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tv   Energy and Commerce Committee Markup of Affordable Care Act Replacement...  CSPAN  March 9, 2017 4:00am-6:01am EST

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treatment in question such as dental care or eye glasses or special equipment such as a wheelchair, isn't covered for the state's adult medicaid beneficiaries. ese per capita caps will likely include the pernicious removal of the epsdt requirement. i've seen states push the envelope here already on this and try to ratchet back what is really fundamental to taking care of kids across the country. so many enrolled in medicaid. about 50% in florida. this would place vulnerable children at risk of having various conditions going undiagnosed and not being treated on a timely basis, if at all. that is very poor public policy. it is better to catch problems early. we talked about the importance of prevention before. so it is all the worse. this whole move towards the per
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capita cap is made all the worse at the same time as what is going on over at ways and means with the huge tax cuts. i just don't think we can ignore the entire package. therefore, i urge you to support the plone amendment. >> what reason does the gentleman from ohio seek recognition? >> mr. chairman i move to strike the last word. i am a little befuddled why there is so much -- appears to be so much opposition to per capita cap reform for medicaid, especially given the history of support from members of my colleagues on the other side of the aisle from their party. let me read a few quotes. per capita reforms -- and i quote -- provides that health care and coverage could be
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protected and maintains the individual guarantee to medicaid services. the per capita cap approach provides that health care and overage could be protected and cause can be controlled by disciplining the program with an annual limit in federal spending per beneficiary. this approach maintains the guarantee to services and creates an incentive to maintain health care coverage. funding would follow the people in need, not some political entity. that is a quote from senator bob graeme, democrat, from florida. we have another per capita reforms provide an additional incentive for states to control program spending but will not force them to restrict medicaid eligibility. and i quote, the president has proposed per capita limits on federal medicaid spending which will provide an additional incentive for states to control
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program spending but will not force them to restrict medicaid eligibility. under per capita spending limits medicaid enrollment can continue to expand and contract with economic conditions and individual needs. but then stability states will be able to manage while medicaid beneficiaries including senior citizens, disabled people, and children will retain their health care coverage. that is the director of health care, financing, administration in june of 1995. then the big one. a per capita reform guarantees that the elderly, disabled, and pregnant women, and children, continue to be eligible for health benefits while reducing the rate of increase in medicaid spending to a level that is sustainable for states and the federal government. and i quote, a per capita cap
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would limit the amount of federal spending for eligible person while retaining current eligibility and benefit guidelines. this approach guarantees that the elderly, disabled, and pregnant women and children meeting certain criteria will continue to be eligible for health benefits while reducing the rate of increase in medicaid spending to a level that is sustainable for states and the federal government. that quote was by president bill clinton in january of 1996. so i continue to be befuddled with the opposition to per capita cap reforms that we are proposing in our bill now. i urge my colleagues to oppose this amendment. with that i will be glad to yield some time to my colleague from kentucky, mr. guthrie, if he would like it. >> well, i think i just said -- i just want to stress that it is not to start with the 2016
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that all the states had. so it is not a cut from what they had. so you are not all of a sudden pitting groups against each other. it starts with the basis they had last year, it grows by medical inflation and by demographics of who comes and goes with the program. so it is not -- it slows down the growth but it does drive budgets. are you going to have a sustainable program sf we are going to spend over $1 trillion in states and federal government in 2026 over the current projection. so i don't think we can dismiss the fact that it is growing at the rate it is growing and take it seriously and try to deal with it. i think it is a responsible way to look at this problem. i yield back. >> i yield back the balance of my time. >> the gentleman yields back. ho seeks -- mr. kennedy from massachusetts.
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for what reason does the gentleman seek recognition? >> thank you. i move to strike the last word. >> well, you get to do that for the next five minutes. >> lucky me. thank you. i have a couple of things to submit for the record. one, i know some of my colleagues were referencing a "new york times" piece from 1997. i have a "new york times" piece from i guess yesterday morning that talks about the proposed medicaid reforms and not quite as positive as you might have anticipated. i would like to submit that for the record. i also want to point out, there's been some discussion of engagement between the committee and various governors. >> did the gentleman submit something for the record? >> i have a couple of things. i appreciate that. thank you, sir. another is a letter written by pointing out one of the overall recommendgations
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going forth -- recommendation going forward. more flexibility and shifting costs to states, given our questions it is relevant. and last is a letter from a massachusetts hospital association in which they detail their concerns over the proposed medicaid reforms, quoting here briefly. our concern includes the g.o.p. plan subtuition of medicaid coverage with a per capita federal grants to states, grants that can cover more people but offer less. so mr. chairman, with your consent i ask unanimous consent to submit all three documents for the record. >> i can't list them as fast as you talk but i think i will accept. >> i have been told they've problem. >> but i appreciate your conversation. the other piece that i think is critical to this debate and i will do my best to keep this a ittle more intel yidgible is
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long-term care. i think -- i would hope most of the committee is aware, medicaid is the largest payer of long term care services in the country. i know we all care deeply about our seniors. but understanding that, cording to aarp, there are millions of seniors that are at risk with some of these reforms. so to go through some of the states represented by the committee, those are 1.1 million seniors in california that are at risk of having their long-term care benefits cut. it is 563,000 seniors in florida. 194,000 seniors in georgia, that,000 seniors in illinois, 102,000 seniors in indiana, 99,000 seniors in kentucky, 122,000 seniors in louisiana, 156,000 seniors in michigan,
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93,000 in mississippi, 94,000 i have been told in missouri, 2,000 in new jersey, 687,000 seniors in new york, 193,000 in north carolina, 10,000 in north dakota, 203,000 seniors in 261,000 000 in oregon, in pennsylvania, 152,000 eniors in tennessee, 496,000 in texas, 118,000 in virginia, 109,000 in washington state, 44,000 in west virginia. and a grand total for the ommittee's conversation of nearly 6.9 million seniors across the country at risk of losing long-term care benefits if these caps in medicaid reform go through. i think critically important
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that we understand given the late night, given the late notice, given the rushed tenure of this debate about what this is going to mean for our seniors, and particularly those that are going to be subject to these caps and these medicaid reforms as -- and making sure our constituents have time to understand what that means. because i believe that most people out there think that medicare actually covers the cost for seniors -- which it does. but when it comes to their caps for health care spending, nursing care spending long-term spending for seniors under medicare often which it kicks in. putting these caps in place would restrict. and the onus of that burden is then going to fall on families to care for their parents, grandparents, their sick, frail, at their most vulnerable
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moment. so we should be very, very clear that our constituents ungs that that risk is going to be borne by families in our home states, in our home districts under this plan. with that i yield back. >> the gentleman yields back his two seconds. who seeks recognition on the majority side? seeing everybody asleep we now go back to the minority side. the gentleman from california? or the gentleman from iowa? oregon. i am sorry. we are going to recognize the gentleman from oregon. if you want to be recognized. > i do mr. chairman. so questions for counsel, if i may, sir. i think they are appropriate. we are talking about the per capita caps and how they would play and it is a big change to how we would provide medicaid to folks. it goes from an entitlement
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program to a program that has some enrollee changes. it has an inflationary index, increase in the medical cpi. i want to thank the -- my friends across the aisle for at least thinking outside the box to an earlier commented, at least it is not a flat-out block grant which would be horrible. the question is, though, is it designed as well as it could be to accomplish what my friends on the other side of the aisle actually want to do? and my good friend from kentucky has referenced several times the 2016 baseline that suggested going forward that the problem -- i guess i'm concerned, the question, is there a range of state spending per category? because there is a lot of different categories. in 2016. tate by state. >> the per capita amount for
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each state would be based on state historiccal spending. >> and it varies. my understanding, there's a huge range among the states. the "new york times" had a story the other day showing that the range is like from 4,000 plus in georgia to 10,000 plus in new york. isn't it correct, also, that in recent years vermont and rhode island spent about 5,000 per child on medicaid while indiana, georgia spend around 2,000? >> i don't have those numbers right in front of me. but you are correct, there is a discrepancy in state spending by category. >> i guess where i'm going with that is, as you have a baseline that's set up that is geerled around a particular time period, there is going to be huge variations. in my state, for instance, in that 2016 time period, we were working hard to limit the rate
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of medical inflation. as a matter of fact, it was part of our waiver, part of a deal we made with the federal overnment. it seems to me the way this is set up we're rewarding the wrong behavior. you get more money if your medical inflation continues to increase. is that what we want to do? that doesn't really control health care costs. you are just rewarding bad behavior. those states, those providers are using expensive treatments maybe they don't need to do because they are not thinking outside the box in how they deliver health care. you are just rewarding people to spend money rather than get the quality health care outcomes that i think we all want. i think -- i think it would make more sense to have a target for inflation over a period of time -- that is blow may a state's current rate of inflation -- and give credit for those folks who are able to maintain that.
