Statement on Introduced Bill and Joint Resolutions

Floor Speech

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Ms. COLLINS. Mr. President, let me begin my remarks this evening by commending my friend and colleague the Senator from Louisiana for coming up with a creative and comprehensive health care bill that I am pleased to cosponsor.

As a physician, Senator Cassidy knows far better than most of us in this body what it is like to deliver health care and has made a real effort to come up with a public policy response in anticipation of the Supreme Court's decision in King v. Burwell, which is expected to be handed down later this month. So I thank him for his work and his creativity in tackling a very complex issue.

As I mentioned, later this month, the Court is expected to rule in King v. Burwell, a case challenging the availability of premium tax credits under the Affordable Care Act in the 37 States that have not established a State-run health insurance exchange.

If the Supreme Court rules in favor of the plaintiffs, as many experts expect it will, 6.4 million Americans who are now receiving premium tax credits through the federally run exchanges will lose their subsidies, and, as a result, their health insurance may well become unaffordable. This includes almost 61,000 people in my State of Maine.

Such a decision will place responsibility on Congress and the President to work together to protect those individuals. Senator Cassidy and I believe we can do this by extending the current subsidies for a transition period, as contemplated by the sense-of-Congress language included in the Patient Freedom Act that we are introducing today.

But the Supreme Court's decision will also invite us to think anew about how to ensure that all Americans have access to affordable, high-quality health care. We can advance this goal by revamping and reforming the Affordable Care Act to improve the quality and affordability of health care while retaining the insurance market reforms that are so important to consumers.

Senator Cassidy's Patient Freedom Act is precisely the type of new thinking we need. As the title of this bill suggests, the Patient Freedom Act is built on the premise that freeing people to take charge of their health care is superior to the one-size-fits-all approach of ObamaCare. A decision for the plaintiffs in King v. Burwell would essentially leave States with two options, absent congressional action. They could either set up a State-run exchange to ensure that their residents have access to the Affordable Care Act subsidies or do nothing and allow their residents to lose these ObamaCare subsidies. Under Senator Cassidy's bill, however, States with federally run exchanges would have a third option. They would have the choice of participating in the new Patient Freedom Act.

Participating in the Patient Freedom Act would allow States to structure their health insurance market without an individual mandate or an employer mandate or many of the other expensive mandates under ObamaCare. In return, States would have to offer their citizens a basic health insurance plan that would include first-dollar coverage through a health savings account, basic prescription drug coverage, a high-deductible health plan to protect enrollees against medical bankruptcy, coverage for preexisting conditions--a good provision of the current law that we would retain--coverage through a parent's plan for children up to age 26--another good provision of the law that we would retain--and there could be no annual or lifetime limits on insurance claims, again a good provision of the current law that we would retain.

Here is how it would work: The Federal Government would provide funding directly into the health savings accounts of individuals insured through the Patient Freedom Act. These funds would be phased out for higher income individuals. The aggregate funding for these per-patient, per-capita grants would be determined based on the total amount of funding that the Federal Government would have provided in the form of ObamaCare subsidies in each State, plus any funding each State would have received had they chosen to expand their Medicaid Program, even if, like the State of Maine, they had chosen not to do so.

In addition to Federal funds, individuals and employers could make tax-advantaged contributions to these health savings accounts. The bill even provides for a partial tax credit for very low-income individuals who do receive employer-based coverage, but it would help these workers pay for their deductibles and copays.

Individuals who are insured under the Patient Freedom Act would receive debit cards tied to their health savings accounts, which they could use to purchase a high-deductible health plan to pay directly for medical expenses or pay premiums for a more generous health insurance policy. In addition, health care providers receiving payment from the health savings accounts would be required to publish cash prices for their services, which would add transparency that we desperately need to move toward a more patient-directed health care future.

The promise of patient-directed health care is one of the advantages of this approach, but it has other advantages as well. For example, residents of States that elect this option would no longer face the individual mandate penalty that can cost individuals 2.5 percent of their income and the typical American family of four an estimated $2,100 next year. It would also codify the elimination of the employer mandate in these States, freeing these employers to add jobs and let their full-time employees work 40 hours a week. ObamaCare has been causing some employers to reduce hours for their employees. The result has been smaller paychecks for those workers.

Perhaps most important, however, the Patient Freedom Act would do away with what the superintendent of insurance in Maine refers to as ``wage lock.'' That is caused by the fact that the subsidies in the ObamaCare exchanges phase out completely at 400 percent of the Federal poverty level. In other words, there is a cliff there. Now, 400 percent of the poverty level is about $47,000 for an individual and $64,000 for a couple. Taxpayers who earn just $1 more than the threshold lose their entire subsidy.

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