Updates from Washington, D.C. on Healthcare reform

June 2009

Mark Ups Begin on the American Health Choices Act

The Senate Health, Education, Labor and Pensions Committee began consideration of the American Health Choices Act on June 17, despite many concerns about the size, scope and cost of the bill.

The bill is still missing key sections, including details on a government-run public plan, employer mandate and financing. The markup is being led by Senator Chris Dodd in the absence of ailing Senator Ted Kennedy. More than 380 amendments have been filed on the bill, with more to come after the missing pieces of Title One of the bill are released, which will supposedly happen later today.

During opening statements on June 17, the Republicans on the committee derided the legislation, its incomplete cost data and the speed at which it is being pushed forward. Senator John McCain was perhaps the most strident, calling the markup up "a joke." But McCain was echoed by other GOP Committee leaders with Senator Judd Gregg interrupting Dodd's opening statement by asking, "How do you mark up a bill that you don't know what it costs?"

In his opening statement, ranking member Mike Enzi said, "I hope that Democrats will stop trying to rush this very flawed, deeply partisan bill and start working with us on a bipartisan solution to ensure every American has access to quality, affordable care."

The GOP universally noted the lack of bipartisan discussions in the weeks leading up to the release of the bill, although they acknowledged that the process had improved once Dodd stepped in.

The bill has been criticized on many fronts as overly far-reaching and costly. The Congressional Budget Office's preliminary analysis of the cost of some of the coverage provisions already totals up to more than $1.3 trillion dollars, but will only insure about 16 million more people. CBO also estimated that the Kennedy/Dodd bill would cause 15 million Americans to lose their employer-sponsored coverage.

Even the White House backed away from the legislation after the CBO letter was released. "This is not the Administration's bill... And it's not even the final Senate Committee bill," White House Press Secretary Robert Gibbs said.

The full tally of the bill is still unknown as the cost has yet to be determined for items such as a Medicaid expansion up to 150% of the FPL, the government-run public plan, an employer mandate, implementing the proposal, establishing and implementing the "gateways" or exchanges, and the proposal's effects on spending for other federal programs.

The senators began considering health care quality amendments relative to Title Two of the bill on June 18, with 20 more to consider in this title on June 19. After that, the plan is to mark up health care workforce provisions in Title Four. The health care coverage provisions of most direct relevance to NAHU are in the still incomplete Title One, which isn't scheduled to be marked up until later next week.

Senate Finance Committee Delays Release of Health Reform Concepts

The Senate Finance Committee Chairman Max Baucus announced on Wednesday that his committee would not release its proposed health reform legislative concepts as expected this week, and that the markup of the Finance Committee legislation would not occur until after the Senate's Independence Day recess.

The delay followed word leaking to the public that the initial draft of the committee's legislation was projected to cost more than $1.6 trillion over 10 years. Baucus pledged to cut at least $600 billion from his measure and said the committee would not bow to political pressure to release an incomplete bill but instead act when the bill was completely ready.

Democratic Committee members walked through the concepts on June 18, looking for spending reductions while considering reduced levels of subsidies to individuals purchasing private coverage, a limited Medicaid expansion and potential caps to the employer exclusion as a revenue raiser, among other things.

According to slides from the meeting, a government-run public plan option is not in the legislation currently, but a version of non-profit government-backed cooperatives to purchase health insurance coverage is included. One such cooperative was proposed last week by Senator Kent Conrad as a possible compromise on this controversial issue. An employer mandate as well as its scope and potential penalties is also still under debate.

The Finance Committee's delay jeopardizes President Obama and Democratic leadership's aggressive timeline to have health care bills passed through both houses of Congress next month. The original intent of Senators Kennedy and Baucus was to pass two separate pieces of legislation through their respective committees and later merge them on the Senate floor before they adjourn for the August district work period.

GOP House Leadership Health Reform Proposal

House Republicans outlined their own health care bill this week but acknowledged that, like the offerings from Democrats, it leaves some questions unanswered.

The Republicans hope to head off Democratic efforts to increase the government's role in health care by strengthening private insurance and making coverage cheaper and easier to obtain. But Republican leaders offered what largely amounts to a collection of talking points. Lawmakers involved in the discussions said they are still haggling over the details.

"It's still a work in progress," said Rep. Charles Boustany, Jr., a member of the group assigned to develop health policy. "We're making a serious effort to get a bill together that a majority of our caucus can embrace."

A spokesman for Rep. Roy Blunt, who leads the GOP health group, said Republican leaders aim to have a bill ready by the time House Democrats bring their own plan to the floor next month.

According to the outline, the Republican plan will focus on expanding insurance coverage in part by allowing states to jointly regulate private insurance plans and allowing small businesses to join in partnerships to buy coverage for their employees. Both individuals and small businesses would receive new tax deductions and tax credits-in unspecified amounts-to help cover insurance premiums.

The outline draws heavily from Republican legislative proposals in past Congresses, including limits on medical malpractice lawsuits, expansion of HSAs, and steps to make the prices of medical procedures and insurance coverage more transparent.

The aim is to give states and businesses more flexibility in regulating and buying insurance without creating new mandates on insurers that Democrats have included in their legislation, including requirements that insurers cover people with pre-existing conditions, provide a minimum level of benefits, or limit differences in premiums for older or sicker people. Republicans believe that increasing competition in private insurance markets would make such mandates unnecessary.

Republicans said they would reduce the number of uninsured people-now estimated at about 46 million-by as much as 7 million simply by allowing children to stay on their parents' insurance plans until age 25. They also propose allowing people on Medicaid and the Children's Health Insurance Program to convert the value of their coverage into a voucher to buy private insurance.

Republicans said they did not know how much their plans would cost, and they proposed no way of paying for its provisions, except for a crackdown on fraud and waste in Medicare. But they vowed that their bill would cost less than the $1 trillion over 10 years that Democrats are contemplating. Republican leaders have, however, rejected one way to pay for an overhaul: by taxing any portion of workers' health benefits.

[Reprinted from NAHU Newsletter June 19, 2009. Everyone is urged to contact their Congressmen, Senators and the Whilte House, to voice their views on the changes pending in our health care system.

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