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86–196 PDF 2013

OBAMACARE IMPLEMENTATION: HIGH COSTS, 

FEW CHOICES FOR RURAL AMERICA 

HEARING 

BEFORE THE

COMMITTEE ON OVERSIGHT 

AND GOVERNMENT REFORM 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

NOVEMBER 25, 2013 

Serial No. 113–69 

Printed for the use of the Committee on Oversight and Government Reform 

( 

Available via the World Wide Web: http://www.fdsys.gov 

http://www.house.gov/reform 

(II) 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM 

DARRELL E. ISSA, California, Chairman 

JOHN L. MICA, Florida 

MICHAEL R. TURNER, Ohio 

JOHN J. DUNCAN, JR., Tennessee 

PATRICK T. MCHENRY, North Carolina 

JIM JORDAN, Ohio 

JASON CHAFFETZ, Utah 

TIM WALBERG, Michigan 

JAMES LANKFORD, Oklahoma 

JUSTIN AMASH, Michigan 

PAUL A. GOSAR, Arizona 

PATRICK MEEHAN, Pennsylvania 

SCOTT DESJARLAIS, Tennessee 

TREY GOWDY, South Carolina 

BLAKE FARENTHOLD, Texas 

DOC HASTINGS, Washington 

CYNTHIA M. LUMMIS, Wyoming 

ROB WOODALL, Georgia 

THOMAS MASSIE, Kentucky 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

KERRY L. BENTIVOLIO, Michigan 

RON DESANTIS, Florida 

ELIJAH E. CUMMINGS, Maryland, Ranking 

Minority Member 

CAROLYN B. MALONEY, New York 

ELEANOR HOLMES NORTON, District of 

Columbia 

JOHN F. TIERNEY, Massachusetts 

WM. LACY CLAY, Missouri 

STEPHEN F. LYNCH, Massachusetts 

JIM COOPER, Tennessee 

GERALD E. CONNOLLY, Virginia 

JACKIE SPEIER, California 

MATTHEW A. CARTWRIGHT, Pennsylvania 

MARK POCAN, Wisconsin 

TAMMY DUCKWORTH, Illinois 

ROBIN L. KELLY, Illinois 

DANNY K. DAVIS, Illinois 

PETER WELCH, Vermont 

TONY CARDENAS, California 

STEVEN A. HORSFORD, Nevada 

MICHELLE LUJAN GRISHAM, New Mexico 

LAWRENCE J. BRADY, Staff Director 

JOHN D. CUADERES, Deputy Staff Director 

STEPHEN CASTOR, General Counsel 

LINDA A. GOOD, Chief Clerk 

DAVID RAPALLO, Minority Staff Director 

(III) 

C O N T E N T S 

Page 

Hearing held on November 25, 2013 ...................................................................... 1 

WITNESSES 

Mr. Raymer M. Sale, Jr., President, E2E Benefits Services, Inc. 

Oral Statement ................................................................................................. 10 

Written Statement ............................................................................................ 13 

Dr. Jeff Charles Reinhardt, President, The Longstreet Clinic, P.C. 

Oral Statement ................................................................................................. 18 

Written Statement ............................................................................................ 20 

Mr. Michael Boyette, Owner, Owl Town Auto 

Oral Statement ................................................................................................. 25 

Written Statement ............................................................................................ 27 

Ms. Emma Lucille Collins, Owner, Synergy Wellness 

Oral Statement ................................................................................................. 30 

Written Statement ............................................................................................ 32 

APPENDIX 

‘‘Obamacare Fallout: Millions Face Sticker Shock Following Insurance Cancellations’’ Article by the Associate Press Submitte by Mr. Woodall ............... 62 

BACKGROUNDER Article on Health Insurers’ Decisions on Exchange Participation Submitted by Mr. Kingston ................................................................ 65 

Letter From Signature Flight Support BBA Aviation Submitted by Mr. Kingston ........................................................................................................................ 89

(1) 

OBAMACARE IMPLEMENTATION: HIGH COSTS, 

FEW CHOICES FOR RURAL AMERICA 

Monday, November 25, 2013 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

WASHINGTON, D.C. 

The Committee met, pursuant to call, at 10:02 a.m., in the Hall 

County Government Center, Commission Meeting Room, 2875 

Browns Bridge Road, Gainesville, Georgia, Hon. Rob Woodall presiding. 

Present: Representatives Woodall, Collins, Meadows. 

Also Present: Mr. Kingston and Mr. Gingrey. 

Staff Present: Caitlin Carroll, Deputy Press Secretary; John 

Cuaderes, Deputy Staff Director; Linda Good, Chief Clerk; Meinan 

Goto, Professional Staff Member; and Emily Martin, Counsel. 

Mr. WOODALL. The Committee will come to order. 

This is a Congressional Oversight Committee hearing. We exist 

to secure two fundamental principles. First, Americans have a 

right to know that the money Washington takes from them is well 

spent. And second, Americans deserve an effective government that 

works for them. Our duty on the Oversight and Government Reform Committee is to protect these rights. Our solemn responsibility is to hold government accountable to the taxpayers because 

taxpayers have a right to know what they get from their government. 

We will work tirelessly in partnership with citizen watchdogs to 

deliver the facts to the American people and bring genuine reform 

to the federal bureaucracy. This is the mission of the Oversight and 

Government Reform Committee. 

At this time, I would like to ask unanimous consent that the gentleman from Georgia, Mr. Kingston, and the gentleman from Georgia, Dr. Gingrey, be allowed to participate in today’s hearing. Without objection, so ordered. 

I want to welcome you all here today for this very important field 

hearing on the status of the Affordable Care Act’s implementation, 

known to many of us as Obamacare. 

I want to thank our Committee’s Chairman, Darrell Issa, who 

unfortunately could not be here with us today, for allowing the 

committee to hold this hearing. I also want to thank my good 

friend and colleague whose district we are in right now, Doug Collins, for being the driving force behind this hearing. Without his incredible leadership, we would not be here today, this hearing would 

not be happening. I am grateful to him for that. 

Mr. COLLINS. Thank you. 

2 

Mr. WOODALL. We know about the sticker shock that so many 

Americans are facing today, those self-employed individuals and 

small business owners who have been getting their insurance on 

the individual market canceled, and are experiencing rude awakening when they find out, because of the Obamacare mandates, 

their policies can no longer be continued. But the new Obamacare 

policy costs more and covers less of the many products that are so 

important to them. Many more individuals are learning that their 

doctor is not available to them through their new and, quote, ‘‘better’’ plan. 

The numbers do not lie. According to an Associated Press report 

earlier this month, 900,000 Californians, 130,000 Kentuckians, 

140,000 Minnesotans, and nearly 400,000 Georgians have received 

cancellation notices. In just those four states, that is nearly two 

million Americans who have already been affected by Obamacare’s 

unnecessary mandates. 

At this time, I would like to ask unanimous consent to insert 

that AP article into the record. Seeing no objection, so ordered. 

Mr. WOODALL. According to a recent Heritage Foundation report, 

Obamacare is succeeding in at least one area. It is destroying individual market competition. There are currently 360 insurers in 

America that serve at least 1000 individuals—360 insurers that 

serve at least 1000 individuals. Under Obamacare, that number 

will drop by 29 percent to only 254 insurers. 

In Georgia, there are currently 11 insurers in the individual marketplace, but under Obamacare, there will only be five. That is a 

55 percent decrease in insurance competition. 

North Carolina will go from 12 insurers to two, an 83 percent 

drop. 

And in two states, New Hampshire and West Virginia, there will 

only be one individual market insurer left under Obamacare. 

I would like to ask unanimous consent to enter that Heritage 

Foundation report into the record. Seeing no objection, so ordered. 

Mr. WOODALL. We know that choice and competition drive prices 

down and increase consumer service. By driving insurers out of the 

market, Obamacare is doomed to result in higher prices and in a 

lower quality of care. And that is before we even begin to experience the certain turmoil that will result from the implementation 

of the employer mandate next year when large businesses will have 

to consider whether to increase their costs in order to provide 

health insurance to their employees, or simply dump those folks 

onto the exchange. 

The lead editorial in today’s Chicago Tribune, the President’s 

home state, noted exactly that, that large employers have no incentive to continue their insurance plans, and all of the financial incentives are to dump their employees into the exchange. 

Our witnesses today have been experiencing the turmoil in the 

individual market, experiencing that difficult transition first hand. 

They can tell us the real world implications of the law and hopefully we can find ways of reforming healthcare that will control 

costs and will increase quality without creating these negative experiences for so many Americans. 

With that, I would now like to recognize my colleague, Mr. Collins, for his opening statement. 

3 

Mr. COLLINS. Thank you. 

Mr. Chairman, I appreciate being here and I appreciate looking 

out into this room here, welcoming those who, not only my colleagues that are here from different parts of the state of Georgia, 

but also my dear friend from North Carolina, Congressman Meadows, who we share a boundary together. Congressman Woodall 

chairing this and being a part of this today, I appreciate it and 

with Congressman Kingston and Gingrey providing a lot of experience, I think we are going to have that opportunity today to talk 

about some really very real issues that are affecting not only northeast Georgia, but America as a whole. 

And I am pleased to be here in Gainesville and Hall County for 

the first Congressional hearing in a little over 10 years. It is good, 

I can think of no better place in my humble to be here and to hear 

from the nation and to hear the good and hardworking folks on 

how our federal government can serve the people better. 

I am pleased to be here and as thankful as I am to Chairman 

Issa and the Oversight Committee staff for the opportunity to hold 

this hearing today, I wish it could be under different circumstances. 

It absolutely pains me to see firsthand the devastating impact 

that Obamacare is having on our nation, especially our rural communities. The issues my constituents have with Obamacare are not 

just political. The concerns I continue hearing demonstrate a fundamental philosophical difference between the people of northeast 

Georgia and the folks who support Obamacare. 

First, folks in northeast Georgia and throughout rural America 

know what it is to live in community. They are generous people 

who come alongside those who are in need. Doctors and patients 

in rural America have traditionally been more free to come up with 

payment arrangements that work for them, so not everyone depends on health insurance. When a major medical expense comes 

up for someone who cannot afford it, it is people who come together 

many times in these rural communities. 

A community knows itself far more than the Washington bureaucrats and they have far greater interest in meeting the needs of 

their friends and neighbors than a government agency. The one 

size fits all nature of Obamacare is an affront to those who know 

no two communities are the same and not just a one-size approach. 

Northeast Georgians are also used to living within our means. 

Whether we are talking about a dream vacation or sending our 

child to college, we make financial plans to save enough money to 

pay for what we want. We are used to making sacrifices to meet 

our goals. That is why we cannot understand a government that 

already has catastrophic debt passing a $2.6 trillion healthcare bill 

into law. Even if all that money was well spent, that is a lot of 

money to spend today to have our kids and grandkids pay for tomorrow. What rubs salt into the wound is the way the taxpayer 

money that has been poured into Washington bureaucrats and 

websites that do not work has literally been wasted. 

For a President who has talked so much about economic stimulus, I wonder if he has considered what our economy would look 

like today if he had taken a more realistic approach to healthcare 

reform, an approach that did not create so much uncertainty and 

4 

take so much out of Americans’ wallets. But the biggest fundamental difference between the philosophy of folks in northeast 

Georgia and the philosophy behind Obamacare can be summed up 

in two words—individual liberty. Around here, we believe as the 

founders did, that the function of government should be limited to 

those that allow each American to pursue their own life, liberty 

and happiness. Remember, the founders said that we are to have 

the pursuit of happiness. They did not say the guarantee of happiness, because we have to be a part of that process as well. It is fine 

for someone else’s pursuit of happiness to look different from ours, 

but frankly, we get offended when someone imposes their version 

of American dream on us, because each individual story and success is unique. 

We do not believe the federal government has the right to compel 

individuals and families to purchase a product or a service. Even 

if this Administration had managed a flawless rollout of 

Obamacare, rural Americans would still have issues with this law. 

But implementation of this bill has been far from perfect. As I look 

at our panel of witnesses, one point is abundantly clear. Each of 

you are here because the President’s promises have failed you in 

some way or they failed someone you know. The barriers to accessible quality healthcare in rural communities are great, but as a 

result of Obamacare, they are now devastating. In Georgia, three 

rural hospitals have shutdown already this year and some estimates indicate that 15 more may be closing their doors in the coming months. 

Many of you here today probably have growing concerns about 

Obamacare’s impact on you. You may have questions like, ’’Will I 

still be abe to go to my primary care provider?‘‘ ’’How far will I 

have to drive to get the medical services I need?‘‘ ’’Will I get to 

choose among several different providers or just one?‘‘ Or maybe it 

is even more basic than that. Maybe you are just wondering if you 

have the ability to keep your job or if your employer will lay you 

off because he frankly cannot afford Obamacare. Last month, the 

New York Times reported on the lack of competition in many rural 

communities resulting in higher premiums. The Times wrote, ’’In 

rural Baker County, Georgia, where there is only one insurer, a 50 

year old shopping for a silver plan would pay at least $644.05 before federal subsidies. A 50 year old in Atlanta where there are 

four carriers could pay $320 for a compatible plan. 

Despite the spin that the President and his people try to put on 

Obamacare, the facts speak for themselves. Families in rural communities will pay more for healthcare under Obamacare. Of the approximately 2500 rural counties served by the federal exchanges, 

58 percent have plans offered by only one or two providers. In fact, 

530 counties are only served by one provider. 

Today, we are going to highlight what the title of this hearing 

suggests, the high cost and scarce choices facing rural Americans 

under Obamacare. But I also want to talk about solutions. I would 

love to hear what our witnesses think Congress can do to promote 

affordable, accessible medical care in their communities. 

Once again, I would like to thank Chairman Issa and his staff, 

all of our witnesses for being here. I look forward to a constructive 

5 

conversation and hope we get some ideas about how to best move 

forward from here. 

And with that, I yield back. 

Mr. WOODALL. Thank you, Mr. Collins. 

I would now like to recognize the gentleman from North Carolina, Mr. Meadows, for his opening statement. 

Mr. MEADOWS. Thank you, Mr. Chairman. 

And I want to open up by saying thank you to each one of you 

who showed up today to hear this hearing. I actually represent 

western North Carolina, 17 counties from Lenoir, Hickory all the 

way to Murphy, and we share a common border with Congressman 

Collins. Not only is he a good friend, but he is someone who really 

puts the care and concern for the people he represents first. I can 

tell you first hand, in talking with him on a weekly basis, there is 

not a week that goes by that he is not saying well, how does this 

affect the people that I represent. So not only do you have a great 

representative, but I want to thank you because on a Monday before Thanksgiving, I know there are many other things that you 

could be doing and yet you are here to express your concern about 

how this Affordable Care Act that is turning out not to be affordable, is affecting you. And so I want to just say thank you for coming. 

I want to thank the witnesses for coming and being willing to 

share your testimony today. We look forward to hearing from you, 

hearing that expert testimony and how we can indeed fix it and 

make sure that it does not affect the people in a more adverse way 

than it already has. 

Many of the facts and figures have been shared today. I can tell 

you over 473,000 people in North Carolina have lost their coverage. 

When it comes to being affordable, we are finding out that indeed 

it is not affordable. You know, even though there were promises 

made that we could somehow have some insurance policies that 

were $2500 less, I can give you example after example of people 

that are having to pay between two and eight thousand dollars 

more a year to get the same healthcare coverage under this new 

law. That is troubling to me. I know it is troubling to most of my 

colleagues, in fact all my colleagues here on the dias. But I also 

want to say there are a number of other areas that we need to address. 

We had a hearing recently in Washington, D.C. where we talked 

about security and the fact that there has not been a comprehensive security test of this website that continues to malfunction. 

That is very troubling to me in a time and day and age of identity 

theft where we would put forth something that should have confidence where people could put in their information and yet we 

have not done a comprehensive security test. In fact, in that testimony, they were saying that it may not be done for another 60 to 

90 days. That is troubling. We had one expert testimony given that 

said that the best practice would be to take down the site until we 

can do that security testing. And the question before many of us 

today is why are we not doing that. We are continuing to rush on 

to try to meet a November 30th deadline for this website so that 

we can do that. And even with that, even if it does get up and runVerDate Aug 31 2005 10:48 Jan 24, 2014 Jkt 000000 PO 00000 Frm 00009 Fmt 6633 Sfmt 6633 C:\DOCS\86196.TXT APRIL
6 

ning, we know that there are a number of other areas that have 

been promised that will not be addressed. 

I also was to just say that for rural communities—I represent 17 

counties, most of them are very rural. When it talks about 

healthcare and keeping your doctor, that is a critical component, 

because quite frankly we do not have the choices that you might 

have in Atlanta, Georgia or the choices that we might have in 

Washington, D.C., because as you know, healthcare providers, 

there is a long distance. Dr. Reinhardt is going to be testifying 

today, I can tell you when we had our two children, we had to travel over an hour and 15 minutes for delivery for my son and daughter. It is not like you just go and check into the hospital right 

around the corner. It is different. 

So I just want to say thank you. We look forward to hearing the 

testimony and I know the Chairman will be addressing how many 

of you can provide your testimony for the record, and I just again 

thank the Chairman, thank the committee staff. This is an unbelievable staff on Oversight and Government Reform. They are diligent, not only on this issue but a number of issues. And to have 

these hearings where we come out from Washington, D.C. takes a 

tremendous amount of work. So my thanks to the committee staff, 

to the folks here at Hall County for being so gracious and hospitable. 

And I yield back. 

Mr. WOODALL. I thank the gentleman. 

I would like to yield to the gentleman from Georgia, Mr. Kingston, for his opening statement. 

Mr. KINGSTON. Mr. Chairman, thank you very much for letting 

me join you. And Mr. Collins, it is always great to be in your area 

and thank you for letting me come. And same to you Mr. Meadows 

and Dr. Gingrey, I am proud to be on the dias with you. 

As you know, I chair the Appropriations Subcommittee of Health 

and Human Services, which does the financing for the Affordable 

Care Act, but also Medicaid and Medicare and Social Security and 

CMA and so many other vital programs that so many Americans 

use. So we are very concerned about this from a price tag point of 

view. 

And I just wanted to touch base on a couple of quick things that 

I want to submit for the record. One, in terms of the objective of 

Obamacare to reduce the cost of premiums, one need not go outside 

his own household to hear stories. My daughter who is a 30 year 

old healthy young woman had her premium go from 160 to 270 a 

month. And I talked to so many businesses who have experienced 

the same thing. I talked to a parking lot company in Atlanta, Georgia, 1000 employees. They put 900 on a part time basis. I talked 

to another business in Cobb County, Georgia, a business that was 

growing. They stopped at 42 employees, because they knew once 

they got over 50, they would have a whole new set of rules and regulations under the Affordable Care Act. And so you just think 

about stopping the growth that you could be having. 

I talked to a hospital in south Georgia, and this is a real interesting story of unintended consequences. The hospital identified 65 

people which are frequent visitors to the emergency room, 65 people who go basically to the emergency room on a regular basis for 

7 

their healthcare needs. What this hospital is doing is actually taking out insurance policies on these 65 frequent visitors. And under 

Obamacare, they will be able to pay the premium, subsidize for 

these people, and then be reimbursed for the cost of their medicine 

and actually come out ahead thousands of dollars by legally gaming 

the system. 

I got a letter from Leonard Blount in Statesboro, Georgia, who 

is the President of Capstone Benefits. It is a company that deals 

with healthcare. He said that he had a high deductible plan in 

which he paid for just about everything until the deductible is met. 

His premium went from $8020 a year to $14,608. But he was not 

complaining about the large premium increase. What he was complaining about is that his healthcare high deductible plan has been 

canceled and is not offered any more and the government sent him 

a letter saying but do not worry—and this is the exact quote—’’Be 

assured that your new plan meets the requirements of healthcare 

reform law and provides the major medical benefits and strong financial protection that you need.‘‘ And he said, please, the government in Washington has no idea what I need. My wife is 58 years 

old, why would she need prenatal care. And that was what his 

point was, is that I do not mind the premium increase as much as 

I am outraged that the federal government is now dictating to me 

what my family in Statesboro, Georgia needs. I want to submit 

that for the record. 

So, Mr. Chairman, there are so many cases of this, I will submit 

these. I have another one from Signature Aviation in Savannah 

where they said our healthcare premium went up, therefore, writing a tenant saying we are just passing the cost on to you. And I 

would like to submit that. 

But thank you for letting me be with you and I look forward to 

the testimony. 

Mr. WOODALL. Thank the gentleman. Without objection, those 

documents will be submitted into the record. 

Mr. WOODALL. Now I would recognize the gentleman from Georgia, Dr. Gingrey. 

Mr. GINGREY. Chairman Woodall, thank you very much for giving me the opportunity of being here in Hall County, Gainesville, 

in northeast Georgia for this very important field hearing, and to 

join my colleagues, of course Congressman Doug Collins of the 

Ninth and Congressman Kingston from the First and Mark Meadows from North Carolina, a great member. 

I want to just kind of tell the group that is here—and it is a 

large group obviously—that this is just exactly what we do in 

Washington. This is a hearing. If there are any C–Span junkies in 

the room—and I am sure there are—and you watch these hearings 

sometimes late at night, this is exactly the way it is. You have the 

committee. The committee of course is usually the full committee, 

and then four or five witnesses, sometimes you will have more than 

one panel. In this case, we have one very important panel. And 

then the audience. Now this audience this morning is just about as 

big as any audience that I have seen in my 11 years as a member 

of the House of Representatives. 

Oversight is one of the most important things we do. Congressman Kingston mentioned appropriations, of course, paying the 

8 

bills, spending the money. But then once those things are committed to, to follow up and to have oversight and Oversight and 

Government Reform is a separate committee and it is the main 

committee. And I commend Doug Collins and Rob Woodall and 

Chairman Issa. But each committee in the House of Representatives actually has an oversight subcommittee and we all do this. I 

sit on the Energy and Commerce Committee and we have jurisdiction over all of Medicare Part B and C. We have jurisdiction over 

all of Medicaid and also Peachcare, the SCHIP program. And we 

have an oversight subcommittee. I sit on both the health and the 

oversight committees of that committee. So that is the reason why 

we are doing what we are doing here today. This is just like what 

we would be doing in Washington, but this obviously is called a 

field hearing because we are in these districts. And we want to 

know, we want the audience to be the people that are the most affected by Obamacare, and of course the witnesses, to be the experts 

on how it has affected them. 

So I just wanted to kind of lay that out there and tell you and 

right from the very start, from my perspective, how I feel about it. 

The federal government would literally torch a village to kill a 

gnat. And that is their whole attitude toward things. 

What has happened to federalism, which this document talks 

about, and I am sure all of you believe in, local control and the 

ability to maintain your own liberty and to buy your own health 

insurance and the sanctity of the doctor-patient relationship. Sure, 

the media and the Democrats and this Administration high-fived 

each other March 23rd of 2010, when this Obamacare became law 

because they said we have been wanting to do this for 100 years. 

Well, did you ever think of why maybe they have been wanting to 

do it for 100 years? Because people 100 years ago did not want to 

government to take over healthcare, in the days of Woodrow Wilson 

and Franklin D. Roosevelt, and whoever was trying to push it on 

their side of aisle. And today, even as we speak, 61 percent of the 

American people are totally opposed to this abomination. 

So I think from that little bit of preface, other than going off my 

prepared remarks, you get a general idea of how Congressman 

Gingrey feels about this law. And I definitely look forward and 

thank the witnesses for being here and look forward to their testimony. 

I have been hearing from my constituents for the past seven 

weeks about these high premiums like my colleagues are talking 

about. They are in anxiety over finding coverage and even the law’s 

impact on their ability to keep their doctor, to keep their hospital, 

and to keep their insurance. It is clear that this law was misrepresented from the start. It neither protects patients nor affordable, 

both to individuals and to the government. 

The President’s law gives control of one-sixth of our economy to 

Washington bureaucrats and it imposes a tax increase on middle 

class Americans and small business owners, many of our witnesses. 

As the government becomes more involved in healthcare, doctors 

and patients become further removed from their own care decisions. Dr. Reinhardt will tell us about that. And this results in a 

more expensive and a more dysfunctional system. 

9 

A constituent recently told me that the law has become a financial disaster for his family. The fact is the President’s words, ’’If 

you already have insurance you like, you can keep it‘‘ period, seem 

to be directly refuted by the millions of cancellation notices already 

sent to Americans in the past few weeks, many more cancellation 

notices than sign-ups; right? It does strike me that millions of individuals voted believing one thing and now they find themselves 

without coverage and they are now scrambling to find coverage in 

a marketplace that offers only more expensive plans with fewer options for care. 

My colleagues have commented in regard to someone 55 years 

old let us say a single male, does he really need maternity care? 

And it is just ridiculous what they are trying to do. 

We can solve this problem. And I will conclude with this. A lot 

of times the media, the talking heads on the Sunday morning 

shows will say well, those Republicans, they just do not have any 

plan, they want to repeal. But they do not—what are they going 

to do about the fact that the health insurance in this country, even 

though healthcare is great and it allows the average man to live 

to age 78 and the average women to live to age 80, that is far different than back in the 1930s when we first did Social Security and 

in the 1960s when we did Medicare. So we do have the greatest 

healthcare system in the world. We just need to address the issues 

that are making it too costly. 

And here is a bill—here is a bill, a comprehensive bill, called the 

American Healthcare Reform Act. There are seven bullet points on 

here, not 2700 pages. I am not going to take any more time to go 

over this, but of course we have a plan. Some of it involves insurance, health insurance reform but of course we have a plan. But 

we never get the media attention, we never get the press. Let me 

tell you, that is why I say repeal or go home. 

I yield back, Mr. Chairman, and thank you so much for giving 

me the opportunity. 

Mr. WOODALL. Thank you, Dr. Gingrey. 

It is now my great pleasure to welcome our first panel of witnesses. Beginning left to right, we have Mr. Raymer Sale. Mr. Sale 

is the founder and President of E2E Benefits Services and E2E Resources in Duluth, Georgia, which provide employee benefits and 

HR administration. Mr. Sale founded E2E Benefits and E2E Resources back in 1993 and over the past 20 years, he and his staff 

have provided services to literally thousands of small business employers and employees. He is the immediate past chairman of the 

Gwinnett Chamber of Commerce, which is one of the largest chamber organizations in the state, with over 2100 members. And is a 

member of the Gwinnett Chamber Executive Board. His business 

has twice been honored as a Pinnacle Small Business Award winner, which distinguishes E2E Resources as one of the top 25 small 

businesses in Gwinnett County. 

I would also like to welcome this morning Dr. Jeff Reinhardt, 

who is an OB–GYN right here in Gainesville, and the President of 

The Longstreet Clinic which is one of the largest multi-specialty 

practices in northeast Georgia with over 550 employees, including 

more than 150 physicians and mid-level health providers representing over 16 specialties. Dr. Reinhardt’s leadership of The 

10 

Longstreet Clinic gives him an invaluable window into how 

Obamacare is already affecting hospitals and private practices. 

To his right we have Mr. Michael Boyette who is a small business owner in Ellijay, Georgia. His family’s automobile sales business and his own health insurance premiums have been negatively 

affected by Obamacare and he is here to give us that first-hand 

story, both of his family and of his business here this morning. 

And finally, we have Mrs. Emma Collins from Ellijay, Georgia, 

who is self-employed. Because of a preexisting condition, she was 

uninsured. But her condition was manageable and her monthly 

health bills were very low. Her family has experienced tremendous 

insurance premium increases thanks to Obamacare. And her family 

is currently trying to navigate the complicated Obamacare website 

system. I think there are many Americans who find themselves in 

that very same situation as Mrs. Collins and her family, and we 

are so happy to have her here to tell that story today. 

As is the custom with the Oversight Committee, pursuant to 

committee rules, I would ask all witnesses to rise and allow us to 

to administer the oath. Please raise your right hands. 

[Witnesses sworn.] 

Mr. WOODALL. Let the record reflect that the witnesses have answered in the affirmative. Thank you. Please be seated. 

