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Chabot Announces Health Affordability Legislation in Committee Hearing
Hearing Witnesses Optimistic about its Impact on Costs and Competition
October 25, 2007

Washington, D.C. -- Increased consolidation in the health insurance market prompted the House Small Business Committee to hold a hearing today examining the impact of mergers on small businesses.  Amid mounting concerns about rising health care costs, Congressman Steve Chabot (R-OH), Ranking Member of the House Small Business Committee, announced that he reintroduced his Health Insurance Affordability Act this morning to offer individuals relief in the form of tax deductions.

“When the members of this committee travel back to their districts, they are put face-to-face with constituents and small business owners who struggle every day to cope with the rising costs of obtaining and providing health care,” Chabot said.  “In addition to the bulwark of antitrust laws to protect competition, another avenue is to increase competition in the provision of health insurance.”

Competition helps keep prices down and – as evidenced by testimony from the witness panel – health care is the market most desperate for lower costs.  Hearing witness James R. Office, vice president and general counsel for Victory Wholesale Group in Springboro, Ohio said, “Reduced competition in health care at the insurer level or the provider level has increased the costs of health care to Victory and its employee-associates as well as those of other small businesses.  Solutions must include some meaningful competition.”

One solution to alleviating the high costs and promoting the level of competition came in Ranking Member Chabot’s Health Insurance Affordability Act introduced today.  The bill would allow individual taxpayers to deduct the total cost of their health insurance premiums from their annual tax returns for themselves and their families, making coverage more affordable for small business employees and all Americans facing ever-increasing premiums.

Panelist Robert Hughes, president of the National Association for the Self-Employed, said that the legislation would “have the impact of bringing more people into the marketplace… and ultimately increasing competition” and indicated he would “wholeheartedly support” Mr. Chabot’s efforts.  President of Consumers for Health Care Choices, Greg Scandlen, echoed Mr. Hughes’ sentiments, calling the bill a “marvelous idea.”

Ranking Member Chabot also asked that association health plans be considered in any discussion of increasing competition and reducing health costs.  Noting the House had passed association health plan bills in the past that died in the Senate, he called for the Committee to “investigate the resuscitation of the concept.”

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