Senator James Jeffords
Chairman, Committee on Health, Education, Labor and Pensions
U.S. Senate
Washington, D.C. 20510


Dear Mr. Chairman:

On behalf of eHealthInsurance, we are pleased to join you, Senator Breaux, Senator Lincoln, Senator Frist and Senator Snowe, in support of the Bipartisan "Reach" Act of 2001, offering relief and expanded access to health coverage through tax credits for health insurance.

By way of background, eHealthInsurance markets and sells health insurance from a broad selection of health insurance companies nationwide at the best available prices. Since 1997, the reach of the Internet has allowed eHealthInsurance to become America's leading distributor of health insurance to individuals and families, online or offline, and one of only a few companies that sells health insurance to individuals and small businesses nationwide.

Over 40 percent of those who have purchased health insurance through eHealthInsurance.com were previously uninsured. This realization has caused us to become actively involved in seeking realistic, executable solutions to this serious problem of the uninsured, through both private and public sectors. Hence, we stand ready to provide our factual knowledge and experience in the cost of health insurance and our perspective on the potential impact of tax credits on American consumers.

We know your proposal for tax credits will have a powerful influence on affordability by looking back at an historical sample of the thousands and thousands of customers who have applied for insurance through eHealthInsurance.com:

• 77 percent of singles and families selected policies where the tax credits would cover 75% to 100% of their premium, and more than half of them selected policies that would be fully covered by the tax credit amount.
  
• 81 percent of families selected policies within 75% to 100% of the $2500 tax credit for families.
  
• 75 percent of single persons selected premiums within 75% to 100% of the $1000 tax credit for individuals.

Objectively and subjectively, we conclude the proposal will have broad impact since:

• Recorded comments from our customers state that people would have purchased health insurance sooner had the government offered a tax credit.
  
• The proposed tax credits will empower Americans in an income range that is currently not eligible for economic assistance, such as Medicaid.
  
• The introduction of tax credits will trigger many uninsured Americans at all income levels to reevaluate their assumptions about the cost of health insurance by seeking information for themselves. As studies have shown, factual pricing information surprises many of the uninsured, leading them to purchase an affordable policy.

We have been discussing with Members of Congress a broad strategy, in an effort to achieve a bold, but realistic objective of reducing the number of uninsured in America by half by 2010. These tax credits represent one of many important steps alongside subsidies for the "hard to insure" or chronically ill, options to reduce the barriers that exist for small businesses, and others.

We look forward to again working with you to see that this legislation and other proposals to address the uninsured receive appropriate consideration by both the House and the Senate, and the signature of the President for enactment into law in the very near future.

Sincerely,