In order to allow time for discussion, I would ask you all to 

please limit your opening testimony to five minutes. We have your 

written testimony, which will be submitted for the record. 

You have a timing light there on the table in front of you. Green 

means go, yellow means we are coming to the end and red means 

we are there at the end. 

It is now my great pleasure to recognize Mr. Raymer Sale. 

STATEMENT OF RAYMER M. SALE, JR. 

Mr. SALE. Thank you very much, Chairman Woodall and members of the Committee. Thank you for inviting me to participate in 

this hearing today and I appreciate your interest in the consumers 

who are living through the implementation of the Patient Protection and Affordable Care Act. This law is complex and does not protect everyone, nor is it affordable in many cases. 

Consumers are frustrated with the failure of Healthcare.gov and 

the high cost of many new policies. We are being led to believe policies in effect prior to 2014 are inferior. Inferior to whose standards? 

Most of the policies in effect now were purchased to fit the specific 

needs of the consumer. 

We are also being told that cancellation notices are really renewal notices, and this is not true either. The insurance companies 

are canceling an existing policy, you cannot have that one any 

more. If you do not select a new policy, your coverage will terminate. By the way, state law controls this and we have not seen the 

backlash yet that will come when consumers find out their doctors 

may not be in the network. 

Once we get through the individual market, the small and large 

group plans will be front and center. They will be faced with many 

of the same issues that are affecting the individual market. Many 

will see higher premiums requiring new plan designs. You cannot 

keep your coverage unless it is a grandfathered plan. And just for 

11 

the record, the insurance industry has known since 2010 that most 

plans would lose their grandfather status. Of the roughly 100 employer clients we serve at E2E approximately four have retained 

their grandfather status and E2E is not one of those. 

The law is loaded with opportunities for small and large employers to face severe penalties for not complying with one portion of 

the law or another. This begins with the age 26 notice that employers were supposed to have distributed back in 2010, to the summary of benefits and coverage that must be distributed at renewal, 

when an employee is hired, upon a qualifying event, or when requested. Failure to comply with this requirement could result in a 

fine of $1000. And that is just one requirement. Documentation is 

imperative because you will have to prove compliance. 

As the law matures, this gets worse, as the employer is required 

to make sure their plans comply with PPACA plan design, track 

the hours worked by the employees, report the hours to the government, manage hours worked to keep an employee at part time status to control cost, track seasonal employees to be sure they are 

added to the plan once they pass a certain number of hours, pay 

higher costs due to new taxes added to the premium. This is going 

to increase premiums—and it already has—three to four percent. 

I have got one client that pays $10,000 per month in taxes alone, 

got about 235 employees covered. Prove to the IRS an affordable 

plan is offered to the employee, if an employee buys coverage from 

the exchange. Either upgrade payroll systems or purchase systems 

that track many of these items mentioned above. All of this is expensive and is a distraction from the main function of the employer, that is to provide services or products and jobs. 

E2E has spent thousands of dollars on software upgrades, purchasing new software and educational training so we will be able 

to advise our clients. And many employers do not understand this 

law, what it means to their business, because they cannot absorb 

everything they will be required to do in order to comply. 

Currently, most of the E2E clients who qualified have been 

moved to December 1, 2013 renewals, called early renewals. This 

action is designed to defer many of the effects of PPACA until 

2014. This early renewal action protects plan design, avoids community rates, controls costs and gives government time to observe 

the effects of the employer and correct or repeal this law. This is 

confusing to the employee and disruptive to the employer. 

Finally, a great concern is the legal exposure as a result of this 

law. Never in my almost 40 years in the insurance industry have 

I been concerned with legal action. We are very detailed and effective in the guidance we offer. However, as stated in the opening 

paragraph, this law is complex. Employers hire and expect E2E to 

provide the guidance that will allow them to comply with the law. 

And it is ripe with opportunities for government penalties and 

fines. 

To complicate matters, once PPACA became law, the regulators 

made changes to the rules here, delayed a portion of the law there, 

requiring businesses and consumers to change directions and spend 

additional time and money to comply and adjust. Constant last 

minute alterations to the rules and the refusal to make permanent 

modifications that will improve the product build uncertainty, 

12 

which is counter-productive, not to mention the lack of respect for 

the individual or business community. 

Again, thank you for the opportunity to be here today and I look 

forward to answering your questions. 

Mr. WOODALL. Mr. Sale, thank you for taking time to be with us 

today. 

It is now my great privilege to recognize Dr. Reinhardt for his 

opening testimony. 

[The prepared statement of Mr. Sale follows:] 

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Good Morning. 

Statement of 

Mr. Raymer M. Sale, Jr. 

President 

E2E Benefits Services, Inc 

before the 

Committee on Oversight and Government Reform 

U.S. House of Representatives 

November 25, 2013 

My name is Raymer Sale and I am a small-business owner from a suburb of 

Atlanta called Duluth. I own an insurance agency called E2E Benefits Services, 

Inc. with a staff of 9. I am here to share with you the issues my clients are 

facing as they strive to comply with healthcare reform. 

I would like to thank the House Committee on Government Oversight and 

Reform and Chairman Issa for inviting me here today and for electing to hold 

this public hearing. The impact of the Patient Protection and Affordable Care 

Act (PPACA) and the new costs it will impose on small-business owners and 

individuals will be profound. 

Only now is the public beginning to see the intended and unintended 

consequences of the Patient Protection and Affordable Care Act. It wasn't until 

October 1 that consumers began to receive cancellation notices and were 

exposed to the higher cost of purchasing health insurance. The problems with 

Healthcare.gov only added fuel to the fire. 

The insurance community has known from the very beginning that prices were 

expected to increase because of the required additional benefits; however, 

talking about the prospective increase in the cost of health insurance pales in 

comparison to showing someone the real numbers. These numbers weren't 

available until recently. 

When an insurance company is required to add a benefit there is a cost 

associated with that new benefit. The mandated wellness benefits were 

responsible for a 1% to 2% increase in the cost. The contraceptive benefits were 

added, followed by the Minimum Essential Benefits. These are followed by the 

PCORl, Reinsurance and Health Insurance Taxes, which are being passed 

through to the consumer adding an additional 3% to 4% to the premiums. Our 

largest client saw their premium increase by over $10,000 per month due to the 

added tax burden alone. The costs directly tied to mandated benefits have 
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resulted in an overall increase of approximately 10%. Employers, both large 

and small, and individuals are seeing these increases in their premiums. 

Since 2014 rates became available last month, we have quoted both 2013 and 

2014 rates to our individual clients. In almost every case, the 2014 rates have 

been 50-100% higher. Although the ability to obtain coverage for previously 

uninsurable conditions is a good thing, it comes at a sometimes steep price. 

The bottom line is there is no free lunch. 

In addition to the points above, since 2010, my agency has spent thousands of 

dollars to purchase the tools and modify software to help our clients weave through the compliance requirements of PPACA. Additionally, we have spent 

countless dollars and hours on education, so we could better understand a very 

complicated law. 

This law is heavy with penalties and opportunities for the employer to be fined 

for failure to comply. The first such opportunity came in 2010 with the Age 26 

notice to employees, and many more such requirements continue to appear. 

Making things even more complicated and costly, requirements have frequently 

changed, often at the last minute. After many advisors, including my agency, 

invested significant capital in software to prepare for the "Play or Pay" 

mandate, that mandate was delayed. Similarly, we spent several days preparing 

the October 1 notice to employees concerning the existence of the Marketplace. 

This notice included information about the projected penalties. We didn't send 

this notice until late September to hopefully incorporate any changes that 

might be made, but the same day we sent it the information came down that 

there would be no compliance penalty. When you add to issues such as these 

the confusion and misunderstanding of the law and its requirements, the costs 

continue to add up. All of this takes time, and time is money. 

For the employer, the associated costs are even greater. The insurance 

companies began this past summer to offer employer groups the opportunity 

to renew their existing poliCies early in order to keep their current benefits and 

rating structures. These renewals were offered primarily for December 1, 2013 

to extend through December of 2014. Maintaining the current policies also 

gives the government time to see what will and what will not work as the law is 

implemented and its real world effects become apparent. These early renewals 

have just served to further confuse employers and have resulted in higher 

administrative expenses. The end result has been that employers are seeking 

every possible way to avoid the financial impact of the law and many of them 

have been successful, but they are really just postponing the inevitable. When 

they are finally faced with these costs, it is certain that jobs will be affected. 

Even now, we are seeing a few employers drop coverage altogether, some 

because of the uncertainly and some because of a prevalent misunderstanding 

that their employees can now go to the exchange and get "free" coverage. 

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One of the most costly administrative expenses added to an employer involves 

the way a group client is now billed. Prior to 2014 companies were usually 

billed in four tiers - employee only, employee/spouse, employee/child(ren) or 

employee/family. Unless they had less than 10 covered employees (and 

sometime even then), the rates would be the same for any employee falling into a given tier. PPACA is now requiring that the community rates mandated for 

small bUSiness be age-billed. Each and every participant in the plan, the 

employee, the spouse and each child, must have their own line item billing rate. 

Therefore a group of 45 covered employees may go from 45 billing lines to be 

reconciled to well over 100. Additionally, much more information including 

Protected Identity Information, must be gathered, maintained and secured. 

Another unintended consequence is that of participation. The reason many 

employers don't currently offer coverage is that they cannot get enough of their 

employees to purchase coverage to meet participation requirements. These 

requirements are not going away and with many employees dropping coverage 

to try to purchase subsidized coverage or just because the rates have increased so much they will only get that much harder to meet. This will cause more 

employers to drop coverage altogether, again increasing rather than decreasing 

the number of people uninsured. 

These are some of the issues facing most of our clients. Following are realhfe 

scenarios involving actual individual clients: 

1. An employer group of 49 FTEs received an offer of early renewal. This 

client has three separate plans for employees to choose from and the 

offer called for 11-26% increase in premium to early renew these plans. 

In comparing this to what the renewal would be if they waited for their 

scheduled February 1, 2014 renewal, we found that some of the 

employees would receive a decrease beginning February 1, 2014 but some 

would receive a much greater increase. There were two employees 

particularly whose rates would increase from approximately $591 per 

month to over $1,018 per month, a 72% increase. 

2. A rural Georgia client has reluctantly accepted the early renewal offer even though it carried a significant increase in premium. This decision was based partly on the fact that they like their current benefit structure, 

which was chosen to best serve the needs of their particular employees, 

and wanted to keep it. This employer has more than 50 FTEs and will be 

faced with "Play or Pay" in 2015. This employer is in the nursery 

business and pays approximately 75% of the employee premium. Many 

of the employees chose not to be covered due to the cost. Beginning in 

2015 the employer will be required to offer coverage that is affordable. 

The law requires employees to either accept this coverage, or to purchase 

coverage from another source. So, let's look at an example of offering 

affordable coverage. Let's assume the employee is making $8.00 and 

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works a minimum of 40 hours per week. This employee will receive a 

gross income of $1,387 per month. 9.5% is $132 per month the employee 

can be charged for employer offered group medical insurance. This is 

more than he would pay for the current coverage and yet he's opting out. 

I expect he is making a financial decision to house and feed him family 

instead of purchasing coverage, but in 2014 he will be mandated into 

coverage. Now let's assume the employee has a spouse and dependent 

children. The employer's offer of coverage only has to meet the 

afford ability test of offering the employee coverage that doesn't exceed 

9.5% of the employee's income without taking into account how costly it 

may be for the employee to find additional coverage for his spouse and 

child. The employer is not required to offer "affordable" coverage to 

spouses or dependent children, and that coverage can lawfully be at a 

cost well above 9.5% of the employee's income. 

3. A roofing contractor has 42 full-time employees and no part-time. This 

is down from 49 full-time employees 2 months ago. They are not 

replacing employees who leave because they don't want to run the risk of 

reaching 50 employees. Rather than become subject to "Play or Pay", 

they have already decided that they will supplement their labor force 

with part-time helpers and apprentices whose hours will be strictly 

monitored not to exceed 30 hours a week. Their first thought was to pay 

$200 month for each employee to purchase coverage through the 

exchange, where many would qualify for a subsidy. However, IRS Ruling 

2013-54 removed that option for assistance when it clarified that an 

employer can only help an employee with individual health insurance 

premium if that contribution is treated as salary in every way, including 

paying FICA and other taxes, being figure into COLA increases, etc. So 

their hands are tied when it comes to helping their employees obtain 

health insurance. 

4. A client in the entertainment retail industry has converted a significant 

portion of their staff to part-time to avoid having to offer them coverage. 

Some of the situations our individual clients find themselves in are even more 

alarming, as evidenced here: 

1. We have had numerous clients come to us seeking individual health 

insurance because they were covered as retirees by a former employer 

who is now dropping retirees from coverage. 

2. A large national company who has multiple franchise-model offices 

throughout the country announced that effective January 1, 2014 they 

will no longer allow the franchise-employed personnel access to their 

health insurance plan, which in turn caused the franchise owners to cease 

to offer coverage since most are fewer than 50 FTEs. This left thousands 

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of previously-insured individuals without coverage. 

3. A client is seeking individual coverage because the husband's employer, 

in another state, has about 100 FTEs, and is choosing to drop coverage. 

They are going from paying the full cost of family coverage to paying 

$400 per month in salary increase on the mistaken belief the employee can go the exchange and purchase coverage easily for that. We do not 

believe they are aware of the fine for each employee who accesses 

exchange coverage, nor are they aware of what the true costs are for an 

employee such as this one who earns slightly over 400% of FPL. 

4. Many more individuals are losing coverage and would qualify for a 

subsidy to ease the cost burden, but they are terrified they will be 

uninsured January 1, 2014 because they can't afford the high 2014 

premiums and cannot access the subsidy due to the numerous glitches in 

the healthcare.gov site. These are responsible individuals who want 

coverage and are willing to pay as much as they can for it but they are 

being left without viable options. 

The examples cited here are not unique. These are the kinds of issues we are 

facing every day as Americans struggle to understand and comply with the 

changed world of purchasing health insurance. I truly appreciate the 

opportunity to appear before this committee and provide testimony. I consider 

it an honor to be here and a privilege to be able to help our elected 

representatives become more informed about how healthcare reform is 

impacting business owners and individuals in our state. If you have any 

questions, or I can be of additional assistance to you please do not hesitate to 

contact me. 

Thank you. 
18 

STATEMENT OF JEFF REINHARDT 

Dr. REINHARDT. Good morning, Mr. Chairman, committee members, fellow witnesses and attendees. Thank you for the opportunity to come before you this morning to discuss the impact of the 

Patient Protection and Affordable Care Act. 

As stated, I am Jeff Reinhardt, I am a full time practicing OB– 

GYN and President of The Longstreet Clinic. I wear several hats 

as it relates to healthcare. I am a consumer, a provider, and an employer. And I was asked to speak today in my role as a physician 

and a provider of care. 

It is not new news, as Dr. Gingrey mentioned, that healthcare 

in this country is in crisis. Dating all the way back to 1926, out 

of concern for the costs and utilization of care, Congress formed a 

committee on the cost of medical care. This committee was abolished in 1932 after their recommendations were felt to be too radical. This illustrates that cost, access, and quality of care and the 

government’s role in these issues, has been ongoing for some 90 

years. 

According to data reported by the WHO, the cost of healthcare 

in the United States changed from about 13.5 percent of GDP during the 1990s to almost 18 percent this year. Last month, Aon 

Hewitt, a leader in employee insurance benefits, reported that the 

average healthcare premium for workers has seen increases ranging from 3.3 to 8.5 percent for each of the last seven years, with 

an estimated increase of 6.7 percent for next year. Also, noting a 

trend that has seen the employee’s share of total healthcare costs 

jump 150 percent since 2004, clearly increasing cost is a problem. 

Access to medical care is influenced by geographic location, a person’s literacy and disabilities, and the ability to pay for services. 

From 2004 to 2008 in Georgia, there has been a reduction in the 

number of OB–GYN providers from 13.5 to 10.9 per 100,000. This 

will lead directly to an increase in pre-term birth. That is bad. This 

reduction in providers is due to the lack of an increase in Medicaid 

reimbursement since 2002, increased cost of compliance with government mandates such as electronic health records, lack of meaningful protections against frivolous lawsuits, and increasing student loan debt. 

In general, the universal access for health care is the emergency 

room. It is providing the appropriate location of care for people that 

is our challenge. The nearly 50 million uninsured non-elderly 

Americans receive much of their healthcare in the ER with about 

25 percent of all ER visits being non-emergent. CMS estimates the 

cost of this to the taxpayer as about $176 billion per year. Additionally, about 55 percent of care provided in the ER is uncompensated, 

meaning no payment at all is received for services rendered, either 

by hospital or doctor. Historically, this charity care has been paid 

for with cost shifting. However, with the stagnant or declining reimbursements, this is becoming increasingly difficult and in some 

cases impossible. 

The imperative about quality is a tough nut to crack. Doctors 

and other experts cannot seem to agree on the definitions of quality 

and our ability to gather clinical data is poor. 

19 

Well, here is what I know. When I finished medical school, I 

thought an exchange was what I did the day after Christmas with 

the sweater that did not fit. 

[Laughter.] 

Dr. REINHARDT. Right now, I am struggling to educate myself 

about private exchanges, Medicaid expansion, and doughnut holes. 

I know that many of the problems discussed here this morning preceded the Affordable Care Act and the old system was broken. I 

know that when the coordinator called me to testify this morning, 

I was in one of my rural offices and the patient I had just seen remarked at checkout about how happy she was that she did not 

have a co-pay for her visit. I know that her co-pay will eventually 

be rolled into the premium for her insurance and that ultimately 

she will pay for it. I know that one of my dear employees and 

friends has been stricken with metastatic pancreatic cancer and 

that her treatments would have bankrupted her if not for the elimination of annual and lifetime insurance maximums. For her, thank 

God for the Affordable Care Act. I know that particularly the parts 

of the Affordable Care Act slated for implementation in 2014 will 

bring great change, with real people tragically affected and others 

receiving great benefit. I know that it is too premature to know the 

full impact of the Affordable Care Act. I know that change is hard. 

I know that there is a lot of work yet to be done. And I know that 

I appreciate the opportunity to be here today and to present to you 

my impressions and thoughts and views and to answer your questions. 

Mr. WOODALL. Thank you, Dr. Reinhardt. 

It is now my privilege to recognize Mr. Boyette for his opening 

testimony. 

[The prepared statement of Dr. Reinhardt follows:] 

20 


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Good Morning Mr. Chairman, Committee members, fellow witnesses, and 

attendees. Thank you for the opportunity to come before you this morning to 

discuss the impact of the Patient Protection and Affordable Care Act (ACA) 

specifically, insights I may be able to share with you from the perspective of a 

practicing physician. 

My name is Jeff Reinhardt. I am a full time practicing OB/GYN and am President 

of The Longstreet Clinic, P.c. We are a physician owned multi-specialty group, 

formed in 1995. Currently there are about 160 medical providers including about 

100 physicians in the group. Geographically we have offices in locations in more 

heavily populated areas in Duluth, Buford, Braselton, Oakwood and Gainesville 

working out of large medical centers in Gwinnett Co, population about 842,000; 

and Hall County, population about 185,000. We also have offices in more rural 

areas including Dahlonega and Baldwin, caring for patients in smaller hospitals 

including Chestatee Regional Hospital in Lumpkin Co, population about 30,000; 

Habersham County Medical Center in Habersham Co, population about 43,500; 

and Ty Cobb Regional Medical Center in Franklin Co, population about 22,000. 

Also, we are in partnership with the Department of Community Health, providing 

obstetric services for patients in our local health department, many of which are 

currently uninsured and economically disadvantaged. As you can see, we have an 

extremely diverse patient base - ethnically, socioeconomically and 

geographically. 

Presently, I wear several hats as it relates to healthcare - I am a consumer, 

provider and employer. Each of these roles has a different set of needs, 

challenges and motivators. I was asked to speak today about my perspectives as 

a physician and provider of care. 

It is not new news that healthcare in this country is in crisis. Dating all of the way 

back to 1926, out of concern for the costs and utilization of medical care, our 

congress formed the Committee on the Cost of Medical Care. The committee was 

abolished in 1932 after their recommendations were felt to be too radical. This 

illustrates that issues of cost, access, quality of care - and the government's role 

in these issues has been ongoing for 90 years. 

1 
21 


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It is widely accepted that the cost of medical care in this country is a problem. 

Over the last 20+ years, according to data reported by the World Health 

Organization, the cost of healthcare in the US changed from being flat and 

predictable at around 13.5% of our GDP during the 1990's, to increasing annually 

to almost 18% this year. Just last month, Aon Hewitt, a worldwide leader in 

employee benefit and insurance consulting reported average health-care 

premium per worker increases ranging from 3.3% to 8.5% per year for each of the 

last 7 years, with an estimated increase of 6.7% for next year. Also, noting 

average cost to employees for out-of-pocket expenses, increasing by nearly 13 

percent last year, continuing a trend that has seen employees' share of total 

health-care costs jump 150 percent since 2004. Clearly increasing cost is a 

problem. A budget item of nearly 2.5 trillion dollars, with no obvious end in sight 

to increases is a strong motivator for change. 

Access to medical care is an extremely complex issue. It is influenced by 

geographic location; a person's literacy; disabilities; and the ability to pay for 

services including both out of pocket costs and costs covered by a payor - be it 

government program or private insurance. In general, there is a perceived lack of 

access to care, but few good comprehensive studies about the issue of access 

exist. Certainly, when there is a decrease in the number of providers per capita, 

or when providers and hospitals move from more rural areas, geographic access 

to care is negatively influenced. Here in Georgia, there has been a reduction in 

the number of OB/GYN providers from 13.5/100,000 to 10.9/100,000 between 

2004 and 2008, this from data reported by the Georgia Health News. This will 

directly impact our ability to prevent preterm births. The reasons for this 

reduction in provider ratio include stagnant Medicaid reimbursements for over 10 

years; the increased cost of compliance with government mandates - such as 

electronic medical records; lack of meaningful protections against frivolous law 

suits; and increasing student loan debt. 

In general, the safety net for care is the emergency department. This is where the 

nearly 50 million uninsured, nonelderly Americans receive much of their 

healthcare, this estimate being from the U.S. Census Bureau data from 2010. 

These patients have typically delayed seeking care for chronic issues until their 

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medical needs are much more complicated than they might be had they received 

ongoing care in a traditional office setting. In a study by the National Institutes of 

Health (NIH) from 2010, about 25% of all emergency room visits are for nonemergent problems. The Center for Medicare and Medicaid Services (CMS) 

estimates that cost to the taxpayer for this care is roughly $176 billion. About 

55% of care provided in the ER is uncompensated - meaning no payment at all is 

received for services rendered by either the hospital or physicians. Historically, 

doctors and hospitals have been able to "cost shift," paying for this "charity" care 

with "profits" available from the care provided to those with private insurance. 

However, with stagnant or declining reimbursements, this is becoming 

increasingly difficult and in some cases, impossible. This has led to consolidation 

of providers, where small physician practices and small hospitals, are merging 

with larger physician groups or hospital systems. This has resulted in increased 

numbers of physicians as employees rather than owners of practices; a reduction 

in services offered at rural hospitals; and increased costs of care due to increased 

reimbursement allowances for services performed by hospitals and hospital 

providers. There are headlines about hospital closings in every state - which 

implies reduced access, but a presentation 2 weeks ago using Medicare Payment 

Advisory Commission (MedPAC) data concluded that "access is expected to be 

strong despite declines in margins." Therefore, it is difficult to make solid 

conclusions about the availability of access to care, but certainly there is concern 

about providing the appropriate location for this access. 

The imperative about quality is a tough nut to crack. Agreement in the definition 

of quality is not generally universal and our ability to gather clinical data is poor. 

Many of our current indicators of quality are based on billing codes and medical 

claims submitted for charges, and not based on clinical information. For instance, 

I can submit a charge for Tobacco Abuse, but may not submit a charge for my care 

which may have included counselling a person about the benefits of stopping 

smoking. 

So, how does the ACA playa role as cause and solution? Clearly, from the data I 

have reported - almost all of which preceded 2010, these are not new issues, and 

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have not been the result of the ACA which was signed into law in 2010. This law 

includes mUltiple provisions that take effect between 2010 and 2020. 

Just looking at 2010, there was a requirement for insurance plans to allow 

dependents to remain on their parents plans until age 26 - insuring many young 

adults in school and in transition to the working world; phase outs on both annual 

and lifetime coverages; eliminating insurance denials for children with "preexisting conditions;" additional funding for Community Health Centers; as well as 

Small business tax credits for insurance premiums paid for. 

In 2011 there was implementation of "free" preventive care and contraceptionwith no co-pay for the patient; allowable medical loss ratios for insurance 

companies; additional taxes for manufacturers and importers of brand-name 

drugs - subsequently passed on to patients; elimination of over-the-counter 

medications as allowable purchases from Health Savings Accounts and Flexible 

Spending Accounts. 

Calendar year 2012 brought payment reforms incentivizing quality and penalizing 

avoidable complications; incentives and imperatives for using electronic health 

records and standardized billing practices - ultimately with penalties for those 

noncompliant; and incentives for provider groups to better coordinate patient 

care and improve quality, help prevent disease, illness and reduce unnecessary 

hospital admissions. 

This year, 2013 brought new funding to state Medicaid programs that choose to 

cover preventive services for patients; excise taxes for medical devices; 

limitations on Flexible Spending Account contributions; more payment reforms 

incentivizing providers to work even more closely to provide care; and it also, 

brought with it enrollment in Small Business Health Options Plan and individual 

exchanges. 

2014 and 2015 are slated to bring more Consumer Protections, Improvements to 

Quality and Cost and Increased Access. 

Well, here is what I know and what I don't know. When I finished medical school I 

thought an exchange was what I did the day after Christmas with the sweater that 

4 
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didn't fit, and right now, I am struggling to educate myself about Private 

Exchanges, Medicaid Expansion and "doughnut holes." I know that many of the 

problems discussed here this morning preceded the ACA. I know that when the 

coordinator called me to testify this morning, I was in one of my rural offices, and 

the patient I had just seen remarked at checkout, about how happy she was that 

she didn't have a copay for her visit. I know that her co pay was going to be rolled 

into the premium for her insurance and that ultimately she would pay for it - just 

not at the time of her visit. I know that the pre-ACA system is broken. I know one 

of my dear employees and friends has been stricken with metastatic pancreatic 

cancer and that her treatments would have bankrupted her if not for the 

elimination of annual and lifetime insurance maximums - for her, thank god for 

the ACA. I know that particularly the parts of the ACA slated for implementation 

in 2014 will bring great change, with real people tragically affected, and others 

benefitted. I know that it is too premature to know the full impact of the 

Affordable Care Act, judicious data collection and interpretation is needed before 

objective conclusions can be drawn. I know that change is hard. And, I know that 

I appreciate the opportunity to have been here today to present to you my 

limited view and answer any questions that you may have. 

5 
25 

STATEMENT OF MICHAEL BOYETTE 

Mr. BOYETTE. Thank you, sir. 

I am here today to explain how the Affordable Care Act has affected me and my family. My name is Mike Boyette, age 28. My 

wife is 30 and my daughter is two years old. We have been residents of Georgia for 10 years. My wife is employed by the state as 

an educator and I am a small business owner. 

We have had health insurance through the State Health Benefit 

Plan for the past six years. Our monthly premium with our current 

carrier, United Healthcare, is $350 a month. Due to the new 

healthcare law, our new carrier, Blue Cross Blue Shield, has raised 

our premium to $540 a month. This results in an increase of $190 

a month, a $2280 increase for the year. 

You may think we went with a more expensive plan or got more 

coverage. In fact, we have not. We have less coverage than before, 

a higher out-of-pocket expense, and a premium that has risen 65 

percent. This is not affordable to me. 

I do not believe in my government telling me I have to buy something and on top of that, if I do not, I will be fined. I believe the 

American people have been lied to and misled. I myself liked the 

President’s promises that we could keep our same healthcare and 

that we would actually be saving money. This was promised and 

believed by me and many other Americans. 

