Executive Summary of H.R. 3200, House Democrats’ Government Takeover of Health Care
On July 14, 2009, the Chairmen of the three House Committees with jurisdiction over health care legislation—Education and Labor Chairman George Miller (D-CA), Energy and Commerce Chairman Henry Waxman (D-CA), and Ways and Means Committee Chairman Charlie Rangel (D-NY)—introduced H.R. 3200 as a revised version of the “discussion draft” first publicly released on June 19. On July 17, the Ways and Means Committee approved the bill by a 23-18 vote, and the Education and Labor Committee approved the bill by a 26-22 vote. The Energy and Commerce Committee approved its version of the legislation on July 31 by a 31-28 margin.
The summary and analysis below refers solely to the bill as introduced. The Rules Committee will merge the respective bills, and their amendments approved in Committee, for the House to consider one piece of legislation on the floor.
Executive Summary
The introduced bill sets the tone for a Washington takeover of the health care system—one defined by federal regulation, mandates, myriad new programs, and higher federal spending. The bill would ensure the heavy hand of federal bureaucrats over the United States health care system, levying costly new taxes on individuals and businesses who do not comply. Many Members may question how additional federal mandates and bureaucratic diktats raising costs appreciably for all Americans would make health care more “affordable.” Many Members may also be concerned that the bill’s provisions—only partially masked by budgetary gimmicks and “smoke-and-mirrors” accounting—cost well over $1 trillion, financed largely by significant job-killing tax increases imposed on small businesses during a recession.
Highlights of major provisions likely to cause Member concern include:
- Creation of a government-run health plan that experts say would result in up to 114 million Americans losing their current coverage—a clear violation of any pledge to allow individuals to keep their current health plan;
- More than half a trillion dollars in tax increases on certain income filers, a majority of whom are small businesses—and $820 billion in tax increases overall;
- Insurance regulations that would raise costs for nearly all Americans, particularly young Americans, and confine choice of plans to those approved by a board of bureaucrats;
- New price controls on health insurance companies that provide perverse incentives to keep individuals sick rather than managing chronic disease, while impeding patient access to important services just because those services do not provide a direct clinical benefit;
- Additional federal mandates that would significantly erode the flexibility currently provided to employers—and could result in firms dropping coverage;
- Massive expansion of Medicaid—fully paid for by the federal government—to all individuals with incomes below 133 percent of the Federal Poverty Level ($29,326 for a family of four), replacing the existing private health coverage of millions with taxpayer-funded health care;
- Language opening employers operating group health plans to State law remedies and private causes of action—subjecting employers to review by 50 different State court rulings, thereby raising costs and encouraging more employers to drop their current health plans;
- Establishment of a bureaucrat-run health Exchange that would abolish the private health insurance market outside the Exchange—and could evolve into a single-payer approach due to the Exchange’s ability to cannibalize existing employer plans;
- Creation of a new government board, the “Health Benefits Advisory Committee,” that would empower federal bureaucrats to impose new mandates—including a mandate to obtain and provide abortion coverage—on individuals and insurance carriers;
- Taxation of individuals who do not purchase a level of health coverage that meets the diktats of a board of bureaucrats—including those who cannot afford the coverage options provided;
- New, job-killing taxes—over $200 billion worth—on employers who cannot afford to provide their workers health insurance, which could result in up to 5.5 million employees losing their jobs;
- Penalties as high as $500,000 on employers who make honest mistakes when filing paperwork with the government health board—which would likely dissuade businesses from continuing to provide coverage, increasing the amount of health care provided through the bureaucrat-run Exchange;
- “Low-income” health insurance subsidies to a family of four making up to $88,200;
- Arbitrary and harmful cuts to popular Medicare Advantage plans that would result in millions of seniors losing their current health coverage; and
- Expanded price controls on pharmaceutical products that would discourage companies from producing life-saving breakthrough treatments.