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maybe give them the enhanced match because they have been able to control their costs. that is what i think the majority is looking for. i think the minority is looking to make sure that it is a fair system that people actually get their health care delivered with that enhanced match that allows the innovation to think transformtively about it. without that enhanced match, with regular medicaid, you are just treating a few cases walking in the door. it is the same terrible health care system we have had from the beginning. medicaid doesn't pay very well. like everyone on the panel knows it pays the worse than anything. worse than medicare, worse than commercial. we need an incentive to make states and providers think outside the box. you have given flexibility with little money to be flexible with rather than just treating that acute case that walks in the door there is nothing that changes if we don't do that. so i -- based on the data here
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and the fact that we are rewarding kind of the same bad inflationary behavior, why don't we think outside the box and do it like -- well, i guess oregon is doing that. why don't we do something like that? i yield back. thaumpling. >> the gentleman yields back. i'm not the full committee chairman but if i were i would work with you on your suggestion. i don't think the members on your side of the aisle would work with you very much. you would? there you go. you may have to come up with an idea at 4:30 in the morning or whatever time it is. does anybody on the majority side seek recognition? on the minority side we go to the gentleman from california. > thank you, mr. chairman. a question to the staff. what special categories are in the new medicaid per capita cap plan? can you rattle off a few of
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them? >> sorry, sir. there is four categories of enrollment and five if there's an expansion. so children, elderly, adults, disabilities, and then expansion enrollees. >> as an example, what does this bill define as a isability? >> federal law requires that medicaid eligibility determinations must be made in the best interest of the recipient. so section of the social security act provides the determinations be made in a manner consistent with the simplicity of the administration and the best interest of the recipient. states can't deny coverage to individuals with complete applications or terminate existing coverage until all avenues have been explored or evaluated.
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for individuals who qualify for more than one, they will be determined to be eligible for the one that he or she accepts. so we would maintain that approach. >> so, therefore, would diabetes be covered -- be onsidered as a disability? >> we would maintain that approach in current law. >> now, apparently if somebody cost for s, the coverage is about four times the cost of someone that doesn't have a disability. it's factored somewhere in that range. so what happens to them when they reach the cap created by this bill? >> so the way the allotment
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works is that it is a per capita allotment determined by the number of individuals in eligibility categories times the number of enrollees. and that's the total computible allotment. so it doesn't limit the amount of federal dollars that can go to one single individual. >> so once again, it is a per capita cap plan and therefore it is allotment of dollars. and then the states have to determine how they are going to apply those dollars to their population mix. speaking of diabetes, i think the most effective community in the united states with diabetes is the native american community. i think they top the charts of all other categories of folks. if that's the case, how would this per capita cap plan
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involve sovereign nations? would that be a subset of the state? or do they have a special category of their own in a pot they would have to divvy up amongst the federally recognized tribes? >> on page 38, line p, american indians and ihs are exempt. >> age 38 the american indians and ihs are exempt. >> so they would have their own pot delineated directly to sovereign nations? >> they would be exempted from the cap. >> oh. they would be exempted from the cap. under efore how would -- -- >> current law would apply for those individuals. >> so this bill wouldn't affect the native american tribes. ok. and where are they covered in the current law?
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>> 1905 b. >> thank you. i yield my time to anybody on my side of the aisle who would like the remainder. seeing none. i yield back my time. >> the gentleman yields back. anybody on the majority seek recognition? seeing no one, others on the minority side? we go to the gentleman from new mexico. for what reason does he seek recognition? >> to strike the last word. >> the gentleman is recognized for five minutes. >> a question to counsel. what happens if rather than
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january 1, 2020 these changes to medicaid go into effect, those get moved up to january 1, 2018? what does that mean? >> which changes are you referencing, sir? >> what text in the bill references january 1, to 20 as it talks about medicaid? >> so there are multii am dates or multii am issues that reference january 1, 2020 as it relates to medicaid in the underlying bill. january 1, 2020 is the freeze date for the expansion population. then also on that date the per capita allotment system would start. >> so with both of those dates, if those move up to january 1, 2018, what would happen? >> if they were moved to january 1, 2018, they would
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start on january 1, 2018. >> it would shorten the time period associated for the transition? >> yes. so if we move to january 1, 2018, that would be a shorter time period. >> i am glad everyone got a giggle out of that, because i know that we don't believe everything that is tweeted but what is being tweeted is that the white house team indcate to move up medicaid fix to january 1, 2018 instead of 2020 to entice conservatives. so i think it is an important question that we need to ask. i don't know if there is an amendment that is coming or not. if it is going to be done in conference. if the conference can he that our republican colleagues are going to demand that they open up to c-span the way they did before. i just think here we are, 4:24 in the morning and tweets are coming out so maybe someone is
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awake, maybe they're not. as we're trying to get answers as to what policy is and what policy isn't to what that is going to mean to the american people. because as we look at the impact specific to new mexico, and we are looking at medicaid and what these per capita caps are, i don't think there is any disagreement here that these per capita caps will result in deral investments, federal dollars, to states to support medicaid. is there anyone that would disagree with that? is there anyone that would disagree with me when i say that the result of this legislation would result in less federal money going to medicaid? everyone agrees? >> no.
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i would -- does the gentleman want an answer? >> i would, mr. chairman? >> or is that a rhett orkle question. under the pending proposal money for medicaid would grow. it just wouldn't grow at as fast a rate as it does urnt current law. >> so you are saying that there would not be less federal money going to states for medicaid. they would -- based on the base year of 2016, move forward to more money uld be but the additional growth in funding would be at a slower rate than under current law. moy that is my understanding. >> well, i promised i would yield a minute to her. if i have any time left i would ask a followup question. >> i thank the gentleman.
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it is, what, 4:30 or whatever in the morning. i want to raise a red flag here. i know that we're all exhausted, but i think that we are not really thinking how -- what a heavy, heavy impact this is going to have on long-term care. approximately 60% of medicaid goes to long-term care. now, what is not being talked out is the tsunami that is not that far off in our future elative to dementia and also mer's. aarp in their letter talk about the boomers. when they start to turn 80 and older, the levels of service they would need. ou know, talking about these
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formulas like they're just tidy and neat. >> the gentleman's time has expired. >> i think this is going to be big trouble. and i think the majority doesn't realize what is coming on this. >> does anybody on the majority seek recognition? seeing none -- the chairman recognizes the gentlelady from michigan, pls dingell, for five minutes. >> mr. chairman, strike the last word. but i need help doing my math. so i want to build on what my colleague from california and new mexico were asking. my colleague from michigan who i love and is one of my dearest friends. but i don't understand his math. earlier today, he said that this was -- that this bill was oked because it didn't jeopardize the success we have seen of the healthy michigan plan. and that it wasn't going to hurt it. the way that i understand it, it puts an arbitrary date to
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ending expansion of -- i'm so tired like the rest of you. 695,000 people right now have coverage. but, bam, 1e9, anybody that comes after that is not going to be covered. but by the way you've got to -- >> no. if the gentlelady would yield. but don't say they're not going to be covered. >> the gentleman -- >> they will be covered but anybody that comes after that will not be. >> no. >> let me finish. >> if the gentlelady will yield but they will be covered under lower fmap. >> but i am going to build what they were talking about because medicaid is the largest payer accounting for 42% of all spending. as our population starts to age, which is going to happen, the demand for long-term care is going to double in the next 40 years.
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among people 65 and over it is estimated that 70% will need long-term care at some point. and people who are older than 85 are four times more likely to need these services than younger services. so all this math is coming together. yet you're telling me, no, we're not going to have to ration. we're not going to have to worry. i can't get the math to add up in my head. and maybe it is because it is 4:30 in the morning but i don't think it is. >> i had about three people talking to me at the same time. does the counsel want to -- if the gentlelady, does the counsel want to yield to the question that she was asking? >> i love my colleague. but i just can't figure out his math tonight right now. >> i thought you loved another former member of this committee from msh. >> he is my true love.
