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Kline Statement: Hearing on "Reviewing the President's Fiscal Year 2013 Budget Proposal for the Department of Health and Human Services"
As prepared for delivery.

In his Fiscal Year 2013 budget, President Obama requests $932 billion for the Department of Health and Human Services, one of the largest allocations for any federal agency. Nearly $70 billion of this request is dedicated to various social services programs, including Head Start and Community Services Block Grants. 

While they support families nationwide, such programs are also vulnerable to waste and abuse of taxpayer resources. For example, a 2010 report by the Government Accountability Office revealed fraud in the Head Start program, including misleading taxpayers about the number of children enrolled to inflate the amount of federal funds received. Despite a lengthy delay, I am pleased the administration finally took steps to implement a 2007 law to strengthen Head Start and protect taxpayer dollars by requiring the lowest performing programs to re-compete for funding. I hope the department will continue to improve the accountability of this and other social services programs within its jurisdiction.

While these programs and policies will be a part of the discussion, health care is undoubtedly at the forefront of the minds of many here today. It is an issue continually raised by our constituents and inextricably linked to the strength of our economy. Congress continues to closely examine the 2010 health care law and its unprecedented regulatory process. What we have learned is deeply troubling.

First, we have learned the law will fall far short of the president’s promise to lower health care costs. By any basic standard – whether the premiums families and employers pay or the costs leveraged on taxpayers to finance government programs – health care costs are going up. The average cost of a family health insurance plan increased 9 percent just last year. Charles Blahous, a public trustee of Medicare and Social Security, recently stripped away the budget gimmicks to reveal the law will add as much as $527 billion to the federal deficit over the next decade. 

Patti-Ann Kanterman, chief financial officer of a family-owned business in Pennsylvania recently told this committee exactly what the law did not do: “It did not reduce the cost of insurance; it did not reduce uncertainty of offering insurance.” It is worthwhile to note the president’s budget requests a $111 billion increase for health insurance subsidies, perhaps an implicit recognition costs are accelerating faster than even he imagined.

We have also learned the law has made it more difficult to hire new workers. According to the Congressional Budget Office, the law will cut 800,000 jobs from the nation’s workforce. This reflects the concerns raised by employers like Gail Johnson, president of a small business that offers early childhood education to families in Virginia. Ms. Johnson told the committee the 2010 law will “slow or stall the growth of small and midsized businesses as [they] struggle to absorb its new costs.”

Finally, we learned the president’s pledge to the American people that they could keep their current health care plan was nothing more than empty rhetoric. The administration has made it virtually impossible for employers to maintain their grandfathered exemption, which means employers must choose between losing the ability to manage coverage on behalf of their workers or complying with the law’s myriad requirements as costs skyrocket. 

The consequences of this health care law extend beyond an employer’s bottom line; they have consequences for workers as well. Brett Parker with Bowlmor Lanes in New York City has testified his kitchen staff will have to accept part-time hours due to the law’s employer mandate. Other workers confront similar changes including lower wages and loss of coverage as employers grapple with the law’s regulations and mandates. Pennsylvania employer Will Knetch echoed the concerns of many when he said the law “provides so many unknowns for the business community; it is scary.”

With 13 million searching for work, our nation simply cannot afford policies that create uncertainty and fear. Folks like Gail Johnson, Brett Parker, Patti-Ann Kanterman - these are America’s job creators, and their personal experiences reveal the difficult reality now facing countless employers and workers. 

Madam Secretary, we realize your job is to administer federal law to the best of your ability. However, Congress also has a responsibility to protect the best interests of the American people. Toward that end, we will continue to conduct aggressive oversight of the law and the related regulatory actions taken by the administration.

As such, effective oversight requires the timely cooperation of the administration. It was disappointing to receive just last week answers to questions this committee asked 10 months ago. Adding insult to injury, the responses you provided are out of date and largely irrelevant to the current debate. If it takes this long for the federal bureaucracy to answer basic questions, it’s hard to believe it can effectively run our nation's health care system.

I hope you can provide an explanation for the delay and commit to doing better in the future. 

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