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House Hearing on HHS Budget Becomes Debate on Health Care Reform

By Bill Leonard  6/7/2013
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A June 4, 2013, hearing on the Department of Health and Human Services’ (HHS) budget requests for fiscal year 2014 turned into a debate between the Republican and Democratic members of the House Education and the Workforce Committee about the efficacy of the Patient Protection and Affordable Care Act.

At the center of the debate was HHS Secretary Kathleen Sebelius, who appeared before the committee to testify and answer questions on the budget proposals.

Committee Chairman John Kline, R-Minn., opened the hearing with a statement that was highly critical of the health care reform law and the Obama administration’s efforts to implement the law’s complex regulations and requirements.

“Is the health care law living up to the promises the president made to the American people?” Kline asked. “Once again the answer is no. The president promised to lower health care premiums for the average family by $2,500, but premiums rose 4 percent last year and 9 percent the year before. Meanwhile, insurance providers are warning of rate shock in the years to come.”

The committee’s ranking minority member, Rep. George Miller, D-Calif., responded to Kline’s criticism of the legislation and the Obama administration by citing a recent report that the premiums for health insurance plans offered through California’s health care exchange were substantially less expensive than estimated.

“In the states that have published 2014 health insurance premiums so far, insurance companies are offering affordable premiums, many of which are lower than many opponents of the law have predicted,” Miller said in his opening statement. “For instance, California’s published premiums have come in at the same level or much lower than plans today with comparable benefits.”

Sebelius answered a litany of questions from the committee on how her department was implementing the health care reform law. Key provisions, such as the operation of health care exchanges (the online marketplaces where individual consumers can shop for health insurance plans), will take effect Jan. 1, 2014.

Sebelius told the committee the HHS staff is working hard to ensure that the rollout of the law’s new requirements goes smoothly. She said her staff had made substantial headway in implementing the changes since March 2010, when President Barack Obama signed health care reform into law. Several committee members, however, found fault with the department’s efforts and pointed to business owners who have complained that the law is overly confusing and burdensome.

Rep. Joe Wilson, R-S.C., pointed to a recent study released by the National Federation of Independent Business that concluded the cost of providing health care to employees could increase by more than 20 percent in 2014. Wilson said the steep rise in costs is causing many smaller businesses to rethink their plans to expand and hire more workers. He asked for Sebelius’ reaction to the report and if she believed that the health care reform act was having a negative effect on the job market.

Sebelius replied that she had not seen the report and did not know how researchers with the NFIB arrived at their conclusions.

“I do know, however, that most of these reports are based on estimates and projections on what will happen when the law takes full effect in 2014,” Sebelius said. “We really won’t understand the complete impact of the law until it actually happens.”

She told the committee that the law was certain to change and that fixes would be made as the effect and consequences of the reform effort became more clear. She said that Medicare and Medicaid had changed substantially from when the federal health care programs were first enacted, nearly 50 years ago.

“If we could jump ahead 50 years from now, the health care reform law most likely will have changed and evolved just like Medicare has,” she observed.

During the hearing several committee members questioned Sebelius about her efforts to solicit donations to help pay for the health care reform law’s implementation. The New York Times identified the Robert Wood Johnson Foundation and H&R Block as two of the organizations the HHS secretary contacted.

The committee members expressed concern over allegations that Sebelius and other officials within the Obama administration had asked private organizations to donate money to Enroll America—a health care advocacy group run by Anne Filipic, a former White House official.

Sebelius confirmed that she called several “health-care related groups” to discuss Enroll America. However, she insisted that she had done nothing wrong and that there were precedents of similar activities from prior administrations, both GOP and Democratic.

Republican leaders have criticized Sebelius for her fundraising efforts for Enroll America and have claimed that she was circumventing the wishes of Congress, which has limited the funding to the HHS for implementing the health care reform legislation.

Republican Reps. Tom Price, Ga., and Trey Gowdy, S.C., asked Sebelius if the groups she contacted felt pressured to donate money to Enroll America.

She replied that she has not solicited funds from any group that her agency regulates. She did emphasize, though, that there are no statutes or regulations that prevent her from doing so.

“This is not a statutory line,” she said. “This was a chosen line. I have promoted and discussed education activities not only with Enroll America but with dozens of organizations.”

As the hearing drew to a close, Miller praised Sebelius and pointed to the initial successes of the health care reform law. He noted that millions of young adults 26 and younger now have health care coverage through their parents’ insurance plans and that many other Americans with pre-existing health conditions cannot be denied coverage.

Kline disagreed with Miller, saying that the bad news about the health care reform law keeps mounting and far outweighs any positives.

Bill Leonard is a senior writer for SHRM.

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