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Education & Labor Committee Republicans

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Hearing Confirms ObamaCare Increases Costs, Uncertainty for Employers

Today, the Subcommittee on Health, Employment, Labor, and Pensions held a hearing to investigate the rising cost of employer-provided health care and its impact on workers. Members of the subcommittee heard testimony that described  a number of factors contributing to the growing expense, including the Democrats’ recent government takeover of health care.

Rep. Phil Roe, M.D. (R-TN), chairman of the Subcommittee, said, “For many patients, the price of health care is the determining factor when deciding whether to receive the care he or she needs. It also imposes a tremendous burden on taxpayers, as government health services become more and more expensive.” Roe added, “Employers, however, understand better than most the tough choices workers and their families face as health care costs go up year after year.”

Brett Parker, a finance officer for a small business in New York City, noted that ObamaCare has failed to “rein in costs, and instead increased them, while loading job creators with mandates, regulations, new taxes and burdens. Rather than solve the problems in the health care system, PPACA ignores costs and instead redistributes money from producers in order to fund vast new entitlements and expand old ones – this was not an improvement over the status quo, it was a step backwards.” 

Referring to the health care law, Parker stated, “Every year we pay more and get less, and under the new law it appears that this process could get even worse.” Parker continued, “The absurdity of the new 1099 reporting mandate, or the anxiety, complexity, disorder, uncertainty and overall peril the new health care law and its array of mandates imposes, we feel like the Federal government time and again creates obstacles to success and, by doing so, increasing the likelihood of failure.” 

The failure of small  businesses would be detrimental to unemployed workers and the economy. Business owners must now consider a number of tough choices as they try to remain in compliance with the law, and those choices will become more difficult as future mandates and regulations go into effect.  

J. Michael Brewer, president of an employee benefits consulting group, said of employers, “What they [employers] will do in 2014 depends on their health insurance costs and budget in 2014, and their perceived need to use a health plan to gain a competitive advantage for labor. With regard to this latter point, many clients have told us, ‘We won’t be the first to drop coverage, but we won’t wait to be third, either.’” 

Those sentiments were echoed by Thomas Miller, a health policy researcher at the American Enterprise Institute, who testified that  “the unpredictability of what will be enforced and how it will be interpreted leaves many employers frozen in uncertainty in their health benefits planning, when not fearing the worst and finding their expectations met.” Miller went on to say, “The massive uncertainties and confusion ahead under the ACA for employers and their workers are already mounting, after less than one year.”  

Today’s hearing reiterates the importance of Republicans’ goal to repeal Obamacare and replace it with responsible policies that lower costs.  As Chairman Roe stated, “We have a responsibility to understand the underlying causes of these factors and to consider commonsense solutions that ultimately reduce expenses for workers and their families.”

To watch hearing footage and read testimony, visit www.edworkforce.house.gov/hearings.

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