WASHINGTON (CN) – Illustrating the long and poisonous reach of the health care debate, a senate subcommittee hearing on the normally snooze-worthy topic of bankruptcy quickly turned into a heated, partisan exchange featuring Senator Al Franken dressing down a witness from a conservative think tank with sarcasm and statistics.
Rhode Island Democratic Sen. Sheldon Whitehouse said his intent in calling for testimony before the Senate Judiciary Subcommittee on Oversight and the Court was “to examine a particularly cruel effect of our current system — the millions of American struggling with medical debt.”
“The bankruptcy code does not distinguish between debtors driven into bankruptcy by medical bills and those who became insolvent through poor planning or reckless spending,” said Whitehouse who chairs the subcommittee.
Whitehouse, who has introduced a bill that would make it easier for medical debtors to file for bankruptcy, argued that the prevalence of medical debt underlines the larger problems in the American health care system. But so long as they are required to file for bankruptcy, that process should be streamlined.
He referred to a recent Harvard University study which found that 60 percent of personal bankruptcies result from medical debt.
Alabama Ranking Member Sen. Jeff Sessions was the only Republican to attend the hearing on Tuesday. He argued that the bankruptcy system works well and expressed concern about abuse if the procedure is more relaxed.
Sparks flew as Whitehouse defended his bill with vigor, attacking the position of anyone who appeared to oppose his bill. The heat of the broader health care debate currently raging in Congress seemed to spill into the bankruptcy debate as each of the three Senators present used the issue as a platform to launch into discussions on the American health care system.
The panel testifying was a mix of medical debtors and experts.
Kerry Burns, a witness on the panel, testified that her son was treated for cystic fibrosis before he died while she fell into debt. “The collection calls were unrelenting, upwards of 30 calls a day,” she said.
As part of the bankruptcy filing process, Burns has to undergo credit counseling, where she was asked how she could have avoided bankruptcy. She called the course “humiliating” and “a slap in the face,” and to this day has not successfully filed for bankruptcy because she had not filled out the forms.
While Whitehouse was quick to express his outrage at the process she was required to undergo, after watching her son die, Sessions appeared more accepting.
“When the government starts to regulate anything, including health care, you have rules,” Sessions answered.
Whitehouse has proposed the Medical Bankruptcy Fairness Act, which he said would selectively waive the means test and unnecessary credit counseling requirements, which can be costly and time-consuming. He said the bill would also make it easier for medical debtors to keep their houses.
Aparna Mathur from the American Enterprise Institute, a conservative think tank, said the act could lead to unintended consequences. “This particular act could be open to abuse and fraud,” she said, apparently worried that medical debtors might be less responsible for paying their full debt.
Whitehouse said it sounded like her concerns were with the unintended consequences to credit card companies, and not to patients.
Mathur replied that it would be harder for patients to get loans if the legislation were to pass.
When Diana Furchtgott-Roth from the Hudson Institute attacked everything from the public option to the health bill that passed out of the Senate Finance Committee last week, Whitehouse remarked that she “veered across three lanes of traffic.”
“Did you actually read the bill that is the subject of today’s hearing?” he asked.
When Whitehouse asked her about the issue she had failed to focus on — bankruptcy — Furchtgott-Roth replied simply that the current system does a good job.
“Did it do a good job for Ms. Burns?” Whitehouse rebutted, visibly frustrated. Furchtgott-Roth simply replied that Burns had been in a bad situation.
Minnesota Democratic Sen. Al Franken was the next batter, and took his swings at Furchtgott-Roth. He joined the rest in using the bankruptcy platform to question the health care system in the United States, asking her how many medical bankruptcies there are in Switzerland and France.
Furchtgott-Roth, who wore a silk turquoise jacket, said she would have to research that and get back to the committee.
But Franken said he knew the answer. “It’s zero,” he said, before asking her about Germany.
She replied again that she didn’t know, but said she would guess from the line of questioning that it is zero.
“Well, you’re very good. You’re very fast,” Franken said sarcastically
But just as it seemed Franken was done asking questions, Furchtgott-Roth broke from tradition and fired back. “Do you know the cancer survival rates in those countries?” she asked forcefully.
The United States is reportedly one of the top countries in cancer survivorship.
“That study isn’t legitimate,” Franken replied, and said she was cherry picking to make the American system look better than it is.
Sessions, in opposing certain aspects of the bill, brought up the question of how to distinguish between who has been bankrupted by medical bills and by other means. He opined that even gambling debts might be considered medical debts.
Currently, debtors who earn below the median income might qualify to have all their debts cleared, Sessions noted, and added that 80 percent of people who file for bankruptcy are below the median income.