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>> i just want to clarify. >> he is probably asleep. > he is probably tweeting. >> we need humor. we need it. ok. could someone help me with my math? >> sure. so again the question regarding how the medicaid freeze would work and how it would affect expansion states? >> and how are we taking into account all this math, that we are going to freeze the number, we are going to -- we say we want people to be able to come in to healthy michigan and we have all these seniors needing more care. if they weren't on medicare because they have private insurance beforehand, suddenly they need medicaid to help. >> so the bill before us would allow expansion states to continue to enroll individuals on expansion until january 1,
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to 20. at that date, those individuals who stay on the medicaid program, the state would continue to receive enhanced match as long as those individuals -- >> but just for the old ones. not the new ones. >> correct. so for individuals enrolled after that date. >> that eends expansion. >> the state could continue to add enrollees at regular match. >> what are we doing about the seniors whose numbers are growing and have to go into that number somehow and we're not going to hurt them? we're not going to ration care? >> so the aged are a traditional medicaid population dr >> so we are growing. 10,000 of us -- i'm not 65 yet, either. fred is older than me. >> i'm not 65, either. >> i know. >> so i think that was a reference to how a growth in seniors in a state would intersect with the per capita allotment. >> and greater health care needs as well.
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>> to the extent that more individuals enroll in the medicaid program than any state, for any category, the federal contribution to the state would increase under the per capita allotment. >> but is it going to keep up with inflation, with the cost of long-term care? especially when you hit 80 and over. how do they account for -- that's the population that has the greatest health care needs. how are we accounting for the increase in those that need coverage? >> i might ask the gentlelady might have an additional 25 seconds? >> oh, my lord. >> by the time you figure that machine out, 30. >> 25 seconds. >> so the provision would grow at cpi medical. >> not with the real rate of inflation. thank you. and thank you for my extra 25. >> the gentlelady's time has expired. before i recognize somebody else i will ask counsel a question primarily just to keep myself awake.
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you have somebody in a medicaid expansion state that is a healthy adult. you have somebody in a medicaid state that is disabled. two different people. under current law, they both sign up. the young adult signs up at the 95% match. is that correct? >> that is correct. and that phases down to 90% under the current law. >> the disabled individual signs up at the regular fmap match. not the higher map. >> correct. >> so under current law, medicaid eligibles under the traditional categories are signed up at the normal fmap, but the new category of young adults are signed up at the super match.
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is that correct? >> that is correct, sir. >> thank you. does anybody on either side seek recognition? if not, the chair is prepared to call the question. does the gentleman seek a roll call vote? all those in favor of the pa lone amendment will vote aye. all those opposed will vote no. the clerk will call the roll. >> roll call. mr. barton votes no. mr. upton votes no. mr. shim cuss votes no. mr. murphy. r. burgess votes no. mrs. blackburn. mr. sca lease. r. l att a votes no.
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mrs. mcmorris rogers. mr. harper votes no. mr. lance votes no. mr. guthrie votes no. mr. olson votes no. mr. mckinley votes no. mr. kinsinger votes no. votes no.th mr. bill racks votes no. mr. johnson votes no. mr. long votes no. mr. buchon votes no. mr. flores votes no. mrs. brooks votes no. mr. mullin votes no. mr. hudson votes no. mr. collins votes no.
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mr. cramer votes no. mr. wallberg votes no. mrs. walters votes no. mr. costello votes no. mr. carter votes no. mr. pa lone votes aye. mr. rush. ms. eshoe votes aye. mr. engle votes aye. mr. green votes aye. ms. deget votes aye. mr. doyle votes aye. ms. schakowski votes aye. mr. putterfield votes aye. ms. matsui votes aye. ms. caster votes aye. mr. sarbanes votes aye. mr. mcnerny votes aye.
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mr. welch votes aye. mr. lieu han votes aye. mr. tonko votes aye. ms. clark votes aye. mr. lobe sak votes aye. mr. slader votes aye. mr. kennedy votes aye. mr. car dane as votes aye. mr. ruiz votes aye. mr. peters votes aye. ms. dingell votes aye. chairman walden votes no. >> are there other members wishing to be recorded? the gentlelady from tennessee. is she recorded? >> ms. blackburn votes no. >> the gentleman from pennsylvania. >> no. votes no. >> the gentleman from louisiana. >> mr. sca lease votes no. >> the gentlelady from the great state of washington.
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anybody else on our side not recorded? turning to this side anybody over here not recorded? we have everybody. so the clerk will report the tally. >> mr. chairman, on that vote there were 23 ayes and 31 nos. >> 23 ayes, 31 no's. the amendment is not agreed to. are there other amendments? are there other members seeking recognition? the chair recognizes the gentlelady from florida for what purpose? >> mr. chairman, i have an amendment at the desk. >> can you describe that amendment? >> on age rating. >> do you have a number or reference? i think you have a cheat sheet there. >> i might. yes, i do. >> or do you have a copy of it? >> yes, i do. >> just help our staff. >> this is at the very end of the bill to section 135. >> at the top -- if you have the amendment itself at the top it will give us a number.
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>> that's a different amendment. it is number . >> 8? ok. let them get that and then we ill proceed. the clerk will report the amendment. >> an amendment to the amendment in the nature of a substitute offered by ms. caster. > the reading is dispensed with. the chair recognizes the gentlelady from florida for 5 minutes. >> thank you, mr. chairman. colleagues, my amendment changes the republican's five to one age rating back to the three to one age rating which is the current law. the three to one age rating that was adopted in the affordable care act is a very important consumer protection that prohibits insurance companies from charging older adults more for their insurance. and i am talking a whole lot
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more. and changing the age rating the g.o.p. is allowing the insurance companies to charge our older neighbors more. so the affordability of insurance for our neighbors who are 50, age 50 and older, up to going into medicare, gets dramatically more difficult. how difficult do you ask? the five to one age rating would disproportionately harm millions of hard-working americans who are currently participating in the marketplace. 40% of whom are over age 50. a report by rand on the impact of a five to one age rating would increase premiums for older adults, that would increase premiums by up to $32 00 a year. in february 2017, in a -- in a february 2017 letter, the aarp
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discussed how the aca has helped drop the uninsured rate for americans age 50 to 64 by half. the aca helped drop it by half. that is a huge accomplishment. think about these folks. they are working hard. they didn't have insurance through their employer. the affordable care act in the marketplace was a lifeline for them. thank goodness, when they went in they didn't have to pay exorbitant premiums and copays. it was kind of kept in check. additionally, a september 2015 commonwealth fund analysis found that the change to five to one would cause 400,000 of our older neighbors to lose coverage. now, remember what president trump said. he promised numerous times that the republican bill will have
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better health care for more people at a lesser cost. well, the five to one age rating included in this republican bill would fail that test. and i can't help but think of my friend kathy palmer from tampa. she was my guest to the joint session of congress the president's address. she is 60 years old. she worked two parttime jobs. she's a single mom. she's also going to school to get her accountant's degree. she has a teenager in high school. and before the aca she could not afford insurance. so thanks to the marketplace and some help with tax credits and this age rating provision she is able to afford care. and here's the story she told me. and she has spoken out across
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my community back home in tampa. in december she had heart pain. she thought she was having a heart attack. she rushed to the emergency room. thank goodness it was a false alarm. but do you know what? can you guess what her emergency room bill was? $70,000. but ult mayly she paid $200 because she had coverage. that's one of the problems with the g.o.p. bill, it doesn't commit to coverage. i know the new omb director day said on tv, this isn't about insurance coverage -- again going back to assess. these are the thing thars impeding will really harm our neighbors back home. and i urge you to support this
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important amendment, to take the age rating back to an affordable level for our older neighbors back home. >> the gentleman yields back the balance of her time. the chair recognizes the gentleman from indiana, dr. bourbon for five minutes to speak on this -- buchon. >> thank you. this suggests for a possibility of success the individual market set up by obamacare would need to consist of at least 40% of young adults. today that number sits near 30% which has led to destabilized risk pools and driven insurers out of many areas of the country. in fact, patients in two thirds of our country are limited to a choice of one or two insurers. across five entire states patients have only one option. the department of health and human services estimates 25% average increase in premiums to millions of americans on the exchanges. under obamacare premiums may vary on the basis of enrollee's
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age but not by more than a three to one ratio. cbo suggests this policy inherently raises average premiums. prior to passage to obamacare health care expenses for the elderly premedicare age typically ran 4.8 times higher than younger patients. this artificial age band inhibits the ability to provide sound plans driving younger individuals out of the insurance market. skewing risk pools and driving up premiums for everyone. state age rating flexibility act of 2017, which i had introduced and is in this bill, gives control back to the states allowing them to tailer their age rating standard to their specific population. under this legislation, states may set their age bands anywhere from five to one to one to one depending on their state. studies suggest this would add almost 4.5 million individuals
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under the age of 47 to the marketplace and drop average premiums by 5.9%. this flexibility will allow young healthy patients to join the health insurance marketplace, stabilize risk pools, allowing insurers to offer patients more options breeding competition and driving down costs for everyone. and this has been done in the state of maine the state where the health care market was facing a long-term death spiral even before obamacare they offered guaranteed issued preexisting protection protections to stabilize their market. main had an invisible high risk pool that they loosened their age ratio. as a result of these changes, individuals in their early 20s were able to see premium savings of nearly $5,000 a year. while individuals in their 60s saw savings of more than $7,000. board meb of maine's
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invissible high risk pool recently wrote more and healthy applicants entered. the total increase in the individual market multii year death spiral was reversed. our plan gives flexibilities to the states. it more adequately reflects the real cost of care. and i urge my colleagues to reject this amendment. i yield back. >> the gentleman yields back. do other members wish to be heard? the chair recognizes the gentlelady from california. >> thank you, mr. chairman. move to strike the last word. i think that this is an age tax, in plain english. i don't know what the thinking as in how this was constructed , but while people over the age of 60 get twice as much as
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individuals under 30, the replacement bill also increases the age rating ratio from three to one to five to one. an age tax.p with we're going to hear from a lot of people across the country on this. this is going to create some real big bills and hardships for people. now, aarp says that their previous estimates on the age rating change shows the premiums for current coverage could increase by up to $32 00 for a 64-year-old while reducing premiums by only 700 for a younger enrollee. but they say the change in structure of the bill will dramatically increase premiums for old clersumers.
