Jeff Bingaman United States Senator from New Mexico

U.S. SENATOR Jeff Bingaman

Friday, November 20, 2009

Bingaman Speech Touts Benefits of Health Insurance Reform Legislation

 I wanted to speak for a few minutes about the health care legislation that has now been proposed by the majority leader and that we will be hopefully proceeding to for serious discussion and deliberation and opportunity for amendment.  

Let me talk first about where we are today without health care legislation. What are the circumstances faced by the average American family without health care legislation enacted?   The cost of medical care is rising. In fact, it is unaffordable for many individuals. It is unaffordable for many businesses.  

In addition, there are 46 million who are uninsured in the country, and that number continues to grow. I have been here in the Senate and continued to watch that number grow for the last decade at least. Those most in need of health insurance often are denied coverage. Many others worry about whether they are one diagnosis away from financial ruin because of their lack of adequate coverage and their lack of ability to afford adequate coverage.  

So we are working here in the Senate to craft a national health reform proposal that would remedy this situation, and would do so by reducing the growth in the cost of health care. And let me be clear. We are not saying that the cost of health care is going down substantially. We're talking about the growth in the cost of health care. And that is what we are trying to moderate as part of this legislation.  

We are also, as part of this legislation, providing insurance to nearly everyone in the country, regardless of their health status and their medical conditions.  This health reform proposal is designed to lower health care costs, lower them from what they otherwise will be in the future.  Health reform caps what insurance companies can force patients to pay in their out-of-pocket expenses and in their deductibles.    

The legislation we're considering would let small businesses and join purchasing pools and give them the lower cost  for the benefit -- that benefit larger groups today. I have heard from many hundreds of small business owners in my state over the years who have complained that the cost of health care to them and their employees is so much higher than the cost of health care to large employers and their employees. So we would solve that.  

We would create a system that helps to prevent illness and disease instead of just treating it when it's too late and when the cost is excessive. This health reform proposal will reduce health care fraud and waste and abuse and overpayment to insurance companies. It's estimated by most experts in the range of $60 billion per year under the current arrangements we have, the current health care delivery system.    

This legislation would eliminate most of the cost of uncompensated care. This is a very substantial part of the premium that people with health insurance are required to pay. They are not only paying for their own health care when they pay their premium, they are paying for the uncompensated care that the hospitals and the physicians and others are providing to people who don't have insurance. That's that 46 million uninsured figure that I mentioned before. This legislation reduces the growth in the cost of public programs such as Medicare and Medicaid and helps to rein in the federal deficit.    

Let me just say we have the unusual circumstance here that many of the individuals who opposed the establishment of Medicare and claimed it was socialized medicine are now resisting any effort to put it on a sounder financial footing and doing so purportedly in the name of defending the beneficiaries of Medicare.  So we need to speak the truth to the American people and say Medicare and Medicaid are going to continue. There are going to have to be reductions in the growth of those programs the future, the growth of the cost of those programs. And some of those changes are incorporated in this legislation. And that is a good thing for Medicare beneficiaries. That is a good thing for people who are going to be dependent upon Medicare in the future.  They will know that Medicare is there. They will know that Medicare is solvent and will benefit accordingly.              

Health reform will also ensure that Americans -- all Americans -- have access to quality and affordable insurance.  It will prevent insurance companies from the current practices that they're engaged in.  And one of the worst of those practices is this practice of denying health insurance, or health coverage for preexisting medical conditions.  If you find that someone with a preexisting medical condition is able to buy a policy perhaps, but the policy in its own language will exclude them from getting medical treatment that might result from that preexisting medical condition.  This legislation would end that.  It would end the discrimination that charges that currently exist where the charge for health care is based on your health status.  

During the course of this year, and in the last few years while we've been health care and the health care delivery system, I've come to a new understanding of the meaning of the word underwriting. I used to think I knew what the word underwriting meant in insurance. What I found is that underwriting means the screening out of people who might actually need the insurance that is being sold so that much of the effort of the health insurance industry today is not focused on assisting the patient or the policyholder. It is focused on screening out those individuals who might in fact wind up sick and might need health care. So we try to end that in this legislation, and we do so effectively.  

