The President
The White House
Washington, DC 20500
Dear Mr. President:
We applaud your leadership in seeking agreement with Congress on how to reform our health care system. We share your sense of urgency that health care reform be addressed now and believe that there is a pathway to achieve significant bipartisan consensus. Business Roundtable continues to be constructive in stating what we believe will work and what we believe will not.
Business Roundtable is an association of chief executive officers of leading U.S. companies who collectively provide health care coverage to over 35 million Americans. We purchase health insurance benefits for our employees, retirees and their families.
In general, we believe that the centerpiece of health care reform must address the rising cost of health care. We need to reduce the rate of increase in health care costs so that more employers, employees and their families can afford coverage. We are very concerned about projections that health care costs will rise over 166% over the next ten years absent significant marketplace reforms. There are two costs that we are subsidizing that must be addressed. First, there is approximately $56 billion in uncompensated costs that are either paid by cost-shifting to private payers or reimbursed by government programs for those who do not have health insurance coverage. Getting more people coverage will begin to reduce these costs. In addition, Medicare reimbursement to providers must be changed. The payments need to shift away from a pure volume driven, fee-for-service reimbursement to one where the incentives are aligned to reward providers for quality and value in the delivery of care.
Second, we agree with you that most Americans want to keep what they currently have. Today, over 132 million Americans receive health insurance coverage through their workplace. ERISA is the legal foundation for the offering of those benefits, and we encourage you to retain the flexibility so that employers will continue to offer and subsidize health insurance coverage.
Finally, we strongly support insurance market reforms that create a more competitive marketplace with no restrictions on preexisting condition coverage and guaranteed issue. In addition, we support limiting the rating of plans. We do believe that every American has an obligation to have coverage that is affordable. If we do these reforms correctly, we should have options for all Americans and ensure broader coverage than we have today.
We do not support a public plan option that would compete in the private marketplace. A public plan option, or a government-run plan, would impede innovation, have no real incentive to improve the delivery of care, and will never have the same cost structure as a private entity. A government plan would erode existing worker coverage if employees seek a subsidized, public option. That would leave employer-sponsored coverage more expensive for both the employer and employees. We believe strong insurance market reforms will create a more vibrant marketplace without the need for a government run plan.
Business Roundtable remains committed to finding solutions to reduce costs, expand coverage and improve delivery of health care services in America. We look forward to working with you to review information, including data and evidence on what we are doing and what we believe will provide the best way to achieve these goals.
Sincerely,
John J. Castellani