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Herger Statement on Markup of H.R. 3200 ” America’s Affordable Health Choices Act”

July 16, 2009

Mr. Chairman, nobody disputes that America’s health care system needs reform. Rising health care costs are putting the squeeze on families, businesses, and government alike, while placing quality health coverage completely out of reach for too many Americans. Unfortunately, the bill before us fails to bring costs under control. Instead, it would raise taxes and force employers to cut jobs at a time when we are in the middle of the most severe recession in decades.

In addition to the 8% payroll tax on businesses that can’t afford to provide the level of coverage mandated by Congress, the surtax will put the top marginal income tax rate in California above 55%. We shouldn’t have to resurrect the 1970s to remember that when tax rates go too high, people lose the incentive to build new businesses and create jobs.

These massive tax increases are no substitute for real fiscal responsibility. Today, we spend a much higher share of our economy on health care than any other industrialized country. The bill before us raises taxes to pump even more money into health care, but it’s woefully short on cost savings. Even the President’s budget director has expressed concern that this bill doesn’t do enough to move Medicare away from the fee-for-service system that drives up costs. Meanwhile, it does nothing at all to address the costs associated with out-of-control medical liability lawsuits.

Finally, the bill before us fails the President’s own test that if you like the coverage you have, you should be able to keep it. As we have heard in previous testimony, an independent study has estimated that 2 out of 3 Americans who have private health coverage will lose it because of the policies in this bill, such as the establishment of a new government-run health plan paying Medicare-based rates. In addition, several million seniors will be at risk of losing their Medicare health plan.

If we are committed to ensuring that people who like their health care can keep it, then this is the wrong bill. If we want to build on what works and encourage more innovative employer plans, then this is the wrong bill. And if our goal is to advance responsible reforms that will truly get rising health costs under control, then this is most certainly the wrong bill. I hope we will reject this legislation so we can get to work writing a bipartisan health care bill that achieves the objectives we all want to pursue.