s largest percentage – 36 percent compared with 26 percent – of Medicare beneficiaries who fall into this gap of prescription drug coverage.  In its first year, H.R. 3962 will reduce the doughnut hole by $500 per beneficiary, provide a 50 percent discount on brand-name prescription drugs, and phase out the doughnut hole by 2019.

It is remarkable that in just the past two days, over 300 groups representing Americans from all walks of life – doctors, farmers, seniors, consumers, cancer and diabetes patients – have rejected the unsustainable status quo and have endorsed H.R. 3962.   In its endorsement of the bill, Consumers Union – publisher of the independent, non-partisan Consumer Reports – called the health care status quo a “consumer crisis with its crippling costs, its unreliability, and lack of access,” and strongly endorsed the House of Representatives health care bill because it will create a “a more secure, affordable health care system.”  Other groups endorsing the House bill include the: American Medical Association, American Nurses Association, AARP, AFL-CIO, AFSCME, Americans for Democratic Action, American Cancer Society, American Diabetes Association, Asian & Pacific Islander American Health Forum, Association of Asian Pacific Community Health Organizations, National Association of Community Health Centers, National Education Association, Campaign for Tobacco-Free Kids, and from my district, Lana‘i Community Health Center.

Now is the time to end insurance discrimination based on pre-existing conditions or gender.  Now is the time to begin to close the Medicare doughnut hole for America’s seniors.  Now is the time to bring change to a broken system.

I urge my colleagues to vote in support of H.R. 3962.

Aloha and mahalo.


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