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Testimony

Statement by
Kathleen Sebelius
Secretary
U.S. Department of Health and Human Services (HHS)

on
Health Reform in the 21st Century 

before
Committee on Ways and Means


Wednesday May 6, 2009

Chairman Rangel, Ranking Member Camp, members of the Committee, thank you for this opportunity to join you for a critical conversation about health reform in America. Health reform has advanced thanks to your work and willingness to move forward together with other House Committees. We appreciate your hard work to enact reform.   It is urgently needed.

Health care costs are crushing families, businesses, and government budgets. Since 2000, health insurance premiums have almost doubled and health care premiums have grown three times faster than wages. Just last month, a survey found over half of all Americans, insured and uninsured, cut back on health care in the last year due to cost. And behind these statistics are stories of struggles for too many American families.  Families who face rising premiums – now over $12,000, when it was $6,000 a decade ago.  Parents choosing between health insurance and their mortgage because they can’t make ends meet because their paycheck is standing still but health care costs are rising much faster than inflation.  Today health care costs are the big squeeze on middle class families and these challenges are growing as the economic picture worsens.  And on top of all of this, in the last eight years an additional seven million Americans have become uninsured.   

And we know that during this recession, hundreds of thousands of people are losing health insurance as they lose their jobs.

Even families who do have some coverage are suffering. From 2003 to 2007, the number of “under-insured” families – those who pay for coverage but are unprotected against high costs – rose by 60 percent.

Still, we have by far the most expensive health system in the world. We spend 50 percent more per person than the average developed country. The U.S. spends more on health care than housing or food.

And the situation is getting worse. The United States spent about $2.2 trillion on health care in 2007; $1 trillion more than what was spent in 1997, and half as much as is projected for 2018. 

High and rising health costs have certainly contributed to the current economic crisis. Rising health costs represent the greatest threat to our long-term economic stability. If rapid health cost growth persists, the Congressional Budget Office estimates that by 2025, 25 percent of our economic output will be tied up in the health system, limiting other investments and priorities.  

This is why I share the President’s conviction that “health care reform cannot wait, it must not wait, and it will not wait another year.” Inaction is not an option. The status quo is unacceptable, and unsustainable.

We are already on our way to making health reform a reality. In just over 100 days, this President has made great strides to advance the goal of reducing costs, guaranteeing choice and assuring quality, affordable health care to all Americans.

Within days of taking office, the President signed into law the reauthorization of the Children’s Health Insurance Program. This program’s success in covering millions of uninsured children is a hallmark of the bipartisanship and public-private partnerships we envision for health reform.

The President then signed the Recovery Act, which includes essential policies that will protect health insurance for the American people, support groundbreaking research, and make important investments in our health care infrastructure.

And just last week, members of Congress passed a budget that includes an historic commitment to health reform.

Delivering on this commitment and enacting comprehensive health reform is one of my top priorities. The Obama Administration is focused on passing health reform legislation that will end the unsustainable status quo and adhere to eight basic principles.

First, we believe that reform must reduce the long-term growth of health care costs for businesses and government. The high cost of care is crippling businesses, who are struggling to provide care to their employees and remain competitive. It is driving budget deficits and weakening our economy. We must pass comprehensive reform that makes health care affordable for businesses, government, and families.

Second, we must protect families from bankruptcy or debt because of health care costs. Today, too many patients leave the hospital worried about paying the bills rather than returning to health. They have reason to be concerned. In America, half of all personal bankruptcies are related to medical expenses. It’s time to fix a system that has plunged millions into debt, simply because they have fallen ill.

Third, we will guarantee choice of doctors and health plans. No American should be forced to give up the doctor they trust or the health plan they like. If you like your current health care, you can keep it.

Fourth, we will make sure that Americans who lose or change jobs can keep their coverage. Americans should not lose their health care simply because they have lost their job.  

Fifth, we must end barriers to coverage for people with pre-existing medical conditions. In Kansas and across the country, I have heard painful stories from families who have been denied basic care or offered insurance at astronomical rates because of a pre-existing condition. Insurance companies should no longer have the right to pick and choose. We will not allow these companies to insure only the healthy and leave the sick to suffer.

Sixth, we must assure affordable, quality health coverage for all Americans. The large number of uninsured Americans impose a hidden tax on other citizens as premiums go up, and leaves too many Americans wondering where they will turn if they get sick. A system that leaves millions of Americans on the outside of the doctor’s office looking in is unjustifiable and unsustainable. 

Seventh, we must make important investments in prevention and wellness. The old adage is true – an ounce of prevention truly is worth a pound of cure. But for too long, we’ve sunk all our resources into cures and shortchanged prevention. It’s time to make preventing illness and disease the foundation of our health care system.

And finally, any reform legislation must take steps to improve patient safety and the quality of care in America. Our country is home to some of the finest, most advanced medicine in the world. But today, healthcare associated infections – infections caught in a hospital or other settings -- are one of the leading causes of death in our nation. 98,000 Americans die each year as a result of these and other medical errors -- more than car accidents, breast cancer, or AIDS. These numbers are not acceptable for the world’s richest nation. We must sharply reduce the number of medical errors, keep patients safe and ensure all Americans receive high-quality care.

As we work to enact policies that adhere to these principles, the President is committed to hearing from people in communities across the nation and on both sides of the aisle. In March, he held a White House health care forum and several regional forums in places like Michigan, Iowa, Vermont, North Carolina and California. There, bipartisan forums brought together people from all perspectives – across the political spectrum and representing all people with a stake in the system – to focus on solutions. 

I look forward to continuing this bipartisan process and I am eager to work with this Committee and your colleagues in the House and Senate to deliver the reform we so desperately need.

Again, Mr. Chairman, thank you for the opportunity to participate in this conversation with you and your colleagues. I look forward to taking your questions.

Last revised: June 17, 2013