For the year 2013, we had two companies we could choose from, 

along with four options each company provided. When we went to 

sign up for our new 2014 healthcare plan, one company was available with three options. One company, three choices—that was it. 

I thought I was wrong and it was not possible that I would pay 

more and have less coverage and fewer options. This was not what 

the President assured me and many other Americans. 

When you hear the leader of the free world tell you something, 

you would like to believe his words have truth, meaning and honesty. I do not believe this to be the case. 

More money, less coverage. Obamacare seems to hurt the majority of Americans while only having a positive effect on a very small 

percentage. I do not understand why this Administration wants so 

badly to have the Americans rely on their government for food, 

housing and now healthcare. It concerns me to look into the future. 

Should the government run the automotive business next, telling 

us that if we do not buy their cars, we will be fined? When does 

this stop? 

Please fix the issues at hand. Do not create more problems, do 

not lie about it for political advancement. And I believe we all have 

been lied to. 

If I lie to my customers and tell them something that is not true, 

I would not have any business. They are wondering where their 

customers are. Well, they have lied; therefore, they do not have any 

business. It is time that we as Americans stand up for what is 

right. This is very cut and dry. This is an Obama tax, not 

Obamacare. 

I would like to thank our elected officials and other Americans 

who have stood up and fought for this from the very beginning. I 

urge them to keep fighting for us and hope that they know those 

fighting for the American people are appreciated. I also hope that 

26 

one day justice and real freedom and choice will be back in our 

healthcare system. 

While the future of my healthcare seems uncertain and far from 

affordable, I hope that those Americans who have been negatively 

affected, like myself, by Obamacare, can reverse the wrongs that 

have been done to the millions of us. 

Thank you. 

Mr. WOODALL. Thank you, Mr. Boyette. 

It is now my privilege to recommend Mrs. Collins for her opening 

statement. 

[The prepared statement of Mr. Boyette follows:] 

27 


Insert offset folio 11 here 86196.011

Good morning, 

letter of Testimony 

before the 

Committee on Oversight and Government Reform 

u.s. House of Representatives 

by 

Michael C. Boyette 

Owner 

Owl Town Auto 

Ellijay, Georgia 

November 18, 2013 

I am here today to explain how the Affordable Care Law has affected me and my family. My 

name is Michael Boyette age 28. My wife is 30 and my daughter is two years old. We have 

been residents of Georgia for 10 years. My wife is employed by the state as an educator and I 

am small business owner. We have had health insurance through the State Health Benefit Plan 

for the past six years. 

Our monthly premium with our current carrier United Health Care is $350 a month. Due to the 

new health care law, our new carrier Blue Cross Blue Shield has raised our premium to $540 a 

month. This results in an increase of $190 a month - a 2,280 dollar increase for the year. 

You may think that we went with a more expensive plan or have gotten more coverage. We 

have not. In fact we have less coverage than before, also a higher out of pocket expense and a 

premium that has risen 65%. This is not affordable to me. I do not believe that ObamaCare has 

my best interests at heart. 
28 


Insert offset folio 12 here 86196.012

I do not believe in my government telling me that I have to buy something and, on top of that, if 

I do not, then I will be fined. I believe the American people have been lied to and misled. I 

myself liked the President's promise that our health care premiums would not increase and 

that my family could keep the same coverage that we currently have. This was promised and 

believed by me and many other Americans. 

For the year 2013 we had two companies that we could choose from along with four options 

that each company had. When we went to sign up for our health care plan in 2014 our health 

provider had only one company. Three options were available - one company, three choices. 

That was it. I thought this must be wrong. That it was not possible that I would pay more, and 

have less coverage and fewer options. This is not what I was guaranteed told and led to believe 

by our leader. This is what I see as being deceitful, wrong, and illegal. 

When you hear the leader of the free world tell you something you would like to believe that 

his words have truth, meaning, and honesty. This is not the case. 

More money less coverage - this is not what the American people should settle for. 

ObamaCare seems to hurt the majority of Americans while only having a positive effect on a 

very small percentage. There are over 300 million people in this great country. Why hurt the 

vast majority of Americans to pay for such a small percentage? Why does this administration 

want so badly to have Americans rely on the government for food, housing, and now health 

care? It concerns me to think of what could happen in the future. Should the government run 

the automotive business next? Telling us that if we do not buy their vehicle then we will have 

to pay a fine. When does this stop? 

Fix the issues at hand. Do not create more problems. Do not lie about it for political 

advancements. I believe we have all been lied to and bait and switch has taken place. 

2 
29 


Insert offset folio 13 here 86196.013

If I lie to my customer and tell them something and it not true then I would not have any 

business. Why is the administration wondering where there customers are? They have lied and 

not told the truth about their product therefore there will not be any customers. Millions, if 

not billions, of our tax dollars have been spent creating and developing this tax. It is time that 

we as Americans stand up for what is right. This is very cut and dry. This is an ObamaTax - not 

ObamaCare. 

I would like to thank our elected officials and other Americans who have stood up and fought 

against this law - the ObamaTax - from the beginning. I urge them to keep fighting for us. I 

hope that they know that those fighting for the American people are appreciated and I also 

hope that one day justice and real freedom and choice will be back in our health care system. 

While the future of my health care seems uncertain and far from affordable, I hope that those 

Americans who have been negatively affected by ObamaCare - like myself and my family - can 

reserve the wrongs that have been to the millions of us. 

Thank you. 

3 
30 

STATEMENT OF EMMA COLLINS 

Mrs. COLLINS. Thank you very much and good morning. Thank 

you for inviting me, I am happy to be here and I am honored to 

have been chosen to participate in this hearing on the Affordable 

Care Act, hereafter referred to as the ACA. 

My husband and I are both self-employed and as such, we do not 

have access to group healthcare insurance. He is a certified quality 

auditor and an independent contractor. I am a licensed massage 

therapist and I have my own business. We had group insurance 

when I was employed by a local school system. However, when 

budget cuts caused my position to be eliminated, we lost that option. 

So we researched private companies and applied with several. I 

was rejected by all these companies because I have a preexisting 

health condition. So then, we applied for just my husband and our 

college age daughter, so they could at least have insurance. We 

found a policy from Humana for them at $265 a month. It was basically catastrophic coverage but that was fine. It was affordable 

and it gave us financial protection in case of major medical issues. 

Early October this year, we got a letter from Humana, the policy 

was being changed. For them to have a plan that was compliant 

with the requirements of the ACA, our cost went from an affordable $265 a month to an outrageous $898 a month. That is a 240 

percent increase. In addition to this much higher premium, the deductible on this exorbitantly priced plan is $6000 for one person 

and $12,000 for both. So in the event of medical issues with them, 

this ACA-compliant plan exposes us to the risk of up to $2000 per 

month. That is in no way, shape or form acceptable or affordable. 

With the low premium payment that we had, we were willing to 

accept the risk of a high deductible, but it is just not feasible to 

combine a high premium with a high deductible. 

It is not like my husband and daughter are even at high risk for 

illness for the plan to be so expensive. They are both athletic, long 

distance runners and are extremely healthy. So for their rates to 

increase at this ridiculous amount is just simply unreal. 

I still do not know what I am going to do about health insurance 

for myself. I am very concerned about how much it is going to cost. 

If it is anything like my husband and daughter’s case, it will be 

anything but affordable. 

I have not signed onto Healthcare.gov yet to find out the true 

cost for me. I am very concerned about the security of my data, the 

potential for hacking, and the potential misuse of private information entered into that database at this time. 

My husband, my daughter, and myself are not the only ones in 

our family negatively impacted by the new healthcare law. Our 

married college student son, his wife and their four year old daughter apparently make too little to qualify for a subsidy. However, 

they make too much to qualify for Medicaid. It makes no sense to 

set up a program where some of the very poorest financially among 

us are left out in the cold while those who make only slightly more 

are given free largess. 

While I was looking for information on the public pages of 

Healthcare.gov, I noticed something curious. On all the pages I 

looked, the subsidies were promoted. It was implied that most peoVerDate Aug 31 2005 10:48 Jan 24, 2014 Jkt 000000 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 C:\DOCS\86196.TXT APRIL
31 

ple would quality for a subsidy and that their premiums would 

probably be lower than the ones quoted on the estimation page. 

But even with the wide variety of financial situations in our family, 

no one qualifies. 

I think it is great to help those who are poor and desperately 

need help, but that is not what is happening. There is a great gap 

in the assistance to the poor, through which our son and his family 

fall. And there is great inequality in how the subsidies are given 

to those with higher incomes. Why should Congress and staffers 

who are as well—in most cases financially better—equipped than 

my family receive subsidies when what we receive instead is outrageously priced health insurance, or being required to pay a fine 

beginning next year at one percent of our income. The misleading 

advertising on Healthcare.gov and unfair application of the subsidies all make this costly financial pill even more bitter to swallow. 

The ACA will also have a negative impact on our local economy. 

We currently employ people to clean our home, do yard work and 

odd jobs around the house. That will have to stop because of the 

necessary tightening of our budget. This will reduce their income, 

thus reducing what they are able to add to the economy. We may 

not make such a dramatic impact just by ourselves, but we are not 

alone. Imagine this combined with all those others like my family 

and myself. Once happily contributing to multiple levels of the 

economy, now required to funnel most of that financial stream into 

the behemoth that is the ACA. 

So because of the ACA, our family will go from having some 

healthcare coverage we can afford to no healthcare coverage and a 

fine beginning next year at one percent of our income. 

Please repeal the ACA in its entirety. There has to be a better 

way that would not cripple families like us financially, yet would 

still help those who simply cannot help themselves. 

Thank you again for your time and consideration of this extremely important matter. May God bless you with wisdom. 

[The prepared statement of Mrs. Collins follows:] 

32 


Insert offset folio 14 here 86196.014

Testimony of Emma Collins 

To the House Oversight and Government Reform Committee 

Field Hearing 

Gainesville, GA 

November 25, 2013 

Thank you for giving your time and effort to research the wide-ranging effects 

of "Obamacare" - The Affordable Health Care Act (ACA.) Thank you also, for 

allowing me to represent my family and the many self-employed people who 

are now in similar negatively impacted situations. The effect of the ACA on 

my family and myself has been, already, considerable. As self-employed 

persons, my husband and myself are not covered under any group insurance 

plan, thus we are participators in the private insurance market. 

My husband is a Certified Quality Auditor (CQA) who performs independent 

food quality/safety audits at food manufacturing facilities. He is an 

independent contractor in his work and owns his own auditing business and 

has done so for approximately the last thirteen years. I am also an 

independent contractor as a Licensed Massage Therapist (LMT.) I own my 

own massage therapy business and operate out of a local medical day spa. 

have been self-employed for over two years. We used to be covered by 

group health insurance when I was employed by our local school system. 

However, when my part-time position there was eliminated several years ago, 

that all changed. 

As self-employed persons, we carefully researched private health insurance for 

our family to cover my husband, our college-age daughter and myself. I 

searched in vain for a company that would insure me at all, since I have the 

pre-existing condition of having had heart-valve replacement surgery 15 years 

1 
33 


Insert offset folio 15 here 86196.015

ago, Even though I am, in reality, quite healthy, I was refused coverage by all 

the insurance companies to which I applied, So, we decided to focus on 

finding insurance coverage for my husband and daughter at least. 

We purchased a policy for my husband and our daughter through Humana 

with a monthly payment of $265 that would cover both of them, It was 

basically catastrophic coverage, but that was fine and exactly what we needed, 

We paid out of pocket for their rare medical expenses and for any that I 

incurred, 

In early October 2013, we received a letter from Humana stating that our 

policy would no longer available as we had purchased. We could purchase 

the "substandard" plan for only a small increase per month. However, we 

were told in the letter, if we chose that option we would be reported to the 

IRS as noncompliant and charged a fine, To make their policy compliant 

with the ACA it was now going go up from $265 per month to $898.00 

per month. That is a 240% increase! In addition to a much higher 

premium, the new policy would have a $6000 deductible for one person and 

$12,000 for both of them. That adds up to potentially $500 to $1000 more a 

month in cost, just to reach the deductible and then, finally, begin to receive 

a percentage of reimbursement. While a high deductible was an acceptable 

risk when we were paying a low premium, it is not workable at all when the 

premium is already so high, 

My husband and daughter are both athletic and healthy, They are both 

runners and in the last 3 years he has ran a marathon and several halfmarathons and shorter races and he and she have both completed 2 halfmarathons together as weI! as she has ran several other races. They are 

among the healthiest people I know, and for their health insurance coverage 

to increase at that ridiculous amount is absolutely ludicrous. 

2 
34 


Insert offset folio 16 here 86196.016

I still don't know what I am going to do about health insurance for myself. 

understand that one of the provisions of the ACA is that those with preexisting conditions can't be denied coverage. I had originally hoped that 

would provide benefits for someone like myself who had been unable to 

purchase private health insurance previously. At this point, however, I have 

no idea how much any coverage for me would cost. Sure, they are required 

to cover me, but there is nothing I know about that requires it to be at an 

affordable amount for me. We are blessed to make too much money to 

qualify for a "subsidy", but certainly cannot afford the amounts that this law 

would try to make us spend on just the two healthiest members of our family, 

much less me with the pre-existing condition. 

I have not signed on to healthcare.gov yet because I am very concerned 

about my private information being insecure on that site. It seems the 

website has many issues, and one of the ones that makes me most 

uncomfortable is the questionable security of the information that one enters 

into it. Identity theft or other misuse of the private information entered 

therein is an issue I do not feel has been adequately addressed and/or 

worked through. Because of my concerns with the safety of my personal 

information on the website, I have not even attempted to see if I could 

become one of the few people to get through to sign up and see what my 

rates will be. Based on the exorbitant cost of coverage for my healthy 

husband and daughter, I do not have high hopes that coverage for me will be 

any less expensive, and most likely much more. 

My husband, our daughter and myself are not the only ones in our family to 

be negatively impacted by the new healthcare plan. Our married son, his wife 

and daughter also have been adversely affected. Our son is a full-time 

college student, his wife works part-time and they share in the full-time care 

of their 4-year-old daughter. They make less than the poverty level, but more 

than the amount that would qualify them for Medicaid. So, they do not make 

3 
35 


Insert offset folio 17 here 86196.017

enough to qualify for a subsidy, but too much for Medicaid since Georgia 

chose not to place the state under the heavy financial burden of expanding 

Medicaid. I was recently told that there is supposed to be a waiver form to 

be developed to eliminate the fine for having no insurance for those in this 

"gap." They are still left with no insurance and no ability to afford it at this 

time. 

As I was looking on the public pages of the healthcare.gov website, I noticed 

an odd thing. On those pages of the website, the the subsidies are touted 

constantly and one is over and over encouraged to see what subsidies for 

which one qualifies and told that one's premiums will probably be lower than 

the cost cited because of the subsidies. However, even with the variety of 

financial situations in our family, NO ONE in our family qualifies for the 

subsidies at all. It seems from the website presents it, that most everyone 

qualifies, but when one starts looking at the nitty-gritty of it, that list narrows 

down a lot. I am not a great fan of the subsidies, though, anyway, because of 

the way they are applied. I gladly would help the poor and those who 

desperately need help, but it seems the subsidies have reached out far 

beyond that. When our family, who is by no means rich, does not qualify for 

subsidy, but is required to pay for exorbitantly priced insurance in full or pay 

a fine, but yet, politicians and staffers in the Congress and Executive Branch 

have subsidies - something is wrong. Why should our family be required to 

carry the burden of those who are as well, and most instances better, 

financially equipped as we? Misleading advertising on healthcare.gov and 

unfair application of the subsidies all make this painful financial pill even more 

bitter to try to swallow. 

Now, with the skyrocketing cost of health care coverage thanks to the "ACA" 

my family will be bearing an incredibly heavy financial burden, simply to 

obtain health care coverage. This will have a very negative impact on our 

contribution to the local economy. We currently employ someone to clean 

4 
36 


Insert offset folio 18 here 86196.018

our home on a regular basis. That will have to stop because of the tightening 

of our financial purse strings thanks to healthcare coverage. So, it flows on 

down to her, reducing her income and reducing the income she has to add to 

the local economy. We also employ other persons to perform yard work and 

odd jobs. That will also have to stop, thus reducing the income of those 

people too. Our discretionary spending will have to be decreased drastically 

with the vast bulk of it going directly toward maintaining health care 

coverage we do not want. This is spending we would normally do at local 

shops, restaurants, gas stations, hair salons, and so on. We may not make so 

much of a dramatic impact just by ourselves on this, but we are not alone. 

All those of us who are self-employed and blessed financially enough to not 

receive a subsidy will be forced to do the same thing. This certainly does not 

sound like a harbinger of an upswing of the economy to me. If it has the 

negative impact on our economy that I, with just my local effect, can foresee 

- imagine this combined with all those others like my family and myself. 

Once, we were happily contributing to multiple levels of the economy, now 

we will be required to funnel most of that financial stream into only one thing 

- the health care behemoth of the ACA. 

Originally, my family and I thought that this health care reform might actually 

work out to be a good thing in our lives. However, as self-employed small 

business owners, we are being penalized and placed under a potentially very 

heavy financial burden. We would much prefer it would simply go back to 

how it was. We had affordable coverage for my husband and daughter. We 

realized the financial risk we took to pay for their healthcare coverage out of 

pocket because of their high deductible and to cover out-of-pocket any 

health care expenses I might incur. However, with the outrageous cost 

increases that the ACA is bringing to bear; it will not take long for coverage 

under the ACA to cost us much, much, more than we were paying before with 

little benefit to us. I would much rather save the money and apply it as 

needed to healthcare, than to pay it up front for dubious coverage that may 

5 
37 


Insert offset folio 19 here 86196.019

not be needed, or what we even want, if and when it is needed. Now, 

because of the ACA and its mandates, our family will go from having some 

health care coverage that we can afford, to no health care coverage and a 

fine of 1% of our income. 

I do understand there is some value in health care reform. However, the lack 

of choices of types of policies (no catastrophic care over the age of 30, for 

example) and lack of choice over what is covered (maternity coverage being a 

requirement, for example, regardless of whether it is needed or wanted) 

create a mandatory high cost. What about an a la carte system? This would 

help our family considerably, since we could then choose to pay for the items 

we needed and only those items. If we choose not to elect a certain type of 

coverage, then so be it. We would have to payout of pocket if it became 

necessary. Thus, we could have truly Affordable Health Care, not this 

unaffordable quagmire that is the ACA. 

In summary, I am a 47 year old, self-employed healthy woman with a preexisting condition. I currently have no health insurance. My 51 year-old, selfemployed healthy husband and 22 year-old healthy college student daughter 

have private health coverage. Their current coverage rate of $265 has been 

tripled in price to $898.00 per month due to requirements to make their 

policy ACA compliant. This, combined with the unknown cost of "required" 

health insurance for me, is an excessive financial burden on our family. Please 

do all you can to repeal the ACA in its entirety. There has to be a better way 

that will not place such an onerous burden on our family and those like us 

yet will help those who truly cannot help themselves. 

Thank you again for your time and consideration of this extremely important 

matter. May God bless you all with wisdom. 

6 
38 

Mr. WOODALL. Thank you, Mrs. Collins. Thank you all. I will 

begin the first round of questions. 

And Mrs. Collins, I think you hit it on the head with your ask 

for a blessing of wisdom. I was with a member of Congress a week 

and a half ago when he noted how many state legislators had been 

elected to the Congress and he wondered if a wand of wisdom was 

suddenly passed over you when you went to Washington, D.C., that 

you believed that Washington had all the answers, answers that 

you could not find while you were a state legislator. 

Mr. Sale mentioned that this was a marketplace that our state 

legislatures and regulators have been working in for a long, long 

time. In fact, I saw Senator Renee Unterman with us this morning. 

I really do believe that the level of conversation has increased 

dramatically. The focus—I remember back in 1996 when the feds 

eliminated preexisting conditions for federally regulated plans, but 

they did not try to interfere in state regulated plans. But as Dr. 

Reinhardt pointed out, lifetime caps, the elimination of those lifetime caps, has been something that both consumers and the industry itself has come together to say, you know, this is something 

that we could do. I sincerely believe if we had voted on the Affordable Care Act, six pages at the time, instead of 2400 pages at the 

time, there would have been some benefits in there for some folks. 

But we would have rejected so many of these things that we continue to talk about rejecting today. It is you and your family, Mrs. 

Collins, that were the poster child of why we need the Affordable 

Care Act. And here you are, the very family that we intended to 

help—not saying we have not done so at all. At the same time, Mr. 

Boyette believed those promises and is finding them unfulfilled. 

You talked about subsidies on the web page. When I heard that 

every family’s policy was going to be $2500 cheaper under the Affordable Care Act, I thought it actually meant that premiums were 

going to go from a level that we all thought insurance costs were 

too high, and insurance costs were going to come down. But it 

sounds like from your reading of the web page what it means is 

premiums are just going to go up even higher but we are going to 

create enough of a federal subsidy to try to bring those down below 

what we were paying before. 

Is that an accurate reflection? 

Mrs. COLLINS. That is how I perceived it. It was that basically 

if you—they will take from those that make too much to get the 

subsidy, to give to those who will receive a subsidy. But even at 

75 percent, if it covers 75 percent of these plans, I have been at 

incomes of those people that have the eligibility to receive the subsidy. It is still going to be a very painful financial burden, even 

paying that 25 percent. 

Mr. WOODALL. Dr. Reinhardt, you talked about the folks who are 

receiving non-emergency emergency room care and the literally 

hundreds of billions of dollars that go out the door in that way. I 

do not believe there is a man or a woman in this room who does 

not believe that folks, who have no healthcare choices in their life, 

deserve and require access to healthcare. That seems like a solution—a problem that we could come together on a solution for. We 

do not want those folks in the emergency room. 

39 

Is it your expectation that what we are seeing under the Affordable Care Act is going to eliminate that emergency room traffic? 

Dr. REINHARDT. I think the degree to which it will reduce that 

is going to be measurable. The degree to which that gets changed 

is going to be unclear, because part of what we will do in this process of trying to provide a more appropriate location for access, is 

we will have to retrain people. So historic patterns of seeking care, 

habits if you will, are hard to break. And so those individuals that 

will get coverage or be provided coverage through, you know, federally qualified care centers, subsidized care centers, if you will, I 

think retraining them that that is where they go for their care, I 

think that is going to be a great challenge for us. So the degree to 

which you will reduce that 25 percent of non-emergent visits to the 

ER, I think that is going to take time to be able to calculate. 

Mr. WOODALL. I do think there is a common commitment to improving access. My uncle is a primary care doc down in south Georgia. He said, ’’Rob, you can hand out all the new Medicaid cards 

you want to, but I am the only doc in five counties who will see 

Medicaid patients, and I cannot fit anybody else in my waiting 

room.‘‘ So that handing out cards does not improve access. 

You talked about the number of OB–GYNs per thousand Georgians going down. I cannot imagine when we are creating an incentive for doctors not to get in the business, or even worse for docs 

with experience and talent to leave the business. If we continue to 

see the ratio of docs to patients declining, we are going to end up 

with access issues. There is just no way around it. 

Mr. Sale, what I understood you to say was that of 100 clients 

that you looked at whose plans were supposed to be grandfathered 

under the ’’if you like your healthcare, you can keep it,‘‘ something 

that was designed to mitigate problems that folks knew would 

occur, that only four of those companies still maintain their grandfathered status today? 

Mr. SALE. That is correct. Most of the plans lost their grandfather status because the insurance carriers made dramatic change 

in the benefit structure. Early on when the law was passed, they 

said if you even change carriers, you lose your grandfather status. 

And one of my larger accounts lost grandfather status by June of 

2010. So most everyone is gone, and the ones that we have found 

that still have it were caught in the early renewal changes, moving 

their renewal dates to December. And we found four of them that 

actually still had grandfather status. We had done all the rules— 

we had done all the compliance that the employer needed, but we 

just did not keep up with them until we came to this renewal status. 

Mr. WOODALL. And finally, thinking about Mrs. Collins’ request 

to repeal and start over from scratch, that is the same request the 

Chicago Tribune is making. But all the turmoil that we are seeing 

that is creating that desire to repeal and start over again, did I understand you to say that what we are seeing is just the tip of the 

iceberg, that folks are going through a process called early renewal 

to try to mitigate the damage that is happening and when those 

early renewals expire, there is going to be a whole other round of 

insurance complications? 

40 

Mr. SALE. This is true. What we have done in our practice, and 

what many agents have done, at the encouragement of the insurance companies, is to change the renewal date from whenever it 

was going to occur in 2014, to 2013, because they avoid the plan 

designs that are going to be required, the metal plan designs if you 

will, they avoid the community ratings which are going to be a big 

item when they hit the board too. 

The problem we have here is it is going to be real difficult for 

me to renew another group of 100 employees, 100 employer clients 

in December of next year. So there are going to have to be some 

changes. But the foundation behind this is to give—just like when 

the Healthcare.gov hit the streets and all the politicians—not all 

of them, but the Administration is a better word—was touting ’’it 

is going to work,‘‘ ’’it will work, do not worry about it,‘‘ ’’everything 

is protected,‘‘ ’’it is going to be flip the switch on October 1st and 

your life is going to be a new life.‘‘ Well, that is going to happen 

again when all these other renewals start in 2014. People have to 

actually live it so they can believe it. I can tell you all day long 

your premium is going up 20 percent and you are going to say 

okay, well, you may be biased or you are an insurance agent. I understand, but is that really true. And then somebody else is out 

there saying those things really are not true, they are just pulling 

your leg. It is true and I can assure you, come 2014 it is going to 

be another firestorm out there. 

Mr. WOODALL. Well, there are a lot of folks this holiday week 

who are thankful that they have not yet been adversely affected by 

the Affordable Care Act but it sounds like this is just the beginning 

and there is more, sadly, pain and frustration for American families to come. 

With that, I would like to recognize the gentleman, Mr. Collins. 

Mr. COLLINS. Thank you, Mr. Chairman. I appreciate it. 

What is interesting to me, you talk about this, we look at it from 

a different perspective, is a fundamental difference—I spoke about 

that a little bit in my opening statement—a fundamental difference 

in government’s role and also a fundamental difference in what is 

actually happening in healthcare and what should be happening in 

healthcare. This concerns me, and it came out in Dr. Reinhardt’s 

testimony and Mr. Sale, you just brought it out just a moment ago. 

I heard a quote early on after they started getting the renewals 

and started looking at everything, I heard this quote and it was 

from I believe it was California, I am not exactly sure, but the 

quote was, ‘‘I liked this Affordable Care Act but I did not realize 

I was going to have to pay for it.’’ 

[Laughter.] 

Mr. COLLINS. And I think that is a fundamental problem when 

you look at this. And really what it is—and Dr. Reinhardt, I am 

going to get my first question in to you here. You brought up something that goes back to an old literature, it’s a tale of two worlds— 

or a tale of two cities—however you want to put it. You have got 

those that are benefitting, and I am not going to deny in this room 

that there are some who see a lower premium, better coverage, 

there is some benefits, which could have been addressed without 

changing the way we deliver healthcare in this system, without a 

government basically takeover. 

41 

But at the same point, you are also having people lose their 

healthcare in the way that Mr. Boyette described. You are changing. 

Are you see this in rural healthcare maybe exasperating this 

problem, that some might actually get a little help but in actuality 

we are taking on the rural healthcare problem and making it a lot 

worse? 

Dr. REINHARDT. Well, I think none of this happens in a vacuum, 

so this—a lot of the statistics I mentioned this morning were data 

that was collected before 2010. So it is pre-Affordable Care Act. 

These issues have been going on for a long time, that reduction in 

workforce of OB–GYNs was between 2004 and 2008, pre-Affordable 

Care Act. So these are issues that I think we have to address. 