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they estimate that the bill's changes to the current law's tax credits could increase premium costs for a 55-year-old earning $25,000 by more than $2300 a year. for a 64-year-old earning 25,000 that increase rises to more than 4400 a year and more 64-year-old a earning $15,000. why are you doing this? why are you doing this? in the -- and so much of the conversation and debate this evening, one of the things that our republican colleagues have highlighted were out-of-pocket costs for premiums. well, if you objected to what ou were describing before,
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this provision has older americans being forced to pay higher out-of-pocket costs for their premiums because of this age-adjusted tax credit given the increase in the adjustment ratio. so this is an age tax. hat is what you've got here. i don't think that the -- i should put it this way. i think that the impacts are really rather significant. if these numbers were much lower, at least some people would be able to absorb them. but these are large amounts. these are large amounts of -- it is the st opposite of what -- it's not the opposite of what you were describing before relative to higher out-of-pocket costs.
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but now you've done a turnaround. and you're applying it and you're applying it to older americans. that's why it is an age tax. i support the gentlewoman's amendment and -- i don't know if you're going to all get in a huddle after this markup and start talking about some of the things that you've put into this bill, but if there were to be a huddle i would think it would be around this one because this is -- this is going to be highly, highly objectionable legitimately by people across the country that 50 to here from, what, 64 and older. so i don't know if anyone would like my last 41 or 40 seconds. all right. i yield back.
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thank you. >> the chair will recognize the chairman of the subcommittee on health. the gentleman from texas, mr. burgess. >> thank you, chairman, for the recognition. as you know, our committee has been focused on market reforms. market reforms without mandates. we've talked a lot in the subcommittee about giving states options through greater flexibility. under the affordable care act, not only are there mandates on the health care benefits that must be covered, there are also restrictions on cost factors. so focusing on one, the age rating ratio. many states were using a five to one age ratio before 2010. meaning that the most expensive plan can only cost five times more than the least expensive plan when it comes to patients' ages. the affordable care act moved this three to one -- moved this
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ratio to three to one for all states -- all states, regardless of their patient needs or circumstances. during a hearing last year, quoting from a witness from that hearing, makinging health insurance too expensive for healthier young people we want in the insurance pools drives them away, increasing the cost of insurance for everyone who remains. again, looking to the congressional budget office and quoting from them, average spending among people who are 64 years old is about 4. times as high as average spending among people who are 21 years old. in a separate hearing, another witness suggested the cost for an average 64-year-old may be as much as six times that of a 21-year-old. here is the witness in his own words. the average 64-year-old
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consumes six times as much health care in dollar value as the average 21-year-old. hence, an underwritten, in an underwritten insurance market, insurance premiums for 64-year-olds are roughly six times as costly as those for 21-year-olds. under the affordable care act, policies are age rated, insurers cannot charge their oldest policy holders more than three times what they charge their youngest customers. if every customer remains in the insurance market, this has the net effect of increasing premiums for 21-year-olds by 71% and reducing them for 64-year-olds by 13%. mr. chairman, i don't think it is any secret we want to the attract younger healthier patients to health care plans. making health insurance more affordable will encourage all patients to buy and to keep
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health insurance without a government mandate. as far back as 2013, the kaiser family foundation argued that the percentage of young people necessary to balance the risk should be 40%. this report calls a scenario where young adults represent only 25% of enrollees, what they called the worst-case scenario. and it goes on to say, quoting here. but if this more extreme assumption of low enrollment among young adults holds, overall costs in the individual market plans would be about 2.4% higher than premium revenues. today, the number of young healthier enrollees is less than 30%. initial eesmaths from analysts suggested for a possibility of success the individual markets set up in the affordable care act would need to consist of at least 40% young adults.
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40% young adults. today, that number sits near 30%. so everyone here should be able to agree that we need more young, healthy individuals for a stable market. it is one of the strongest tools that we have to achieve that goal. studies suggest that this change would add almost 4.5 million individuals under 47 to the marketplace and drop average premiums by 9.5%. this policy gives control back to the states. it allows the states to tailer their age rating standards to their specific population. each state has different populations, and they are allowed to set their age rating wherever it most advantages their citizens. thank you, mr. chairman. i yield back the balance of my time. >> the gentleman yields back. are there other members wishing to be heard on this matter? the chair recognizes the gentleman from colorado. >> thank you, mr. chairman.
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mr. chairman, when we passed the affordable care act, one of the issues that we faced was the fact that older americans who had oftentimes more complicated and greater health care issues and health care needs could not afford their insurance. and so what we did when we passed the aca was we instituted a three to one ratio. that is because we want older people, people who are what they called them earlier today the younger -- or or the almost elderly. the people from 50 to 65. we want to make sure people like that can actually get insurance that they can afford and get the health care that they need. now, prior to the affordable care act most states did not protect consumers from being charged higher premiums solely based on age. so these older people, many of them could not afford -- could not afford to get insurance. the aca's three to one ratio
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struck really a good balance because it shielded older americans from paying vastly higher premiums than younger healthier enrollees but it also did allow for some age rating. and what would happen would be if you did the five to one ratio, premiums for older adults would increase more substantially than premiums would decrease for younger enrollees. and so just for example, the annual premium for a typical silver plan for 64-year-old would grow from 8500 under the aca to 11,000. a 24-year-old enrollee would see premiums fall from 2800 to 21 00. so what would happen if you went to a five to one ratio, you would actually overcharge older adults and undercharge younger adults. now, my friends on the other side of the aisle say, well, we
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want to encourage enrollment among the young and healthy. and yes we do, but let's not forget that enrollment among the young and healthy has actually been relatively strong under the aca. in 2016, 32% of the marketplace enrollees were ages 19-43, which is pretty comparable to their representation in the population. we can always do better. i am not suggesting that we have achieved everything we want with the young and healthy. but to put it on the backs of older americans would only make our situation worse because they wouldn't be able to afford insurance. in fact, if you change the ratio to five to one, that would decrease coverage among healthy older adults by as many as 400,000 people over age 47. now, this is why the the aarp came out in opposition to this legislation. i know that one of my
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colleagues has already put the letter into the record. but what aarp is concerned about is for older adults -- people who are not yet medicare eligible -- they will not be able to afford insurance. and what aarp estimated is that for a 64-year-old senior who makes $15,000 to $25,000 a year, premium increases could a as high as 7,000 to $8,000 year. you tell me how they are going to afford that insurance at a salary of $15,000 to $25,000 a year. so i really think this is a very backward way of thinking. it didn't work before and it certainly is not going to work now. if our goal is to get meaningful health insurance for every american, we should stick with our three to one ratio and fix some other things. with that i yield back. >> the gentlelady yields back.
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the chair recognizes the gentleman from georgia, our pharmacist. >> thank you, mr. chairman. i am glad we finally got to this end of the dais. i appreciate that very much. mr. chairman, i want to talk about this real quickly. the plan that we are offering here will strengthen the health care market by loosening obamacare's age rating ratio, which is used to adjust premium amounts according to an individual's age. obamacare mandated that the cost of the most generous plan for older patients can only be three times what younger consumers pay for the least generous plan. this unrealistic regulation led to insurance pools with older, less healthy individuals while driving younger and healthier americans from the insurance market. this ill-advised three to one policy led to artificially higher premiums for millions of americans especially younger and healthier patients. loosening the age rating restriction will help.
