Statement of Judiciary Committee Chairman Lamar Smith Subcommittee on Intellectual Property, Competition and the Internet Hearing on "Health Care Consolidation and Competition After PPACA"

Statement of Judiciary Committee Chairman Lamar Smith
Subcommittee on Intellectual Property, Competition and the Internet
Hearing on “Health Care Consolidation and Competition After PPACA” 

Chairman Smith: I am proud of the work that the Judiciary Committee has done to protect Americans’ rights from being threatened by the Obama administration’s so-called Affordable Care Act. 

This Committee has helped expose the unprecedented and, to me, unconstitutional individual mandate, which requires every American to buy health insurance.  This Committee also has worked to protect Americans’ religious liberty from Obamacare mandates that would violate their faith.

I signed Amicus briefs with the Supreme Court urging them to recognize that the Act is unconstitutional and to strike down the entire law.  And I have joined my Republican colleagues in voting 26 times to defund all or part of Obamacare.

Setting the constitutional concerns aside, today’s hearing focuses on a different sort of problem with Obamacare.  The law is not only unconstitutional, but it also scrambles the economics of America’s health care system in a way that reduces competition.  And when competition is reduced, higher prices, less innovation, and lower quality care inevitably follows.

Obamacare is not just bad policy, it is bad economics as well.

We know that centralized, top-down, government run systems do not work as well as competitive markets.  In a government run system, businesses respond mostly to government mandates.  In a free market system, businesses respond mostly to the needs and wants of their customers. 

But Obamacare places government decision making above free market competition.

Under Obamacare, the government not only tells Americans that they have to buy health insurance; it also tells them what that insurance must cover.

Rather than leaving medical professionals free to care for patients as they see best, and compete with each other to offer better care, the new law buries doctors under a mountain of regulatory paperwork.  

I expect the testimony at today’s hearing will demonstrate how the Administration’s regulatory approach reduces competition and leads to higher medical costs and lower quality care.

The first victim of Obamacare’s regulations will be the small, independent and innovative insurance companies and health care providers. 

The new law already stifles the ability of smaller, more innovative insurance companies and medical practices to offer innovative business models that might improve on current practices.

The second victim of Obamacare will be competition as these small businesses either go out of business, consolidate into larger businesses, or are never started at all.

The ultimate victim will be the American people who will receive higher cost, lower quality care.  And to add insult to injury, taxpayers are the ones who are forced to foot the bill.

Competition and innovation benefit patients.  Overregulation benefits only the largest incumbent companies and the status quo.

During the debate over Obamacare, Jeffrey Flier, Dean of Harvard Medical School, wrote that it:
“would undermine any potential for real innovation in insurance and the provision of care. It would do so by overregulating the health-care system in the service of special interests such as insurance companies, hospitals, professional organizations and pharmaceutical companies, rather than the patients who should be our primary concern.”

Accordingly, Dr. Flier gave the bill “a failing grade.”  I agree. 

Obamacare violates both the Constitution and common sense.  Unfortunately, if it is not declared unconstitutional, repealed, or modified, the worst is yet to come.

Ideally, Obamacare would be replaced with a system that promotes competition, innovation and the best interests of the American people.