Carper talks health care costs at chamber

U.S. Senator Tom Carper (D-DE) stopped by the Bethany-Fenwick Area Chamber of Commerce on Aug. 1, for a mixed bag discussion ranging from transportation to health care.

“The role of government is to do for the people what they can’t do for themselves,” he said. Appropriate to the chamber setting, he noted its primary role as “nurturing an environment of job preservation and creation.”

He listed education of a “world class workforce,” safe communities and access to good transportation systems as important ingredients.

Add common sense regulations — Carper noted the recent passage of the Central American Free Trade Agreement (CAFTA) that would, among other things, knock down existing barriers to poultry exports, he said.

And finally, Carper noted the importance of holding down health care costs. He mentioned discussions he’d had with Rick Wagner, CEO of General Motors (GM), and the closure of auto manufacturing plants in nearby Baltimore, Md. and Linden, N.J.

Good news at the Wilmington plant notwithstanding, Carper said he shared Wagner’s concerns about civil justice in some places around the country, where judges were elected rather than appointed.

“I worked real hard on class action lawsuit reform, so that you wouldn’t end up with companies coming into courtrooms and courthouses where they wouldn’t have a fair shake,” Carper said. And he said Wagner had expressed his appreciation for those efforts — but had also asked for help on health care.

Carper noted opening day for the Medicare Prescription Drug Plan on Jan. 1, 2006 (which will replace the discount cards of the last year and a half, next May) but emphasized the optional nature of the program. He recommended people stick with their existing prescription drug coverage, if they were happy with it.

Embedded within that same bill, he referenced health savings accounts, which allowed employees to request their employers withhold funds (up to $1,800 in any year) and place that money in a tax-free account specifically for medical expenses.

“The catch is, if you don’t spend it, you lose it,” he said. “It doesn’t roll over year to year.” As an alternative, Carper talked about high deductible health insurance policies coupled with individual savings accounts — again, tax-free, but which would roll over.

He suggested this way of setting funds aside would place a greater responsibility on individuals for thinking about where they were spending their health dollars. That could encourage people to adopt a more preventative approach — scheduling annual health screenings, for instance (mammograms, colorectal exams).

Carper noted the efforts of local figures Jim Rasa and Dan Sullivan with First Healthy Choices as a common sense program along those lines.

He also pointed out legislation introduced in the most recent session, which “would do for small businesses what we do for federal employees.” Although he said each government agency stood separately, they were able to band together for greater power in collective bargaining — Sen. Blanche Lincoln (D-AR) had petitioned the Office of Personnel Management to study a private sector model that would mirror the one used in the public sector.

Karen McGrath, executive director for the chamber, asked about one bill that could prove a major boon to small business employers and employees — House Resolution (HR) 525, or, the Small Business Health Fairness Act of 2005.

From the Library of Congress online resource (, HR 525 would “provide for the establishment and governance of association health plans (AHPs)…”

These AHPs would be group health plans with sponsors — and those sponsors could be “trade, industry, professional, chamber of commerce, or similar business associations…”

HR 525 makes provisions that could strengthen collective bargaining. For instance, it “allows two or more trades or businesses to be deemed a single employer if they are in the same control group offering medical care benefits, under specified conditions.”

U.S. Representative Sam Johnson (R-TX) sponsored the bill, and it passed the House on a 263-165 vote (July 26). Republicans (including Delaware’s U.S. Representative Mike Castle) offered unanimous support, and were joined by 36 Democrats.

“I have no idea what’s going to happen to the bill in the Senate,” Carper said.

HR 525 has been assigned to the Senate Committee on Health, Education, Labor and Pensions.

In other health-related topics, Carper also touched on components of a “Delaware Health Information System” — a smart card that could provide medical background information in an emergency — and discussed President George W. Bush’s efforts to cap medical malpractice insurance costs.

In matters relating to the health of the area’s tourism economy, he offered very cautious optimism that Delaware would see some beach replenishment funding in this year’s Energy and Water Appropriations Bill.

He said Delaware’s Congressional delegation had asked for $5 million — “We got $4 million in the Senate version of the bill, nothing in the House version,” Carper pointed out. “In all fairness, it’s easier for Joe (U.S. Senator Joe Biden, D-DE) and I — we’re two out of 100. Mike (Castle) is one out of 435.”

Carper said they’d hash it out in conference committee. “My guess is that we’ll get something in the final bill,” he said — but he declined to narrow an estimate.

He fielded a question from Selbyville resident Jeff Lynch regarding the Estate Tax (also known as the death tax), but didn’t give the answer Lynch was looking for.

Carper said one of the most important aspects of tax law was predictability, and he didn’t recommend a declining estate tax rate if it might, or might not, return to a higher rate several years later. He said it was slated to dwindle away to nothing, but could then go jump from zero to 55 percent.

He suggested a max cap and then the top marginal tax rate (15 percent on long-term capital gains, 35 percent on interest income), instead.

Lynch said he’d like to see it disappear altogether, but Carper said he didn’t see that happening, especially at a time when the country was running record deficits.