CQ TODAY ONLINE NEWS
– HEALTH
Updated July 2, 2009 – 12:33 p.m.
Revised Senate Health Bill Includes Employer Mandate, Public Plan Option
By Alex Wayne, CQ Staff
Revised health overhaul legislation under development in the Senate would result in insurance coverage for 97 percent of Americans, leaders of a key committee said Thursday, though the total cost is still unknown.
The Health, Education, Labor and Pensions Committee is expected to resume work next week on the latest version of its overhaul bill, released Wednesday night.
Chairman Edward M. Kennedy , D-Mass., and Sen. Christopher J. Dodd , D-Conn., outlined the revised measure in a letter to other panel members. The Congressional Budget Office’s estimate of the bill’s cost and coverage puts a far better shine on the legislation than its assessment of an earlier, incomplete version which CBO said would cost $1 trillion over 10 years and cover only about 16 million of the 47 million uninsured Americans.
The new estimate, according to the letter, concludes that the HELP bill would cost $611 billion over ten years, and would provide insurance to 90 percent of Americans, excluding illegal immigrants. HELP aides told reporters in a conference call Thursday that an assumed expansion of Medicaid to cover people earning less than 1.5 times the federal poverty level — about $33,075 for a family of four in 2009 — would bring total coverage to 97 percent of the population.
The Medicaid expansion is part of a bill under development by the Finance committee. HELP Democrats’ assumption may be optimistic; Finance members have said they may have to scale back the Medicaid expansion out of concerns about its cost.
The cost estimate Dodd released Thursday pertains only to provisions of the HELP bill; it does not include Finance provisions, such as the Medicaid expansion, that are expected to bring the total cost of a combined overhaul bill to about $1 trillion over ten years.
Nonetheless, Dodd said in a Thursday morning conference call with reporters that the new cost estimate for the HELP bill had brought Congress to “the cusp of a historic reform of health care.”
Dodd, who has stood in for Kennedy while the chairman battles brain cancer at home in Massachusetts, began a markup of the bill before the Fourth of July recess despite the earlier, unfavorable CBO estimate. That drew sharp fire from Republicans, who assailed the measure as overly expensive, and through amendments, slowed the markup to a crawl.
All About CBO’s Numbers
Democrats have struggled with CBO to get the agency’s cost estimates of their legislation down to a less staggering price tag. Dodd alluded to the behind-the-scenes negotiations during the Thursday conference call, at a point when he thought reporters were unable to hear him.
“This is great news, staff really did a wonderful job,” he told other senators who had joined him on the call. “I talked to [CBO director} Doug Elmendorf more times over the weekend, trying to get these numbers. It got to be pretty frustrating. The results are great.”
The latest draft bill includes a government-run health insurance plan that would compete with private insurers. It also would mandate employers to provide health insurance to their workers or pay a fee instead — a so-called “pay-or-play” requirement that is opposed by many business lobbying groups but drew important support this week from Wal-Mart Stores Inc.
Businesses with 25 or more employees that don’t offer insurance would have to pay the government $750 per worker per year, or $375 for part-time workers. Those with fewer than 25 employees would be exempt from the requirement. HELP aides said employers would be required to pay 60 percent of the cost of insurance premiums for their workers in order to avoid the charge.
“It’s a cost, I realize that,” Dodd told reporters. “But a modest cost. Indeed, we would hope employers would continue to provide coverage for people.”
Together, the two new sections increased the bill’s coverage and reduced its cost, according to CBO. The HELP leaders said that the bill would result in very few workers losing their employer-sponsored insurance, a key concern for many lawmakers. A HELP aide said that the employer “pay-or-play” requirement was the most important element in reducing the cost of the bill — the requirement both produces revenue for the government, through the fee, and encourages employers to maintain coverage for their workers.
The revised bill also reduces subsidies available to people buying plans through new “gateways” the bill would create to make it easier for people to shop around for insurance Families earning less than four times the poverty level — about $88,000 for a family of four — would be eligible for subsidies, down from the original bill’s five times poverty.
The government-run plan, or “public plan option,” as Democrats call it, would be run by the Health and Human Services Department and would be available to any American who purchases insurance through new government-run “Health Insurance Gateways” that the bill would create. Dodd said the public plan in the bill had been endorsed by all 13 Democratic members of the HELP committee.
“I’m convinced — members of the committee are convinced — that when we have a public option competing with private insurance plans, that both will be better as a result,” said Sen. Sherrod Brown , D-Ohio, a HELP member who joined Dodd on the conference call.
The public plan would offer people who lack insurance “an opportunity to access quality, affordable care,” Kennedy and Dodd wrote in their letter.