You know, if you think about it from the perspective of—let us 

look at it just from my perspective as a physician who finishes his 

residency and comes out here into the outside world. And let us say 

I had finished in 2009 and I came out here and I am slapped in 

the face with a 906 page Affordable Care Act and I am in a partnership with four other doctors. What do we do? Do we each take 

150 pages and go home and read it overnight and come back together the following morning and say okay, this is how we are 

going to implement this? Heck no, we are confused, we need advice, 

we need help. And so we have to, through the economies of scale, 

you know, hire somebody or merge with another organization who 

has the faculties to help me as a provider adhere to laws. The 

HIPAA law, you know, and TOLA. These are laws that preceded 

the Affordable Care Act. This is not a new problem created by this. 

And so what has happened is you have had a lot of consolidation 

of providers, a lot. You have small practices that can no longer 

function in that capacity. Many of these people are seeking job security just like you and I, just like the members of this panel. Job 

security seems to be with the people with the deepest pockets and 

that is our hospital systems. 

So you are seeing physicians begin—well, it is a decade old trend, 

but they are being hired by larger medical groups like myself or by 

hospital systems. The law in this country allows hospital systems 

to charge more for the care that they provide, a significant amount. 

So if you have providers in rural areas, okay, that are now employees of hospitals, you have reduced the number of providers. In 

many cases, you probably reduced the insurance companies that 

are participating with those providers, and you have elevated the 

cost of care because now you are paying more for the very same 

thing you got last year at the very same place. That was not the 

fault of the Affordable Care Act, but the Affordable Care Act is another one of those 900-page laws that has just put another stone 

in our pocket of burden. This consolidation has forced a lot of scrutiny around where I go as a provider to provide care. 

And this is the answer to your question. Many of these providers 

are beginning to be consolidated into more urban areas. So care 

that we may have been providing in more rural areas, it is no 

longer there because your doctors and your providers are being consolidated into more urban areas. 

The full extent of that, again, I think it is too early to know. We 

had three hospital closings this year, but if you look at Med Pak 

42 

data, they will tell you that there are plenty of hospital beds available in this country. 

The Affordable Care Act was meant to provide care in the proper 

place and for many of these hospitalized patients, the proper place 

is not in the hospital, so it actually motivates care out of the hospital. So that has freed up some hospital beds. So is it because the 

Affordable Care Act is working and it is forcing people into a more 

appropriate location of care, which is out of the hospital, or do we 

have a stable number of hospital beds? I do not know the answer 

to that question. 

Mr. COLLINS. One of the things you hit on and just in a round 

about question is I think what we have here is a healthcare set up 

that had an ideological bent, this is what we want to do, without 

the look at the cost. And also I believe it was set up by folks who 

basically have not owned businesses, have not run businesses, they 

basically signed the backs of checks instead of fronts of checks, as 

I have said before. And I think when you look at that, that is a 

whole different process. 

Real quickly, I know my time is out, but I do want to ask Mr. 

Boyette. You made an interesting comment that I think Mrs. Collins sort of jumped on as well. It is the issue that is not talked 

about. We talk about the shifting cost of exchange cost, we talk 

about, you know, how much it is going to be and who lost, who did 

not. But what you brought up was an interesting process. And 

those, the vast majority of people—remember, most people had 

healthcare before this. This was not an issue where we are taking 

a group, but what you said is really interesting and I think it is 

going to be really interesting here in the state of Georgia for all 

state employees is this issue of now you went to one provider with 

three choices. 

Mr. BOYETTE. Absolutely. 

Mr. COLLINS. And I think—that affects you. How does that affect—I want you to elaborate on it, you touched on it briefly in your 

testimony. Did you find that shocking? Like I think I have that 

kind of issue in my own household. 

Mr. BOYETTE. Well, absolutely. I mean, you know, variety is the 

spice of life. You know, we like to pick and choose, you know, and 

when you go from eight options to four options and, you know, the 

whole time believing that it is going to get better, our healthcare 

system is going to improve and when you see it first hand, it is not. 

You know, it is very disappointing. 

Mr. COLLINS. Well, I think that is something for everyone to understand here, is the insurance industry, just like every other industry, is going to find ways to adapt to what they have to do. And 

if they have to give a cheaper premium over here, they are going 

to find other ways to cut their costs and make premiums go up on 

the other side. And I think you brought up something that is often 

missed in this process. 

Mr. BOYETTE. That is what hurts the most. It hurts the most 

when it hits your pocket. I mean just like Mrs. Collins here, and 

myself, and many other Americans, you know, it hurts the most 

when it hits your pockets. 

43 

Mr. COLLINS. Your comment right there, ‘‘it hurts the most when 

it hits your pockets’’ is sort of why we are sitting here today. And 

something that was promised—— 

Mr. BOYETTE. I watched the YouTube clips the other day. You 

know, it is heartbreaking. 

Mr. COLLINS. It promises a cotton candy world and the reality is 

cotton candy goes away, life comes on, and you get a premium and 

you get a process that is not just right now but it is going to fail 

in the future. 

And with that, my time is out, Mr. Chairman, I yield back. 

Mr. WOODALL. Thank you, Mr. Collins. 

I would like to yield now to Mr. Meadows of North Carolina. 

Mr. MEADOWS. Thank you, Mr. Chairman, and thank each of you 

for your testimony. 

I know, Mr. Chairman, this is not a town hall, but in going 

around, there were a few individuals that I know had some testimony and so forth. One particular gentleman had talked about how 

he had lost his coverage as part of a pension plan, and so I would 

ask unanimous consent for anybody who has written testimony 

that they have seven legislative days to be able to submit that testimony as part of this hearing. 

Mr. WOODALL. Without objection, if anyone has testimony, they 

can submit it to the Oversight Committee within the next seven 

days and we will make that part of the official record. 

Mr. COLLINS. Will the gentleman yield? 

Mr. WOODALL. Sure. 

Mr. COLLINS. And for those—and especially being here, you can 

call my office and we will facilitate getting your stories in. You just 

contact us. Many of you here, you know my office, you just get that 

in and I appreciate the Chairman. 

Mr. MEADOWS. I thank the Chairman. 

Dr. Reinhardt, let me follow up a little bit with you and then I 

am going to come to you, Mr. Sale, with some questions. You identified some issues. 

Is there anything in the Affordable Care Act that you believe will 

help that trend of doctor shortages? You know, you were talking 

about that was a trend I think that was happening up until 2008 

and continues on now. Is there anything in there that you believe 

that will allow us to have greater physician accessibility in rural 

areas? 

Dr. REINHARDT. You asked two questions there. You may not realize it, but you asked about the doctor shortage. I have been asked 

this question before by my state legislators, about whether or not 

there is anything in there that will stimulate more physicians to 

go and get trained. And the answer to that question is if there is, 

I have not seen it, heard it, or read about it. 

The second question though, that you really kind of asked in 

there as well was access. Like are we going to be able to deliver 

providers into areas where it is underserved. And there is some 

money in the Affordable Care Act that is supposed to go to provision of community health. I have looked at data from 2007, 2010, 

2011, 2012, at number of providers in those facilities. Again, these 

are the federally qualified health centers. I have looked at the 

numbers in terms of the number of patient visits and it is all going 

44 

up. Again, I think it is hard to know whether or not this is an increase in the number of providers to these areas. There are some 

inducements about paybacks for student loans in there. So if I was 

toting around $200,000 of student loan, which is roughly the average nowadays, which is a house and a half for a lot of Americans. 

You know, I might be induced to go into a rural area and work in 

one of these centers. So there is some language in there and some 

mechanisms in there to begin to bring care providers into some of 

these underserved areas. 

Mr. MEADOWS. Let me go on, because maybe it is just in western 

rural North Carolina that we have this issue. But in rural areas, 

high speed internet is not always available and in fact in a number 

of my counties, it is very difficult—access to Healthcare.gov or even 

computers to get on because of the low income level. Are you finding the same thing in Georgia here? 

Dr. REINHARDT. I think there is no question that the access— 

there is some presumption in this process that access to the computer is available to everybody. And, you know, I do not think that 

is—I have developed Tourette’s syndrome personally since we— 

where I curse a lot since implementation of our electronic health 

record about two years ago. 

[Laughter.] 

Mr. MEADOWS. That will be quoted on the news, I can tell you. 

[Laughter.] 

Dr. REINHARDT. Sometimes the truth is funnier than fiction. But 

I think that—and we have good access. So in more rural areas 

where your access is less continuous and less certain, I think that 

we have got to come up with more creative ways to provide, you 

know, registration for these individuals in these areas that either 

do not have computers or where that access is intermittent. 

Mr. MEADOWS. Thank you, Dr. Reinhardt. 

Mr. Sale, in your opening testimony, you mentioned something 

that was very concerning to me because Mr. Boyette was saying 

that if you could keep your healthcare plan—if you liked it, you 

could keep it. And that he banked on that. And yet you said—and 

correct me if I am wrong—in 2010, insurance companies knew that 

there would be a number of cancellations. Did I hear you wrong or 

is that correct? 

Mr. SALE. No, you heard me correct. What happened and the way 

the grandfather law was designed, if you made certain changes to 

your plan, you would lose the status at the beginning. If you 

changed carriers, you would lose the status. And employers were 

faced with 20–25 percent rate increases if they had had an 

unhealthy year. And if they went to another carrier, they may get 

a 10 percent decrease in their rates and so it was smart to change 

carriers to do that. And so you would lose grandfather status. And 

then you had to publish that your plan met—you had to publish 

to the employees that you thought your plan was a grandfathered 

plan based on what you knew about it. And that letter had to go 

out to the employees telling them that their plan did not contain 

or would not contain some of the benefits that a non-grandfathered 

plan would contain. 

And so early on, we began to see this happening. I was—I guess 

we were at an insurance company meeting when it was discussed 

45 

that people would lose their grandfather status. I did not really believe it because I thought that these plan designs would be sufficient to retain it. But in reality, it did—it is true. And most all of 

ours have lost it. 

Now one of the carriers that we use went through their portfolio 

and changed everything that they could and that alone killed the 

grandfather status. There was no way you were going to keep it 

and it just happened to be the largest block of business that I had 

was with this carrier. 

Mr. MEADOWS. So what you are saying is that the 400,000 Georgia residents that the Chairman talked about in his opening statement, that has lost coverage here in Georgia, that is not a surprise 

to you based on what you knew in 2010? 

Mr. SALE. No, sir. 

Mr. MEADOWS. Okay. Mr. Boyette, I am going to finish with this 

because I am running out of time and Mrs. Collins, I will follow 

up with you with a few questions if we have a second round. But 

Mr. Boyette, much of what has been talked about out there with 

the Affordable Care Act is saying that the type of policy that you 

had before was really substandard, you know, they were just preying on your stupidity, they were just trying to—you did not really 

know what you had and what you are going to get with these new 

three options, one carrier option, is really better and that you really do not know the facts. 

How would you respond to that? 

Mr. BOYETTE. You do not know my policy. 

Mr. MEADOWS. Let me ask you, has anybody from the federal 

government called you to ask you about your healthcare or 

even—— 

[Laughter.] 

Mr. MEADOWS. —do they know what your children’s names are? 

Mr. BOYETTE. No, sir. 

Mr. MEADOWS. So they probably do not know your individual 

needs as well as you do. 

Mr. BOYETTE. No, not at all. 

Mr. MEADOWS. I yield back, Mr. Chairman. 

Mr. WOODALL. I thank the gentleman. 

I would like to recognize the gentleman, Dr. Gingrey. 

Mr. GINGREY. Mr. Chairman, thank you. 

Mr. Boyette, the government probably does know the names of 

your children. 

[Laughter.] 

Mr. GINGREY. That is part of the problem here. 

You know, I am so glad that the gentleman from North Carolina, 

Representative Meadows, mentioned about, you know, this is not a 

town hall meeting, but to give everybody here—and it is such a 

crowd—and I sure hope everybody in the back can hear because 

our hearing rooms in Washington are not this deep, and as I previously said, not always this well attended. But we definitely want 

to hear from you and maybe we can even stay around just awhile 

afterwards and take some individual questions because I know in 

Washington, the situation is the same, the format is the same, the 

dialogue is between the members and the witnesses, and the questions are between the members and the witnesses, and not those 

46 

in attendance, not the audience. But let me tell you, in Washington, the audience for the most part is a bunch of lobbyists, a 

bunch of special interest people who are on one side or the other 

of an issue. The audience today is we, the people, we, the people, 

who are every one of you being adversely affected by this. And my 

heart goes out to you. 

[Applause.] 

Mr. GINGREY. I wish we could have an opportunity to hear from 

all of you. 

The witnesses have all given great testimony and I thank all of 

you—Mr. Sale, Mrs. Collins. I can relate I guess more directly to 

Dr. Reinhardt as we are both OB–GYNs, he currently and me previously. And Mr. Boyette, this may surprise you, but my dad and 

his two brothers were in the automobile business, just as you are, 

and it was called Gingrey Motors in Aiken, South Carolina. And 

you are Owl Town Auto in Ellijay, Georgia. 

Now I am sure you sell pre-owned vehicles, they sold used cars. 

[Laughter.] 

Mr. GINGREY. But times do change. And honestly, I bet my dad, 

they made 50 to 75 dollars a car at best. And in those days, there 

was no Medicare, there was no Medicaid, there was no Peachcare. 

There was hardly any welfare. But mom and dad kept shoes on us 

and, you know, we went to good public schools and we were clothed 

and fed and did all right—we did all right. 

So that is what we need, in a way, to get back to, that self responsibility of pulling yourselves up by your bootstraps. And the 

federal government being there to help those who, through no fault 

of their own, absolutely cannot help themselves. And of course I am 

for that. But we have gotten to the point where, as I say, federalism is all the federal government, and it should be mostly the 

states and we, the people, if you believe, as I do, this sacred document. 

So I will direct my first question then, Mr. Boyette, to you and 

just real simple. Would you also like to comment on how this law 

will affect your family’s financial decisions as you go forward? I 

know you have a young daughter and I know you and your wife 

are expecting a new baby soon. Just what is this going to do to you 

in being able to provide food, clothing and shelter for your family? 

Mr. BOYETTE. Well, as I said earlier, you know, it is $200 a 

month more, my premium, what I am going to have to pay out of 

pocket. That is a lot of diapers. You know, all our expenses have 

gone up and anybody will tell you that, going to the grocery store, 

and this is just one more expense, me, as an American person, I 

do not need. Just plain and simple. 

Mr. GINGREY. Mrs. Collins, you had mentioned in your testimony, and I wanted to just touch on this, I think you mentioned 

that it did not seem right to you that members of Congress and certain staff of members of Congress were in Obamacare, had to sign 

up through the Washington, D.C., it is called the Health Link Exchange, but it is one of these federal exchanges that does not work, 

but that members of Congress had to sign up. And of course, the 

law says if you are between—your income is between 100 percent 

and 400 percent of the federal poverty level, I think 400 percent 

for a family of four is about $88,000 a year, that you were eligible 

47 

for a subsidy. Obviously at that high a level, less subsidy than if 

you made 100 percent of the federal poverty level where your subsidy may be 75 percent of the premium. But President Obama, by 

executive fiat, or whatever you want to call it, said that members 

of Congress and their staff would still get this 70 percent supplement. You mentioned that in your testimony. 

I would like to ask you how you feel. I would like to know how 

the members of the audience, if they had a chance to ask a question or throw things, how they feel about a situation like that and 

the lack of fairness of that. 

Mrs. COLLINS. Well, it disturbs me greatly. It is very frustrating. 

We are not rich by any means, we do not qualify for a subsidy, and 

that is okay. But I do not understand why people from no virtue 

of their own other than their employment, get a subsidy to cover 

virtually all of their insurance cost when my family is going to be 

financially devastated by this, if we follow through. 

On the other hand, we also have our son and his wife and their 

daughter who do not make enough to qualify for a subsidy, they 

are not even up to poverty level. He is a full time college student, 

she works part time, they share in care of their daughter. They do 

not qualify for a subsidy, yet they make too much for Medicaid. So 

what is happening to them is they simply have no insurance. Now 

I understand they will have a form they can sign so they do not 

even have to pay a fine, but that is ridiculous. They looked at insurance yesterday on Healthcare.gov. I had looked at it before for 

them on the estimators. And on the cost estimator for their insurance, it was going to be, at the cheapest level plan, almost 40 percent of their total income before taxes. They are going uninsured 

while members of Congress and staffers are getting 75 percent of 

their pay. There is something wrong there. 

Mr. GINGREY. Amen. 

Well, I see my time is expired as well. 

[Applause.] 

Mr. GINGREY. Mr. Chairman, I wanted to ask Dr. Reinhardt a 

question but I will yield back and maybe there will be a second 

round? 

Mr. WOODALL. We will begin a second round right now. I will 

start that out. 

Mr. Collins and Mr. Boyette are both on the receiving end of this, 

the folks to whom the promises were made, the folks that—genuinely I think there is a national commitment to making sure that 

folks have access to care. We have Mr. Sale and Dr. Reinhardt on 

the trying-to-make-good-on-those-promises end of things, which is 

a little harder. 

Dr. Reinhardt, you mentioned federally qualified health centers. 

I do not know if everybody knows what a community health center 

is. We have been funding those in this country for four decades, 

and it is a community-based clinic where folks can show up for absolutely any need that they have and based on their income, they 

will be charged on a sliding fee scale, to try to make those services 

that they require affordable. That sounds strangely familiar to me. 

Let us find folks who need access to care, let us take a look at their 

income and let us make sure they have appropriately priced care. 

48 

I think about the hundreds of billions of dollars that have gone 

into compliance on this issue. I think about the trillion dollars— 

not figuratively a trillion, but actually a trillion, a million million. 

They tell me if you started a small business on the day Jesus 

Christ was born and you lost a million dollars a day seven days a 

week, every day from the day Jesus was born until today, you 

would have to lose a million dollars a day seven days a week for 

another 732 years to lose your first trillion dollars. 

We are spending that on the President’s commitment to getting 

access. What would that mean to rural areas if we committed to 

spend a trillion dollars on expanding those community health centers that you talk about. Because Mr. Boyette has said as plainly 

as anyone I have ever heard that he does not want the help that 

folks are trying to give him, that he was happier before. That 

strangely, he knows more about what he needs than we do. We 

have Mrs. Collins, who is exactly who this bill was intended to 

help, she says it is making things worse—not a little worse, not one 

order of magnitude worse, but did you say 240 percent worse for 

your premiums? 

Mrs. COLLINS. Yes, sir. And that is just for my husband and my 

daughter. That does not even include the required coverage for me 

that I have no idea how much it is going to be. 

Mr. WOODALL. I ask you, Dr. Reinhardt, because you are in the 

caretaking business, you took an oath here this morning, but you 

took another oath a long time ago, to care for people and their 

healthcare needs. Let us get past whether or not we care about 

each other. Mr. Collins in his opening statement talked about what 

it means to be in community with one another, what it means to 

care about one another. 

These dollars are going out the door, they are coming out of 

everybody’s pocket in this room. I understand the President is 

heavily invested in this, the bill has his name on it. Could we have 

done any better? Could we have done any better? And do you believe your patients would be better served if we stripped this language out and started over again from scratch, to identify exactly 

those concerns that you have on your mind? 

Dr. REINHARDT. There has got to be more than one way to skin 

a cat. Mr. Collins, I wrote down one thing and it was what you 

said, and it is that it is people who come together. And whether 

or not we have the system we had in the 1990s, 2000s or today, 

as we morph from kind of the old way of doing things into this new 

way of doing things, there are going to be people who receive great 

benefit and people who are left in a difficult situation. 

Mr. WOODALL. Help me understand that, because I trust you on 

that, I trust my doctor. I get to choose my doctor, I hope I still get 

to choose my doctor in years to come. But I trust you, so when Mr. 

Boyette says he did not have any complaints to begin with, he liked 

what he had to begin with, his family was well served to begin 

with. But here in this legislative process, he has been stripped of 

what he liked, now he has something that he does not like. I do 

not understand why we had to hurt him to help the folks that you 

talked about. I want to help those folks. I just do not want to hurt 

the Boyette family in the process. 

49 

Dr. REINHARDT. I think the notion that one size fits all does not 

work in most things in life and it does not work here. 

Mr. WOODALL. Mr. Sale mentioned that in his opening statement. He said the policies that were being outlawed were inferior 

policies. That is disappointing to Mr. Boyette and his family, that 

he had something inferior. How does it feel to be superior now, Mr. 

Boyette? 

Mr. BOYETTE. I do not feel any more superior. 

Mr. WOODALL. It is amazing to me, those things in life that I 

have done and done poorly, the failures that I have had in life. The 

ones that I caused and brought on myself, I feel a little better 

about. Those failures in life that someone else forced upon me, I 

am still a little bitter about. And I see folks who are willing to take 

responsibility for the decisions that they make and all they ask for 

is the freedom to make those decisions. 

I will close with you, Mr. Sale, following up on Mr. Meadows’ 

question. You said there was discussion in the insurance community as soon as this law was passed—arguably before the law was 

passed, as the language was being vetted and passed around the 

country—that the grandfathering language, the language that was 

supposed to be the if-you-like-your-insurance,-you-can-keep-it language, that folks knew from day one that that had no possibility— 

that language had no possibility of making good on that promise. 

As an administrator to small businesses in a little old state like 

Georgia, you looked at that language in 2010. Was it obvious to you 

on day one that if you like your insurance, you can keep it; if you 

like your doctor, you can keep them, period— was it obvious to you 

on day one that that was a promise that could never be fulfilled? 

Mr. SALE. Well maybe not exactly on day one, but shortly thereafter because the National Association of Health Underwriters either forwarded a document or produced a document that said they 

felt that 80 percent of the plans would lose their grandfather status 

within the first couple of years. And I may not be exactly, whether 

it is one year or two years, which one it was. But as this law began 

to unfold, it became very clear. Now this 2700 or 2400 pages, 

whichever it happens to be, document, has been being gone 

through forever trying to look under every bit of information we 

could figure. So it may not have happened on day one, but the law 

was passed on March—signed on March 23rd, implemented on September of 2010, and it was very close after that that we began to 

get the rumblings that, yeah—because once Congress passed it, 

then people began to delve into it. 

So yeah, it was pretty close up front, because even on the individual plans, you have got four plans to choose from, the metal 

plans—the bronze, silver, gold and platinum—but nobody’s plan 

out there was gold, silver, bronze or platinum, they were all something other than that. And of course, then these new plans have 

so many more added benefits that are going to make life a lot easier for you, it includes free doctor visits for wellness and birth control pills and all of that sort of stuff that just inflate the cost of 

the plan and take the design basically away. 

Mr. WOODALL. I believe that if you like your doctor, you should 

be able to keep your doctor. I believe if you like your plan, you 

should be able to keep your plan. I believe we should be able to 

50 

take steps that reduce the cost of insurance in this country, and 

I believe we should take steps to take care of families that are 

dealing with lifetime caps and are dealing with preexisting conditions. But I also believe that at the end of the day the patients in 

the Boyette family should be able to decide for the Boyette family 

what policy is best for them and the members of the Collins family 

should be able to describe what is best for them. 

I cannot believe that any proposal that comes out of Washington, 

D.C. that tells you that you do not know best for you can ever be 

the right plan for America. 

And with that, I would like to recognize Mr. Collins. 

Mr. COLLINS. Thank you, Mr. Chairman. 

I think going back to this—and Mr. Sale, you made an interesting comment and it is something for all of us here to realize. 

You could read—and I could hand it out today, lock the door and 

say okay, everybody read 2700 pages of the Affordable Care Act. 

And I would ask you then, at the end of the thing, we would have 

a test, I would hand it out. And I would say okay, here is questions 

about this bill. And the problem is that you would not be able to 

answer what the bill actually does because the 2700 pages basically 

stated at the end of every paragraph, ‘‘to be determined by,’’ ‘‘to be 

determined by,’’ ‘‘to be determined by.’’ And if we want to take that 

in perspective, we have an eight foot high, literally, stack of documents that are the regulations that have been proposed on the 

2700. So in other words, you have the 2700 is the inside of the 

trunk of the tree, and then you have eight foot at this point, and 

still growing, regulations that are in effect. There is no way that 

you can honestly understand this. 

I think this is the part that has become the problem. From the 

state perspective, from the local perspective, from the national perspective, this is the issue that we have got to come to grips with. 

The State of Georgia chose not to expand Medicaid. I applaud them 

for that. I sat on the Appropriations Committee in Georgia, we 

could not afford it. 

We have got to get back to some basic common sense on this 

issue. And part of the problem we have got here is that Congress 

has passed bills such as the Affordable Care Act that had 2700 

pages but also said ‘‘By the way, we are going to let you figure out 

how to deal with it.’’ 

So I have got a flip question here. One, we are going to start 

with compliance costs, but then Mrs. Collins and Mr. Boyette, I 

want to give you an opportunity. On sort of the professional, the 

doctor, caring side, I am going to prepare you now so you can just 

think about it. What could we do better? Given your circumstances, 

what could help you, and I just want you to think about that. 

But I want to come back over here for just a second. Compliance 

cost, from Mr. Sale and also from The Longstreet as well. We sort 

of danced around it. Give me sort of an idea of how much compliance costs are affecting business and doctors’ practices and others, 

that you are seeing right now. 

Mr. SALE. I cannot give you a dollar figure because I do not have 

one. But I can assure you that the employers are very serious on 

trying to comply and they are having staff do things that we recommend. And what we are doing is we are sending out bulletins 

51 

to our clients to say you need to be prepared to do this and you 

need to be prepared to do that. And then when we get to specific 

issues, then we involve the attorneys at 300 and 400 dollars an 

hour to get specific. 

I cannot tell you the dollar value, Dr. Reinhardt may be able to 

tell you exactly what has gone on with his compliance, but we have 

in my office, I know we spent almost $800 on one piece of software 

that would allow the employer to see if their plan qualified under 

the play-or-pay rules. 

We have spent about—the program is right now in the middle of about a $2500 modification to our HR software that will allow the 

employer to track hours worked each week inside a calendar month 

so that they can determine whether employees are full time or full 

time equivalents. And by the way, according to information we 

have, beginning in 2016, employers actually have to report that to 

the IRS, that yes, we have X number of employees and each one 

of them worked so many hours a week. 

And then on top of that, I know that I have got personally over $1100 tied up in two training programs that I went to at the American College early on to try to figure out, you know, what our responsibilities were going to be in this. And then we have people in 

the office that have spent more money than that. 

So I can speak only for my company, but maybe Dr. Reinhardt 

can help you. 

Dr. REINHARDT. From the perspective of corporate cost, I cannot 

even begin to give you an estimate. We have a very robust compliance process within our corporation, always have. It is funny, I was 

going to suggest they ask you about that because much of the advice regarding compliance we have gotten from the vendor through 

which we purchase our insurance. 

Mr. COLLINS. Before I go to the other two, would it be a fair 

statement—because I am often criticized in my position, because I 

am not a fan of this bill. I believe there are things we can do—and 

before anybody says well you do not know anything about preexisting conditions, I have a daughter with spina bifida—I get it. 

And there are a lot of other cost issues that we have out there. 

The money that you are having to spend, and other businesses 

are having to spend, just for the record, could be spent on—if a 

business was doing better—on job creation, you know, working on 

better benefits. Would that be a fair statement? Instead of having 

to spend it on compliance costs for something they are still not sure 

about. 

Dr. REINHARDT. Let us make a list. 

[Laughter.] 

Mr. COLLINS. Exactly. 

Mr. SALE. What he said. 

Mr. COLLINS. Exactly. 

Mr. SALE. One insurance company sat in my office the other 

day—now I cannot verify this as being an accurate statement, I do 

not think the gentleman made this up. But he said his insurance 

company has spent one billion dollars since 2010 in compliance. 

And off the record, I will be glad to give you that name and you 

all can verify it. 

Mr. COLLINS. Amazing. 

52 

Back to my question now, for both of you, and whichever one of 

you wants to answer—and if you do not, I completely understand. 

But one of things I want to be able to do here—there is no doubt 

about where I stand on this law or any part of it. But there is a 

part here, there is an issue of how do we help people, how do we 

make sure—and not everybody is going to be helped and especially 

the false dream that was proposed with this. Because there is a 

balance here, and it never was intended to cover everybody. 

But in your specific case, just from your thoughts as a citizen, 

what do you think? 

