The health reform bills currently working their way through the US House of Representatives contain a government-run health plan commonly called the “public option.”  Public options, because they are exempt from the regulations that commercial plans work under, weaken the competitive nature of the health insurance market.

A merged health reform bill is expected to be brought to the floor of the House early this month.  Oregon’s Delegation needs to hear from the Oregon business community on the public option plan. And they need to hear now.

Here is important information that your employees should know. Please consider providing it to them and asking for their help in communicating with Congress.

The Situation
U.S. House of Representatives
Three pieces of health reform legislation were melded together to create the House’s health reform package.  All three bills purported to create competition among insurance plans through use of a public option.  Speaker Nancy Pelosi (D-CA) and the House leadership are now counting votes on their final package.  That package includes a public option which would pay providers—doctors and hospitals—at a level that is tied to Medicare rates. 

This provision is especially bad for Oregon.  Even though Americans pay equal premiums to support Medicare, substantial geographic disparities in physician and hospital reimbursement levels exist in the Medicare program. Oregon is one of approximately 12 states whose historically efficient use of health care resources penalizes them under Medicare’s payment formula.

The root of the problem is that Medicare bases decisions about entitlement benefits on historic costs. As a result, states like Oregon, where Medicare billings per capita are the fourth-lowest in the nation, are reimbursed at lower rates than states with high historic per-capita costs.

This is not good enough for Oregon. A public option tied to Medicare rates will not create competition; rather, it will destroy it.  This will cause the private market to diminish in size, eventually leaving only the government option for coverage.

U.S. Senate
Two committees with jurisdiction over health care issues have approved reform bills.  First to be approved was the Health, Education, Labor and Pensions (HELP) Committee bill, developed under the leadership of Senator Chris Dodd (D-CT), who served as interim chairman during the illness of the late Senator Ted Kennedy (D-MA).  The committee is now chaired by Senator Tom Harkin (D-IA).  The other Senate bill was approved last month by the Finance Committee, led by Senator Max Baucus (D-MT).  The bill is expected on the Senate floor early this month.  Debate in the Senate is expected to last for two weeks, during which many amendments will be offered.  The bill is expected to be considered under regular Senate procedures, under which 60 votes are necessary to pass legislation.  Currently, the ratio in the Senate is 58 Democrats, 40 Republicans and two Independents who caucus with the Democrats.

Our Message
The message that needs to be sent to Congress is simple:  “Time out!”   All of us—employers and employees—want health reforms that reduce costs and improve access for the uninsured.  Unfortunately, a public option decreases the likelihood of that happening.  The public option proposed in the House bill will not promote competition–it will undermine the private market, choice and individual freedom to choose health care coverage.

How you can help
Key issues are at stake as the House and Senate bills head for floor debate.  The Oregon business community needs your help to ensure that affordable and accessible private insurance coverage will continue to be available in all parts of the country.  The more you and your employees can add your voices to the debate, the stronger we will be.  Please consider the following:

• Encourage employees to send e-mail or letters to Oregon’s congressional delegation;
• Forward this email alert to others within your network and ask them to send the same message;
• Depending on your relationships with Oregon’s delegation, please call them personally – or their chief of staff, or legislative assistant that handles health care issues – and convey the messages outlined above.

Collectively, we can make our voices heard. Please contact your U.S. House member today!

Senator Jeff Merkley
107 Russell Senate Office Building
Washington, DC 20510
(202) 224-3753
Merkley.senate.gov/contact/

Senator Ron Wyden
223 Dirksen Senate Office Building
Washington, DC 20510
(202) 224-5244
Wyden.senate.gov/contact/

Representative David Wu
2338 Rayburn HOB
Washington, DC 20515-3701
(202) 225-0855
David.wu@mail.house.gov

Representative Greg Walden
2352 Rayburn HOB
Washington, DC 20515-3702
(202) 225-6730
greg.walden@mail.house.gov

Representative Earl Blumenauer
2267 Rayburn HOB
Washington, DC 20515-3703
(202) 225-4811
earl.blumenauer@mail.house.gov

Representative Peter A. DeFazio
2134 Rayburn HOB
Washington, DC 20515-3704
(202) 225-6416
peter.defazio@mail.house.gov

Representative Kurt Schrader
1419 Longworth HOB
Washington, DC 20515-3705
(202) 225-5711
kurt.schrader@mail.house.gov