Obama, Party Tout Lower Figure for Health Reform

By Ceci Connolly
Washington Post Staff Writer
Friday, July 3, 2009

Senate Democrats and President Obama, trying to assuage fears about the cost of health reform, yesterday touted new estimates that put the price tag for one bill at $611 billion over the next decade.

But the measure drafted by the Senate health committee falls far short of Obama's goal of providing insurance to virtually every American. Analysis by the nonpartisan Congressional Budget Office, released in a letter yesterday, shows that it would cover just 39 percent of uninsured Americans in 2019 -- or about 21 million of the 54 million people expected to lack coverage if no change is made.

"The figures presented in this letter do not represent a formal or complete cost estimate for the draft legislation," CBO Director Douglas W. Elmendorf wrote. The draft legislation does not include details on how to pay for expanded coverage or administrative fees.

The latest missive from the budgetary scorekeeper is part of a wonky mini-drama over the struggle to meet Obama's promise to enact legislation that greatly expands health coverage without adding to the federal deficit.

A few weeks ago, the CBO concluded that proposals being considered by the health committee added up to $1 trillion over a decade and covered just 16 million uninsured.

Republicans pounced on the figure, and even many Democrats complained that it was far too high a price for such little improvement. Committee staffers reworked the bill -- and added a new provision requiring most employers to contribute to the cost of health insurance -- to arrive at the lower estimate. Under the new proposal, any business with more than 25 workers would be required to offer coverage or pay a $750 penalty per employee.

Both Obama and health panel leaders said yesterday that the new version, coupled with an idea the Senate Finance Committee is considering, would "cover 97 percent of Americans." A health committee spokesman said they are counting on the Finance Committee to expand Medicaid coverage to anyone whose income is up to 150 percent of the federal poverty level, or about $15,000 a year.

The Finance Committee bill has not been released and aides would not discuss what provisions may be in the final plan. Outside experts say a Medicaid expansion could add hundreds of billions of dollars to the cost.

Also yesterday, msnbc.com and a reporting group based at American University published an article examining connections between several health-industry firms and Nancy-Ann DeParle, head of the White House Office of Health Reform. The Investigative Reporting Workshop concluded that DeParle served on the board of several companies "that faced scores of federal investigations, whistleblower lawsuits and other regulatory actions."

The story said that five of the firms paid more than $500 million over a five-year period to resolve fraud or product-liability suits and four signed "corporate integrity agreements" promising to improve internal oversight of billing practices.

The reporting unit is run by Charles Lewis, the founder of the Center for Public Integrity, a journalism group.

White House spokeswoman Linda Douglass said DeParle divested of all health-care holdings at a loss and intends to recuse herself from administration decisions directly affecting any company with which she had dealings.

"Before joining any corporate board, she did extensive due diligence, talking with other board members, lawyers and others familiar with the company," Douglass said. If an investigation arose during her tenure on a board, DeParle pressed executives to comply fully, Douglass said.

"When she was in government" previously, "Nancy-Ann was known as a 'compliance hawk,' and she played that role as a board member as well," Douglass said.

In the 18 months prior to joining the administration, DeParle earned more than $2.3 million from several health-related firms and a private equity firm with holdings in the industry, according to her financial disclosure filing.

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