FLOOR SPEECH: Ways to Fix the Affordable Care Act
*remarks as prepared
I have come to the floor today to join several of my colleagues to talk about the impacts the UN-Affordable Care Act has had on Americans across the nation, especially the people of Alaska.
Last year nationally, we saw a dozen co-ops fail that were created by the ACA, throwing people into turmoil and leaving them questioning if they had insurance. UnitedHealth, one of the largest providers in the country, has been forced off the exchanges in numerous states. Just last week in Alaska, Moda Health announced its withdrawal from the market in 2017, leaving the state with only one option for health insurance in the individual market. Now roughly 14,000 Alaskans will be forced to change insurers next year, an easy choice when there is only one option. Also last week, a court found that the administration’s payments of the cost-share reductions was unconstitutional, which may result in further problems.
And this week the Wall Street Journal wrote an article about the ever shrinking market for rural areas. The article mentions small business owners in Alaska who worry about what the price of the premiums will be when left with only one option. As the market continues to fail other states have begun to lose their options as well. Alabama and Wyoming are also now left with only one choice, and more states may be facing this in the near future.
The article points out that the “patchwork of coverage reflects continued instability in the individual market as companies shift their geographic footprints to avoid areas that have turned out to generate steep losses, and focus on places they believe they can get their ACA business into the black.” So states like Alaska, that have some of the highest healthcare costs in the nation, are just not attractive enough to foster competition and at the end of the day the patients are the ones to suffer. The Administration says that the market just needs to “stabilize and evolve” but what about those small business owners, educators, and parents who are left wondering how to make do in the meantime?
The federal government generally used to break up monopolies and foster competition in order to benefit consumers. Now, through bad law and failed policies, we see that same government creating de facto monopolies in the individual insurance market.
I find it deeply troubling that as market options continue to shrink, any hope of curbing the rapid increases of premium rates also disappears. Will already high premiums climb even higher? Monthly premiums amounting to $3,000 is certainly not beyond the realm of possibility given we have already seen increases over 30 percent per year each year in Alaska since the ACA was implemented.
I have shared the stories of hard-working Alaskans who are paying over $2,000 per month for the cheapest bronze plan available on the exchange. I have spoken about how the ACA has been called the “single greatest threat” to quality public education, because school districts face hundreds of thousands of dollars in fines under the Cadillac Tax. And I have relayed stories from employers, who cannot afford to expand their business due to the employer mandate, which harms both businesses and workers. Bottom line—the ACA does not work for Alaska.
Just last week I met with a group of realtors from Alaska. One woman among the group said she was paying upwards of $2,500 a month with a $6,000 deductible for coverage. Her family struggles to make the payments and they don’t qualify for subsidies. Another young family in Eagle River, AK was forced to switch from Premera to Moda after the ACA passed due to premium increases and even then their premium was $1,200 a month with a $10,000 deductible. This makes it hard for them to run their small business and pay for their day to day expenses. Worse yet, now that Moda has left the market that family will be left with no other choice than to return to Premera, leaving the family scrambling and wondering what they will do to afford insurance in the future? As costs continue to raise these small businesses are left wondering how long they will be able to keep their doors open if rates continue unfettered.
In Anchorage, a couple with Moda had been paying $2,500 a month with a $10,000 deductible, an increase of $1,000 a month over their premiums for 2015. Now that they must switch to Premera for 2017 and will see yet another increase. A woman in Anchorage has watched year after year as her rates increased from $500 a month to nearly $2,000 a month and fears for what the 2017 premium rates hold.
I am hearing from more and more Alaskans that they feel it is cheaper to simply not buy insurance, pay the tax penalty, and hope no one in the family becomes sick. Hoping to not get sick is not a health plan. And as more and more Alaskans drop out of the market, costs for those that remain go up, driving more to drop out, and the system overall tumbles into a death spiral.
The deeper we get into life under the ACA, the deeper Alaskans fall into a hole. The ACA has failed the people of Alaska. The “one-size-fits-all” approach rarely works for our state, and it certainly has not worked in the realm of health insurance.
But it is not only in Alaska where the law is failing. There is more that needs to be done to make the Affordable Care Act work for the rural parts of our country that have specialized needs thanks to higher medical costs, lack of access, and now fewer insurance options.