The legislation provides tax credits to middle-class families to make sure that they can afford quality coverage. And there are many middle-class families in my state who, frankly, cannot afford adequate coverage and quality coverage for themselves and their children. This legislation strengthens employer-based health care by offering small businesses a tax credit so that employers can offer competitive affordable rates to their employees if they choose to do so.  

It creates incentives that reward doctors for healthy outcomes, not just for more and more procedures. We have the unfortunate circumstance today which this Congress and this administration and previous Congresses and previous administrations are responsible for, and that is we've set up a system of payment Medicare, in particular, where the amount that the health care provider receives depends on how many procedures they perform, not on whether or not the patient gets better, not on whether or not they have done the right thing to assist that patient. And we are trying to begin changing that in this legislation. This will result in better health care for all Americans.  

This health care reform bill is also designed to improve the choices that people have when they go out to obtain coverage or to obtain health care itself. Most Americans get their insurance through an employer. Many are very satisfied with the plans they currently have. They're very satisfied with the physician or the doctor that they currently have. And it's very clear in the legislation we are considering that this legislation does not require them to change that.  This legislation says they can keep that policy.  They can renew that policy.  They can add family members to that policy if they choose to do so.  But the health reform also provides security that ensures that families always will have guaranteed choices of quality, affordable health care.

And that's even when a person loses their job, when a person switches jobs, when a person gets sick or a person decides to move from one community to another, this legislation will ensure that they have access to health care even in those circumstances.  

It creates a health insurance exchange, and this exchange would be a place where families and businesses could easily compare insurance plans and prices and make a judgment based on that comparison. This puts families, rather than insurance companies or government bureaucrats, in charge of their own health care. It helps people to decide which quality, affordable insurance option is right for them and for their family.  

It keeps government and insurance bureaucrats -- both because there are bureaucrats working for insurance companies just like there are bureaucrats working for the government -- it keeps both from coming between each individual and his or her doctor by simplifying insurance paperwork, by cutting out the pages of fine print, by eliminating all of the gotcha clauses that people discover once they get sick. They find out that they were not covered for whatever it is that afflicts them. And by promoting computerized medical records, this legislation will dramatically improve efficiency in our health care system and through that effort also reduce costs.  

Let me talk a little about the impact of this legislation on my state. I represent New Mexico and, frankly, this legislation is critically important to my state. Without health care reform my state is expected to experience the largest increase in health insurance premiums of any state in the union. For example, the average employer-sponsored insurance premium for a family in New Mexico today, or in 2000, the year 2000, was $6,000. By 2006, that had almost doubled to $11,000 for a family of four.  By 2016, the expected increase goes to an astonishing $28,000.  

In addition, the health insurance premiums and the percentage that those premiums represent of the income of the average New Mexico family is higher in my state, unfortunately, than in any other state in the union. Today 31 percent of a family's income is going to pay for health care. That is for the folks who have coverage today in New Mexico. That's expected to grow to an astounding 56 percent -- over 56 percent of a family's income is expected to be consumed just paying premiums for health care by 2016. That's totally unsustainable and unaffordable.  

The health reform proposal that has been developed by the majority leader based on the work of the Finance Committee, based on the work of the HELP committee, the Health, Education, Labor, and Pensions Committee, intends to slow the growth of health care costs around the nation. The nonpartisan Congressional Budget Office forecasts that the legislation would not add to the federal deficit. In fact, that it would reduce the deficit by $130 billion by 2019, and by much more than -- by more than $400 billion by 2029.  

Most experts believe these reductions also will drive down cost in the private health insurance market. Thus, this legislation is critically important to my state because it will help to curb costs for all New Mexicans.  

In 1999-2000, there were two states that had more than 23 percent of this population uninsured, and those two states were Texas and New Mexico. The only state in the union that has a higher uninsured rate than we do in New Mexico is Texas, and that was the case then in 1999-2000. It is still the case today, I would point out. Many other states, particularly across the south, in California, many other states have joined the ranks of states that have over 23 percent of their population uninsured – their 18-64 population uninsured.  