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my colleague dr. buchon gave the example of maine. a state where the health care market was facing a long-term death spiral. even before obamacare they offered guaranteed issue and preexisting condition protections. to stabilize their market maine had an invisible high risk pool hat loosened their ange -- age ratio. as a result of these changes individuals in their early 20s were able to see premium savings of nearly $5,000 while individuals in their 60s saw savings of more than $7,000 a year. as premiums dropped more young and healthy applicants entered the market. now, the plan that we are offering here states that the flexibility and resources experience these same results that they had in maine. we are told by the health economist that the health cost per age is roughly 4.8 to 1.
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hence, that is where we get the five to one ratio. our plan accepts this reality, loosening the ratio from five to one and gives the states the flexibility to set their own ratio. obamacare failed to make health coverage more affordable for the majority of americans. instead, it increased costs that have reduced access, everything. now, hear this and make sure we understand. because we just heard it said that this was an age tax. keep in mind that to protect older americans our plan will also provide a more generous tax credit to older americans purchasing coverage in the individual market. so we are offsetting that. this is not an age tax. keep that in mind. our age rating reform will help bring younger enrollees get health care and improve the detier yoryating insurance market for everyone.
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this will allow young healthy patients to join the health insurance marketplace, stabilizing risk pools, allowing insurers to offer patients more options, breeding competition. breeding competition. and driving down costs for everyone. so four major points there. first of all, the real cost of are by age is roughly 4.8 to 1 according to health economists. so our plan accepts this reality it loosens the ratio of 5 to 1 and gives states the flexibility to set their own ratio. third, the third point is to protect older americans our plan also provides more generous tax credit to older americans purchasing coverage in the individual market. so i think it is erroneous and i think it is misleading to say that this is an age tax. it is not. this is simply going to make the markets more competitive. so i hope that we will defeat this amendment because what we are offering here is going to
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achieve exactly what we are trying to achieve, and that is more competition in the marketplace. and i yield back. >> just a quick point also i would -- this is one of the main reasons why the exchanges are spiraling and insurance companies are dropping out. young healthy people, the predicted percentage of 40% is around 28 to 30%. because of that costs are going up from everyone further driving even more people out of the marketplace. and that is why the exchanges one of the main reasons the exchanges are failing. this type of change will bring the cost down for everyone and encourage younger healthier people to get in the market. as they do, the costs will continue to come down of course because their risk is less. i yield back to the gentleman. >> mr. chairman, i yield back the remainder of my time. >> the gentleman yields back.
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are there other members seeking recognition? the chair recognizes the gentlelady from illinois. >> thank you, mr. chairman. i would say to my colleagues across the aisle, if you don't think that your town hall meetings are raucus enough, then i would definitely suggest that you vote against this amendment. it is just shocking to me that at the same time as your bill would give a $600 billion tax cut to the richest americans and corporations that you are going to figure out a way -- and you have it all figured out. i know. you've all added it up. i know -- and the tax credit is going to make all the difference in the world. the tax credit -- which isn't even based on income. it is just based on age -- is going to fix everything here.
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you are going to take it out on the backs of senior citizens of the median annual income of the senior purchasing insurance on the exchange is $25,000. $25,000. and let's just figure out how we are going to make them pay more out of pocket for their health care. that is exactly what we were trying to address in the affordable care act. how are we going to make it possible for seniors to get the health care they need? never mind saving for retirement. we are talking now about the 50 to 64-year-old where we have a huge retirement crisis right now. people don't have a penny in the bank in order to retire largely because they are paying so much money for their health care costs. now, we could figure out with
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$600 billion how we might be able to figure out a scheme that would protect those senior citizens and would be able to attract the younger people. and i don't know if maine is the only example of how this thing works. if it has really been tested. aarp says seniors are going to pay $3,000 more or even above that, and the young people will see $700 less that they pay. i'm not sure how that actually works out. so i think this is an absolutely crazy thing to do. i agree with my colleague who called this an age tax. that is exactly what we are dealing with right now. and i am just wondering -- i want to ask my republican colleagues, did you really come to congress to take health care
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away from senior citizens? because that is what happens when you can't afford the care, you don't get the care. we have all heard the stories of seniors cutting their medication in half, taking a pill every other day. of not going to the doctor. of putting off the kind of preventive care that they need because they simply can't afford their health care. all this adding it up with -- i think with very little evidence that this kind of thing is going to absolutely attract young people to come in. we do have a problem there. let's sit down and figure that out and figure out maybe we can lower the cost for young people. but to ask our seniors -- and the way, it gives the state permission not just to go to 5
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to 1. they could go to 6 to 1 or 7 to 1. in other words, insurers could charge any darned thing they want to the senior citizens at any level they want, as long as the state says that it is going to be ok they can set that rate at any place. i just think this -- and it is not just me. the 35 million members of aarp are not going to be greeting this message and your vote with glee here. they are not going to congratulate you for figuring out how to balance the health care market. i assure you. i've been working professionally with senior citizens long before i was one myself. i know that this is going to be a real thorn in their side and it is not necessary. we don't need to do this.
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you don't need to vote against this amendment. i support the amendment and would like to see it pass. i yield back. >> other members seeking recognition? the chair recognizes the gentleman from texas in flores. >> thank you. one of the primary reasons you heard already for the death spiral that obamacare exchanges are in is because of this artificial three to one ratio. if you think about it for a minute, if the cost to provide health care to a 60-year-old is $500 a year but you only charge them $300 a year, and you are taking that $200 difference and charging it to a younger population, that is an age tax. but it is an age tax on the younger. it is an age tax on the 27-year-old who is just starting in their career who can't -- who has a lower income, who can't afford to buy as much as somebody who is
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farther along in their career can. so it is an age tax. it hurts our millenial generation because it is an intergenerational transfer of funds from -- of costs from one generation to a younger generation. and that is what we shouldn't have. you know, my first economics professor taught me something i've never forgotten. she said the laws of economics are like the laws of gravity. the more you violate them, the harder the impact at the end. by artificially setting the underwriting ratio at three to one instead of what the real costs are, you are causing a disruption. so you are causing younger people to not be able to afford their health care because it is more expensive than the product they are getting. and so they don't buy it. and so then you wind up with an older population that is expensive that is not paying the full share of the costs on an underwriting basis and the
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whole system collapses. and that is what happened. that is the reason we have younger healthier americans driven away from the insurance markets. and that is caused prices to rise for all consumers. in fact, persons who purchased insurance, the obamacare's individual marketplace saw their monthly premiums increase by an average of 25%. so our plan, our proposal, accepts reality and it allows the states to set their own rate up to 5 to 1 and -- it's to pull the -- our goal is to pull health insurance markets out of a death spiral by encouraging younger people to purchase health coverage and incur more options to help drive down costs for everyone. the gentlelady's amendment also , by having a 3 to 1 ratio, says that older patients with the most generous plan are only
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charged three times what younger consumers pay for the least generous plan. so there's a further violation of the laws of economics in that. i can understand why aarp doesn't like this, is because they're not getting young people to subsidize the cost of care for their population. and, look, i'm part of that population so it seems to me like i ought to pay for my share of the cost of the coverage that i incur. mr. chairman, i yield back. >> the gentleman yield back the balance of time. >> would the gentleman yield? >> i yield. >> mr. chairman, very quickly. the gentleman has just articulated it excellent. and thank you for doing that. because the point is even obamacare, when obamacare was proposed, this is what the idea was, to get more young people into the health care market, into the health insurance market. it didn't work. it didn't work it at 3 to 1.
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we give you an example of where it did work in maine. it saved money. it saved 20-year-olds $25,000 a year. it saved those in their 60s, $7,000 a year. tax. s not an age we get them in the market along with the younger people. we increase competition. nd then the costs go down. this is -- of all the things that we've done in this plan, this is one of the best things we have done. i would submit that this is going to help competition as much as anything is going to. so i thank the gentleman from texas for doing such a good job of articulating that. i will submit again that at 3 to 1 it didn't work in obamacare. we are going to try it this way. it is not going to cost the older people any more. they are going to get a tax credit for it. this is going to increase
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competition. mr. chairman, i yield. >> the gentleman yields back the balance of the time. mr. flores. >> i yield back. >> other members seeking recognition? the chair recognizes the gentleman from north carolina. >> mr. president i have a brief question. is the 5 to 1 ratio aspirational or is it actually a ceiling? the ratio 6 sets from 5 to 1 but states could narrow or expand. >> would you think a state like north carolina would exceed the 5 to 1 ratio? that is not -- that's rhetorical. i withdraw the question. thank you. >> i yield back. >> the gentleman yields back. members on the this side of the aisle? ok. other members? i guess we go down to mr. sarbanes. you are recognized for five minutes to speak on the amendment. >> thank you, mr. chairman. i don't know that i need five minutes.