We in Congress need to take a serious look at the trends we have seen and start working on solutions that will provide the flexibility needed for states to have a successful marketplace.
While I have consistently supported full repeal of the ACA and have voted to do so on several occasions, I have recognized that it was simply not feasible under this administration. I have supported steps that would reduce the burdens of the ACA and fix some of the most harmful provisions in the law. One example is a full repeal of the Cadillac Tax. The Cadillac Tax will only worsen conditions in Alaska, with nearly 62% of customers facing the tax should it be implemented. The Cadillac tax is a prime example of the ACA hurting small rural states because they often have more expensive health care due to the remoteness and lower population size. Then those states are forced to take money away from public education and other services to cover those costs. Our state suffers, our boroughs suffer, our schools suffer, and Alaskan families suffer.
I have also worked on legislation to address the employer mandate that poses a threat to small businesses across the board. The employer mandate puts businesses in a position where they may have to downsize to keep their business afloat or otherwise suffer. I have heard from business owners across the state that want to expand but simply cannot afford to do so.
Now, we are moving into a new administration; hopefully, one that will not be as dependent on the ACA as a piece of its “legacy,” and we can begin to seriously address the problems created for many areas of our country. For, rural states like Alaska, the approach to health care needs to focus on more than forcing people to buy insurance. Congress needs to work to find solutions to these issues, whether it be through the creation of a nation-wide insurance pool so that policies are not limited to one state, or finding ways to improve cost transparency of medical procedures. We need to look critically at special enrollment periods, and see if people are finding loopholes that allow them to game the system. Expanding both Health Savings and Flexible Spending Accounts will allow people to save what they think they should, and make choices for themselves, instead of the government forcing things on individuals.
The old saying “an ounce of prevention is worth a pound of cure,” seems to have been forgotten in health policy. We should incentivize people to live healthy lifestyles, in order to prevent and bring down the incidence of chronic disease. Type 2 diabetes is largely preventable through lifestyle changes, yet it costs an estimated $176 billion per year. Obesity-related illnesses cost an estimated $190 billion. A recent study found that a 10 percent drop in smokers would save $63 billion per year. It makes zero sense to only pay providers to treat these problems after they have arisen, rather than paying for lifestyle changes and case management that would significantly reduce the cost of treating these diseases.
I have been actively working to find solutions that will help support Alaska’s rural needs, especially those related to access and workforce development. If we can improve the overall access to treatment and options of medical providers we take steps to reduce the costs of medical procedures. That is why I support legislation like the Family Health Care Accessibility Act that will improve the care provided by community health centers by enabling them to utilize volunteer primary care providers. Community Health Centers can play a crucial role in serving the needs of rural and underserved communities and allow patients to receive local treatment instead of being forced to travel far from home for treatment.
That is why I was an original cosponsor of the Treat and Reduce Obesity Act, which would allow Medicare to cover not only behavioral therapy to help people lose weight, but weight loss medications as well. Steps like these to improve access are just some of the ways we can rethink our approach to healthcare in the broader sense to alleviate the burdens of the ACA. And that is why I have continued to reintroduce the Medicare Patient Empowerment Act each Congress, a bill which would give patients the option to negotiate a higher price for care, with Medicare paying the typical fee, and the patient being responsible for the difference. Due to the incredibly low reimbursement rates for Medicare there are few providers that even accept Medicare in Alaska, which has forced many patients to go in search of a new provider when they become a Medicare beneficiary. By providing the flexibility to negotiate prices the bill cuts through the bureaucratic red tape and Medicare beneficiaries benefit from increased access and that enables patients to continue having valued relationships with their physicians. Alaska has some of the fastest growing senior population rates and it is becoming increasingly important to ensure they have the option to negotiate an agreement to prevent further access issues.
I do not support compulsory health insurance but do believe that individuals with pre-existing conditions should receive care. That is why I continue to support efforts for a full repeal and replace. There have been several Republican proposals that would not only replace this unworkable law but replace it with consumer-based reforms, such as those introduced by Senators Burr and Hatch, or Senator Cassidy. It is important take steps to review and discuss these Republican proposals to ensure that affordable healthcare can become a reality and to support a healthy and thriving workforce and successful economy. I stand ready and willing to work on fixing this unworkable law because Alaskans, and all Americans, deserve truly affordable care.
