Velázquez on Reimagining the Health Care Marketplace for America’s Small Businesses

Feb 9, 2017
Washington, DC – Rep. Nydia M. Velázquez (D-NY), the ranking Democrat of the House Small Business Committee, made the following remarks today at a hearing titled, “Reimagining the Health Care Marketplace for America’s Small Businesses”:
“Thank you, Mr. Chairman.   Seven years ago, the President signed into law the Affordable Care Act.  Since then, about 22 million people have secured coverage. These gains have been significant for small business employees. Between 2013 and 2015, the number of uninsured small business employees dropped by 4.1 million and their uninsured rate fell from 27 percent to less than 20 percent.
“These individuals not only gained insurance coverage, they gained high quality insurance coverage. The ACA instituted reforms to protect consumers, including extending dependent coverage to adult children up to age 26, eliminating pre-existing condition exclusions, and requiring coverage of preventive services. 
“Many of these reforms were particularly important for small businesses. Before the ACA, one employee’s rare illness could cause insurers to dramatically raise rates for the entire firm. Now, insurance companies are not allowed to charge higher premiums based on health status, insurance claims, or gender. The insurance market is fairer and more consumer friendly than it was seven years ago. 
“The ACA has also ushered in a period of freedom for entrepreneurs who no longer have to choose between starting their own business and retaining their health benefits. I recently held a healthcare event in my district. One New York City entrepreneur said – and I quote – “I would not be able to own my business without the Affordable Care Act.” 
“The Act has also contributed to reducing health care cost growth. In recent years, premium rate increases in the employer market have been modest. Between 2010 and 2015 premiums rose 27 percent -- significantly lower than the 69 percent increase from 2000 to 2005. 
“As with any major law of this complexity, there have been challenges in implementation. For example, many eligible firms have not taken advantage of the small business tax credit. Similarly, markets have had mixed success in the Small Business Health Options Program. I look forward to hearing testimony today on how these programs could be improved.
“However, rather than working together to develop targeted reforms, Republicans want to throw out the baby with the bathwater. For years, they proposed little more than repeal -- with vague – at best -- plans for replacement. Even today, there is no agreed upon concrete plan or legislative path to replacement.
“Experts agree that that even a partial repeal without a concurrent replacement will destabilize the market. The Congressional Budget Office estimates that repealing the Affordable Care Act through reconciliation would cause 30 million people to lose coverage over the next decade. This coverage drop would cause nearly $1.7 trillion in lost revenue to hospitals, doctors, and other providers between 2019 and 2028. At the same time, demand for uncompensated care would skyrocket.
“CBO also predicts that premiums in the nongroup market would increase by 20 percent to 25 percent. This increase would reach about 50 percent in the year following the elimination of the Medicaid expansion and the marketplace subsidies. Even if the Affordable Care Act is repealed with a delay, uncertainty in the marketplace would likely cause significant premium increases and insurer market exits. These sweeping proposals are careless and will cause a great deal of damage to our health care system and every American who relies on it.
“Small firms were not being served by our health care system and faced many challenges before the Affordable Care Act. The Affordable Care Act sought to provide small firms with greater stability, flexibility, and cost controls. Though we have seen considerable gains, more work remains. Through a thoughtful and bipartisan examination of policies, we could make targeted improvements that better serve small firms. I hope my Republican colleagues will join me in this examination and abandon their dangerous and disruptive plans for repeal.
“Thank you, Mr. Chairman.  I yield back.”   
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