INTRODUCING THE HEALTH CARE ACT -- HON. RICHARD K. ARMEY (Extensions of
Remarks - March 30, 2000)
[Page: E451]
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HON. RICHARD K. ARMEY
OF TEXAS
IN THE HOUSE OF REPRESENTATIVES
Wednesday, March 29, 2000
- Mr. ARMEY. Mr. Speaker, proudly I join my colleague from California, Mr.
DOOLEY, in introducing the Health CARE Act. The word ``CARE'' in the
title stands for Coverage, Access, Relief, and Equity. Mr. Dooley and I
believe this legislation will provide those things for millions of uninsured
Americans. We regard this new bipartisan bill as affordable and enactable, and
we will work to pass it this year.
- Identical legislation is being introduced in the Senate by a group
composed of three Republicans, Senators JEFFORDS of Vermont, FRIST
of Tennessee, and SNOWE of Maine, and two Democrats, Senators
BREAUX of Louisiana and LINCOLN of Arkansas.
- The CARE Act creates a tax credit for the purchase of health insurance,
and is to be the first in a series of measures that our bipartisan, bicameral
group will propose to address the chronic problem of uninsurance in our
country. Today, at any given moment, forty-four million Americans can be found
who lack health-insurance coverage. They become uninsured for a variety of
reasons, and it will take a variety of responses to address this growing
problem.
- I should note here that the CARE Act is very similar to a bill I
introduced last summer under the title of the ``Fair Care for the Uninsured
Act'' (H.R..2362). The CARE Act differs from Fair Care mainly in being less
costly and thus, I hope, more enactable. The basic principles of the two bills
are the same, and I will continue to work for the enactment of Fair Care as my
long-term objective. I will not let the perfect be the enemy of the good. The
CARE Act is a good first step and a solid proposal in its own right.
- Experts agree the uninsurance problem is caused in large part by Section
106 the Internal Revenue Code. Section 106 gives an extremely generous tax
break for the purchase of health coverage, if it is purchased through one's
place of employment but not if it is purchased elsewhere. This discriminates
against people who buy their insurance outside the workplace. Such
discrimination may have been tolerable in the 1940s and 1950s, when it was
common for a citizen to be employed at one large company for most or all of
his or her working lifetime. But it is completely out of step with today's
dynamic workforce. Today, this health penalty tax, as I call it, falls most
heavily on people who are mobile and part-time, on day laborers, farm workers,
and the like. It falls especially hard on Hispanic Americans, who are often
employed in these ways, and one-third of whom are uninsured
nationally.
- Section 106 is unfair in another way. It discriminates against lower-paid
workers. Because today's tax-code is progressive, taxing people at
increasingly higher rates as their incomes rise, tax breaks like Section 106
are by definition more generous to those in the higher tax brackets. Thanks to
this regressive aspect of our system of progressive taxation--a system I hope
to see replaced someday by the Flat Tax--the highly paid CEO today gets a much
more generous tax break for health coverage than does the waitress at the
corner coffee shop. This unfairness needs to be addressed.
- Right now, the ranks of the uninsured are swelling by more than 100,000
persons a month, and it appears this pace will continue unabated until we go
to the root of the
- The Health CARE Act would address the inequities of the tax code by
creating a new tax credit for the purchase of private health insurance, in the
amount of $1,000 for a self-only policy and $2,000 for a family policy. A
person could use this credit toward the purchase of any qualified private
health-insurance policy, including so-called ``COBRA'' coverage between jobs.
If the person is paying for insurance on his own, he could apply the credit
toward the cost of that coverage. The credit would be available regardless of
where the person works or how much insurance he purchases. He could use it
even if he owes no income tax. He could begin using it as soon as he signed up
for insurance. He would not have to wait for a refund check from the
IRS.
- A person would be eligible for the credit if he met all of the following
conditions: First, he is not already covered by a federal-government health
insurance program. Second, he is not offered an employer-subsidized health
plan through his place of work. Third, his annual adjusted gross income is
less than $35,000 (if it is a self-only policy) or $55,000 (if it is a family
policy). Persons making up to $10,000 a year more than these amounts would
receive a reduced credit, which is phased-down over the range.
- Experts believe that any health-care tax credit must be worth at least 30
to 50 percent of the cost of an average health-insurance policy in order for
people to be willing and able to use it to buy private health insurance. The
Health CARE Act credit is worth about 40 percent of the price of a self-only
policy, and about 30 percent of the price of a family policy, depending on
one's health status and the general cost of health care in one's region of the
country. As a result, the credit will be available to an estimated 21.5
million currently uninsured Americans, and would help an estimated 5.5 million
Americans who are now paying for health insurance without the benefit of any
federal health-care tax breaks. The CARE Act credit would enable at least 3.2
million uninsured Americans to afford private health coverage, according to
the Lewin Group, a private health-policy consultancy in Washington,
D.C.
- Mr. Speaker, as a resident of the State with the highest uninsurance rate
in the nation, I think tax equity for the uninsured is a moral, economic, and
political imperative.
- The CARE Act is, in sum, a bipartisan proposal that offers real hope to
Americans shut out of work-based coverage, makes health-care tax benefits
fairer for all workers, begins to repeal the health penalty tax, gets more
Americans covered, and does all of this while preserving the employer-based
system of coverage on which most Americans rely.
- I am proud of this legislation and will work hard with my Democratic
partner, Mr. DOOLEY, to pass it this year.
END