Hatch: Premium Increases Show Health Law Fails to Address Costs

In a Speech on the Senate floor, Utah Senator Says, “While many seem to believe that the Affordable Care Act received a reprieve from the Supreme Court, I think we are actually witnessing the downward spiral of Obamacare.”

WASHINGTON – In a speech on the Senate floor today, Finance Committee Chairman Orrin Hatch (R-Utah) outlined how the Patient Protection and Affordable Care Act (PPACA) has failed to control costs as premiums are set to once again increase and reiterated the need for patient-centered reform to reduce costs and expand choice for American patients and taxpayers.

“Anyone who is being honest and who is listening to the American people should recognize that Obamacare needs to be replaced with real, patient-centered reforms that are designed, not to control the marketplace, but to actually reduce costs for hardworking patients and taxpayers.” Hatch said. “The problems with Obamacare are not minor flaws that can be fixed with a little regulatory tinkering – they are fundamental. The only answer is real reform, which addresses the skyrocketing costs of health care in America.”

The complete speech, as prepared for delivery, is below:

Mr. President, I rise today to talk about an issue that will have serious negative consequences on the lives and livelihoods of millions of Americans and threaten our already muddled and beleaguered health care system.

Ever since the partisan and rushed passage of the so-called Affordable Care Act, I have come to the floor dozens of times to shine a light on the problems associated with this law and to call for a swift repeal and replacement.

I have not been alone. Many of my colleagues have been working to make this case as well.

Truth be told, this hasn’t been an altogether difficult case to make. Indeed, the data have repeatedly shown that Obamacare, despite the many claims of its proponents, simply isn’t working.

We’ve seen more evidence of this in just the past few days.

For example, in a recent New York Times article, we all read about the dramatic proposed increases in health insurance premiums due to Obamacare’s expensive mandates and regulations.

Now, many plans are proposing rate increases that average 23 percent in Illinois, 25 percent in North Carolina, 31 percent in Oklahoma, 36 percent in Tennessee, and 54 percent in Minnesota.

Mr. President, I don’t know about you, but my constituents find this unnerving. After all, one of the President’s chief justifications for his health care law was that it would actually bring down the cost of health care. Once again, we’re seeing that this was just another one of the many empty Obamacare promises.

But, even more frightening than these proposed rate increases are the root causes of the increases.

In the recent New York Times article, Nathan T. Johns, the chief financial officer of Arches Health Plan, which operates in my home state of Utah, was quoted as saying: “Our enrollees generated 24 percent more claims than we thought they would when we set our 2014 rates.”

This, according to Mr. Johns, led to a collection of just under $40 million in premiums while the company had to pay out more than $56 million in claims for 2014.

As a result, Arches Health Plan has proposed rate increases averaging 45 percent for 2016 in order to remain viable.

Now, I know that this was not at all the intention of my Democrat colleagues who voted for this bill. But it is because of this, and a myriad other unintended consequences that Obamacare has consistently polled below 50 percent approval since the day it was signed into law. Indeed, according a compilation by Real Clear Politics, of the 405 polls collected since the law passed in March 2010, 391 reported a majority of Americans opposing or having negative views towards Obamacare.

Unfortunately, President Obama seems to be disconnected from this reality.

In a recent trip to Tennessee, the President called for consumers to put pressure on state insurance regulators to scrutinize the proposed rate increases. He then suggested that, if commissioners do their job and actively review the rates, his “expectation is that they’ll come in significantly lower than what’s being requested.”

But as Roy Vaughn, vice president of the Tennessee Blue Cross plan stated: “There’s not a lot of mystery to it. We lost a significant amount of money in the marketplace, $141 million, because we were not very accurate in predicating the utilization of health care.”

Yet, President Obama fails to grasp the simple mathematics of the problem. And, he’s not alone.

In response to the President’s call for scrutiny, the Tennessee insurance commissioner was quoted as saying she would ask “hard questions of companies we regulate to protect consumers.”

Forgive me, Mr. President, but I fail to understand what hard questions there are to ask.

If I own a business that takes in $100 million in revenue but pays out $120 million in expenses, I won’t be solvent for long.

What is perhaps most disconcerting to me in all of this are the responses these patients get from officials in the Obama Administration.

For example, in response to concerns about these premium hikes, Health and Human Services Secretary Burwell recently argued that patients shouldn’t worry because there are tax subsidies available to help cover the cost. She also said that they could simply shop for cheaper plans on the exchanges during the next open enrollment period.

Of course, in a world where insurance plans across the country are requesting rate increases of 20, 30, 40, or even 50 percent or more, one has to wonder just how many cheaper plans will be available and how many sacrifices patients will have to make in their care in order to get significant savings.

Mr. President, while many seem to believe that the Affordable Care Act received a reprieve from the Supreme Court, I think we are actually witnessing the downward spiral of Obamacare. And I cannot help but question what supposed solutions my friends on the other side of the aisle will come up with next.

Anyone who is being honest and who is listening to the American people should recognize that Obamacare needs to be replaced with real, patient-centered reforms that are designed, not to control the marketplace, but to actually reduce costs for hardworking patients and taxpayers.

I am a co-author of such a plan, which we’ve called the Patient CARE Act. This legislative proposal, which I’ve put forward along with Senator Burr and Chairman Fred Upton from over in the House, will reduce the cost of health care in this country without all the expensive mandates and regulations that are causing these major increases in health insurance premiums.

I’ve talked about our proposal many times here on the floor, and I will continue to do so. I know there are other ideas out there and I think we should consider and evaluate those as well.

Put simply, I am willing to work with anyone – on either side of the aisle – to fix our nation’s health care system and to protect the American people from the negative consequences of this misguided law.

My hope, Mr. President, is that more of our colleagues on the other side will eventually see what the majority of the American people have seen for more than five years now: The problems with Obamacare are not minor flaws that can be fixed with a little regulatory tinkering – they are fundamental. The only answer is real reform, which addresses the skyrocketing costs of health care in America.

With that, I yield the floor.

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