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Big "I" Urges Senate HELP Committee to Move Forward on True Health Care Reform

Agent and broker association opposes current Kennedy bill and calls for bipartisan solutions that protect consumers

Washington, D.C., June 19, 2008 – Robert Rusbuldt, president & CEO of the  Independent Insurance Agents & Brokers of America (the Big “I”), sent a letter to the U.S. Senate Committee on Health, Education, Labor and Pensions (HELP) opposing the current draft of the Kennedy bill that is pending in the committee and calling for “Real and substantive health care reform.”

“In spite of the need for health care reform, IIABA has very serious concerns with the Senate HELP Committee’s bill,” says Rusbuldt. "First, while briefly noted in the bill and not elaborated upon, we are very concerned that a public plan would have a devastating effect on the private marketplace and ultimately consumers.”

The full text of the letter follows:

June 18, 2009

Via Electronic Transmission

The Honorable Edward M. Kennedy Chairman, Senate HELP Committee
The Honorable Michael B. Enzi Ranking Member, Senate HELP Committee

Dear Chairman Kennedy and Senator Enzi:

On behalf of the Independent Insurance Agents & Brokers of America (IIABA) and the nearly 300,000 small business people we represent, I am writing you to express our concerns and opposition to the Senate HELP Committee’s partial bill that the committee is considering. Congress is undertaking a monumental task by tackling health care reform, and it could not come at a more opportune time. Far too many Americans, 47 million by most estimates, were uninsured this past year. Furthermore, the cost of health insurance is on an unsustainable upward path, with the Centers for Medicare and Medicaid Services (CMS) projecting that health care spending will total $2.5 trillion this year and increase to $4.4 trillion by 2018. Our country must take significant steps to address this problem, and IIABA is strongly supportive of real and substantive reform of the private market to address the serious problems in our health care system.

In spite of the need for health care reform, IIABA has very serious concerns with the Senate HELP Committee’s bill. First, while briefly noted in the bill and not elaborated upon, we are very concerned that a public plan would have a devastating effect on the private marketplace and ultimately consumers. According to the 2009 Lewin Group study, if the public plan’s reimbursement rates are similar to Medicare, an estimated 119 million people would shift from private insurance to the public plan. The Congressional Budget Office, in scoring the Senate HELP language even without the public plan, estimated 15 million Americans would lose their employer coverage within 10 years. Put simply, if these estimates are even remotely accurate, a public plan would have a crippling effect on the private marketplace. Eventually, consumers would ultimately be left with only one choice, a public plan.

Second, while only briefly mentioned in the bill and without details, we are also concerned with a potential employer mandate. Requiring employers to offer their employees health insurance and to supplement a certain percentage or amount of their monthly premium could have an adverse effect on our country’s small businesses and greater economy. A 2009 NFIB study found that an employer mandate would result in a net loss of 1.6 million U.S. jobs between 2009 and 2013, and small businesses would be hit hardest, accounting for an estimated 66% of job losses. Further, a 2007 Employment Policies Institute study found that approximately 1.5 million U.S. jobs would be shifted from full-time to part-time status in addition to job losses. On top of those job numbers, the 2009 NFIB study estimates that real U.S. GDP would contract by $200 billion between 2009 and 2013 with an employer mandate – small businesses would lose an estimated $113 billion in output. Small businesses are the engine of growth in our economy, and we want to make sure they are not placed at a competitive disadvantage.

Finally, the Senate HELP bill would create a new federal “Navigators” grant program. The new program would award grants to public and private entities to conduct public education, distribute information, and assist with health insurance enrollment. The legislation specifically states that health insurance issuers, including agents, would be prohibited from participating in the grant program. This grant program would mistakenly entrust organizations with no prior health insurance background, professional expertise or training with the authority to advise individuals on their insurance decisions. Individuals seeking information on what health insurance plan best fits their needs should be able to count on sound advice from a licensed health insurance agent, broker or consultant. It would be detrimental to the consumer to hand this trusted advisory role over to community organizations with no relevant health care training or background, and IIABA strongly opposes this provision.

Real and substantive health care reform is needed, and we stand ready to work with your committee in any way possible to achieve needed reforms. Thank you in advance for your work on this issue and your willingness to hear our comments. Please feel free to contact me if you would like to discuss our concerns as you consider the Senate HELP Committee bill.


Robert A. Rusbuldt President and Chief Executive Officer Independent Insurance Agents & Brokers of America

cc: Senate HELP Committee Members

​127 South Peyton Street
Alexandria VA 22314
​phone: 800.221.7917
fax: 703.683.7556

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