My state has the lowest rate of employer-sponsored insurance in the nation. We also have the highest rate of uninsured among employed individuals in the nation.  

You generally think of the American public as having a lot of -- most people have private health insurance coverage. In New Mexico, 38 percent of our population has private health insurance coverage, so it's not a majority. It's 38 percent. We have 14 percent that are covered by Medicare. We have 22 percent that are covered by Medicaid and the Children's Health Insurance Program (CHIP).  We have 4 percent that are undocumented immigrants in our state - estimated at about 80,000 individuals.  And they do not have coverage today and they will not have coverage once this legislation becomes law if we are able to pass this legislation and the president is able to sign it. And then this large red area down here at the bottom, it's 22 percent, so you have the undocumented immigrants 4 percent, and then you have 22 percent without coverage. These are folks who are legally here. Most of them are citizens. They do not have coverage. And this gets back to the point I was making before about people's premiums today are covering not only the costs of their own health care needs but they're covering the cost of care, the uncompensated care that is provided to the uninsured. So it's a serious problem that needs -- needs attention.  

New Mexico will benefit from this legislation in very important ways. The legislation will provide new federal tax credits for private insurance, and it will also expand the Medicaid program for individuals with incomes of up to 133 percent of poverty. Now, this is a -- this is a very important provision for my state.   

It's projected that insurance market reform and federal tax credits may reduce the costs of coverage on the individual private market for the average family in my state by as much as 40 percent. 

What would likely occur by 2019, ten years from now, if, in fact, we are able to enact this legislation? We will have more people covered by Medicaid and CHIP. We would have 29 percent rather than the 22 percent we had before. And it shows that we will have many more people covered by private insurance. We will have for the first time, I believe in the history of our state, we will have for the first time over 50 percent of our population. Exactly 53 percent is what is estimated that will be covered by private insurance and have an insurance policy that they can depend upon.  

So this would still leave undocumented immigrants, which is still 4 percent of the population estimated to be without any guaranteed source of coverage. But you would have about 124,000 New Mexicans newly eligible for Medicaid coverage and covered by Medicaid, we would hope, and you would have an additional 238,000 New Mexicans who would be eligible for private coverage through the exchange or from their employers if their employers chose to provide that coverage.  

We will have a lot of opportunity over the next few weeks to debate particular parts of this legislation. I look forward to that debate. I think the more that the American people understand what's in this legislation, the more support they -- the more wholeheartedly they will support us moving ahead and enacting there legislation.  

This has been a long time in coming. In the 27 years I have been in the Senate, we have not gotten to this point previously where we -- we were beginning a serious debate that might actually result in the passage of legislation, major comprehensive reform legislation. But I think we are to that point.  

This is legislation that is currently available for anyone to review on the Internet, and I encourage people to do that. I encourage people to study the issue and follow the debate, and as I say, the more people do study the issue and follow the debate, the more people will conclude that this is worth doing, this is important to do. So I very much urge my colleagues to rally around this effort. I hope, frankly, we will get some republican support for this.  

I think it is very unfortunate that we are going into this debate with reports that all Republicans are agreeing to oppose health care reform. That is not the way to move our country forward. If there are amendments that they would like to offer, obviously they will have every opportunity to offer those. Some of them may prevail. That certainly was the case in the Finance Committee when we marked up the legislation there. That certainly was the case in the HELP Committee when we marked up the legislation there.  

Amendments were offered from Republican members and some were adopted, but to just say no, to just say we are opposed to reform is not a good option, and I think the American people deserve better than that, and I hope we will have a serious, substantive discussion about what the elements of health care reform should be.  

I compliment the majority leader for putting together a very credible proposal that will move this country very far toward meeting the health care needs of all Americans, and I hope that by the end of this year we are able to enact that legislation or pass it through the Senate and go to conference with the House of Representatives.