News Release

ORAL TESTIMONY TO U.S. HOUSE COMMITTEE ON EDUCATION AND THE WORKFORCE

Washington, D.C.
July 9, 2002
Harry M. Jansen Kraemer, Jr.

Mr. Chairman and members of the subcommittee, thank you for inviting me today. It's an honor to represent my fellow members of the Healthcare Leadership Council, as well as to share my own perspectives as CEO of Baxter International. The Healthcare Leadership Council, or HLC, is a coalition of chief executives of this nation's leading healthcare companies and institutions, all committed to advancing a market-based health care system that values innovation and provides accessible, high-quality care for all Americans.

Let me begin, Mr. Chairman, by applauding you and your colleagues for the attention and energy you are devoting to our nation's uninsured. Like you, the members of the HLC are deeply concerned about this issue. We're concerned about the lives of 40 million people who lack health insurance. We're concerned about men, women and children who are forced to receive their care in emergency rooms and acute care facilities, and who are suffering avoidable illnesses and dying at too young an age. And we are concerned about the impact this issue has on the cost and accessibility of health care for all Americans, and the well-being and productivity of our communities.

In short, we believe our status quo is one that is troubling, costly on many levels and entirely unacceptable.

When the HLC took on this issue, we first asked the question, "Who are the uninsured?" The answers that came back from our research surprised us. Conventional wisdom about the uninsured labeled people without health coverage as "someone else" -- someone who doesn't have a job, someone living in abject poverty, in short someone people hear about but don't really know.

The truth is, though, that we do know the uninsured. It may very well be your next door neighbor, the cashier at the local market, or the person who runs our local day care center. We don't have to look far to find uninsured Americans.

It's impossible to put together a profile of a typical uninsured individual, because this is a problem that crosses socioeconomic lines, but there are a few things we do know. Most uninsured Americans -- eight of every 10 -- live in a household that's drawing a paycheck. We know that the smaller your workplace, the more likely you are to be uninsured. Among businesses with fewer than 10 employees, one in every three workers are uninsured. Among those with 25 to 99 employees, it's one in every five. Many of these people are not eligible for programs like Medicaid or S-CHIP and, even if they are eligible, large numbers of them are not applying for benefits.

If you're Hispanic, you've got a 33 percent chance of being uninsured. If you're African-American, that likelihood is 20 percent. And if you're a very young family…well, 18 to 24 year olds are most likely be uninsured, and their offspring are among the 8.5 million children who do not have health coverage.

Knowing what we know about the uninsured -- that the vast majority are in working households, and that the problem is focused to a large degree within small Main Street businesses, we can begin to structure workable solutions.

The members of the HLC advocate a three-pronged approach to this problem:

• First, use refundable tax incentives to encourage the purchase of insurance, including employer-offered coverage.
  
  
• Second, improve our existing public programs like Medicaid and S-CHIP so that they do a better job of enrolling those currently eligible. Also, Congress and the Administration should give states greater flexibility to use those program dollars to help low-income workers afford private coverage.
  
  
• And, third, bring greater awareness among both small business owners and low-income workers on the importance and availability of health coverage.

There is much we can do to increase health coverage among small businesses. Studies have shown that many small business owners don't know the cost of health insurance for their employees. Many, in fact, also don't know that health coverage is 100 percent tax deductible. The Kaiser Family Foundation conducted a survey of small business owners who don't offer coverage to their employees, and asked these employers what they could afford and would be willing to pay for insurance. Remarkably, the price they listed was nearly adequate to purchase coverage. This tells us that we can make a dent in the nation's uninsured numbers by providing small employers with credible, useful information on the cost and availability of health coverage.

Within HLC's Health Access America campaign, we have launched the Main Street Initiative to look at ways to increase the level of health coverage among small business owners. We envision, for example, developing web sites that would provide health insurance information to small employers, publicized nationally. We foresee widely distributed, regionally-tailored materials giving cost and benefit comparisons of locally-available health insurance products.

And there is much we can learn and model from the many successful local and regional programs around the country, programs in which employers, employees and local governments are collaborating to make coverage accessible and affordable.

In San Diego, for example, government agencies worked with the Sharp Health Plan and local employees on a program called FOCUS to place health coverage within reach of uninsured working families. One company, Allison Flowers, is a testament to FOCUS' impact. It has a very loyal workforce -- made up mostly of immigrants who received their documentation though the tireless efforts of Allison's owners. It's a workforce that works long days in the field gathering the business's inventory, but neither Allison Flowers nor its employees could afford health insurance.

But, then, the private-public partnership that formed the FOCUS program made coverage possible. And it couldn't have happened at a more opportune time. Shortly after Allison Flowers was able to procure coverage for its employees through this program, the young son of one of its foremen was diagnosed with stomach cancer. Health insurance coverage made his early diagnosis and subsequent treatment possible, and what would have been a tragedy became an opportunity for hope.

Once again, this committee deserves appreciation for the work you are doing individually and collectively to help Americans without health insurance. The primary thought I want to leave with you today is that the health care industry stands enthusiastically ready to work with you to bring about a healthier, fully-insured America.

Thank you.

FOR ADDITIONAL INFORMATION:

	Media Contact: Jill Dalovisio, Healthcare Leadership Council, 202-452-8700