Mrs. COLLINS. I have thought about this a lot actually. As someone with a preexisting condition, it would be great to be able to get 

insurance. However, I do not think it is fair for my husband and 

daughter to have to pay an exorbitant amount just to cover the risk 

for insurance for me. We would prefer as a family—and my husband and I have discussed this at length—an a la carte system. 

Why he as a man having to have maternity insurance, that is ludicrous. Why can we not get catastrophic care insurance? Oh, great, 

because we are too old, we are over 30 and in the new system, you 

cannot get it if you are over 30. 

What we would prefer to have would be an a la carte system 

where we could choose what types of coverage we needed and take 

personal responsibility; if we choose the wrong ones, then okay, we 

pay. And be able to have a catastrophic care plan. 

We are, overall, quite healthy and to pay for our care as we need 

it. But then for those that cannot, I love the community health centers, expand those. That would help people like my son and daughter-in-law and their daughter—expand those community healthcare 

centers for those that cannot afford. And offer the opportunity for 

catastrophic care for those of us that simply do not want to have 

to pay exorbitant premiums to cover every single little thing. And 

that would be what we would like to see happen. 

Mr. COLLINS. Mr. Boyette, any thoughts on that? 

Mr. BOYETTE. Yes, sir. What I would like to see done the first 

time was do it right the first time. 

Mr. COLLINS. Okay. 

Mr. BOYETTE. How long, you know, did these guys have to, you 

know, prepare for this October 1st Obamacare rollout? Three years 

roughly? 

Mr. COLLINS. Give or take. 

Mr. BOYETTE. Give or take. You know, that is a long time to get 

their stuff together, keep their promises on stuff. 

Mr. COLLINS. I think what you bring out, I think the bottom line, 

it was—when you take the base bill, it was never able to work, it 

was never a thought-out plan, it was never a vetted bill, it was 

never something—it was something we have got to pass because we 

have a set number of political deadlines and numbers. And politics 

is numbers. Bottom line. If you have enough numbers, you can pass 

what you want. And that is what they needed. But they passed a 

bill that was not workable, that is why you have the eight foot 

stack of regulations as we go forward. 

And I think that is why we are here today and I appreciate, you 

know, from the different perspectives here. Yes, we have got to find 

solutions, we are a country that needs to be a part of the solution, 

53 

but a lot of that is just government getting out of the way and 

helping where it needs to help instead of trying to blanket plan, 

and in other words, hurt a lot of other people and compliance costs 

and everything else. 

And with that, Mr. Chairman, I yield back. 

Mr. WOODALL. Thank the gentleman. 

The gentleman from North Carolina, Mr. Meadows. 

Mr. MEADOWS. Thank you, Mr. Chairman. 

Dr. Reinhardt, let me pick up a little bit on what you were sharing, because you were talking about the compliance costs and just 

that you have done a great job with that, but that it is just very 

costly. 

Are there any federal regulations that have come down the pike 

that have not ultimately cost you to comply with? 

Dr. REINHARDT. Here is a political answer—without a little time 

to think about it, I cannot come up with one off the top of my head. 

Mr. MEADOWS. All right. So let me ask you, for each dollar that 

we spend on complying to federal regulations, is that a dollar that 

is not spent on really providing healthcare to your patients? 

Dr. REINHARDT. I am not sure that is a totally fair answer. If you 

are looking for compliance specifically with government regulation, 

some of that actually has resulted in—— 

Mr. MEADOWS. Better care? 

Dr. REINHARDT. Well, I think absolutely some of it is better care, 

some of is increased and improved reimbursement to our practice 

in terms of—— 

Mr. MEADOWS. Let me hit on that reimbursement, because I 

have visited a number of hospitals and a number of healthcare providers, and what they have said is they have gotten caught up in 

this having to make sure that they put down the correct coding. It 

can get kicked out as Medicare or Medicaid fraud just because the 

coding is incorrect when actually the procedure was justified, but 

it was—instead of putting H2R, it was H2RA. Do you see that in 

your—you have a big practice, do you see that as something that 

you have to spend just making sure your coding is correct to get 

your reimbursement? 

Dr. REINHARDT. I do, and I think that may actually be one of the 

advantages of the ICD–10 transformation we are going to go 

through. 

Mr. MEADOWS. Sure. 

Dr. REINHARDT. I will tell you that one of the great frustrations 

that we are struggling with right now around measuring quality of 

care is how do you develop data banks that help us evaluate quality of care. Most of the data that is available is based around billing data and billing codes. As an example, if a patient comes to me 

who is a smoker, I can sort of submit a charge code for tobacco 

abuse. But if I counsel that patient, there is not much of a way for 

me to communicate with the insurance company that I did that 

counseling. That would be considered to be good care. 

So we actually are struggling to try to figure out how to communicate that we have done something that would be deemed to be 

quality, to a system that largely just accumulates charges. And 

that is a great challenge for us. 

54 

Mr. MEADOWS. So what you are saying is there is an incentive 

to do another procedure or do something that would qualify for reimbursement instead of providing the healthcare counseling that 

would be considered a lot more advantageous to your patient. 

Dr. REINHARDT. I think you have hit in large part on the reason 

for payment reform. Right now, we are in sort of a pay for procedure environment, where if you do something you get reimbursed, 

rather than a pay for outcome, where if you do something well, you 

get reimbursed at a higher rate for accomplishing it better. And 

that is why we are trying to figure out how to report this quality 

information in a way that we can transfer or transform that incentive to actually do things into an incentive to do the right things. 

Mr. MEADOWS. All right. Mr. Sale, let me go to you because you 

get to deal with a number of companies. Are you seeing any companies that you deal with that are not hiring people to try to stay 

below that 50 employee threshold, or if they are hiring people, that 

they are hiring them on a more part-time basis. Are you experiencing that at all? Are you seeing that with your clients? 

Mr. SALE. We are hearing conversation about it. I cannot tell you 

that I have seen any of my clients that have actually done it. I do 

know that we have one client that I talked with the other day, actually not a client, it is a friend that works for this company. We 

were talking about their group size and this person said our company is at 40 lives and we will never be more than 49, because we 

do not want to cross that 50 threshold. 

We have another person whose corporate headquarter is out in 

the midwest, has over 100 employees, and they just said we are out 

of the insurance business. And they have been paying for the full 

cost of the employee, and they are giving the employees $400 a 

month. This particular person has come to our office; to cover he 

and his family was going to be over $1200 a month, if I recall their 

bottom line. So, while I cannot tell you that I have had actually an 

employer say this is what we are doing, they are talking about it. 

Mr. MEADOWS. So Mr. Sale, are you saying that that one particular instance that you gave at the end there, that you have people that are losing their healthcare coverage because he is getting 

out of the healthcare business altogether and he is just going to 

purchase it for he and his family? 

Mr. SALE. That is correct. 

Mr. MEADOWS. Mrs. Collins, let me come back and finish up with 

you. You have got a preexisting condition. 

Mrs. COLLINS. Yes. 

Mr. MEADOWS. For many of us, we saw the covering of a preexisting condition to be a good thing with this law. 

Mrs. COLLINS. Uh-huh. 

Mr. MEADOWS. We said, you know, that really as a compassionate, fair country, we believe in taking care of our friends, our 

neighbors and our community. And so I saw that. It came home to 

me recently though, because I have got a sister with stage four cancer, who is losing her coverage because of this Affordable Care Act 

and losing the ability to see her doctor because of that. 

Is that something that you are seeing personally? How are you 

going to grasp this with you preexisting condition? 

55 

Mrs. COLLINS. Well, right now being uninsured—the preexisting 

condition that I have is I actually have an artificial heart valve and 

I take blood thinners every day. I am always at risk for stroke or 

for some kind of incident like that. We are just aware that right 

this minute we—if I had something major happen, then it would 

very potentially be catastrophic for our family. So as someone with 

a preexisting condition, I would love to have a catastrophic care 

plan that would cover me. 

Mr. MEADOWS. So you are saying under the ACA, that you, because of your age—and I know that you may be 29, but because 

of your age, you do not qualify for a catastrophic plan. 

Mrs. COLLINS. Correct, I am 47 and otherwise I am in great 

health, and I do not qualify for that, no. And before the ACA was 

passed, I did not qualify for any plan. We were rejected by multiple 

companies because of my issues. So I was very happy for it to be— 

that only aspect, I thought this is great. But it has unfortunately 

not been the case. 

Mr. MEADOWS. So basically, what you are telling me is that this 

is the American people being forced to buy a particular product at 

a particular price, to not be able to make those choices on your 

own. 

Mrs. COLLINS. Right. 

Mr. MEADOWS. Which means that ultimately you are having to 

not make other purchases that perhaps you and your family would 

make, because you are having to focus on a narrow set of what the 

ACA is forcing you to look at. 

Mrs. COLLINS. Absolutely. Given the financial burden that we 

will be bearing should we comply with the ACA and all three of our 

family members have insurance coverage through it, our discretionary spending would plummet dramatically. And like I mentioned in my statement, you know, we have people that we hire 

around the house to do different things. That in and of itself would 

probably not make that big of an account in the economy. The fact 

that we go out to eat or that we go to the local shops or that we 

buy from our local car dealerships, or whatever we do. Us alone are 

not going to make that big of a difference, but all the people in our 

situation, they are going to have no choice but to do the same 

thing. And that is frustrating. 

Mr. MEADOWS. Thank you, Mrs. Collins. 

Mr. Chairman, I yield back. 

Mr. WOODALL. Thank you, Mr. Meadows. 

Dr. Gingrey. 

Mr. GINGREY. Mr. Chairman, thank you. 

A couple of my colleagues asked the question could we have done 

any better. I think maybe a more appropriate question would have 

been could we have done any worse. 

[Laughter.] 

Mr. GINGREY. Because I absolutely do not think we could have 

done any worse. I do think we could have done better. 

Let me just offer a suggestion and then ask the witnesses, to see 

how they feel about this. I have not worked out all the fine details 

and maybe it is a little bit half-baked at this point. 

But you understand, the witnesses and I am sure everybody in 

the audience, something called COBRA, Consolidated Omnibus 

56 

Budget Reconciliation Act of 20 years ago, or whatever. But what 

COBRA allows is that you are working for a company and you get 

laid off, the company downsizes or you quit for some reason, you 

decide to go to take another job. You can continue to be in that 

group plan that that company has offered and maybe you have 

been there 15–20 years and everybody pays the same premium. 

And you have been in great health. You started it right out of college, you are 10 feet tall and bullet proof, you do not smoke, you 

do not drink, you do not sky dive, you do not do any dangerous 

things. And you have had very few claims. 

So the insurance company that has that policy for that company 

and those employees has really done pretty well on you. I hope 

you—the hypothetical you—is getting an annual physical or maybe 

a physical every two years. But bottom line is the health insurance 

company, as far as that group is concerned, has really made a nice 

profit off of you over 10 or 15 years. 

But during that time, you could have developed high blood pressure, you could have developed Type 2 diabetes, you could have had 

a malignant melanoma, you could have had a heart attack. You 

may well have had a stint put in. And then all of a sudden though, 

you are fine, you are recovered, you are working, you are still 

working. But you find the ideal job that you want to transition to 

or you get laid off and you lose your job. 

So federal law allows you to continue in that plan for 18 months, 

right, 18 months. You have to pay the entire premium, do you not, 

the employer part if it is 60 percent, if it is 50 percent, whatever 

they paid, you have to pay it all plus a two percent administrative 

fee. And you have that for 18 months. 

And let us say that at the end of 18 months, you are 52 years 

old. What in God’s name are you going to do until you turn 65? You 

are not disabled, you just now have a preexisting condition. Well, 

why not—and this will be my question to the panel—why not say 

that a person in that situation should have the option to own that 

policy and continue to keep it until they turn 65, if they want to, 

and pay that premium, and not put them in that God-awful position of not being able to get coverage, be denied, or if they could 

get coverage, some new insurance company say well, yeah, but five 

times standard rate or eight times standard rate. 

Now that is called health insurance reform. That is really what 

we needed, I thought, from the very get-go. That is why I say we 

could not have done worse, we darn sure could have done better. 

But let me just ask—and Mr. Sale should be the expert on this, 

and do not be afraid to shoot holes in this because as I say, I have 

not fully thought it out, but believe me, we do have other ideas. 

Mr. Sale. 

Mr. SALE. It is a good idea, Congressman. And the idea of being 

able to keep insurance is certainly important, because the one 

thing that the law could have done prior to the PPACA law is to 

have a pool for the uninsurable individuals, those who, through no 

fault of their own, end up being placed in that category. And it does 

not need to be—it just could be molded in with all the other costs 

of coverage that we have, that idea of keeping your COBRA coverage or going on and extending it is certainly not a bad idea. 

57 

Mr. GINGREY. Well, I appreciate your response and we will move 

over to Dr. Reinhardt. But I mean you even could say pay a little 

bit more for your premium for that option, for that ability, if you 

are willing to do that, if that is necessary actuarially to make it 

work. 

Dr. Reinhardt. 

Dr. REINHARDT. I think the word actuarial is a good word, because the implication there, if you were to allow a person to do that 

is to calculate what the expected cost of care for someone with that 

diagnosis, say Type 2 diabetes, what is the expected cost of care for 

that individual for medications, co-morbidities including their increased risk of heart attack, high cholesterol and things of that nature—what are the expected costs for that individual and should 

not that individual be expected to pay for those things. 

And so we go to the actuarial tables and you can all boil this 

down to math, statistics and what-not, what is going to be the cost 

of that person during the course of their lifetime. Better yet, what 

is going to be the cost of the care for that person in this particular 

calendar year, age 52, et cetera. And essentially that number is 

amortized over the course of a year. These are companies which, 

according to the law, are allowed to make 15 percent profit or 

whatever it is, their loss ratio could be 85 percent. 

So I think that yeah, that sounds like a good idea, but I also believe that the patient should be required to pay for the expected 

cost of their care during that period of time. 

Mr. GINGREY. Well, Dr. Reinhardt, thank you very much for 

bringing that up because I may not have made myself completely 

clear on that. That option, to continue that COBRA until you reach 

Medicare age, because you now have these preexisting conditions, 

that option of course would be only from that insurance company 

that had that group policy where you were a member paying a premium for a set number of years. I would say that if you worked 

there one year, no. But if you worked there 20 years or 15 years, 

some break point where you say surely this particular health insurance company, whether it is a Blue, Cigna, Aetna, United, you 

name it, has made enough money off of you already, and surely 

they would have the compassion and the good marketing sense to 

be willing to cover you until you turned age 65. 

Mr. Boyette. 

Mr. BOYETTE. I am going to let Mrs. Collins speak on that. I am 

not too—— 

Mrs. COLLINS. Okay, as far as the COBRA, I could see there 

could be some benefit in that. It would concern me the cost that 

that would end up going on into. 

I would love to see a health savings account, I think the HSAs 

were great, and see those be rewarded. And see as many people as 

can take responsibility for their own healthcare costs without bankrupting themselves. But also cover the people in the middle like 

the woman that Representative Meadows referenced with pancreatic cancer. There needs to be some sort of—something to cover 

that where you cannot be just cut off. When you are in the middle 

of treatment, that is basically going to be a death sentence. 

So I like the idea of COBRA, I think there are some other things 

that I would love to see happen. Like I said, some more individualVerDate Aug 31 2005 10:48 Jan 24, 2014 Jkt 000000 PO 00000 Frm 00061 Fmt 6633 Sfmt 6633 C:\DOCS\86196.TXT APRIL
58 

ized choices and more individual responsibility and that sort of 

thing. 

Mr. GINGREY. Yeah. And they are all in here as part of the American Healthcare Reform Act, Republican proposal coming out of the 

Republican conservative study committee of the House of Representatives. 

So, Mr. Chairman, my time has expired. I thank all of you, I 

thank all of the witnesses, you all have been fabulous. 

Thank you, Mr. Chairman, I yield back. 

Mr. WOODALL. Thank you, Dr. Gingrey. 

Mrs. Collins, I will say to you there is a bill out there called H.R. 

25, the Fair Tax, that is the subject of a different hearing—— 

[Laughter.] 

Mr. WOODALL. —for a different day. 

[Applause.] 

Mr. WOODALL. But that changes all of those tax incentives so 

that you and I can buy that policy when we turn 18 and take responsibility for those decisions. 

Everyone on this panel up here is a co-sponsor of that fair tax 

and it is amazing how many of these decisions come back to the 

federal government and how we have pushed behavior in this direction instead of allowing it to take that natural course. 

For a final word, I would like to yield to Doug Collins. 

Mr. COLLINS. I appreciate that, Mr. Chairman. 

One, something was said early on about the attendance and I 

have the great privilege of representing Georgia’s Ninth Congressional District and I tell them all the time it is not only one of the 

most conservative districts in the country, I believe it is, in my 

humble opinion, the best district to be able to represent. And it is 

shown in this room today. 

[Applause.] 

Mr. COLLINS. Dr. Gingrey, this is normal in Georgia Nine. This 

is normal in Georgia Nine. We have been a round a great deal, because they are passionate, because they believe in individual freedoms, they believe in a government of a constitutional role. And I 

think these are the things we have talked about today and a problem with a bill that, frankly, may at some point have had good intentions but bad ideology. It had bad ideology to say we are going 

to fix it for everybody, but maybe not you, and maybe not you, but 

yet sell it as if it would. Cost to the person may go down for some, 

it may go up for others. But for everybody, as taxpayers, you will 

pay for this plan, like it or not. 

And so when we look at this, I just want to thank the staff, my 

staff that is here today, they worked very hard on getting this 

done, our district staff, our Washington staff, and I just want to 

thank them. And they are in the room today. They are very special 

to me and I appreciate them. They will be here if you have those 

statements that you would like to submit for the record, you can 

get those to us and be a part. 

The OGR staff, again, we talked about are great to work with 

and to get this put up, and Chairman Issa and the rest of the staff. 

To my colleagues that I shared the dais with today, it is special 

to have you here with us today—Congressman Woodall, Meadows, 

Gingrey and Mr. Kingston had to leave. We are just trying to do 

59 

what we promised and that was to listen and to be a part and, you 

know, find solutions as we go forward. 

The witnesses who have taken their time. But I do want to take 

one moment here to remember a witness who is not here. Josh 

Kinsey was intended to be here today. I got to know Josh when I 

would go to White County and I got to represent White County 

while I was in the State House. Josh run a little pharmacy on the 

square, had a little soda shop next to it, his pharmacy was there 

and Josh is just one of those guys in the Chamber, he is just one 

of those vivacious kind of guys that you just like to be around. 

He has closed his practice because of compliance costs, because 

of the uncertainty of this law and the uncertainty of healthcare. He 

made a choice that he had to make for him and his family, which 

I find no fault in, you have to do that. 

But here was another example of an independent pharmacy, and 

others in healthcare, having to make choices that limit choices, do 

not expand them, they limit choices. He went to work for a bigger 

firm and that is great, that is what needs to happen in his life. But 

I am saddened today that he could not be here because he just 

started his new job and could not be here to tell you about the folks 

that he took care of and how this has affected him. 

I make this statement all the time—what we do is a lot about 

paper, but in the end, it is all about people. And that is something 

we can never forget. So we look at that, the people in this audience, 

you make it up, these witnesses, my colleagues, it is just good to 

be here today, but also to still be in a country where we can still 

debate these and find solutions. 

And with that, I yield back. 

Mr. WOODALL. I thank the gentlemen. 

As all of you know, America is not run by 51 percent of Americans, it is run by the 51 percent who care enough about America 

to show up. I thank each and every one of you who took time out 

of your day to be here, both the folks who came to give us their 

testimony on the panel and those who came to be with us in the 

hearing room today. 

And with that the Committee stands adjourned. 

[Whereupon, at 12:01 p.m., the Committee was adjourned.] 

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APPENDIX 

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Insert offset folio 20 here 86196.020

Obamacare fallout: Millions face sticker shock following insurance cancellations 

By Associated Press 

MIAMI - Dean Griffin liked the health insurance he purchased for himself and his wife three years 

ago and thought he'd be able to keep the plan even after the federal Affordable Care Act took 

effect. 

But the 64-year-old recently received a letter notifying him the plan was being canceled because it 

didn't cover certain benefits required under the law. 

The Griffins, who live near Philadelphia, pay $770 monthly for their soon-to-be-terminated health 

care plan with a $2,500 deductible. The cheapest plan they found on their state insurance 

exchange was a so-called bronze plan charging a $1,275 monthly premium with deductibles 

totaling $12,700. It covers only providers in Pennsylvania, so the couple, who live near Delaware, 

won't be able to see doctors they've used for more than a decade. 

"We're buying insurance that we will never use and can't possibly ever benefit from. We're basically 

passing on a benefit to other people who are not otherwise able to buy basic insurance," said 

Griffin, who is retired from running an information technology company. 

The Griffins are among millions of people nationwide who buy individual insurance policies and are 

receiving notices that those policies are being discontinued because they don't meet the higher 

benefit requirements of the new law. 

They can buy different policies directly from insurers for 2014 or sign up for plans on state 

insurance exchanges. While lower-income people could see lower costs because of government 

subsidies, many in the middle class may get rude awakenings when they access the websites and 

realize they'll have to pay significantly more. 

Those not eligible for subsidies generally receive more comprehensive coverage than they had 

under their soon-to-be-canceled policies, but they'll have to pay a lot more. 

Because of the higher cost, the Griffins are considering paying the federal penalty - about $100 or 

1 percent of income next year - rather than buying health insurance. They say they are healthy 

and don't typically run up large health care costs. Dean Griffin said that will be cheaper because it's 

unlikely they will get past the nearly $13,000 deductible for the coverage to kick in. 

Individual health insurance policies are being canceled because the Affordable Care Act requires 

plans to cover certain benefits, such as maternity care, hospital visits and mental illness. The law 

also caps annual out-of-pocket costs consumers will pay each year. 

In the past, consumers could get relatively inexpensive, bare-bones coverage, but those plans will 

no longer be available. Many consumers are frustrated by what they call forced upgrades as they're 

pushed into plans with coverage options they don't necessarily want. 

Ken Davis, who manages a fast food restaurant in Austin, Texas, is recovering from sticker shock 

after the small-business policy offered by his employer was canceled for the same reasons 

individual policies are being discontinued. 

His company pays about $100 monthly for his basic health plan. He said he'll now have to pay 

$600 monthly for a mid-tier silver plan on the state exchange. The family policy also covers his 8-

year-old son. Even though the federal government is contributing a $500 subsidy, he said the $600 

he's left to pay is too high. He's considering the penalty. 

"I feel like they're forcing me to do something that I don't want to do or need to do," Davis, 40, said. 

Owners of canceled policies have a few options. They can stay in the same plan for the same price 

for one more year if they have one of the few plans that were grandfathered in. They can buy a 

similar plan with upgraded benefits that meets the new standards -likely at a significant cost 
63 


Insert offset folio 21 here 86196.021

increase. Or, if they make less than $45,960 for a single adult or $94,200 for a family of four, they 

may qualify for subsidies. 

Just because a policy doesn't comply with the law doesn't mean consumers will get cancellation 

letters. They may get notices saying existing policies are being amended with new benefits and will 

come with higher premiums. Some states, including Virginia and Kentucky, required insurers to 

cancel old policies and start from scratch instead of beefing up existing ones. 

It's unclear how many individual plans are being canceled - no one agency keeps track. But it's 

likely in the millions. Insurance industry experts estimate that about 14 million people, or 5 percent 

of the total market for health care coverage, buy individual policies. Most people get coverage 

through jobs and aren't affected. 

Many states require insurers to give consumers 90 days' notice before canceling plans. That 

means another round of cancellation letters will go out in March and again in May. 

Experts haven't been able to predict how many will pay more or less under the new, upgraded 

plans. An older policyholder with a pre-existing condition may find that premiums go down, and 

some will qualify for subsidies. 

In California, about 900,000 people are expected to lose existing plans, but about a third will be 

eligible for subsidies through the state exchange, said Anne Gonzalez, a spokeswoman for the 

exchange, called Covered California. Most canceled plans provided bare-bones coverage, she 

said. 

"They basically had plans that had gaping holes in the coverage. They would be surprised when 

they get to the emergency room or the doctor's office, some of them didn't have drug coverage or 

preventive care," Gonzalez said. 

About 330,000 Floridians received cancellation notices from the state's largest insurer, Florida 

Blue. About 30,000 have plans that were grandfathered in. Florida insurance officials said they're 

not tracking the number of canceled policies related to the new law. 

National numbers are similar: 130,000 cancellations in Kentucky, 140,000 in Minnesota and as 

many as 400,000 in Georgia, according to officials in those states. 

Cigna has sent thousands of cancellation letters to U.S. policyholders but stressed that 99 percent 

have the option of renewing their 2013 policy for one more year, company spokesman Joe Mondy 

~d. . 

Cancellation letters are being sent only to individuals and families who purchase their own 

insurance. However, most policyholders in the individual market will receive some notice that their 

coverage will change, said Dan Mendelson, president of the market analysis firm Avalere Health. 

The cancellations run counter to one of President Barack Obama's promises about his health care 

overhaul: "If you like your health care plan, you'll be able to keep your health care plan." 

Philip Johnson, 47, of Boise, Idaho, was shocked when his cancellation notice arrived last month. 

The gift-shop owner said he'd spent years arranging doctors covered by his insurer for him, his wife 

and their two college-age students. 

After browsing the state exchange, he said he thinks he'll end up paying lower premiums but higher 

deductibles. He said the website didn't answer many of his questions, such as which doctors take 

which plans, 

"I was furious because I spent a lot of time and picked a plan that all my doctors accepted," 

Johnson said. "Now I don't know what doctors are going to take what. No one mentioned that for 

the last three years when they talked about how this was going to work." 
64 


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• Associated Press writers Christina A. Cassidy in Atlanta; Rachel La Corte in Olympia, Wash.; 

Marc Levy in Harrisburg, Pa.; Tom Murphy in Indianapolis; Juliet Williams in Sacramento, Calif.; 

and Kristen Wyatt in Denver contributed to this report. 

Read more: http://www.washingtonlimes.com/news/2013/nov/2/obamacare-falloul-millions-feelslicker-shock-foll/#ixzz2mX6VySyQ 

Follow us: @washtimes on Twitter 
65 


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'Tfie _ 

Hentage Foundation LEADERSHIP FOR A,,"HRICA 

BACKGROUNDER _____ No. 2852L N_'O_V_E_M!l,ER 12, 2013 

Health Insurers' Decisions on Exchange Participation: 

Obamacare's Leading Indicators 

Edmund F. Haislmaier 

Abstract 

How have health insurance companies responded to Obamacare? 

Insights into how Obamacare is likely to alter the health care system 

can be gleanedfrom analyzing insurer decisions to participate, or not 

participate, in the new exchanges. An analysis of the decisions shows 

that in the vast majority of states the Obamacare exchanges will offer 

less, not more, insurer competition than the state's current individual 

market. Obamacare's complicated, income-based design of premium 

and cost-sharing subsidies will result in the exchange market essentially offering something akin to Medicaid managed care for Ihe middle class. The resulting picture is one that millions of Americans are 

likely to find unappealing. 

I

n the run-up to thc launch of the Obamacare' health insurance 

exchanges, attention increasingly focused on the premiums for 

the new coverage-specifically the degree to which they might be 

higher or lower than current premiums. 2 

Yet, changes in premiums tell only part of the story. Additional 

insights into how Obamacare is likely to alter the health care system 

can be gleaned from analyzing insurer decisions to participate, or 

not participate, in the new exchanges. Analyzing insurer exchange 

participation decisions in light of current insurance market data 

and other public information can yield important insights into 

how insurers expect the implementation of Obamacare to change 

America's health system. 