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i am very concerned about changing the age rating and even more concerned to hear hat this 5 to 1 is sort of a guideline but states can go on either side of that because once you take down the guard rails, which is essentially hat the age rating is, you begin to slice the insurance pool back up in ways that completely undermine the principle of broadening insurance pool, spreading risk in a way that can make the pool viable and also those who are benefiting from the coverage in the pool addressed in an effective way. so i worry that there is a combination effect occurring americans t to older
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. and that combination is negative and it comes from the age rating being changed. which is going to have a significant impact on the premiums that are being paid. by older americans in the health exchanges. the supports to help alleviate the burden of some of the eductibles and copayment assistance or copayments that re in the current aca are also going away. so that extra support that is available will not be there any more. and then the notion that the tax -- these flat tax credits
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-- you know, there's a couple of tiers to them. but the idea that those in any the n substitute for affordability credits that are being pulled away is nonsense. every analysis that has been done so far suggests that, again, particularly for those adults in the higher age brackets within the insurance xchange, the health exchanges, the credits that are available to them under this proposed legislation don't come anywhere close to making up for the affordability credits that are being lost. and so you have the combination of the tax credits, of being last essentially being down graded. you have assistance with
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respect to deductibles and copayments going away. and then taking these guard rails out of the picture, which e the age ratings, and those ratios, further aggravate the higher n those in the age brackets. we're getting their coverage -- who are getting their coverage through the health insurance exchanges. so you put all that together, and it's really a significant burden on those folks in the health insurance exchanges. for that reason, i don't think we should be changing the age rate, particularly in the context of all of these other things that are happening. i yield back. >> the gentleman yields back. other members seeking recognition on this amendment? the chair recognizes the gentleman from new mexico for
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five minutes for purposes of striking the last word. >> thank you, mr. chairman. good morning, sir. counsel responded to mr. putterfield's question in a way that caught my attention. i wasn't intending on asking anything during this round. did i hear general counsel say that the age rating is changed o 5 to 1 in this bill? >> 5 to 1 and states can expand or narrow the band. >> so that's the part i want to go on. states can expand or narrow. what does that mean? >> they can go below 5 to 1, they can go 5 above 5 to 1. >> it could be 10 to 1. it could be 2 to 1. so why put a number in there at all? mr. chairman, the republicans
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in this bill chose to put a number in there that they have been bragging on that is 5 do 1 and i guess i didn't fully appreciate this. maybe when counsel was reading the bill yesterday morning they were going a little fast here so i didn't catch that as i was going through it. maybe when i went to the restroom and i got zolded for that one, too. but -- >> there you go. >> help me understand that then. s 5 to 1 a suggestion? >> will the gentleman yield? >> sure. >> as we said before, health economists have said that the cost of care by age is roughly 4.8 to 1. hence, that is where we got the 5 to 1. >> you are not saying it shall be 5 to 1 and only be 5 to 1. that's not what this bill says? >> but states can narrow or expand. >> do states need to apply for a waiver to expand or retract?
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states can determine whatever ratio they want. so i go back to the question i asked before. why are republicanning setting a number to begin with just so they can feel good about themselves? i just don't understand that. >> will the gentleman yield? >> just following up on what was stated earlier. is that the desire to get the young healthy people into the market. but -- >> reclaiming my time. the point that i'm trying to make her is while five to one has been talked about, maybe there are numbers people can cite. the bill does not require 5 to 1. the bill says states can do whatever they want. so we suggest you do 5 to 1, is what the bill says. but the states can do whatever they want. it could be 10 to 1, 8 to 1, 7 to 1, whatever the states determine. i'm sorry. i guess i just -- >> will the gentleman yield? >> i yield. >> the 5 to 1 is that what --
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so getting older is going to be a preexisting condition. so we'll have people 62, 63 will have to pay that much more o for premiums? to draw in the young and invincibles? it sounds like a preexisting condition to me. >> just picking up on the theme here. i mean, this is being stated as an effort to encourage the young and healthy to get in. but if you get to 10 to 1 or 15 to 1 -- getting them in at a certain point doesn't offer much benefit if they are getting in for a nickle and in all of the premium costs are being loaded up to these folks ho are in the higher age brackets. so there's a rationale to
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putting the ratio in a place where there's some connection there. because otherwise you're not going to get people coming in who are young and healthy, who are benefiting the pool with the premiums that they are paying. i yield back. >> and mr. sarbanes, i guess the only thing that concerns me more than that is there's no protection for those that are older in here. none. that ratio can be as high as the state wants it. our republican colleagues can't even set a cap. maybe add an amendment that can say it will be no more than 100 do 1. >> will the gentleman yield? were you not on a public utility commission? >> i was. >> didn't you set rates? how the heck can we trust you to set rates if -- >> mr. chairman, reclaiming my time. >> i don't get it. >> reclaiming my time. you and i both know when you
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are establishing rates and looking at rates up a fixed rate in there. so what you have done -- >> the gentleman's time has expired. >> you took a little time there. >> you yielded to me. the gentleman's time expired. >> you're suggesting utilities should only pay 5 cents a kilowatt hour but you can charge whatever you want to charge. >> no. >> you're setting the range at an arbitrary -- >> the gentleman's time has expired. >> why details matter. >> the gentleman's time has expired. i am going to recognize myself and continue this discussion because i find it fascinating. we have a couple of former rate regulators from the states, and i might ask my colleague mr. cramer who is an elected rate regulator. why is it that only a washington politician or bureaucrat knows the right rate and it is arbitrary and not based on the marketplace? is there a reason that we
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wouldn't trust somebody at the state level to take care of their constituents? >> my answer would not be as clear and articulate as your question. you answered the question with the question. >> tell me about that. >> well, i was sitting here listening. i had the exact same thought. what in the world would we be doing if we turned north dakota's utility rates over to the ferk? that would make no sense. because we in north carolina know the costs of the resource, the cost of the transmission of whether it is elect trissty or gas. we are the experts on the ground with the customer. and to somehow suggest that we should be confined by some washington mandate violates really what is best for the people that we work for. so your question is exactly what was running through my mind.
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>> does the gentleman yield? >> the stunning thing to me is that mr. lieu han himself was a public utility commissioner. and they looked at the market, they looked at their resources, they looked at what mattered to new mexico. and i assume, didn't stick it to the consumer just because they could. >> if they did, you wouldn't be in the job very long. >> and that would apply to any commissioner anywhere. im not picking on him here. but i'm just saying, i'm thinking through my days in the state legislature -- >> since you used my name a few times would you yield to me? >> of course in a second to my good friend. but my point is, this the is the seminal difference at least on this issue, between us on the republican side and you all on the democratic side. which is we actually trust people closer to the patient, closer to the consumer to make this decision better than some bureaucrat back here. and i would just take you back
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to my comments from governor herbert in utah who had to plide plead with a bureaucrat in washington to be able to use this new technology called email to email recipients who had email and he was turned down by the federal bureaucrat by email and it would have that 6 billion for utah could have gone into health care. but the administration said no you can't use this wild new crazy technology that everybody else uses. you can't save your state $6 billion. you have got to continue to use snail mail. this makes no sense. so yes, i would now yield to my friend. >> mr. chairman, i just hope all the seniors who are watching here understand that there is no protection for them against these rate increases. as i reminded the chairman elier your good governor from
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oregon said the bill would increase costs for women and seniors. i see why. >> reclaiming my time. the good governor and i have a disagreement too. he voters dedicated to dictate lottery money to help veterans and she took the money out of general funds for veterans. they're feeling sold out. so the governor and i have a difference of opinion there. but the bottom line is, we believe in the states and the -- the closer we get to these decisions back to the people who are right there in the communities, it is what we believe in what the cco's, what we believe in in other parts of what we do. and for the life of me, i can't imagine why if it were mr. cramer back in north dakota, he would think it is in his best interest or the best interests of the consumers in north dakota to come up with some scare tactic rate that doesn't work for them. this makes no sense.
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and by locking in this arbitrary 3 to 1, that's the arbitrary number here what you all did to lock it in. you stuck it to the younger generation. please. you stuck it to the younger generation. >> will the chairman yield? >> no. you stuck it to the younger generation. that's why 19.2 million people under the age of -- 45%, said i will pay the i.r.s. penalty. that is your enforcement mechanism. or i will get a waiver. but i'm not buying insurance. so i'm out of the pool. my time has expired. other members seeking recognition? >> mr. tonko. >> thank you, mr. chair. i rise in support of the gentlelady's amendment to eliminate the age tax. older americans are among the hardest hit by this republican plan. not only would the proposed tax cuts drain away the medicare
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trust fund to pay for a handout for the healthy. this republican lan also repeals a common-sense protection with the the affordable care act that kept premiums under control for those in their 50s and 60s. instead, under this republican plan older americans will be forced to spend their preretirement years paying thousands more every year just to keep their health care. then we are hitting seniors with massive medicaid cuts that will jeopardize their long term care. i don't think it is a winning political strategy for certain to kick granny out of the nursing home. this entire bill is an attack on seniors. the brookings institute has estimate that had this republican repeal bill would not only impose a new age tax on seniors, it will hasten the insolvency of the medicare trust fund by 2024. earlier tonight, or perhaps yesterday, i heard my colleagues talk about how the aca raided billions of dollars from medicare.
