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Congressman Dan Donovan

Representing the 11th District of New York

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Donovan To Vote ‘No’ On American Health Care Act

March 22, 2017
Press Release
New York-specific Medicaid amendment among key reasons for decision

Donovan: “Recognizing that the status quo is failing isn’t, on its own, a compelling reason to vote ‘yes’ on the current replacement plan”

Washington, DC – March 22, 2017….Congressman Dan Donovan (NY-11) today announced he intends to vote “no” on the American Health Care Act as currently drafted. Donovan singled out this week’s Medicaid amendment as one of the reasons for his decision. The provision effectively exempts New York State counties from contributing to the state’s Medicaid coffers, but it excludes New York City. Donovan’s constituents would, in essence, be paying for tax breaks for other New Yorkers.

Donovan said, “Obamacare has burdened New York families with unaffordable premiums, rendered some insurance plans unusable because of high deductibles, and caused people to lose their doctors. But recognizing that the status quo is failing isn’t, on its own, a compelling reason to vote ‘yes’ on the current replacement plan.”

On the so-called Collins Amendment, Donovan said, “The provision excludes New York City, putting an unfair and disproportionate burden on City residents to cover the state's exorbitant Medicaid expenses. We need healthcare reform – including promised Medicaid reform in New York where we spend more than Texas, Florida and Pennsylvania combined – but it shouldn't be done on the backs of already overburdened City residents who will undoubtedly have a tax increase forced on them to pay for this eminently unfair policy.”

Donovan also pointed to the legislation’s impacts on seniors as a reason for his decision. The non-partisan Congressional Budget Office estimates older Americans would see 25 percent increases in their insurance premiums as a result of the AHCA. Additionally, all of the hospital systems – the biggest employers in Donovan’s district – expressed their opposition to the legislation because they stand to lose millions of dollars due to changes to Medicaid, threatening local jobs and health care delivery.

Donovan applauded President Trump for his commitment to fixing the healthcare system and his engagement with Congress throughout this process. He looks forward to working with the President and House leadership toward accomplishing their mutual goals.

Congressman Donovan published the below op-ed in the Staten Island Advance explaining his rationale in full.

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Donovan: Why I will vote 'no' on the American Health Care Act

Since my first day serving in Congress I made a commitment to weigh the impact my vote will have on the people and families of Staten Island and Brooklyn first. That is why I will vote no on the American Health Care Act (AHCA). I do not believe the legislation as currently written is in the best interest of the 740,000 people I represent in Congress, and I believe we can do better.

Our current healthcare system is broken. The Affordable Care Act, or “Obamacare,” burdened New York families with unaffordable premiums, rendered some insurance plans all but useless because of sky-high deductibles, caused people to lose their doctors and already one of New York’s largest insurers collapsed, leaving thousands forced to find a new plan. Working families had a tough time affording their health insurance ten years ago, but it’s even worse now. And businesses need relief from the employer mandate burdening them.

But recognizing that the status quo is failing isn’t, on its own, a compelling reason to vote “yes” on the current replacement plan.

Over the past month, I’ve met with all the stakeholders this bill would affect: hospitals, doctors, nurses, community health centers, and the residents of the 11th congressional district who have raised valid concerns with the current bill.

Of particular concern to me is a provision added only days before the vote that prohibits New York State from passing Medicaid costs down to county governments. The proposed amendment exempts New York City, putting an unfair and disproportionate burden on City residents to fund the entire state’s share of the Medicaid bill. That’s wrong. I cannot support a deal that gives our district short shrift.

This amendment, combined with other cuts in the bill, would especially harm our local hospitals – the biggest employers in this district. Under the proposed plan, Staten Island and Brooklyn hospitals could lose more than $77 million.

The legislation would also have a harmful impact on senior citizens. The bill permits insurers to charge older Americans up to five times as much as younger individuals, as opposed to the three-to-one ratio that exists now. The non-partisan CBO projects the AHCA would increase premiums for a 64-year old by 25 percent. In one startling example, a 64-year old earning $26,500 could pay $14,600 per year for an insurance policy.

A recent study found that charging older Americans five times more for insurance than younger people would cause about 400,000 seniors to lose their ability to afford insurance. Seniors on fixed incomes would likely see a big jump in their healthcare expenses without a near-term reduction in premiums. We can’t burden seniors who deserve better from us!

Of particular concern, New Yorkers wouldn’t be able to take advantage of tax credits that are meant to help families pay for private insurance. New York State requires insurers to cover medically necessary abortions and contraception, but under the AHCA tax credits can only be used to buy insurance that does not include abortion coverage. This would render this aid useless to our residents.

The AHCA doesn’t address two of the biggest drivers of skyrocketing health costs: pharmaceutical prices and medical malpractice suits. Consumers around the world pay a fraction of the price that Americans pay for drugs, and our own government doesn’t even negotiate prices for Medicare beneficiaries. Also, local doctors have told me that they intentionally order tests so they can have a better defense if a patient sues them. That tells me something is wrong.

What’s more, the bill is unable to permit competition across state lines, a key method to reduce premiums and something which I have long advocated. When insurance companies can compete for consumers across the country, costs will come down. In fact, another provision of the bill, the so-called “Cadillac Tax,” which penalizes the plans that give the insured better coverage, should be eliminated.

Still, the proposed legislation does have some good policies and innovative ideas.

The Medicaid reforms – barring the cost-shifting amendment that leaves out New York City – are a step in the right direction for a program that cannot continue on its current trajectory. The federal government will soon spend more on Medicaid than on defense. Here in New York we spend more on Medicaid than Texas, Florida and Pennsylvania combined. At the same time, there’s no doubt that there are flaws with care delivery. We need a medical safety net – it’s humane and actually lowers costs in the long-run. But we can accomplish our goal cheaper and more effectively.

I applaud President Trump for his commitment to fix the healthcare system and his engagement with Congress throughout this process where he has demonstrated he has an open door and an open mind. It is a needed and welcome change from the posture of the previous administration.

This bill was a starting point, and while it is not the version I can support, I remain steadfastly committed to replacing Obamacare with a plan that truly works for the people. Our aim should be to help those who were harmed by Obamacare without harming those who were helped by it. I look forward to working with the President and my colleagues to get this done right. I believe we can.

Link to op-ed here