July 16, 2003

I would like to thank Chairman Bilirakis for holding this hearing today. I hope that given the importance of this issue and the multiple approaches to address it, today’s hearing will be the first of a series of hearings on reducing the number of the uninsured.

I commend the Chairman for putting forward the Health Insurance Certificate Act, which attempts to address the problem of the uninsured. There is $50 billion available in the Fiscal Year 2004 Budget Resolution for the uninsured and we should not let this opportunity go to waste.

I do have some serious concerns about this legislation, however, as it is constructed. In particular, I worry that this approach does not get the most "bang for the buck." In other words, it does not cover many uninsured for the amount it spends. As we will hear from witnesses today, estimates indicate that 89 percent of those who receive a certificate under this model will already have coverage; for the

$50 billion spent, it will only reach 1.28 million individuals who previously did not have coverage. That is an average cost of $39,000 per newly insured person.

I am also concerned about who will be able to receive coverage under the Health Insurance Certificate Act and what kind of coverage it would be. There is nothing in this bill that guarantees an individual who gets a certificate will be able to use it, or even that the coverage would provide the benefits needed. I fear this legislation will wind up giving federal dollars primarily to young, healthy individuals -- leaving families and individuals who are older or in less-than-perfect health, the population most in need of assistance, out in the cold.

It is no surprise that my friends in the insurance industry would line up behind such a proposal. They do not want people with high risks in their health insurance plans -- but they will certainly take federal funding to cure the healthy. I see it differently. As a nation, it is our job to take care of all who are in need, not just the easiest cream off the top.

I believe a better approach would be one that builds off the existing system of public programs and employer coverage. Public programs already have an infrastructure in place and proven experience in serving not just the healthy, but also the most health-challenged and vulnerable individuals. Public programs also guarantee coverage to all who are eligible -- coverage that is comprehensive, affordable, and meets the varied needs of families. And, we know they are cost effective.

We must also work to reinforce the existing system of employer coverage. We should not be setting up a system for healthy, low-cost individuals to flee to individual market policies leaving employers with higher risks and spiraling costs. There are many employers out there who provide decent coverage for their workers and want to continue to do so. There are also many who would like to. We need to shore up those employers, but unfortunately the legislation before us today does not do so -- and in fact may do harm in that regard.