Health insurers are the market actors with the strongest motivation to understand how Obamacare is likely to alter the decision 

This paper, in its entirety, can be found at http://report.heritage.org/bg2852 

Produced by the Center for Health Policy Studies 

The Heritage Foundation 

214 Massachusetts Avenue. NE 
66 


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BACKGROUNDER: 1":0. 2852 

NOVEMBER 12, 2013 

making of the other players in the system-employers, individual consumers, and health care providers. Numerous provisions of Obamacare that will 

take effect in January 2014 will interact to reshape 

the health care market in significant ways. Because 

health insurers are either directly or indirectly 

affected by most of those changes, they have been 

forced to rethink their business plans. 

Health insurers also have access to more comprehcnsive and granular data (from their own businesses) to feed into their assessments. Furthermore, 

they have had three years to analyze the data, map 

the interactions, and adjust their business plans 

in response to their expectations for the effects of 

Obamacare. Those factors all make insurer behavior a leading indicator for the likely path of future 

health system change under Obamacare. 

It is possible to intuit some of the reasoning 

behind insurer decisions to participate, or not, in 

exchanges by examining state-level current market data and comparing it to state-level insurer exchange participation. Current market data 

offers a picture of each insurer's existing business 

focus, while exchange participation decisions can 

be presumed to reflect insurer expectations for 

Obamacare. Any patterns that emerge from such an 

analysis offer evidence of the extcnt to which insurer behavior is consistent, or inconsistent, with theoretical expectations. 3 

Divergent Expectations 

In the three years since the enactment of 

Obamacare, there has been substantial disagreement between its supporters and opponents abont 

the law's likely effects on health care markets. Until 

now, the two sides have supported their respective 

arguments with largely theoretical analyses. Now, 

with insurer-participation decisions finalized, and 

the exchanges open, it is possible to begin comparing 

the theories to reality. There are three broad areas 

in which the expectations of Obamacare's proponents and opponents differ: 

1. Increased vs. reduced insurer competition. 

Proponents have argued that Obamacare's standardization of private health insnrance and its 

creation of insurance exchanges offering easier consumer comparison shopping, along with 

substantial new premium subsidies, will stimulate greater competition among health insurers. 

In contrast, opponents have argued that Obamacare's product standardization and new insurer 

regulations, such as the uminirnum loss ratio" regulation, are more likely to discourage insurer participation in the exchanges, induce smaller carriers 

to exit the market, raise barriers to market entry 

for new players, and limit the ability of existing 

carriers to expand beyond their current markets.' 

2. Coverage expansion vs. coverage substitution. Proponents have argued that Obamacare 

will produce its intended effect of extending 

health insurance coverage to most of the currently uninsured population. They point to 

Obamacare's Medicaid expansion, new exchange 

coverage subsidies, and the individual mandate as factors that they believe will, collectively, produce a significant coverage expansion. 

In contrast, opponents have argued that any 

increase in coverage is likely to be much less than 

proponents forecast. They point to past experiences with expansions of Medicaid and the Children's Health Program (CHIP), in which a significant portion of the new enrollment was the 

product of the so-called crowd-out effect of individuals switching from private coverage to newly 

Patient Protection and Affordabk~ Care Act (PPACA) of 2010, Public law 111-148. 

2. For the most thorough analysis to date of premium changes, see Drew Gonshorowskl, "How Wi!! You Fare in the Obamacare Exchanges?" 

Heritage Foundation Issue Brief No. 4068, October 16, 2013, 

http://www.heritage.org/research/reports/2013/10/enrollment~in·obamacare-exchanges-how-will-your-health-insurance-farc, 

3. All results reported in this Backgrounder that reference, or are otherwise based on, current market data, were derived by the author from 

insurance market data by state, carrier, and business segment, as reported ,n state insurance department regulatory filings, aggregated by the 

Nationa! Association of !nsurance Commissioners (NA!e), and formatted into a comprehensive subscription data set by Mark Farrah Associates 

4. Edmund F. Haislmaier, "Health Care Consolidation and Competition After PPACA," testimony before the Subcommittee on Intellectual 

Property, Competition and the Internet, Committee on the Judiciary, U.S. House of Representatives, May 18, 2012, 

http://thCmedia.s3.amazonaws.com/2013/pdf/Testimony-lnsurance%20Conso!idation.pdf. 
67 


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RACKGROUNDER ' NO. 2852 

;\iOVEMBER 12, 2013 

available, and more generously subsidized, public 

coverage.' They argue that Obamacare's Medicaid 

expansion, new exchange coverage subsidies, and 

employer mandate are likely to produce similar 

shifts from private to public coverage. They also 

expect that Obamacare's new benefits and rating 

rules will make exchange plans more expensive 

(and thus, less attractive) to many of the uninsured (particularly younger and healthier) even 

after applying the new premium subsidies. Consequently, they expect the result to be a much lower 

net increase in coverage than supporters envision. 

3. Increased vs. reduced access to care. Proponents have argued that Obamacare's coverageexpansion provisions will increase access to 

care. Opponents argue that, while access to care 

may improve for some of the newly insured, the 

increased costs and regulations imposed on private insurance are likely to result in less access 

to care for many others, particularly those who 

already have coverage. Opponents anticipate that 

insurers will respond to Obamacare's imposition 

of higher costs by excluding more providers from 

their networks and reducing provider reimbursement rates-resulting in more doctors who refuse 

to participate in their plans. 

Of course, any definitive assessment of the accuracy of these contending expectations must await 

more complete data from real-world experience. For 

now, however, analyzing health-insurer-exchangeparticipation decisions at least indicates what those 

central players in the system expect, and thus. how 

the market is initially responding to Obamacare. 

Determining Insurer 

Exchange Participation 

The first measure for determining the extent 

of insurer exchange participation is the number of 

insurers offering coverage in each state's exchange. 

Since each participating insurer will be offering multiple plans, most of which are variations on the same 

basic design, the number of plans offered in each 

exchange has little significance. Indeed, the differences among the plans offered by each insurer will mostly 

consist of variations in the level of enrollee cost sharing, as Obamacare requires all exchange plans to offer 

standardized minimum benefits at prescribed levels 

of enrollee cost sharing. In fact, offering additional 

benefits above the required minimum risks making 

a plan more expensive and less competitive. 

Also, the reported number of insurers participating in a state's exchange is sometimes misleading. That is because in some states an insurer may 

offer coverage through two or three of its subsidiaries-in which case, it is really one, not two or three, 

insurers participating in the exchange. For example, Illinois lists eight insurers as participating in 

its state exchange. However, the real number is five, 

because in Illinois Humana offers coverage through 

two subsidiaries, and Aetna offers coverage through 

three subsidiaries.' Conversely, a carrier operating in multiple states may elect to participate in the 

exchanges in some or all of those states. However, 

each state-level exchange participation by a multistate carrier is a separate business decision. That 

is because insurance market competition occurs at 

the state level. states differ in the structure of their 

insurance markets and insurance regUlations, and 

under Obamacare the approval criteria for exchange 

participation can vary from state to state. 

Consequently, counting the number of insurers 

that participate in each state at the parent-company 

level is the most appropriate methodology. Thus, in 

this analysis, participation in a state by two or more 

subsidiaries of the same carrier is counted as participation by the one (parent) company, while participation by the same parent company in more than 

one state exchange (whether through the same or 

different subsidiaries) is counted separately for each 

state. This methodology also omits carriers that will 

---_._-------_._-------

5. For a discussion of the economic literature on the crowd-out effects of Medicaid and CHIP expansions, see Paul L. Winfree and Greg D'Angelo, 

"The New SCHIP Bill: The Senate Must Protect Private Coverage," Heritage Foundation WebMemo No. 2246, January 26, 2009, 

http://www.heritage.org/research/reports/2009/0ljthe-new-schip-bill-the-senate-must~protect-private-coverage. 

6. in Illinois, Aetna is offering coverage through its su~sidiaries Aetna Life Insurance Company, Coventry Health and life Insurance Company, 

and Coventry Health Care of Illinois, Inc., while Humana IS offering coverage through its subsidiaries Humana Health Plan, Inc, and Humana 

Insurance Company. The three other carriers are: Blue Cross Blue Shield of Illinois (3 subsidiary of Health Care Service Corporation), Health 

Alliance (the trade name of the Carle Foundation), and the new land of lincoln Health Insurance CO-OP. News release, "Governor Quinn 

Announces Health Plan Rates Are 25 Percent Below HHS Estimates," Office of the Governor Pat Quinn, September 24, 2013, 

http://lnsurancejllinois.gov/newsrls/2013/09/QHPRates.pdf (accessed October 21. 2013) . 

. ------~----~----- ~----
68 


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BACKGROUNDER; NO. 2852 

NOVEMBER 12, 2013 

be offering only dental insurance in the exchanges, 

as supplemental dental plans will only qualify for 

subsidies if purchased in conjunction with a major 

medical plan. Furthermore, simply purchasing a 

dental plan does not constitute compliance with 

Obamacare's individual mandate. Similarly, carriers 

that will only offer plans to small businesses in the 

separate Small Business Health Options Program 

(SHOP) exchanges are also excluded from this 

analysis, as those plans do not qualify for exchange 

subsidies.' 

This methodology finds that the 51 exchanges in 

the states and the District of Columbia will have a 

total of 254 participating carriers, for an average of 

five carriers each.' New York will have the most, with 

16 participating carriers, while New Hampshire and 

West Virginia will have the fewest, with only one 

carrier offering plans in each state's exchange. Table 

1 sumlnarizes the extent of insurer competition in 

the exchanges. As Table 1 also shows, there does not 

appear to be any correlation between the level of 

insurer participation and whether the state Or the 

federal government operates the exchange. Rather, 

state-specific exchange participation seems to generally rcfiect current insurance-market-participation patterns in the various states. 

Assessing Obamacare's 

Effects on Insurer Competition 

TABLEl 

Insurer Exchange Participation 

States listed in bold indicates state-run exchange 

Number of 

Participating Number 

Insurers of States States 

16 New York 

13 Wisconsin 

12 California 

11 Ohio, Oregon, Texas 

10 Colorado 

4 

11 

10 

Massachusetts, Michigan 

Arizona, Florida 

Pennsylvania, Washington 

Utah 

Georgia, Illinois, Minnesota, 

New Mexico, Virginia 

Idaho, Indiana, Iowa, Louisiana, 

Maryland, Nebraska, Nevada, 

Oklahoma, Tennessee 

Arkansas, Connecticut, Kansas, 

Kentucky, Missouri, Montana. 

North Dakota, New Jersey, 

South Carolina, South Dakota, 

Distriet of Columbia 

Alabama, Alaska, Delaware, 

Hawaii, Maine, Mississippi, 

North Caro!ina, Rhode Island, 

Vermont, Wyoming 

New Hampshire, West Virginia 

Notes: All figures are at the parent company level (i.e., an Insurer 

offering exchange coverage in a state through two or more 

subsidiaries is counted as one company). 

Source: Author'S calculatIOns based on federal and state 

information on exchange participation 

B 2852 .. heritage.org 

One measure for assessing the effect of the 

Obamacare exchanges on insurer competition is 

the number of new entrants in the market. Of the 

254 insurers participating in the various exchanges, 

only 25 are new ones-and 23 of those are so-called 

CO-OP insurers funded by federal grants and loans 

under a program created by Obamacare.' It is highly 

uncertain how many of those CO-OPs will be successful over the long term, given that they were created more in response to government policy than to any 

unmet market demand and that, even if successfully 

launched, they will likely generate little surplus capital (due to Obamacare's restrictive minimum loss 

ratio regulations) needed to fund future expansion.'" 

There are six instances where a carner will be offering coverage in a state's SHOP exchange, but not in Its indiVidual exchange-one each in: 

Connecticut Iowa, Maryland, Michigan, Rhode Island, and the District of Columbia. 

8. The list of exchange-participating insurers was compiled by the author. The source for the federally facilitated exchanges is data from 

HealthCare.gov, "Health Plan Information for Individuals and Families," https//www.heaithcare,gov/health-plan-information 

(accessed October 16, 2013). Information for the state-run exchanges comes from either the state's exchange or its insurance department. 

9. One more CO-OP, in Ohio, faIled to become licensed in time to participate in the exchanges next year. See Carrie Ghose, "Obamacare-Backed 

I~surer Left Off Online Marketplace After MISSing License Deadline," Columbus Business First, August 27, 2013, 

http://www.bizjourrlals.com/columbus/blog/2013/08/obamacare-backed~jnsurer-left-off.htm!?page:;;all (accessed October 22, 2013), 

10 Edmund F. Haislmaier, "Effects of the PPACA's Minimum Loss Ratio Regulations," testimony before the Subcommittee on Health, Committee 

on Energy and Commerce, U.S. House of Representatives, September 15, 2011, 

http://www.hcritage.org/research/testimony/2011/12/effects-of-the-ppacas-minimum-ioss-ratio-regulations, 

4 
69 


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BACKGROUNDER i NO. 2852 

NOVEMBER 12, 2013 

The other two unsubsidized start-up insurers are 

both in New York. One is a regional plan sponsored 

by a local hospital system, the North Shore-Long 

Island Jewish Health System. This last insurer is 

the only one of the 25 new carriers with reasonable 

prospects for long-term success, as it is backed by an 

established local health system. As such, it seems to 

be following the same business strategy that a number of other local health systems throughout the 

country have successfully employed in the past. 

Another measure for assessing the effects of the 

Obamacare exchanges on insurer competition is 

the number of existing carriers that are expanding into new markcts. Nationally, there is only one 

instance of an established insurer expanding into a 

new market in response to Obamacare. That insurer 

is another carrier sponsored by a local health system, the Carle Foundation, which currently offers 

coverage (its Health Alliance plans) in Illinois and 

Iowa. In addition to offering coverage on the Illinois 

exchange, it will also offer coverage in Nebraska 

through that state's exchange. 

It is, then, reasonable to conclude that Obamacare's provisions for expanding coverage by organizing state-based exchanges, subsidizing exchange 

coverage, and imposing an individual mandate to 

buy coverage, have so far had virtually no effect on 

indncing either the creation of new health insurers 

or the expansion of existing health insurers into new 

markets where they previously did not offer plans. 

Rather, the only significant increase in insurer competition will be as a result of direct government 

funding to create 23 new CO-OP insurers, for which 

there is high uncertainty about whether there will 

be sufficient market demand in the coming years,'l 

Yet another way to measure the effect of Obamacare on insurer competition is to compare, in each 

state, the number of carriers currently offcring individual insurance to the number that will be offering 

coverage through the exchanges. That comparison 

is relevant because the plans offered in the exchanges will be for individual coverage. Also, the vast 

majority of exchange enrollees will likely qualify 

for new premium subsidies-theoretically making 

the exchanges an attractive source of coverage for 

consumers and a potential business opportunity for 

insurers. 

In addition to the 25 new insurers, there are 36 

instances in which an existing insurer not currently 

offering individual coverage in a state will offer such 

coverage through the state's exchange. However, 

that increase is offset by the fact that, in most cases, 

insurers whose principal line of business in a state 

is individual coverage have elected to not participate 

in the exchanges. 

Table 2 compares, by state, the number of insurers participating in the exchange with the number 

of carriers that currently offer individual coverage. 

The data show that, despite 61 instances of new or 

existing carriers offering individual coverage for the 

first time through the exchanges, nationally there 

will still be 29 percent less insurer competition in 

the exchanges relative to the current market. Seven 

states will have the same level of competition in 

both markets, and five states will have more carriers offering exchange coverage than now offer individual coverage. In the remaining 38 states and the 

District of Columbia, fewer insurers will offer coverage in their exchanges relative to the number that 

currently offer individual-market coverage." 

Thus, in thevastmajorityofstates, theObamacare 

exchanges will offer less, not more, insurer competition than the state's current individual market. 

Assessing Insurer 

Competition Within States 

While state-level insurer participation is an 

important measure, it still overstates the actual 

level of competition that will occur in many states. 

That is because in most states, plans will be offered 

and priced on a local basis, and in many states few 

of the insurers participating in the state's exchange 

will offer plans in every county or region of the state. 

For instance, the California exchange divided 

that state into 19 rating regions. In three of those 

regions (encompassing Los Angeles and San Diego) 

11. Jay Hancock, 'Rocky Opening leaves Health law's New Co-Ops Jittery," Kaiser Health News, October 15,2013, 

http://capsules.kajserhealthnews.org/index.php/2013/10/rocky-opening-Ieaves-health-Iaws-new-eo-ops-jittery/ (accessed October 22. 2013). 

12. The current individual market is much smaller than the other market segments. In this analysis, only earners with 1,000 or more individual 

market enrollees in a state (as of the first quarter of 2013) are counted as currently offering such coverage. The assumption is that those 

carriers were likely still writing new individual policies as of 2012, while any carrier with fewer individual market enrollees was likely no longer 

writing new individual policies. 
70 


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BACKGROUNDER I NO. 2852 

NOVEMBER 12.2013 

TABLE 2 

Insurer Competition: Number of Insurers Offering Individual Coverage 

State 

Alabama 

Alaska 

Arizona 

Arkansas 

Colorado 

Connecticut 

Delaware 

Florida 

Kansas 

Kentucky 

louisiana 

Maine 

Maryland 

MInnesota 

Montana 

Nebraska 

Nevada 

New Hampshire 

New Jersey 

New Mexico 

New York 

North Carollna 

North Dakota 

Ohio 

Oklahoma 

Oregon 

Utah 

Vermont 

Total 

current market partiCipants. 

In the Current Market 

11 

7 

12 

14 

7 

4 

18 

11 

4 

5 

2 

J 

3 

10 

10 

14 

18 

10 

7 

4 

15 

5 

360 

In the Exchange 

10 

J 

2 

8 

5 

16 

2 

3 

11 

7 

2 

J 

3 

6 

2 

5 

7 

1 

13 

2 

254 

Obamacare Effect 

on Competition 

0% 

-29%1 

-57% 

-50% 

-56% 

-55% 

0% 

-67% 

-50% 

-50%) 

-50~,'o. 

-50% 

13% 

50% 

0°10 

-20"/0 

-50% 

0% 

0% 

-50%) 

10% 

-50% 

-SOO/D 

0% 

-75% 

-13% 

-60% 

-29% 

B 2852 i: heritage,org 
71 


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BACKGROUNDER, 1':0,2852 

NOVEMBER 12, 2013 

there will be a choice of six carriers, while five 

other regions will have a choice of only three carriers.'s Thus, while 12 carriers are participating in 

California's exchange, in any given region of the 

state, enrollees will have a choice of plans from only 

one-quarter to one-half that number. Indeed, only 

two of the 12 participating carriers are competing 

statewide in all rating regions. 

In the New York exchange, plans will be offered at 

the county and New York City borough level. While 

16 carriers are participating in ;\lew York's exchange, 

the greatest competition will occur in four of the five 

New York City boroughs and Nassau County on Long 

Island, with nine carriers offering plans in each of 

those jurisdictions. In contrast, five New York counties have only two competing carriers, and 11 counties have only three. None of the 16 carriers participating in New York's exchange is offering coverage 

on a statewide basis." 

Furthermore, the largest states are not the only 

ones that will experience more limited local competition. For instance, Wisconsin is the state with the 

second-highest number of insurers participating in 

its exchange (13 carriers), but as in New York, none 

of them is offering coverage statewide. At the county 

level, actual competition in Wisconsin will consist 

of less than half the total number of participating 

insurers. The most competition will be six insurers-but that will only be the case in four Wisconsin 

counties. Eleven counties will have five competing insurers, 10 counties will have four competing insurers, 17 counties will have three competing 

insurers, another 17 will have two competing insurers, and the remaining 13 counties will have only 

one insurer offering exchange coverage. Thus, in 42 

percent ofWisconsinJs 72 counties, enrollees will be 

able to obtain exchange coverage from only one or 

two insurers.ls 

Similarly, while four insurers are participating 

in Iowa's exchange, three will offer plans in 14 of tho 

state's 99 counties. The other 85 counties will have 

only two competing insurers each.'6 Indiana also has 

four insurers in its exchange, but all four will offer 

plans in only 6 of that state's 92 counties. Thirty 

Indiana counties will have only one insurer offering exchange coverage, and another 35 counties will 

have only two insurers. 

In Arkansas, while three insurers are participating in the exchange, in 24 of the state's 75 counties (nearly one-third) only one carrier will offer 

coverage. In Mississippi, two carriers are offering 

coverage in the exchange, but they will compete 

directly in only five counties-the four counties 

that encompass Jackson and its surrounding area, 

and a fifth county that is a suburb of Memphis, 

Tennessee. In the other 77 Mississippi counties, 

the exchange will offer coverage from only one of 

the two carriers. 17 

Other states also have similar patterns of less 

insurer competition at the local level, particularly in 

more rural areas. In fact, only four states have both 

an above-average level of insurer participation in 

the exchange (six or more carriers), and a choice of 

plans in every region of the state from at least half 

the participating carriers, as shown in Table 3. Yet, 

those are states that already have more competitive 

markets, as evidenced by that fact that in no case 

does an insurer in any of the four states currently 

have even a 50 percent market share in a state's individual or employer-group market. 

Assessing Insurer 

Participation Decisions 

Each insurer decision to participate, or not participate, in a given state's exchange is the product of 

a variety of factors and considerations. While much 

of the thinking behind those decisions is not pUblic, 

an examination of current insurance market data 

and other public information provides some insights 

into how insurer decisions reflect carrier expectations for Obamacare's market effects. 

The private health insurance market can be 

divided into six basic business segments, or product 

"lines," each with different business characteristics: 

13, Covered California, "Health Insurance Companies for 2014," September 2013, 

https://www.coveredca.com/PDFs/English/booklets/CC·health·plans-booklet·rev2.pdf (accessed October 22, 2013). 

14. NY State of Health, "Health Plans by Counties and Boroughs," 

http://healthbcncfitexchange.ny.gov/sites/default/fHes/Health%20Plans%20by%20County.pdf (accessed October 22, 2013). 

15. Healthcare gOY, "Health Plan Information for Individuals and Families," 

16. Ibid 

17. Ibid 
72 


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BACKGROUNDER i NO. 2852 

NOVEMBER12,2013 

(1) individual coverage; (2) employer group coverage; (3) administrative services only (ASO) for selfinsured employers; (4) Medicaid managed care; (5) 

Medicare Advantage plans; and (6) various "supplemental" coverage products, such as dental plans, 

vision care plans, Medicare supplemental policies, 

and prescription drug plans. 

Some insurers concentrate on offering products 

in only one or two market segments, while others 

have a broader business portfolio, offering products 

in most or all segments. Thus, an insurer's principal 

business segment in a state is an important reference point for understanding that insurer's decision 

to participate, or not, in the state's exchange. 

For instance, it is not surprising that carriers 

whose principal current business consists of offering Medicare Advantage plans will generally not 

participate in the exchanges, since the exchanges 

are designed to offer individual major medical coverage to the non-elderly. Nor is it surprising that 

insurers whose principal business is offering supplemental coverage plans will also generally not 

participate in the exchanges-other than those 

olfering stand-alone dental plans, which, as previously noted, are not relevant to an analysis of insurer exchange participation. 

That leaves four health insurance business segments where it is possible to look for patterns in 

insurer exchange-participation decisions that might 

give indications of carrier expectations for the effects 

of Obamacare. 

The Individual Market. Because of the highly 

favorable tax treatment given to employer-sponsored insurance, individual coverage has long been 

a small subset (less than 10 percent) of the total 

private health insurance market. Such coverage is 

typically purchased by those without access to an 

employer-sponsored plan, such as the self-employed. 

However, Obamaeare could potentially expand the 

individual market significantly, as the new exchange 

coverage will consist of individual plans accompanied by new federal subsidies for enrollees with 

incomes between 100 percent and 400 percent of the 

federal poverty level (FPL). 

TABLE 3 

States with Insurer Exchange 

Participation Above the National 

Average and Coverage Offered in 

Every Region of the State by at Least 

Half the Participating Insurers 

Insurers Insurer Competition at 

Participating Rating Region level 

State in Exchange Maximum Minimum 

Colorado 10 

Massachusetts 

Oregon 11 10 9 

Utah 6 

Source: Author's calculations based on federal and state 

exchange participation Information, 

B 2852 ;jI heritage.org 

However, in the exchange market there is almost 

a complete lack of participation by insurers whose 

principal business in a state is individual coverage. 

There are only three instances of such earriers deciding to participate in a state's exchange, and in all 

three cases the carrier's principal business in most 

other states is not individual-market coverage." 

Employer Group Coverage Market, This segment consists of insurers focused mainly on selling 

traditional employer-group policies. Their customers are typically small to medium-size employers, 

each with anywhere from a few employees to several 

hundred. In contrast to individual-market insurers, 

a large share of the carriers whose principal current 

business consists of offering employer-group market plans have elected to participate in the exchanges. For this category of insurers there are, nationally, 

84 instances of carriers electing to participate in the 

exchange, versus 46 instances of carriers declining 

to participate-a participation rate of 65 percent to 

35 percent. Thus, carriers whose principal business 

is employer-group coverage are effectively betting 

on the Obamacare exchanges by a ratio of two to one. 

18 (entene, primarily a Medicaid managed care insurer, is participating in the exchange in Arkansas, where Its only current business is through a 

subsidiary in the individual market Humana operates in all states, With Medicare Advantage plans accounting for the largest share of its total 

enroflment. Humana is participating in the exchanges in 14 states and In two of them, Colorado and Utah, its largest business segment in the 

state happens to be the individual market. 
73 


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BACKGROUNDBR! NO. 2852 

NOVEMBER 12,2013 

Employer Self-Insured Market. While smaller 

employers tend to purchase so-called fully insured 

group coverage from an insurer, larger employers 

tend to "self-insure" their employee health plansmeaning that the employer, not the insurer, bears 

most of the risk for the plan's cost, However, selfinsured plans almost always contract with an insurer, or another third-party administrator (TPA), to 

administer the benefits and process the claims. 

Insurers refer to contracts of this kind as administrative services only (ASO). Among the group of 

insurers whose principal business consists of ASO 

contracts with self-insured plans, there are, nationally, 78 instances of carriers participating in the 

exchange, versus 127 instances of carriers declining 

to participate-38 percent participation versus 62 

percent nonparticipation. 

However, there is an important caveat. This 

group includes 41 Blue Cross and Blue Shield insurers. Relative to their peers, there are other factors 

likely at play in Blue Cross participation decisions, 

such as the fact that many of them also have the largest share of the individual market in their state. 

Thus, in order to form a more precise picture it 

is necessary to further divide the category of insurers whose principal business is ASO for self-insured 

employers into two subgroups. Doing so shows that 

for the subset consisting of Blue Cross carriers, 39 

(95 percent) are participating in the exchanges, 

while two are not. In contrast, for the subset consisting of non-Blue Cross carriers, in only 39 instances 

(24 perccnt) are they participating in the exchanges, 

while in 125 instances (76 percent) they are not-a 

nonparticipation ratio of three to one. 

Medieaid Managed-Care Market. During the 

past two decades there has been significant growth 

in states contracting with private insurers to deliver benefits to Medicaid enrollees, particularly nonelderly, non-disabled enrollees, The growth has been 

in both the number of states adopting this approach 

and the number of enrollees covered by "Medicaid 

managed care."" Among insurers whose principal 

business in a state is Medicaid managed care, nationwide there are 50 instances of carriers electing to 

participate in the exchanges, versus 103 instances of 

carriers declining to participate-33 percent participation versus 67 percent nonparticipation, 

What Insurer Participation 

Decisions Indicate 

There are five distinct patterns that emerge from 

this analysis. Each of those patterns offers evidence 

of the extcnt to which insurer behavior is consistent, 

or inconsistent, with theoretical expectations. 

Pattern #1: Overwhelming participation by 

Blue Cross and Blue Shield carriers. Of the 62 

Blue Cross and Blue Shield licensees in the U.S., all 

but three will participate in the exchanges.'· This 

pattern is likely explained by the fact that Blue Cross 

carriers tend to occupy a unique competitive position in their local markets. Unlike its competitors 

that typically focus on one (or sometimes, two) market segments, a Blue Cross carrier is often the dominant insurer in two (or more) market segments in its 

state. 

