CONTROLLING THE RUNAWAY COSTS OF HEALTH CARE

Thursday, October 1, 2009

Madam President, a week ago, freshmen democratic senators came to this floor to discuss as a group how our current health care system is broken and unsustainable.

Today, we return to address the challenge of runaway costs and how health care reform can bend the cost curve, making health care more affordable and more accessible to our families and our businesses.

Now, many folks have said to me, is this really the time to take on the health care reform, when we are in the middle of the worst recession since the great depression?  The answer is an unequivocal yes.

Now is the time.  Now is the time, because health care costs are a runaway train making great damage on our families, our small businesses and our large businesses.   Indeed, consider the situation with a family: when health care costs have doubled in the last nine years.  So, families that could afford insurance just a few years ago cannot afford it today.  And now health care premiums are rising even faster.  They’re expected to double in the next six to seven years.  As a result, many families and individuals who are struggling to pay those health care premiums right now won’t be able to do so in just a few more years.

So, fixing our broken health care system cannot wait.  Indeed, reform is essential to our families, our small businesses and our large businesses.

Consider this:  for a working family every additional dollar that goes into a health care premium comes out of the wages that would otherwise go to increase the family’s purchasing power.  So rising health care premiums really are a tax on family wages, a tax on family purchasing power, making it much harder for our families to get ahead and for them to provide for their children and establish a high quality of life.

Now, controlling costs is also essential to small businesses.  Small businesses want to offer health coverage to attract and keep good employees and to do what is right for their employee’s quality of life.   
But runaway costs are making that more and more difficult.

Consider the example of the Hawthorne Auto Clinic founded and operated by Jim Houser and his wife Liz Dally.  When they opened 26 years ago, Jim and Liz were committed to offering those who worked for them and with them a good benefits package, including comprehensive health care.  They are still able to provide health insurance to their employees, but it is getting tougher.  Premiums have gone from 9% of their payroll to 18% in just the last five years.  As a result, they’ve had to cut back on the benefits they have offered.  Over the last decade health care premiums have skyrocketed for small businesses across the board just like they have for Hawthorne Auto Clinic.  

Large businesses see the effect as well.  If you build a car in America, it costs $1,500 in health care.  If you build that same car across the border in Canada or Europe, the cost is zero.  In fact, in 2007, G.M. spent more on health care than they did on steel.  Controlling costs is essential for our large businesses to be competitive in the world and to build products here in America.  If we don’t build products in America, we will not have a middle class in America.

So, Madam President, health care reform cannot wait.  Our families need help with runaway costs.  Our small businesses are looking to us to help control costs.  Our large businesses need reform to be competitive in the world and to build the strong economy that will raise all boats.