Health care and unemployment are basically State-level concerns, with corresponding programs to meet these needs. The issue of health insurance for the unemployed should also be resolved at that level, without Federal intervention. Currently, 29 States have enacted some legislation dealing with health insurance and unemployment. We advocate that the States continue to resolve this and other health insurance matters.
All too often such well-intended Federal programs simply fuel the flames of spiraling health care cost inflation, diffuse the concentration of limited Federal dollars on the truly medically needy who must rely on Government entitlements for any medical care, and exacerbate the rising uncontrollable element in the Federal deficit which we must get under control if we are going to put people back to work—which is the real objective that would meet the problem addressed by this committee.
Eligibility for such a program must be limited in scope….Individuals should be excluded if coverage can be obtained by another family member who is eligible for employer-based coverage or is eligible for continuation of an employer-offered health benefit plan. In addition, persons who are eligible for Medicare, Medicaid, or other government programs should be required to use such coverage. Stating this more generally, the new benefit should be secondary to other coverage.
Unemployment always lags behind the business cycle and is highest when recovery has begun. In such periods, when pessimism is pervasive, costly proposals are often advanced, such as public programs to create jobs, mortgage subsidies, and health insurance for the unemployed. These proposals always prove to be unnecessary since they never get fully started until recovery is going strong. Furthermore, such programs would increase the federal deficit at a time when it needs to be reduced. This would mean applying the wrong solutions, which would increase the deficit, abort the recovery, reinflate the economy and continue unacceptable high levels of employment.
…we oppose Federal financing for such programs [that provide health care for the unemployed], since Federal deficits are already at record high levels. We also oppose new entitlement programs that have the potential to become open-ended. Some proposals amount to welfare programs without appropriate means tests.
…the chamber remains committed to sound policies that will improve the economy and promote employment. We also remain committed to promoting the solvency of the States’ beleaguered unemployment insurance fund….First, the problem of lack of health insurance for the unemployed will abate as the economy continues to improve and unemployment is reduced. A continuation of the trend toward a reduction in taxation, regulation, and interest rates will help to achieve the dual goal of fuller employment and protection against health care costs.
Private insurance must be the vehicle for benefit coverage. This new program must not become enmeshed with Medicare and Medicaid. Caution must be expressed lest new troubles be created through expansion of an entitlement concept.
…we urge you to be sure that these proposals don’t take away the incentive for unemployment claimants to accept part time and temporary jobs when permanent jobs are unavailable. At present, claimants resist such jobs, because earnings from 2 or 3 days of work will often disqualify them from any unemployment benefits. If claimants] lose their health insurance for weeks in which they are disqualified from unemployment benefits, they will have even less incentive to accept work when it is available.
We also oppose those proposals that would increase employers’ labor costs. Mandating through tax penalties that employers carry laid-off workers for some specified period or open health plan enrollment to spouses, or contribute to an assigned-risk pool, would place them in double financial jeopardy. Employers’ response could be to drop their health care plans altogether and/or lay off more workers.
Many options already exist to provide unemployed persons with health insurance or protection against health care costs. These include: continuous coverage provisions in many employer-paid health care plans; the conversion privilege offered in many of these same plans: coverage under a spouse’s or other relative’s plan; and the social safety net, Medicaid.