Consequently, the exchange participation decision of a Blue Cross carrier likely involves other considerations-such as whether it already has a dominant position in the individual market (as many do), 

or higher "brand awareness" among consumersthat might give it an advantage over other carriers 

in an exchange. For those Blue Cross carriers that 

are still nonprofits, there is the added consideration 

that tax law requires them to justify their nonprofit status by demonstrating a "community benefit," 

So, participating in the exchanges might help them 

make the case that they offer a community benefit, 

even though they largely operate the way their forprofit competitors do. 

In sum, this pattern suggests that Blue Cross carriers view the exchanges as another market segment 

in which they can further leverage their existing 

local market dominance. 

Pattern #2: Virtually no participation by 

individual market-focused carriers. Despite 

the fact that the exchanges will offer individual coverage, and that most enrollees will receive 

a federal premium subsidy, there is virtually no 

19. For a concise discussion of the types and distribution of state Medicaid managed care programs, see Kaiser Commission on Medicaid and the 

Uninsured, "Medicaid Managed Care" Key Data, Trends, and Issues," Policy Brief, February 2012, 

http//kaiserfamilyfoundation.files.wordpress.com/2013/0l/8046-02.pdf (accessed October 23, 2013). 

20. The only ones not participating in the exchanges are Blue Cross and Blue Shield of Mississippi, and Well mark, the parent company of the Blue 

Cross and Blue Shield licensees in lowa and South Dakota. 

9 
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BACKGROUNDER: NO. 2852 

NOVEMBER 12, 2013 

participation in the exchanges by insurers whose 

principal current business in a state consists of 

offering individual-market coverage. Indeed, there 

is no national carrier with an individual-market 

focus offering coverage in any of the exchanges." 

The most likely explanation is that carriers specializing in individual-market coverage tend to be 

relatively small, and that most individual policies are 

currently purchased from larger insurers-such as 

Blue Cross and Blue Shield carriers-that also have a 

large presence in other segments of the market. 

A closely related factor is the considerable uncertainty that all insurers have about the expected 

risk profile of the exchange market, particularly 

the greater probability of higher-than-expected 

claims costs. Small carriers are less able than large 

ones to absorb substantial unanticipated losses. 

Obamacare's minimum loss ratio regulations also 

preclude insurers from increasing premiums in 

future years by enough to recoup any initial losses." 

Thus, the only safe way for a small insurer to enter a 

market as uncertain as the new exchanges would be 

to "rate defensively" -meaning to start off charging 

premiums that rcfiect their actuaries' worst-case 

scenarios. However, since such higher premiums 

would make their plans less competitive, they might 

decide it is not worth the effort. 

Whatever their reasons, it is quite clear that this 

group of carriers overwhelmingly concluded that 

the Obamacare exchanges are not an attractive business opportunity. 

Pattern #3: Significant participation by 

employer group market-focused carriers. As 

noted, this group of insurers has elected to participate in the exchanges by a ratio of two to one. The 

most plausible explanation for this pattern is that 

carriers focused on this market segment anticipate 

significant erosion in employer-group coverage, as 

their customers-particularly smaller employersare induced by Obamaeare to drop their group plans 

and send their workers to the exchanges. Indeed, 

many workers in smaller firms would actually be 

financially belter off if their employers dropped 

group coverage, as they would receive more generous subsidies for coverage through the exchanges. 

It is also reasonable to infer from this behavior pattern that two-thirds of these carriers likely 

helieve that offering coverage in the exchanges will 

give them an opportunity to retain at least some of 

their present enrollees when employers drop their 

current group plans in response to Obamacare. 

This pattern is confirmed by the behavior of the 

largest carrier in this category, Kaiser Permanente, 

which operates in eight states and the District of 

Columbia. Seventy-six percent of Kaiser's total current enrollment comes from employer group plans, 

and Kaiser has elected to participate in the exchanges everywhere it operates. 

Another confirming data point is the fact that 

of the 36 insurers that will be participating in the 

exchanges despite not currently offering individual 

coverage, 11 are carriers whose principal current 

business is employer-group coverage. 

In sum, the behavior of this group of insurers 

appears to offer market confirmation of the expectation among Obamacare opponents that a significant number of employers (particularly smaller 

ones) are likely to drop their current group coverage plans in the coming years. 

Pattern #4: Relatively little participation by 

carriers focused on providing administrative 

services to self-insured employer plans. In nearly two-thirds of cases the carriers in this group have 

opted not to participate in the exchanges. As noted, 

when the Blue Cross carriers are excluded, the nonparticipation rate for this group rises to three-quarters. 

Most significant is that this group includes three of 

the four major insurers that operate nationally in all 

50 states and the District of Columbia-Aetna, United, 

and Cigna. The exchange participation decisions 

of all three carriers strongly confirm this pattern. 

Nationally, 61 percent of Aetna's total business is ASO 

for employer self-insured plans, and Aetna will participate in only 16 of the exchanges. '" For United, 54 

percent of its total business is in this market segment, 

and it will participate in four exchanges. 24 In Cigna's 

21, The two largest individual market-focused carriers operating nationwide are Sun lite Assurance Company and Assurant. Neither carrier is 

offenng major medical exchange coverage in any state. All of Sun Life's major medxa! business is In the indiVidual market, as IS 79 percent of 

Assurant's business (the re'Tlaining 21 percent IS employer~group coverage), 80th carriers also offer free-standing dental plans. 

22, Haislmaier, "Effects of the PPACA's M!nimum Loss Ratio Regulations." 

23. Aetna also participates in SHOP, but not in the Individual exchange in Maryland. 

24. United also participates in SHOP, but not in the Individual exchanges in Connectlcut, Michigan, Rhode Island, and the District of Columbia, 

-------~--"-"-""-- "---"-----"--""---" 

10 
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BACKGROUNDER I NO. 2852 

NOVEMBER 12, 2013 

case, this coverage category accounts for 84 percent of 

its total business, and Cigl1a will offer exchange coverage in only five states. 

The most likely explanation for this pattern is 

that insurers expect enrollment in the employer selfinsured market segment to remain relatively stable 

under Obamacare. That expectation seems reasonable on several grounds. First, self-insured employers tend to be large-or very large-employers and 

as such would be subject to Obamacare's employer 

mandate penalties if they dropped coverage. Second, 

many workers in self-insured firms have family 

incomes that are too high to qualify for exchange 

coverage subsidies in the absence of an employer 

plan. Third, self-insured plans are exempt from 

Obamacare's requirement to cover a minimum set 

of "essential benefits," which means that they retain 

significant leeway to control future cost growth by 

making adjustments to their benefit designs. 

Indeed, with respect to the last point, it is quite 

plausible that Obamacare will produce an expansion 

of the self-insured market segment-at the expense 

of the "fully insured" employer group-coverage 

segment. While Obamacare imposes the minimum 

essential benefit requirements only on insurance 

policies sold in the individual and small group markets, it also includes a provision that expands the 

definition of "small group" from 50 workers to 100 

workers, starting in 20l7. Thus, it would not be surprising if. faced with the onset of that costly mandate, in future years more medium-sized employers 

shift the coverage they now offer their workers from 

fully insured to self-insured plans. 

Pattern #5: Notable participation by carriers 

focused on Medicaid managed care. Atfirstglance, 

the two-to-one nonparticipation ratio among this 

group does not seem surprising. Another key component of Obamacare is the expansion of Medicaid to 

millions oflow-income, able-bodied adults. Despite 

the Supreme Court ruling that Congress could not 

force states to expand Medicaid, the Congressional 

Budget Office projects that Obamacare will still add 

9 million individuals to Medicaid in 20l4.25 Thus, it 

would be understandahle if insurers whose principal 

business is Medicaid managed care decided to stick 

with what they know best, and took a pass on participating in the exchanges. 

However, that explanation raises the intriguing 

question of why one-third of this group did elect to 

participate in the exchanges. One likely explanation 

is that because the incomes of many individuals fluctuate above and below the threshold for Medicaid eligibility, Medicaid managed-care insurers that participate in the exchanges will be better positioned to 

retain those enrollees in their plans. In those cases, 

the principal change would simply be the source of 

the government subsidies paying for the coverage. 

The other possibility is that this subgroup of carriers actually views offering exchange coverage as an 

attractive business opportunity in its own right. 

This participation pattern is essentially the 

same for states that are, and are not, adopting the 

Medicaid expansion. That, too, is understandable, as 

insurers had to make their exchange participation 

decisions last spring, at a time when many states 

were still debating whether to adopt the Medicaid 

expansion. 

Among insurers whose principal business in a 

state is Medicaid managed care, one-third are participating in the exchanges. Those carriers account 

for 50 (20 percent) of the 254 exchange participating carriers nationwide. If other insurers who also 

have Medicaid managed-care business-but for 

whom it is not their principal business-are included, the figure rises to 108 carriers, 43 percent ofthe 

254 exchange participating insurers. Furthermore, 

of the 36 insurers that will participate in exchanges 

despite not currently offering individual coverage, 

22 are carriers whose principal current business is 

Medicaid managed care. 

However, 14 states do not have Medicaid managed 

care and, hence, have no carriers currently offering such coverage. Table 4 shows that, among the 36 

states and the District of Columbia that operate part 

of their Medicaid programs through managed-care 

plans, nearly half (49.5 percent) of the carriers participating in their exchanges operate Medicaid managed-care plans in the state. Indeed, in 28 instances 

Medicaid managed-care accounts for over 90 percent 

of the carrier's current business in the state. Table 

25 Congressional Budget Offlce, "Table 1: May 2013 Estimate of the Effects of the Affordable Care Act Oil Health Insurance Coverage," 

http://www.cbo.gov/sltes/default/files/cbofiles/attachments/44190_EffectsAffordableCareActHeaithlnsuranceCoverage_2.pdf 

(accessed October 23, 2013). 

11 
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BACKGROUNDER i NO, 2852 

NOVEMBER 12, 2013 

----""""" ------" 

4 also shows that 31 states will have at least one 

insurer with Medicaid managed-care business in 

the state offering coverage on the exchange, and that 

in 18 states half or more of the insurers in the state's 

exchange currently have Medicaid managed-care 

business, Indeed, in six states Medicaid managed 

care is the principal current business of half or more 

of all exchange carriers-six of the 11 in Texas, three 

of the five in New Mexico, two of the four in Indiana, 

and one of the two each in Delaware, Mississippi, 

and Rhode Island, 

Clearly, a number of carriers offering Medicaid 

managed care view the exchanges as a business 

opportunity, However, digging deeper into the data 

reveals distinctly different responses to Obamacare 

by the four biggest multi-state carriers in this category-Molina, Wellcare, Centene, and WellPoint: 

• Molina. Just under 90 percent of Molina's total 

business consists of Medicaid managed care, and 

Molina is offering exchange coverage in nine of 

the 10 states where it currently operates. The 

exception is Louisiana, which is the only state 

where Molina's Medicaid business is not "at risk"-

meaning that tbe company contracts with the 

state to manage the coverage of some Medicaid 

enrollees, but does not assume the risk for the 

cost of their coverage" 

• Wellcare. In contrast to Molina's "all-in" position, Wellcare is "all-out" when it comes to the 

exchanges. Medicaid managed care accounts for 

77 percent of Welle are's total enrollment nationwide, but it is not participating in the exchanges 

in any of the six states where it offers that coverage. In fact, Welle are is not participating in any 

exchange in any state-making it the only major 

multi-state health insurer of any kind to entirely 

avoid the exchanges" 

• Centene. The approach taken by Centene is closer to that of Molina" Ninety percent of Centene's 

total enrollment comes from the Medicaid 

managed-care plans that it operates in 14 states. 

In seven of those states, Centene is offering 

exchange coverage, and those seven states collectively account for 75 percent of Centene's total 

Medicaid managed-care enrollment" Centene is 

also offering exchange coverage in two other states 

where it does not have Medicaid managed-care 

business. One is Massachusetts, where Centene 

already offers coverage through that state's existing Health Insurance Connector-which is being 

transitioned into an Obamacare exchange. The 

other is Arkansas, which does not currently have 

Medicaid managed care, In both states, Centene 

is offering exchange plans through its Celtic 

Insurance Company subSidiary, a small, individual market-focused insurer that it acquired in 

2008, 

• WellPoint. Perhaps the most interesting 

response among these four is Well Point's, It operates Blue Cross plans in 14 states and will participate in the exchanges in all of those states. However, last year WellPoint acquired AmeriGroup-a 

Medicaid managed-care insurer operating in 12 

states" In the states where AmeriGroup operates, 

but where Wellpoint does not have a Blue Cross 

subsidiary, the company will not participate in 

the exchanges" Thus, WellPoint has essentially 

responded to the exchanges as a Blue Cross carrier. The company apparently views its acquisition 

of AmeriGroup as a play on the Medicaid expansion-not as a way to leverage broader participation in the exchanges" 

Effects of Obamacare's Cost-Sharing 

Subsidies on Exchange Coverage 

One major feature of Obamacare that has 

received relatively little attention is the law's costsharing subsidies for lower-income exchange enrollees. Yet, understanding how those subsidies operate-and how they interact with the other provisions 

of Obamacare-goes a long way toward explaining 

not only why Medicaid managed-care insurers are 

participating in the exchanges, but also why many 

insurers are offering exchange plans with ((narrow 

networks" that limit coverage to certain providers. 

Obamacarc provides both premium subsidies 

and cost-sharing subsidies for exchange coverage, 

and both sets of subsidies vary based on enrollee 

income. 

Most of the attention has so far focused on the 

premium subsidies for exchange enrollees with 

family incomes between 100 percent and 400 

percent of the FPL Those premium subsidies are 

calculated at enrollment based on the individual's family income and with reference to tbe second-lowest-cost Silver plan that is offered in the 

12 
77 


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BACKGROUNDER I NO. 2852 

NOVEMBER 12, 2013 

----_ .. _--. ~--~-.-.... - .. 

enrollee's location." For example, if it is determined-by applying the statutory formula to the 

enroUee's income-that an enrollee will be responsible for paying $100 a month for coverage, and if 

the reference plan (second-lowest-cost Silver plan) 

costs $250 a month, that enrollee's subsidy will 

then be set at $150 a month. 

Once the enrollee's premium subsidy is calculated, he can apply that amount to the purchase of any 

available exchange plan in the Bronze, Silver, Gold, 

or Platinum coverage levels, with responsibility for 

paying the difference (if any) between the subsidy 

amount and the total premium. So, to continue the 

foregoing example, if the enrollee picks a more expensive plan, say, one costing $300 a month, he would 

have to pay $150 a month for coverage ($300 premium minus $150 subsidy). If instead the enrollee picks 

a less costly plan, say, one with a $200 a month premium, he would only have to pay $50 a month for coverage ($200 premium minus $150 subsidy). 

However, the cost-sharing subsidies work very 

differently. To start with, they only apply to Silver 

plans-so an enrollee must buy a Silver plan to benefit from the cost-sharing subsidies. Second, the costsharing subsidies are paid directly to the insurer, 

without the enrollee knowing the amount. All that 

the enrollee knows is that the deductibles and copayments that come with his coverage are less than 

the plan's standard amounts. For example, if the 

plan's deductible is $2,000 but an enrollee's income 

qualifies for cost-sharing subsidies that pay the 

insurer to lower his deductible to $500, the enrollee will be told that, for him, the deductible is $500. 

The plan's premium, and the premium subsidy that 

the enrollee receives, remain the same. Thus, for the 

same premium, the enrollee will be getting the plan 

with lower cost-sharing requirements. 

Of course, that makes the actual cost of the plan 

to the insurer (for that enrollee) more expensive 

than the stated premium, but the federal government pays the insurer the additional cost-sharing 

subsidy to cover the difference. 

Thus, different individuals can purchase the 

same plan for the same nominal premium, while, 

based on their different incomes, ending up with 

different deductible and co-pay levels for their coverage. Table 5 illustrates how this will work. The 

third row in the table shows the effect of the premium subsidies. An enrollee with an income of 400 

percent of the FPL will be responsible for paying 

$364 a month for the reference plan (the secondlowest-cost Silver plan), while an enrollee with an 

income of 100 percent of the FPL has to only pay 

$19 a month for the same coverage. The federal government pays the difference (if any) between those 

amounts and the plan's premium to the insurer as a 

premium subsidy. 

The next 14 rows in Table 5 show how the plan's 

various cost-sharing provisions will also be adjusted 

based on enrollee income. Thus, an enrollee with an 

income of 400 percent of the FPL will have a $2,000 

deductible and be charged a $45 co-pay for each 

doctor visit, while an enrollee at 100 percent of the 

FPL will have no deductible and be charged only $3 

for each doctor visit-even though both enrollees 

bought the same plan. 

Those adjustments, of course, increase the real 

cost of the coverage for the second enrollee, but the 

nominal premium remains the same. Instead, the 

federal government pays the insurer a second set of 

subsidics (the cost-sharing subsidies) to cover the difference between the real and nominal premium that 

results from the requirement that the insurer reduce 

the plan's deductibles and co-pays for lower-income 

enrollees. The result is that lower-income enrollees 

will pay very little in either premiums or out-of-pocket expenses for their coverage, while Obamacare's 

complicated subsidy scheme will reimburse insurers 

for the extra cost of those features. 

However, this design creates a problem for 

insurers. A substantial share of their exchange 

enrollees are likely to be on the lower end of the 

income scale. That is because lower-income individuals are not only more likely to be uninsured 

and seeking coverage, but will also find exchange 

coverage more attractive, as they will be able to buy 

plans with very low co-pays and heavily subsidized 

premiums. 

26. Obamacare standardizes health insurance plans based on the concept of "actuarial value.' A plan's actuarial value is the average share of total 

expenses for the covered benefits that the plan pays. So, an actuarial value of 70 percent means that the plan, on average, pays 70 percent 

of the total expe"lse for the covered benefits. The enrollee is responSible for paying the remaining costs, according to the plan's schedule 

of deductlbles and co-pays. The four plan categories specified in Obamacare are: Bronze (60 percent actuarial value), Silver (70 percent 

actuarial value), Gold (80 percent actuarial value), and Platinum (90 percent actuarial value), See Public Law 111-148 §1302(d), 

--------_._- ------------

13 
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BACKGROUNDER ; NO. 2852 

NOVEMBER 12, 2013 

TABLE 4 

Insurers with Medicaid Managed-Care Business 

The table below lists the 36 states and the District of Columbia that provide some Medicaid coverage through 

Medicaid managed care (MMC) and the numberofMMC insurers that chose to participate in their exchanges. 

About halfofthe participating insurers in these states conduct MMC business in their states, and about onequarter haveMMC as their principal business. 

State 

Arizona 

California 

Colorado 

Connecticut 

Delaware 

Florida 

Georgia 

Hawaii 

Illinois 

lndiana 

Iowa 

Kansas 

Kentucky 

Louisiana 

Maryland 

Massachusetts 

Michigan 

Minnesota 

Mississippi 

Missouri 

Nebraska 

Nevada 

New Mexico 

New York 

Ohio 

Oregon 

Pennsylvania 

Rhode Island 

South Carolina 

Tennessee 

Texas 

Utah 

Virginia 

Washington 

West Virginia 

Wisconsin 

District of Columbia 

Totals 

Total 

8 

12 

10 

3 

2 

8 

5 

2 

4 

3 

3 

4 

4 

9 

9 

5 

2 

3 

4 

4 

5 

16 

11 

11 

7 

2 

3 

4 

11 

6 

5 

7 

1 

l3 

3 

218 

NUMBER OF PARTICIMTING INSURERS iN EXCHANGE 

." doing some 

business in MMC 

2 

5 

6 

4 

1 

1 

1 

2 

4 

11 

5 

3 

5 

1 

1 

1 

10 

2 

3 

3 

10 

108 

... withMMCas 

principal business 

50 

Note: Connecticut, Iowa, Kansas, LOLlisiana, and West Virginia appear on this list because they have insurers 

that provide MMe, but none of the insurers in those states currently offering MMC will be partlcipatlf'lg in the 

state exchanges. 

... withMMC 

accounting for more 

than 90 percent of 

business 

28 

Source: Author's calculations based on federal and state information on exchange participation and Mark 

Farrah Associates data on current enrollment by carrier, state, and market segment B 2852 :i heritage,arg 

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79 


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BACKGROUNDER i NO. 2852 

NOVEMBER 12, 2013 

TABLES 

Sliding Scale Benefits (Single Person) 

Percent of FPL 100%-150% 

Annual Income $11,490-$17,235 

Consumer Portion of Premium for Silver $228-$684/year 

Plans (balance paid by federal subsidy) ($19-$57/month) 

Deductible None 

Preventative Care Co~pay No cost 

Primary Care Visit Co~pay $3 

Specialty Care Visit Co-pay $5 

Urgent Care Visit Co·pay $6 

Lab Testing Co-pay $3 

X-Ray Co-pay $5 

Generic Medication Co~pay $3 

Emergency Room Co~pay $25 

(waived if admitted) 

Emergency Medical Transportation $25 

Co-pay 

Hospital Care and Outpatient Surgery 10% 

Drug Deductible None 

Preferred Brand Co·pay After Drug $5 Deductible 

Maximum Out-of·Pocket $2,250 

Actuarial Value 94% 

The problem is that insurers know that the very 

low co-pays charged to lower-income enrollees will 

have virtually no effect on their demand for health 

care services. Thus, the only way that insurers will 

be able to control plan costs is by limiting coverage 

to a smaller number of providers willing to accept 

low reimbursement in return for a high volume of 

patients. 

This explains why many participating insurers-including ones that do not currently operate 

Medicaid managed-care plans-are offering narrow network plans on the exchanges. For instance, 

150%-200% 200%-250% 250%-400% 

$17,235-$22,980 $22,980-$28,725 $28,725-$45,960 

$684-$1,452/year $1,452-$2,316/year $2,316-$4,368/year 

($57-$121/month) ($121-$193/month) ($193-$364/month) 

$500 $1,500 medical $2,000 medical 

deductible deductible 

No cost No cost No cost for 1 annual 

visit 

$15 $40 $45 

$20 $50 $65 

$30 $80 $90 

$15 $40 $45 

$20 $50 $65 

$5 $20 $25 

$75 $250 $250 

$75 $250 $250 

15% 20% of the plan's 20% of the plan's 

negotiated rate negotiated rate 

$50, then pay the $250, then pay the $250, then pay the 

co-pay amount co~pay amount co-pay amount 

$15 $30 $50 

$2,250 $5,200 $6,350 

87% 73% 70% 

B 2852 ~ heritage.org 

California Blue Shield has no Medicaid managedcare husiness, hutthe plans it offers on the California 

exchange restrict enrollees to about halfthe number 

of providers in its regular network for non-exchange 

plans." In New Hampshire the only carrier offering coverage on the state's exchange is Anthem (a 

subsidiary of WellPoint). Because New Hampshire 

is a state that does not contract with managcdcare plans for Medicaid, Anthem has no Medicaid 

managed-care business in the state. Yet for its New 

Hampshirc exchange plans, Anthem includes only 

16 of the state's 26 hospitals in its network.'" Indeed, 

27. Chad Terhune, "Insurers limiting Doctors, Hospitals in Health Insurance Market," Los Angeles Times, September 14,2013, 

http://www.latimes.com/business/la-fHnsure-doctor*networks-2013091S,Q,2814725.story (accessed October 23, 2013) 

28. Ben Leubsdorf, "Anthem Takes Heat from NH Senators Over limited Provider Network for Marketplace Plans," Concord Monitor, September 19, 2013, 

