WASHINGTON, DC – The House Energy and Commerce Subcommittee on Health, chaired by Rep. Joe Pitts (R-PA), today examined options to lower the cost of health care by allowing Americans to purchase coverage across state lines, increasing consumers’ options.
Paul Howard, Ph.D, of the Manhattan Institute, explained how current law increases costs. “In every other sector of the U.S. economy, producers compete with each other to provide consumers with a wide variety of “˜bundled’ products and services at a wide variety of prices. In health care, providers have little incentive to compete based on price and quality,” said Howard.
Rep. Marsha Blackburn (R-TN), who has authored legislation to provide an alternative to current law, said, “This bill would give consumers the option of buying health insurance that meets their needs and is right for them – even if that means buying a policy that is qualified in another state. While I may prefer a plan that includes a chiropractor that choice isn’t going to be right for everyone. As Speaker Hastert used to say, “˜We shouldn’t be forcing people to buy a Cadillac when all they need is a Chevy.'”
Stephen Parente, Ph.D., of The University of Minnesota, provided one example that found “premium quotes for the same family from the same insurance company for the same insurance benefit to be more than twice as expensive in a New Jersey town, Lambertville, compared to New Hope, Pennsylvania. These two towns are separated by 1/4 mile of Delaware River.”
Christie Herrera, Director of the Health and Human Services Task Force at the American Legislative Exchange Council, testified, “By opening coverage options across state lines, citizens could benefit from innovative plans in other states; insurers would face fewer barriers to entry into a state’s health insurance market; and policymakers could benefit from new ideas in other states while maintaining core consumer protections important to their home state.”
Pitts said, “This should be about consumer choice, not a one-size-fits-all state mandate package that may or may not address a particular individual’s needs. This is about empowering people to make decisions for themselves, not assuming they need the government to protect them from themselves.”