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i would ask counsel, does this republican repeal bill return this funding to medicare that my republican colleagues care so deeply about? does it return any drars to the rust fund? >> the energy and commerce print doesn't have any provisions related to medicare. >> but -- you must know the elements or whether or not there is a plan to restore funds to the medicare trust fund to make it more solvent. >> which trust fund are you referencing? >> the medicare trust fund. >> which medicare trust fund? >> just in general. >> there are two -- >> does it return it to any of them. >> there are two trust funds the part a and part b. >> does it return to either? >> there are no medicare
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provisions within the enc bill. >> but i hear there's all these buckets that you're going to. is there a plan here to make that fund more solvent based on what has happened to it here? >> which trust fund? >> either one of them. >> well -- >> will the gentleman yield? we're not addressing medicare. would the gentleman yield? we're not addressing medicare in this bill. our provisions are medicaid. >> so i guess we don't make an effort here to make the trust fund more solvent. and that is because this bill is simply a tax cut for the wealthy in health care bill clothing. instead of investing in health care we are investing in health care ceos on the backs of the elderly. i yield back. >> other members seeking recognition? the chair recognizes the gentleman from illinois. >> i yield to the gentleman from maryland. >> you yielded back.
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all right. >> i didn't see his hand up. >> i just want to -- >> let us reset the clock to 2 minutes. >> i just ask counsel. >> if the gentleman would suspend. >> yeah. >> just hit it. we'll stop at 3. >> do you know if -- >> wait a minute. please stand by. we're experiencing technical difficulties. >> just let it go. we'll go until 2. go ahead. mr. sarbanes is recognized for 2 minutes. >> does counsel know whether the -- whether it was the case that at the state level in various states there was situations where insurance companies were allowed to discriminate against patients based on a preexisting condition prior to the passage of the aca? >> yes. >> ok. i just want to say thank god
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for wherever the pointy-headed washington bureaucrat is who decided that states could no longer discriminate based on preexisting conditions. it is not always a good and a virtue to send it back to the states. once of the reasons we're here is to try to put some kind of constraints in place, bring some rational thinking based on expert testimony that we get here as to how these insurance products ought to be regulated. d that extends to the rating guard rail system as well. and we keep hearing about this bogey man of this bureaucrat that is hidden away in washington trying to run everybody's lives. there is a decent respect for the balance in a federalist system between our perspective, the federal perspective, and
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what happens at the states. but when people -- when the practices get out of line in a way that harm people, there is an appropriate role to be played to step in and provide ome kind of restrictions and requirements. and that is what we are talking about with age rating and that is what we are talking about in terms of a ban on discrimination based on preexisting conditions and other things. i yield back. >> the gentleman's time has expired. the chair recognizes the gentleman from illinois mr. shim cuss. >> thank you mr. chairman. just going back on the -- this isn't medicare but when secretary was testifying i mentioned this in a health care hearing, a couple weeks ago. she -- she eventually admitted that they double counted $500 billion as a pay-for for obamacare. then she also admitted that they counted the same $500 billion as a savings of the
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medicare trust fund. so there was a momentous occasion to get her to agree that she double counted $500 billion. n this just discussion about what the savings will be to encourage the young and healthy back in the market, standards and poors did an initial estimate of the bill before us. it suggests increased affordable for the elderly and younger population resulting in an improved risk pool in the individual market. that's what we want. we want an improved risk pool, a stronger one and more youthful one. they suggested that average premiums for 21-year-olds would decline by 20% as a result of the replacement plan. using the average national premium price from the 2016 marketplace, a 20% decrease would mean annual premiums of 2,625 compared to average annual premiums of 3,281 for
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the 21-year-old. >> i will turn to see if anyone wants stirble time. if not i yield back. >> the gentleman yields back. the gentleman from massachusetts. >> to strike the last word. >> recognized for five minutes. >> a couple of points that i just wanted to weigh in on. first, for our colleague from texas mr. flores. i appreciated the explanation that he gave and i thought it was a good one about structuring in the way we bring people in and why it is important to try to keep those costs low for younger americans so that they will come into those insurance pools and offset the risk. the importance of having those healthy risk pools. i think where you see some pushback from democrats on this is, one, not the idea that there's some wealth transfer or that one age bracket is subsidizing the other, but that in the structure of the bill is
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lso a $600 billion tax cut tor wealthy. and there is plenty of way that is $600 billion could be used rather than giving a tax cut for insurance company ceos to increase their pay. it could be used to offset some of the costs for our seniors instead. so in massachusetts we've actually as we talked about before, we've got healthy exchanges, good insurance coverage, a robust economy. one of the issues is we actually have a better insurance product for people in the marketplace and we yes actually have a stiffer penalty than the federal penalty was across the board. so it was a tougher penalty for you not to engage but it was a bet prore duct if you did. so you have structured this a bit differently instead of saying a penalty to let your insurance laps is a penalty to get back in as we've well established there's no cbo score yet we don't know what it
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is going to cost or the insurance implications about who gets in or out. but the fact is that structure is actually quite similar. the rhetoric around this happens to be that somehow paying that fine or fee or tax the government but paying it to an insurance company is somehow freedom. an interesting way i looked at it. i never looked at insurance companies positively but i'm open to the suggestion from our colleagues that somehow investing in the insurance market is an act of freedom. the second point i would like to make and the chairman talked about trusting those closest to the issue, and i think that is a very valid point. i would point the chairman and other members of the committee o the "new york times" piece today -- another one -- that pointed that in fact the american hospital association, the american -- association of
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american medical colleges, the catholic health association of the united states and the childrens hospital association, along with the american nurses association, the american medical association and aarp have all come out against your bill. so if we are talking about the medical community, nurses, hospitals, faith community, they are all looking at this and given what their position is on the frontline and they don't like it. so it isn't just bureaucrats in washington -- which by the way we're all elected to represent our constituents back home here and try to figure out the right way to legitimate. these are the folks representing those people on the frontline. >> i yield the balance of my time to the ranking member. >> i just wanted to follow up on a few of the points that mr. kennedy made. first of all, if the federal government didn't step in and these are thing that is you actually agree with now, we would still have preexisting onditions, we would still have lifetime caps, we would still
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have annual caps, we would still have -- we wouldn't have the children up to 26 on a policy. so to say that there is no need somehow for the federal government and we're going to leave this to the old days when the states were dealing with these things, you know, belies the fact that all of you now agree that some of these discriminatory practices have to be federalized and put into federal law. otherwise, we wouldn't have those protections. so i don't know why i should treat the age rating any differently than these other discriminatory practices and say they should be left up to the states rather than be a federal initiative. secondly, as mr. kennedy said, when you talk about if i run out of time mr. chairman i will just take my own time after the republicans. when you say -- mr. kennedy points out that you're repealing all these taxes. one of the taxes that you're repealing from my understanding actually does impact medicare
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and the trust fund. and that is the one that -- we call it the medicare -- the pay roll tax increase. the pay roll tax increase on the wealthiest americans which currently amounts to 0.9% increase for individual workers with annual incomes of more than 200 and couples with more than 250. that increase helps with the medicare. >> the gentleman's time has expired. is there anyone on the majority side who seeks time? seeing none does the gentleman -- >> strike the last word. >> recognized for five minutes. >> so the repeal of that pay-for, if you will, is going to -- my understanding, will jeopardize the medicare program, put it on less strong financial footing. i understand that in the wames committee so that is why probably the counsel said didn't mention it. but it is a fact. and this is part of the transfer, if you will, from --
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where these higher incomes individuals are now going to get a tax break and money is not available to use for other things that would create more affordability here. now, look, we can do whatever we want here. the reason why my understanding is that the reason why we went from 5 to 1 to 3 to 1 was because we were concerned that these people between 50 and 64 -- that there were a lot of them that were not insured, maybe because when they get to be that age they lose their job or sometimes they fire people that the 50 to 65 because they like to have younger people to work. and maybe a lot of them weren't able to get insurance. the aca was very successful in cutting the number of uninsured in that age bracket in half. so that was the goal. the problem that i see is that not only are you increasing this age rating to 5 to 1, but