http://www.concordmonitor.com/news/work/business/8491779·95/anthem-takes-heat-from-nh-senators-over-llmited-provider-networkfor-marketplace-plans (accessed October 23, 2013). 

~~~ ~--~-~-~-~-----

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BACKGROUNDER i NO. 2852 

"OVEMBER 12, 2013 

insurers throughout the country are responding in 

much the same way." 

Given the parameters set by Obamacare, narrow network plans are less the product of a desire to 

keep premiums low, or improve quality, but rather 

of the need to control costs in a market where the 

insurer cannot rely on standard levels of cost sharing to encourage patients to be judicious consumers 

of medical services. Put simply, when the government pays insurers to lower cost sharing to the point 

that some patients are charged less than the price 

of a sandwich for a visit to the doctor, and calling 

an ambulance could be cheaper than calling a taxi, 

insurers know that their only recourse is to limit 

their plans to covering a smaller group of low-cost 

providers. 

It should, therefore, not be surprising that a 

number of insurers with Medicaid managed-care 

business saw in Obamacare's exchange subsidy 

design an end result that looks a lot like Medicaid 

managed care-and thus, decided to ofIer coverage on the exchanges. It is a business model that 

they already know how to successfully implement. 

Indeed, Molina's CEO was recently quoted in the 

Miami Herald explaining that "Medicaid is essentiallyan individual market for low-income patients ... 

and Medicaid has premiums that are paid for by the 

state. The reason we went after the exchange is we 

feel there are a lot of similarities."30 

Even though insurers can adjust for the inability 

to use cost sharing to influence patient behavior by 

offering narrow network plans, that response creates another problem-one for which they do not 

have a solution. The new problem is that while relying on a limited network of providers accommodates 

lower-income enrollees who face only nominal cost 

sharing, it also makes the plan much less attractive 

to higher-income enrollees. 

For instance, in San Diego, the premium for the 

second-lowest-cost Silver plan for a 40-year-old is 

$308 a month. Consider two 40-year-old enrollees living in San Diego; one with an income at 150 

percent of the poverty level ($17,235 a year), and 

the other with twice that income at 300 percent of 

the poverty level ($34,470 a year). The first enrollee 

pays $57 a month for that plan, with the federal government paying the remaining $251 in a premium 

subsidy. Table 5 shows that tbe government also 

pays the insurer a cost-sharing subsidy to lower the 

insured's deductible to zero, and his physician copays to $3 and $5. 

The second enrollee pays $273 a month for the 

same plan, with the federal government paying only 

a $35 a month premium subsidy. Furthermore, the 

second enrollee does not qualify for reduced co-pay 

amounts. Table 5 shows that his deductible is $2,000 

and that his physician co-pays are $45 and $65. If 

the plan only pays for visits to a limited network of 

providers, that might be an acceptable trade-off for 

the first enrollee, but is likely to be an unattractive 

proposition for the second one-who is paying much 

more in premiums, has a substantial deductible, 

and is charged higher co-pays for each visit. Thus, 

the second enrollee is much less likely to buy the 

coverage. 

Because Obamacare's cost-sharing subsidy design 

essentially forces insurers to adopt more limited 

provider networks for at least the Silver-plan level 

of exchange coverage, those plans will be less attractive to enrollees with incomes between 250 percent 

and 400 percent of the FPL-as they do not benefit 

from reduced cost sharing and also get much less in 

premium subsidies. That could result in enrollees in 

the bottom half of the exchange income scale (100 

percent to 200 percent of the FPL) clustering in Silver 

plans while those in the upper half of the exchange 

income scale (200 percent to 400 percent of the FPL) 

gravitate toward Bronze-level plans that cover more 

providers and offer lower premiums, but impose 

higher deductibles and more cost sharing. Indeed, for 

those with incomes between 300 percent and 400 

percent of tbe FPL, the premium subsidies offered 

for exchange coverage are so small that many might 

decide to instead seek coverage elsewhere. 

29. Robert Pear, "lower Health Insurance Premiums to Come at Cost of Fewer Choices," The New York Times, September 22, 2013, 

http://www.nytimes.com/2013/09/23/health/lower-health-insurance-ptemiums-to-come-at-cost-of-fewer-choices.htm!?pagewanted=l&_ 

r=3&hp& (accessed October 23, 2013), and Anna Wilde Mathews, "Many Health Insurers to limit Choices of Doctors, Hospitals," 

The Waif Street Journal, August 14, 2013. 

30. Danier Chang, "Obamacare Plans for South Florida Vary Widely in Prices, Value," Miami Herald, October 5, 2013. 

http;f/www.miamihera!d.com/2013/10/0S/3672251/obamacare-p!ans-for-south-florida.html(accessed October 23, 2013). 

16 
81 


Insert offset folio 39 here 86196.039

BACKGROUNDI<~R : NO. 2852 

NOVEMBER 12, 2013 

Conclusion 

The patterns that emerge from this analysis of 

insurer exchange participation decisions offer the 

first indications of what the Obamacare exchange 

market is likely to look like. 

When compared with the divergent expectations of Obamacare supporters and opponents, 

the evidence is more consistent with the expectations of opponents than with those of supporters. 

Speci fically: 

• With respect to insurer competition, by any measure Obamacare has produced no more than negligible increases in competition-and in only a 

handful of states. Furthermore, when compared 

to the current individual market, the Obamacare exchanges actually represent a significant 

(29 percent) net decrease in insurer competition 

nationwide. Those results strongly confirm the 

expectations of Obamacare's opponents. 

• On the question of coverage expansion versus coverage SUbstitution, a definitive answer must still 

await data on actual enrollment during the coming months. That said, the insurer participation 

patterns revealed by this analysis suggest that, at 

a minimum, there is an expectation among insurers that Obamacare will produce measurable coverage substitution effects resulting from employers dropping their current plans in response to 

Obamacare. In particular, the exchange participation decisions of insurers whose principal current business is employer-group coverage are 

at least consistent with the views of Obamacare 

opponents on this question. 

• When it comes to the question of whether Obamacare will result in increased or decreased access 

to care, this analysis finds two patterns that 

confirm Obamacare opponents' expectations 

for reduced access. The first is the participation in the exchanges by a significant number of 

carriers with current Medicaid managed-care 

--_ ....... _-----

business-particularly the subset for which Medicaid managed care is their main, or even exclusive, current business. The second is the fact that 

those insurers, along with others-including ones 

that do not currently have any Medicaid managed-care business-are offering exchange plans 

that cover only narrow networks of providers. 

For the vast majority of states, the exchanges 

will offer less insurer competition than the state's 

current individual market. Most of the insurers 

whose principal business is employer-group coverage appear to expect significant erosion in that coverage segment due to Obamacare inducing employers to drop their current group plans. Given that 

the distribution of exchange enrollees will likely be 

skewed toward the lower end of the 100 percent to 

400 percent of FPL income range (and thus, eligible 

for reduced cost sharing), participating insurers are 

offering exchange plans with limited provider networks and a significant number of Medicaid managed-care plans opted to join the exchanges. 

The insurers who have elected to participate in 

the exchanges are mainly amix of Blue Cross carriers 

seeking to extend their current market dominance, 

group-market carriers seeking to retain enrollees 

when employers drop coverage, and Medicaid managed-care insurers expanding into a market that 

they view as very similar to their current business. 

In fact, Obamacare's complicated, income-based 

design of premium and cost-sharing subsidies will 

result in the exchange market essentially offering 

something like Medicaid managed-care for the middle class. 

The resulting picture is one that millions of 

Americans are likely to find unappealing. It is yet 

another reason why Congress should simply scrap 

the entire-ill-conceived-law and replace it with 

simpler and better solutions. 

-Edmund F. Haislmaier is Senior Research Fellow 

in the Center for Health Policy Studies at The Heritage 

Foundation. 

17 
82 


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BACKGROUNDER I NO. 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 1 of 7) 

State 

Alaska 

Arkansas 

California 

Colorado 

Delaware 

Parent Company 

Moda Health 

Premera Blue Cross 

Health Net, Inc 

Humana, Inc. 

Arkansas Blue Cross Blue Shield 

Centene Corporation 

QualChoice of Arkansas, Inc. 

Western Health Advantage 

Access Health Colorado 

Cigna Health and life 

Insurance Company 

Colorado Choice Health Plans 

Colorado Health Insurance 

Cooperative, Inc. 

Denver Health Medical Plan, Inc. 

Humana, Inc 

Kaiser Permanentc 

Rocky Mountain Health Plans 

United Health Group 

WeliPoint, Inc 

Emb!emHea!th 

Aetna, Inc. 

Highmark Health Services 

ASO - Administrative Services Only 

Name(s) Appearing on 

Exchange (Including Trade Insurer's Current Principal 

Names and/or Subsidiaries) Business in State 

Moda Health Self-Insured Employers (ASO) 

Premera Blue Cross Blue Employer Group Insurance 

Shield of Alaska 

Aetna 

S-elHnsured Employers (ASO) 

N/A,-New Insurer, co-or 

Medkare Advantage 

Arkansas Blue Cross Blue Shield SelHnsured Employers (ASe) 

Ambetter of Arkansas Individual Insurance 

QualChoice Health Insurance Self-Insured Employers (ASO) 

New Health Ventures Access Health Medicaid Managed Care 

Cigna Self-Insured Employers (ASO) 

Colorado Choice Plans Self-Insured Employers (ASO) 

Colorado Health Insurance Cooperative N/A-New Insurer, CO-OP 

Denver Heafth Medical Plan 

Humana Health Plan, Inc. 

Kaiser Foundation Health Plan of CO 

Rocky Mountain View, Rocky 

Mountain Mesa County Exclusive 

All Savers Insurance Co. 

HMO Colorado, Inc. 

HealthyCT 

Anthem B!ue Cross Blue Shi-eld 

CoventryOne 

Highmark Blue Cross Blue 

Shield Delaware 

Employer Group Insurance 

Individual Insurance 

Employer Group Insurance 

Self-Insured Employers (ASO) 

Self-Insured Employers (ASo) 

SelHnsured Employers (ASO) 

N/A-New fnsurer; CO*OP 

Serf- Insl)red Employers (ASO) 

Medicaid Managed Care 

Self-Insured Employers (ASO) 

B 2852 • heritage.org 

18 
83 


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BACKGROUNDt:R I NO_ 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 2 of 7) 

State 

Georgia 

Idaho 

Indiana 

Kansas 

AUiant Health Plans 

Centerle Corporation 

Humana, Inc, 

Kaiser Permanente 

WetiPoint, Inc 

Hawaii Medica\ Service'As$odation 

Blue Cross of Idaho Health Service, Inc. 

Cambia Health Solutions, Inc. 

Intermountain Healthcare 

Pacific Source Health Plans 

Centerle Corporation 

MDwlse 

Physicians Health Plan of 

Northern Indiana, Inc. 

Well Point, Inc. 

Aetna, Inc. 

Aetna, Inc. 

Slue Cross and Blue Shield of Kansas 

Blue Cross and Blue Shield 

of Kansas City 

Well Point, Inc, 

ASO - Administrative Services Only 

-----------------------------------

Name(s) Appearing on 

Exchange (Including Trade 

Names and/or Subsidiaries) 

Alliant Health Plans 

Ambetter from Peach State Health Plan 

Humana Insurance Company, Humana 

Employers Health Plan of Georgia, Inc. 

Kaiser Foundation Health 

Plan of Georgia 

Anthem Blue Cross and Blue Shield 

Blue Cross of Idaho 

BridgeSpan Health Company 

SelectHealth, Inc. 

Pacific$ource Health Plans 

Ambetterfrom MHS 

MDwise 

Physicians Health Plan 

Anthem Blue Cross and Blue Shield 

Gundersen Health Plan, Inc. 

Coventry Health and Ufe, Coventry 

Health Care of Kansas.lnc. 

Blue Cross and Blue Shield 

of Kansas. Inc 

Blue Cross and Blue Shield 

of Kansas City 

Insurer's Current Principal 

Business in State 

Employer Group Insurance 

Medicaid Managed Care 

Employer Group Insurance 

Employer Group Insurance 

Self-Insured Employers CASO) 

Employer Group Insurance 

Employer Group Insurance 

Medicare Advantage 

Employer Group Insurance 

Employer Group Insurance 

Medicaid Managed Care 

Medicaid Managed Care 

Employer Group Insurance 

Self-Insured Employers (ASO) 

Employer Group. tnsurance 

Employer Group Insurance 

Employer Group Insurance 

Self-Insured Employers (ASO) 

B 2852 ~ heritage.org 

19 
84 


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BACKGROUNDER: NO. 2852 

r\OVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 3 of 7) 

State 

louisiana 

Maryland 

Mlchlgan 

Mississippi 

Montana 

Parent Company 

HUmana, Inc. 

Louisiana Health Cooperative, Inc. 

Louisiana Health Service & 

Indemnity Company 

Vantage Health Plan, Inc 

CareFirst Blue Cross 81ue Shield 

Evergreen Health Cooperative, Inc. 

Kaiser Permanente 

UnitedHealth Group 

Blue Cross Blue Shield of Michigan 

Caidan Enterprises, Inc 

Henry Ford Health System 

HUmana. Inc. 

McLaren Health Care 

Molma Healthcare, Inc. 

Spectrum Health 

Total Health Care 

Blue Cross and Blue Shteld of Minnesota 

Centene Corporation 

HUmana, Inc. 

Well Point, tnc, 

81ue (ross and Blue Shield of Montana 

Montana Health CO-OP 

PaciflCSoufce Health Plans 

ASO - Administrative Services Only 

Name(s) Appearing on 

Exchange (Including Trade 

Names and/or Subsidiaries) 

Humana Health 8enefit Plan 

of louisiana, Inc 

Louisiana Health Cooperative 

Blue Cross 81ue Shield Louisiana, 

HMO Louisiana, Inc 

AAA Vantage Health Plan 

CareFirst of Maryland, Inc., CareFirst 

BlueChoice, Inc., GHMSI 

Evergreen Health 

Kaiser Foundation 

All Savers Insurance 

Insurer's Current Principal 

Business in State 

Medicare Advantage 

N/A-New Insurer, CO-OP 

Self-Insured Employers (ASO) 

Employer Group Insurance 

SelHnsured Employers (ASo) 

N/A-New Insurer, (O·OP 

Employer Group Insurance 

Self-Insured Employers (ASO) 

Blue Cross Blue Shield of Michigan, Self-Insured Employers (ASQ) 

Blue Care Network of Michigan 

Meridian Choice Medicaid Managed Care 

Consumers Mutual Insurance N/A-New Insurer, CO-OP 

of Michigan 

HAP Employer Group Insurance 

Humana Medical Plan of Michigan Inc Medicare Advantage 

Mclaren Health Plan, Inc. 

Molma Marketplace 

Priority Health 

Total Health Care USA, Inc. 

Ambetter from Magnolia Health Plan 

Humana Insurance Company 

Blue Cross and Slue Shield of Montana 

Montana Health CO-OP 

PaciflcSource Health Pia'ls 

Medicaid Managed Care 

Medicaid Managed Care 

Employer Group Insurance 

Medicaid Managed Care 

Medicaid Managed Care 

Medicare Advantage 

SeIHnsured Employers (ASO) 

Employer Group Insurance 

SelHnsured Employers (ASO) 

N/A-New Insurer, CO-OP 

Employer Group Insurance 

B 2852 ~ heritage.org 

20 
85 


Insert offset folio 43 here 86196.043

BACKGROUNDER j NO. 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 4 of 7) 

State Parent Company 

Nevada Nevada Health CO-OP 

Saint Mary's Health Plans 

UmtedHeaith Group 

Well Point, Inc. 

WellPolnt, Inc. 

New Jersey Freelancers Consumer Operated And 

Oriented Program Of New Jersey, Inc. 

Horizon Blue Cross Blue 

Shield of New Jersey 

Independence Blue Cross 

Molina HeaJthcare, lnc. 

New York Affinity Health Plan 

CDPHP 

EmblemHealth 

Freelancers Health Service 

Corporation, Inc. 

Healthfirst 

HealthNow New York, Inc. 

Independent Health Association, Inc. 

MetroPlus Health Plan, Inc. 

MVP Health Care 

North Shore LUNorth Shore+lIJ 

CareConnect Insurance Company, Inc. 

Oscar Insurance CorporatIOn 

The Ufetlme Healthcare Companies 

The New York State Catholtc 

Health Plan, Inc 

UnitedHealth Group 

Universal American Corp. 

Well Point, Inc 

North Dakota Medica Holding Company 

Norldian Mutual Insurance Company 

Sanford Health 

ASO - Administrative Services Only 

Name(s) Appearing on 

Exchange (Including Trade 

Names and/or Subsidiaries) 

Nevada Health CO-OP 

St.Mary's 

Health Plan of Nevada 

Anthem 

Anthem Bfue Cross and Blue Shield 

Health Republic Insurance 

of New Jersey 

Horizon Blue Cross Blue 

Shield of New Jersey 

AmeriHealth New Jersey 

Affinity Health Plan 

CDPHP 

EmblemHealth 

Health Republic 

Heatthfirst 

Blue Shield of Northeastern NY, Blue 

Cross Blue Shield of Western NY 

Independent Health 

MetroPlus Health Plan 

MVP 

North Shore UJ 

Oscar 

Excellus Blue Cross Blue Shield, Univera 

FidelisCare 

United 

Today's Options 

Empire Blue Cross 

Medica 

Blue Cross Blue Shield of North Dakota 

Sanford Health Plan 

Insurer's Current Principal 

Business in State 

N/A-New Insurer; CO*OP 

Employer Group Insurance 

Self-Insured Employers (ASO) 

Self-Insured Employers (ASQ) 

SeH-lnsured Employers (ASO) 

N/A-New insurer, CO-OP 

SelHnsured Employers (ASO) 

Employer Group Insurance 

Medicaid Managed Care 

Employer Group Insurance 

Employer Group Insurance 

N/A-New Insurer, co-or 

Medicaid Managed Care 

Employer Group Insurance 

Employer Group Insurance 

Medicaid Managed Care 

Employer Group Insurance 

N/A-New Insurer 

N/A-New Insurer 

Employer Group Insurance 

Medicaid Managed Care 

Self-Insured Employers (ASO) 

Medicare Advantage 

Self-Insured Employers (ASO) 

Employer Group Insurance 

Employer Group Insurance 

Self-Insured Employers (ASO) 

B 2852 ~ heritage.org 

21 
86 


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BACKGROUNDER: NO. 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 5 of 7) 

State 

Oklahoma 

Pennsylvania 

South Carolina 

Parent Company 

Humana,lnt. 

Aetna, Inc. 

CommunityCare, Inc. 

GlobalHealth, Inc. 

Health Care Service Corporation 

Atrft.l Health Plans, Inc. 

University of Pittsburgh Medical Center 

Aetna, Inc. 

Capital BlueCross 

Geisinger Health Plan 

Highmark Health Services 

Hospital Service Association Of 

Northeastern Pennsylvania 

Independence Blue Cross 

Name(s) Appearing on 

Exchange (Including Trade 

Names and/or Subsidiaries) 

HealthAmerlcaOn€ 

Aetna, Coventry Health and life, 

Coventry Health Care of Kansas, Inc. 

CommunityCare HMO 

G!obalHealth 

Blue Cross Blue Shield of Oklahoma 

Atrio Health Plans 

UPMC Health Plan 

Aetna, HealthAmericaOne 

Capital Blue Cross, Keystone 

Health Plan Central 

Geisinger Health Plans 

Highmark Health Insurance Company, 

Highmark Health Services 

B!ue Cross of Northeastern 

Pennsylvania 

Independence Blue Cross 

Aetna, Inc. CoventryOne 

BlueCross BlueShield of South Carolina Blue Cross Blue Shield of South 

Consumer's Choice Health 

Insurance Company 

Sanford Health 

Carolina, BlueChoice HealthPlan 

Consumers' Choice Health Plan 

ASO - Administrative Services Only 

Insurer's Current Principal 

Business in State 

Medicaid Managed Cate 

Self-Insured Employers CASO) 

Employer Group Insurance 

Employer Group Insurance 

Employer Group Insurance 

Employer Group Insurance 

Employer Group Insurance 

Medicaid Managed Care 

Self~lnsured Employers (ASo) 

Self-Insured Employers (ASO) 

Employer Group Insurance 

Self-Insured Employers (ASO) 

Self-Insured Employers CASO) 

Self-Insured Employers (ASO) 

Self-Insured Employers (ASO) 

Employer Group Insurance 

N/A-New Insurer, CO-OP 

B 2852 .. heritage,org 

22 
87 


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BACKGROUNDER I NO. 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 6 of 7) 

State 

Tennessee 

Utah 

Vcrm-Q/1t 

Virginia 

West Virginia 

Parent Company 

Blue Cross Blue Shield of Tennessee 

Cigna Health and Life 

Insurance Company 

Community Health Alliance 

Mutual Insurance Company 

Humana, Inc 

Aetna, Inc 

Arches Mutual Insurance Company 

Cambia Health Solutions, Inc. 

Humana. Inc. 

Intermountain Healthcare 

Molina Healthcare, Inc. 

Blue'Cross Blue Shield of Vermont 

MVp'Mealth Care 

Aetna. inc. 

CareFirst Blue Cross Blue Shield 

Kaiser Permanente 

Sentara Healthcare, Inc. 

WcliPoint, Inc. 

Kaiser Permanente 

Highmark Health Services 

ASO - Administrative Services Only 

Name(s) Appearing on 

Exchange <Including Trade 

Names and/or Subsidiaries) 

Blue Cross Blue Shield of Tennessee 

Cigna Health and Ufe 

Insurance Company 

Community Health Alliance 

Humana Insurance Company 

CommunityFirst 

Insurer's Current Principal 

Business in State 

Self-Insured Employers (ASo) 

Self.lnsured Employers (ASo) 

N/A-New Insurer, CO-OP 

Medicare Advantage 

Altius Health Plans Employer Group Insurance 

Arches Health Plan N/A-New Insurer, CO-OP 

BridgeSpan Health Company Employer Group Insurance 

Humana Medica! Plan of Utah, Inc. IndlVidual Insurance 

SelectHealth Employer Group Insurance 

Molina Healthcare of Utah Marketplace Medicaid Managed Care 

Blue Cross Elue Shield of Vermont 

MVP Health (are 

Aetna, CoventryOne, Innovation 

Health Insurance Company 

CareFirst Blue Cross Blue Shield. 

CareFirst BlueChoice, Inc. 

Kaiser Permanente 

Optima Health 

Anthem Blue Cross and Blue Shield, 

Anthem Health Plans of Virginia 

Self-Insured Employers (ASo) 

Employer Group Insurance 

Employer Group Insurance 

Medicaid Managed Care 

Self-Insured Employers (ASO) 

Self-Insured Employers (ASO) 

B 2852 ~ heritage,org 

~~-~~~------

23 
88 


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BACKGROUNDER I NO, 2852 

NOVEMBER 12, 2013 

APPENDIX TABLE 1 

Health Insurers Participating in the Exchanges, by State (Page 7 of 7) 

State 

Wyoming 

Parent Company 

Blue Cross Blue Shield of Wyoming 

WIN health Partners 

ASQ - Administrative Services Only 

departfT1ent tHings, 

Name(s) Appearing on 

Exchange (Including Trade 

Names and/or Subsidiaries) 

Blue Cross Blue Shield of Wyoming 

WINhealth Partners 

Aetna 

Insurer's Current Principal 

Business in State 

Self-Insured Employers CASO) 

Employer Group Insurance 

Sel~lnsured Employers (ASO) 

B 2852 :i heritage.org 
89 


Insert offset folio 47 here 86196.047

Jf~~~~'PORT B~ 

November 15, 2013 

-ivan!h. ;: }~04 

Dear Valued Tenant, 

Corporate Headquarters 

201 South Orange Ave, S!e 1 '00 

OrtaOOo. FL 32801 

T +1407 2065212 

F .1 4072068428 

We would first like to express our thanks for being a tenant and a customer of Signature Flight 

Support SAY. 

To be able to continue to provide the services which are received at our locations, we must keep 

pace with the ever-rising costs that are associated with operating airport facilities, As an example. we 

expect employee health care costs and basic facility costs to rise by approximately 10% in 2014 over 

2013 levels, 

As such, effective January 1, 2014, an increase in tenant hangar and office space rent of 10% will be 

implemented, If a lease term of one year or longer is signed prior to January 1, 2014, rents will be 

assessed at the agreed upon rates, 

Should you have any questions, please feel free to contact myself or Lon Harden at +1 ••••• 

or via email: .·I@signatureflight.comorn·.@signalureflight.com 

Thank you for your understanding and your patronage, 

With best regards, 

General Manager 

SignalUreFHght,com 
90 


Insert offset folio 48 here 86196.048

WRITTEN REQUEST FOR PANAL PARTICIPATION 

Minister Carolyn Reed-Smith Spartanburg, SC 29316 

(864) 621 4311 

crstrinty24 7@gmail.com 

Hello, I am Minister Carolyn Reed-Smith. 

I have been active in following the fate of the Affordable Health Care Ace (ACA) 

in South Carolina. I have traveled several times to the SC State House as we 

lobbied, but the Republicans said NO to the Medicaid ?Expansion flew in a person 

to teach them how to nullifY President Obama's ACA. They did! 

I would like to share with you some of the new laws ratified by S.C. State 

government to nullifY the ACA and ask if you could monitor the laws ratified in 

your state. These laws are designed to derail the ACA!! 

In Proverbs 22:22-23, God's Word says "Do not rob the poor because he is poor, 

nor oppress the afflicted at the gate: for the Lord will plead their cause and plunder 

the soul of those who plunder them." 

We must think about what is best for "All" people. 

You can double check @ 

Legislation> Search Legislation by Bill, Act or Rat Number 

http://www.scstatehouse.gov/bi llsearch.php?billnumbers= 3818&session= 120&su 

mmary=B 

• H*3624 (Rat #0035, Act #0024 of2013) 

Summary: PEBA 

AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 

1976, BY ADDING SECTION 9-4-15 SO AS TO PROVIDE THAT THE 

STATE SHALL DEFEND MEMBERS OF THE BOARD OF DIRECTORS 

OF THE SOUTH CAROLINA PUBLIC EMPLOYEE BENEFIT 

AUTHORITY (PEBA) AGAINST CLAIMS AND SUITS ARISING OUT 

OF THE PERFORMANCE OF THEIR OFFICIAL DUTIES, AND 

REQUIRE THAT THE STATE INDEMNIFY THESE DIRECTORS FOR 

ANY LOSS OR JUDGMENT INCURRED BY THEM UNDERTAKEN 

BY THEM WHILE SERVING AS A DIRECTOR, OFFICER, OR 
91 


Insert offset folio 49 here 86196.049

MANAGEMENT EMPLOYEE OF PEBA. - ratified title 05/02113 Ratified 

R 35 , 05/03113, Signed By Governor 

• {R33, H. 3560 (Word version) AS TO REQUIRE THE JUDICIAL DEPARTMENT 

AND THE STATE LAW ENFORCEMENT DIVISION TO DEVELOP PROCEDURES 

FOR THE COlLECTION OF INFORMATION ON INDIVIDUALS WHO HAVE BEEN 

ADJUDICATED AS A MENTAL DEFECTIVE OR COMMITTED TO A MENTAL 

INSTITUTION AND FOR THE SUBMISSION OF THIS INFORMATION TO THE 

NATIONAL INSTANT CRIMINAL BACKGROUND CHECK SYSTEM 

• S*0465 (Rat #0056, Act #0048 of2013 effective 0612013 

Summary: Small Employer Health Insurance Availability Act 

AN ACT TO AMEND SECTION 38-71-1330, AS AMENDED, CODE OF 

LA WS OF SOUTH CAROLINA, 1976, RELATING TO DEFINITIONS IN 

THE SMALL EMPLOYER HEALTH INSURANCE A V AILABILITY 

ACT, SO AS TO REVISE THE DEFINITION OF AN "ELIGIBLE 

EMPLOYEE". - ratified title 06/04/13 Ratified R 56 

• H*3620 (Rat #0026, Act #0018 of2013) 

Summary: Captive insurance company 

AN ACT TO AMEND SECTION 38-90-160, AS AMENDED, CODE OF 

LA WS OF SOUTH CAROLINA, 1976, RELATING TO THE 

EXEMPTION OF CAPTIVE INSURANCE COMPANIES FROM 

CERTAIN PROVISIONS OF TITLE 38, SO AS TO PROVIDE AN 

INDUSTRIAL INSURED CAPTIVE INSURANCE COMPANY IS 

SUBJECT TO CERTAIN REQUIREMENTS CONCERNING REPORTS 

FOR RISK- BASED CAPITAL, ACQUISITIONS DISCLOSURE, AND 

ASSET DISPOSITION, AND CEDED REINSURANCE AGREEMENTS, 

AND TO PROVIDE THE DIRECTOR OF THE DEPARTMENT OF 

INSURANCE MAY ELECT NOT TO TAKE REGULATORY ACTION 

CONCERNING RISK-BASED CAPITAL IN SPECIFIC 

CIRCUMSTANCES. - ratified title 26 

• S*0460 (Rat #0079, Act #0066 of2013) 

Summary: Insurance 

AN ACT TO AMEND SECTION 38-45-90, AS AMENDED, CODE OF 

LAWS OF SOUTH CAROLINA, 1976, RELATING TO DUTIES OF 
92 


Insert offset folio 50 here 86196.050

BROKERS PLACING BUSINESS WITH NONADMITTED INSURERS, 

SO AS TO REVISE THE PROOF THAT THE DIRECTOR OF THE 

DEPARTMENT OF INSURANCE MAY REQUIRE FROM A BROKER 

SEEKING TO PLACE BUSINESS WITH A NONADMITTED INSURER, 

TO PROVIDE A NECESSARY DEFINITION, AND TO IMPOSE 

CERTAIN DUE DILIGENCE REQUIREMENTS ON 11 IMPOSE 

CERTAIN DUE DILIGENCE REQUIREMENTS ON THE BROKER. -

ratified title 

• H. 3621 ratified # 27 (Word version)) -- Reps. Sandifer and Gambrell: AN 

ACT TO AMEND SECTION 38-5-120, AS AMENDED, CODE OF LAWS OF 

SOUTH CAROLINA, 1976, RELATING TO THE REVOCATION OR SUSPENSION 

OF A CERTIFICATE OF AUTHORITY TO TRANSACT BUSINESS IN THIS STATE BY 

AN INSURER, SO AS TO REVISE PROVISIONS CONCERNING HAZARDOUS 

INSURERS. 

• (R38, S. 448 (Word version)) -- Senators Alexander, Peeler, Cleary and S. 

Martin: AN ACT TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 

1976, BY ADDING SECTION 40-47-938 SO AS TO PROVIDE CIRCUMSTANCES 

IN WHICH A PHYSICIAN MAY ENTER A SUPERVISORY RELATIONSHIP WITH A 

PHYSICIAN ASSISTANT; RELATING TO THE PRESCRIBING OF DRUGS BY A 

PHYSICIAN ASSISTANT, SO AS TO AS TO DELETE A PROHIBITION AGAINST 

PRESCRIBING SCHEDULE II CONTROLLED SUBSTANCES; TO AMEND SECTION 

40-47-995, RELATING TO THE TERMINATION OF A SUPERVISORY 

RELATIONSHIP BETWEEN A PHYSICIAN AND PHYSICIAN 

Two of the main contentions of the Republican Party to the ACA are the amounts 

of money that would be spent and the American people need less government 

control over our lives. 

1. Many of the States have that have accepted the ACA and adopted the 

expanded Medicaid have proven that it works!! 

2. The ACA website was broken because of an OVERLOAD of Americans that 

need CARE!!!! Fixit NOT ditch it!!! 
93 

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3. President Obama won the election of 2012," "Fair and Square"!!! His 

platform was the ACA. Now the Republicans are going through the BACK 

DOOR to NULLIFY the ACA. Putting laws in place so the average American 

will not know the main reason for their support of nullification is for the 

insurance companies to keep their profits. 

4. In SC now, there are laws that tax our tax dollars to fight againsT the ACA!, 

Fly in, spend money to keep "SOME" without healthcare. 

THE REPUBLICAN INTEREST SHOULD BE FOR THE GOOD OF THE PEOPLE 

NOT FOR THE SPECIAL INTEREST GROUPS IN A.L.E.C.!!!!!! 

THE PEOPLE HAVE SPOKEN!!! ATTHE POLLS IN 2012, AND WE CONTINUE TO SAY, 

ALLOW THE TRUTH TO BE TOLD AND HEARD!! OBAMA CARE COULD WORKIIII IS 

WORKING .. AND IS THE AMERICAN WAY!!!!!!!