“For those who have insurance but still struggle to get the care they and their families need, the healthy competition provided by our proposal will offer a wider variety of options while keeping costs down,” they wrote.
Democrats argue that a public plan will force private insurance plans to provide better service at lower cost. The private insurance industry and most Republicans strenuously oppose the idea, arguing that the public plan would take over the insurance market and end employer-sponsored insurance. The CBO estimate of the revised bill, however, projects that the number of people with employer-sponsored insurance would barely change over the next 10 years.
Democrats have been emboldened to push for the public plan in recent weeks by a series of polls showing significant public support for the idea. Kennedy and Dodd mentioned the poll results in their letter.
“Even in the face of scare tactics and false claims that a public option would destroy consumer choice or the insurance industry, a vigorous public option is what Americans want,” they wrote.
One section of the bill is still incomplete: a provision to authorize the Food and Drug Administration to approve generic versions of advanced biologic drugs derived from proteins. While the brand-name biologics industry accepts that Congress will approve generic competition to its products, just as in the chemical drugs market, it is lobbying hard for a generous period of market exclusivity for new biologic drugs and to require generic competitors to subject their products to clinical testing.
First posted July 2, 2009 9:29 a.m.
Comments
The annual payment per employee from businesses with over 25 employees ($750) wouldn't cover two months of my premiums for a basic policy with my HMO. Still, I doubt that reality will keep the Chamber of Commerce, or the national manufacturers association, or any of the other big business lobbies from crying "job destroyer!"
AMERICA'S NATIONAL HEALTHCARE EMERGENCY! It's official. America and the World are now in a GLOBAL PANDEMIC. A World EPIDEMIC with potential catastrophic consequences for ALL of the American people. The first PANDEMIC in 41 years. And WE THE PEOPLE OF THE UNITED STATES will have to face this PANDEMIC with the 37th worst quality of healthcare in the developed World. STAND READY AMERICA TO SEIZE CONTROL OF YOUR NATIONAL HEALTHCARE SYSTEM. We spend over twice as much of our GDP on healthcare as any other country in the World. And Individual American spend about ten times as much out of pocket on healthcare as any other people in the World. All because of GREED! And the PRIVATE FOR PROFIT healthcare system in America. And while all this is going on, some members of congress seem mostly concern about how to protect the corporate PROFITS! of our GREED DRIVEN, PRIVATE FOR PROFIT NATIONAL DISGRACE. A PRIVATE FOR PROFIT DISGRACE that is in fact, totally valueless to the public health. And a detriment to national security, public safety, and the public health. Progressive democrats the Tri-Caucus and others should stand firm in their demand for a robust public option for all Americans, with all of the minimum requirements progressive democrats demanded. If congress can not pass a robust public option with at least 51 votes and all robust minimum requirements, congress should immediately move to scrap healthcare reform and request that President Obama declare a state of NATIONAL HEALTHCARE EMERGENCY! Seizing and replacing all PRIVATE FOR PROFIT health insurance plans with the immediate implementation of National Healthcare for all Americans under the provisions of HR676 (A Single-payer National Healthcare Plan For All). Coverage can begin immediately through our current medicare system. With immediate expansion through recruitment of displaced workers from the canceled private sector insurance industry. Funding can also begin immediately by substitution of payroll deductions for private insurance plans with payroll deductions for the national healthcare plan. This is what the vast majority of the American people want. And this is what all objective experts unanimously agree would be the best, and most cost effective for the American people and our economy. In Mexico on average people who received medical care for A-H1N1 (Swine Flu) with in 3 days survived. People who did not receive medical care until 7 days or more died. This has been the same results in the US. But 50 million Americans don't even have any healthcare coverage. And at least 200 million of you with insurance could not get in to see your private insurance plans doctors in 2 or 3 days, even if your life depended on it. WHICH IT DOES! If President Obama has to declare a NATIONAL STATE OF EMERGENCY to rescue the American people from our healthcare crisis, he will need all the sustained support you can give him. STICK WITH HIM! He's doing a brilliant job. THIS IS THE BIG ONE! THE BATTLE OF GOOD Vs EVIL! Join the fight. Contact congress and your representatives NOW! AND SPREAD THE WORD! God Bless You Jacksmith – WORKING CLASS
I sincerely applaud Senators Dodd and Kennedy for their Herculean work. A vigorous public plan option is the only way to keep the private carriers honest after failing us, and have them truly compete. Their free lunch is over. The people have spoken and the Senate Democrats have responded. The Public Plan Option and certain regulations against cherry-picking will be most effective weapons against the health care crisis that the private carriers have caused.
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