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you are tax credit that you are substituting for the subsidy that we have is not generous enough. so that is where, if you weren't getting rid of some of these pay-fors you could have a more generous tax credit so you wouldn't force these people to go uninsured again. i mean, the aarp in the letter, i know a lot of people have cited, said that changing the rate liments would increase premiums by 21 00. the combined impact -- even with the increased tax credit which i guess goes up almost 4,000 for this age bracket, a 64-year-old earning 15,000 a year would see an 8400 increase in premiums. so this is a person paying 15,000. how are they going to afford an 8400 increase in their premium? a lot of them will lose their insurance? the letter says that 400,000
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older americans would lose their health coverage altogether. so look, you are making a decision here which we don't agree with. you think you are going to get some more young people. but if you look at the letter -- this has been cited many times -- there won't be many more young people that go into this system and decide to have insurance, even though they are only going to save about $700, which may seem like a lot but it may not be and apparently is not enough of an incentive to get a lot of these young people to sign up. so the problem here is you're sacrificing a lot of these seniors because you want to get rid of the pay-for, including the one that is for the wealthy with the payroll tax. you are not giving enough of a generous tax credit to these lower income people that get a subsidy who are between 50 and 64. so you are not going to
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sacrifice hundredses of thousands of these people who are going to lose their insurance because they can't afford it and at the same time you're not getting many young people that are going to be added to the system to help finance this insurance pool. so my point -- and i'm not just -- i'm not making this stuff up. i'm pretty much citing the aarp letter, which is why they don't support the republican bill here today -- is that they've concluded that this isn't going to help much. it is going to take a lot more seniors off the roles, it is not going to add more young people. and this is just the wrong way to go regardless of whether you think states make the right decisions you've already admitted they don't make the right decisions in a lot of case business keeping a lot of the anti-discriminatory practices that we have done in the aca. so i think this new policy is a failure. and it's a good reason not to support this legislation. i yield back. >> the chair thanks the
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gentleman. the gentleman yields back. for what purpose does the gentleman from west virginia seek recognition? the gentleman is recognized for five minutes. >> very quickly. i've been listening to all this about the wealthiest people and how we're taking care of the wealthy. i get a little concerned about that. if you look at the list, first, let's go back and understand most corporations in the country are s-corps and therefore it is not their take-home pay. this is what their corporation is making and we're penalizing those companies. there was $117 billion associated with this repeal of the medicare tax on the payroll tax. we also as part of that -- and
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i would think people would rally around this, is we're delaying the cadillac tax. unless someone wants to go back and punish people for having quality insurance programs, i think that is a good reduction with that. the same thing with the repealing the prescription drug tax or the medical device tax. we've talked about that for years. we need to get it right with that. because that is increasing our overall costs. what about the flexible spending accounts? we're increasing our health savings accounts. those are how it all comes up to a pay-for when we take care of those issues for it that it overall was intended to help out with our health care to keep our costs down. but we should not be punishing our s-corps out there by virtue of this 9/10 of a percent on a payroll tax. so i think it is one more devicive thing that i have seen from some folks here on the oor who like to drive this
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wedge by talking about we're just taking care of the wealthy. and i get weary of that after a while. and i just want people to understand there is a lot more to that 600 than what people are suggesting. if they just take a little bit time instead of just just exaggerating. tell the truth. tell the truth. thank you. i yield back. >> the chair thanks the gentleman. are there any members seeking time on the caster amendment? if not, the question then becomes on adoption of the casstor amendment. a roll call has been requested. he clerk will call the roll. >> mr. barton. mr. upton.
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mr. upton votes no. mr. shim cuss. mr. shims murphy. mr. burgess. mr. burgess votes no. pls blackburn. mr. scaliss. mr. scaliss votes no. mr. l att a. mr. lata votes no. mrs. mcmorris rogers votes no. mr. harper. mr. harper votes no. mr. lance. mr. lance votes no. mr. guthrie. mr. guthrie votes no. mr. olson. mr. olson votes no. mr. mckinley. mr. mckinley votes no. mr. kinsninger. mr. kinsninger votes no. mr. griffith. mr. griffith votes no. mr. bill racks. mr. bill rackice votes no.
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mr. johnson. mr. johnson votes no. mr. long. mr. long votes no. mr. buchon. mr. buchon votes no. in flores. mr. flores votes no. mrs. brooks. mrs. brooks. mrs. brooks votes no. mr. mullin. mr. mullin votes no. mr. hudson. mr. hudson votes no. mr. collins. mr. collins votes no. mr. cramer. mr. cramer votes no. mr. wallberg. mr. wallberg votes no. ms. walters. mrs. walters votes no. mr. costello. mr. costello votes no. mr. carter. mr. carter votes no. mr. pa lone. mr. pa lone votes aye.
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mr. rush. ms. eshoo. ms. eshoo votes aye. mr. engle. mr. green. mr. green votes aye. ms. deget. ms. deget votes aye. mr. doyle. mr. doyle votes aye. ms. schakowski. ms. schakowski votes aye. mr. butterfield. mr. butterfield votes aye. ms. matsui. ms. matsui votes aye. ms. caster. ms. caster votes aye. mr. sarbanes. mr. sarbanes votes aye. mr. mcnerny. mr. welch. mr. welch votes aye. mr. lieu han. mr. will you han votes aye. mr. tonko. mr. tonko votes aye. ms. clark. ms. clark votes aye. mr. lob sak. mr. lob sak votes aye. mr. slader. mr. slayeder votes aye.
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mr. kennedy. mr. kennedy votes aye. mr. car dane as. mr. card dean yass votes aye. mr. ruiz. mr. ruiz votes aye. mr. peters. ms. dingell. ms. dingell votes aye. chairman walden. chairman walden votes no. mr. murphy. mr. murphy votes no. mr. barton. mr. barton votes no. ms. blackburn. s. blackburn votes no. mr. mcnerny. mr. mcnerny votes aye. >> are there any other members seeking to vote? seeing none, the clerk will report.
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>> mr. chairman, on that vote there are 21 ayes and 31 no's. >> 21 ayes and 31 no's. he amendment is not adopted. >> i'm going to recognize myself now for an amendment which i believe the clerk has. if the clerk would report the amendment. >> amendment to the amendment in the nature of a substitute. to committee present offered by mr. walden. >> the clerk will dispense with the reading of the amendment.
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for my colleagues, this literally is a technical amendment. we've talked to the ranking member about it. it is a clarifying amendment to make sure that there is -- if there is a conflict when it comes to the patient state stability fund the appropriated amount is actually the overriding number. the way it was worded there was some question about it. we don't want to have any confusion out there. so this is a technical amendment. it just makes clear that the total amount available is the amount obligated. or is the amount appropriated by the government. with that, are you good with that? >> no problem. it's a technical amendment. i would urge our support. >> any member seeking to comment on the amendment? if not the question comes before us on approval of the amendment. those in favor say aye.
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those opposed nay. the ayes have it. the ayes have it and the amendment is approved. now, are there other members that have amendments? we'll now turn to mr. green. for what purpose do you seek recognition? >> mr. chairman, i have an amendment at the desk number hah 6789 >> we'll get our clerks to find amendment number 45. t's actually 46. the cost sharing a.m. does the clerk have the amendment? the clerk will report the amendment. >> amendment to the amendment in the nature of a substitute to the committee print offered by mr. green. >> the clerk will dispense with reading the amendment. the gentleman from texas is recognized to debate his amendment. >> thank you, mr. chairman. the amendment would strike the provision in the legislation that repeals the cost sharing reduction program of the affordable care act.
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it is mind boggling to me that after all the talk we have heard calling the aca a failure because many face high deductibles and can't afford to use their insurance. this provision repeals the program designed to lower out-of-pocket costs for those who purchase insurance on the exchange. the affordable care act requires insurers that cover marketplace enrollees to reduce cost sharing for enrolees with incomes not exceeding 250% of the federal poverty level. cost sharing reduction payments have been the subject of partisan legal challenges and sabotage efforts to destabilize the aca and put a strain on the markets. so i guess that is not that shocking. an ongoing legal challenge to the crs payments. now that it serves my colleagues to stop deliberatively trying to make matters worse for political gain i expect the appropriators
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will do their jobs and appropriate the money to cover i think that was the amendment we adopted. the real reason to strike the provision is to eliminate csr program that is costing reducing to mitigate the very problem that truck care would exacerbate affordability -- trump care what exacerbate. or overallibles affordability and it makes matters worse change into the financial assistant tax programs that will only put affordability further out of reach for millions of americans. for example, under the plan, a wouldr-old in my district get 35% less financial assistance to purchase than they do under the affordable care act now.

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