The plan I’m announcing tonight would meet three basic goals. It will provide more security and stability to those who have health insurance. It will provide insurance for those who don’t. And it will slow the growth of health care costs for our families, our businesses, and our government. (Applause.) It’s a plan that asks everyone to take responsibility for meeting this challenge—not just government, not just insurance companies, but everybody including employers and individuals. And it’s a plan that incorporates ideas from senators and congressmen, from Democrats and Republicans—and yes, from some of my opponents in both the primary and general election.
Here are the details that every American needs to know about this plan. First, if you are among the hundreds of millions of Americans who already have health insurance through your job, or Medicare, or Medicaid, or the VA, nothing in this plan will require you or your employer to change the coverage or the doctor you have. (Applause.) Let me repeat this: Nothing in our plan requires you to change what you have.
What this plan will do is make the insurance you have work better for you. Under this plan, it will be against the law for insurance companies to deny you coverage because of a preexisting condition. (Applause.) As soon as I sign this bill, it will be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it the most. (Applause.) They will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or in a lifetime. (Applause.) We will place a limit on how much you can be charged for out-of-pocket expenses, because in the United States of America, no one should go broke because they get sick. (Applause.) And insurance companies will be required to cover, with no extra charge, routine checkups and preventive care, like mammograms and colonoscopies—(applause)—because there’s no reason we shouldn’t be catching diseases like breast cancer and colon cancer before they get worse. That makes sense, it saves money, and it saves lives. (Applause.)
Now, that’s what Americans who have health insurance can expect from this plan—more security and more stability.
Now, if you’re one of the tens of millions of Americans who don’t currently have health insurance, the second part of this plan will finally offer you quality, affordable choices. (Applause.) If you lose your job or you change your job, you’ll be able to get coverage. If you strike out on your own and start a small business, you’ll be able to get coverage. We’ll do this by creating a new insurance exchange—a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices. Insurance companies will have an incentive to participate in this exchange because it lets them compete for millions of new customers. As one big group, these customers will have greater leverage to bargain with the insurance companies for better prices and quality coverage. This is how large companies and government employees get affordable insurance. It’s how everyone in this Congress gets affordable insurance. And it’s time to give every American the same opportunity that we give ourselves. (Applause.)
Now, for those individuals and small businesses who still can’t afford the lower-priced insurance available in the exchange, we’ll provide tax credits, the size of which will be based on your need. And all insurance companies that want access to this new marketplace will have to abide by the consumer protections I already mentioned. This exchange will take effect in four years, which will give us time to do it right. In the meantime, for those Americans who can’t get insurance today because they have preexisting medical conditions, we will immediately offer low-cost coverage that will protect you against financial ruin if you become seriously ill. (Applause.) This was a good idea when Senator John McCain proposed it in the campaign, it’s a good idea now, and we should all embrace it. (Applause.)
Now, even if we provide these affordable options, there may be those—especially the young and the healthy—who still want to take the risk and go without coverage. There may still be companies that refuse to do right by their workers by giving them coverage. The problem is, such irresponsible behavior costs all the rest of us money. If there are affordable options and people still don’t sign up for health insurance, it means we pay for these people’s expensive emergency room visits. If some businesses don’t provide workers health care, it forces the rest of us to pick up the tab when their workers get sick, and gives those businesses an unfair advantage over their competitors. And unless everybody does their part, many of the insurance reforms we seek—especially requiring insurance companies to cover preexisting conditions—just can’t be achieved.
And that’s why under my plan, individuals will be required to carry basic health insurance—just as most states require you to carry auto insurance. (Applause.) Likewise—likewise, businesses will be required to either offer their workers health care, or chip in to help cover the cost of their workers. There will be a hardship waiver for those individuals who still can’t afford coverage, and 95 percent of all small businesses, because of their size and narrow profit margin, would be exempt from these requirements. (Applause.) But we can’t have large businesses and individuals who can afford coverage game the system by avoiding responsibility to themselves or their employees. Improving our health care system only works if everybody does their part.
And while there remain some significant details to be ironed out, I believe—(laughter)—I believe a broad consensus exists for the aspects of the plan I just outlined: consumer protections for those with insurance, an exchange that allows individuals and small businesses to purchase affordable coverage, and a requirement that people who can afford insurance get insurance.
And I have no doubt that these reforms would greatly benefit Americans from all walks of life, as well as the economy as a whole. Still, given all the misinformation that’s been spread over the past few months, I realize—(applause)—I realize that many Americans have grown nervous about reform. So tonight I want to address some of the key controversies that are still out there.
Some of people’s concerns have grown out of bogus claims spread by those whose only agenda is to kill reform at any cost. The best example is the claim made not just by radio and cable talk show hosts, but by prominent politicians, that we plan to set up panels of bureaucrats with the power to kill off senior citizens. Now, such a charge would be laughable if it weren’t so cynical and irresponsible. It is a lie, plain and simple. (Applause.)
There are also those who claim that our reform efforts would insure illegal immigrants. This, too, is false. The reforms—the reforms I’m proposing would not apply to those who are here illegally.
AUDIENCE MEMBER: You lie! (Boos.)
THE PRESIDENT: It’s not true. And one more misunderstanding I want to clear up—under our plan, no federal dollars will be used to fund abortions, and federal conscience laws will remain in place. (Applause.)
Now, my health care proposal has also been attacked by some who oppose reform as a “government takeover” of the entire health care system. As proof, critics point to a provision in our plan that allows the uninsured and small businesses to choose a publicly sponsored insurance option, administered by the government just like Medicaid or Medicare. (Applause.)
So let me set the record straight here. My guiding principle is, and always has been, that consumers do better when there is choice and competition. That’s how the market works. (Applause.) Unfortunately, in 34 states, 75 percent of the insurance market is controlled by five or fewer companies. In Alabama, almost 90 percent is controlled by just one company. And without competition, the price of insurance goes up and quality goes down. And it makes it easier for insurance companies to treat their customers badly—by cherry-picking the healthiest individuals and trying to drop the sickest, by overcharging small businesses who have no leverage, and by jacking up rates.
Insurance executives don’t do this because they’re bad people; they do it because it’s profitable. As one former insurance executive testified before Congress, insurance companies are not only encouraged to find reasons to drop the seriously ill, they are rewarded for it. All of this is in service of meeting what this former executive called “Wall Street’s relentless profit expectations.”