By Shailagh Murray and Lori Montgomery
Washington Post Staff Writers
Friday, October 2, 2009 10:43 AM
The long quest to reform the nation's health-care system entered uncharted legislative territory early Friday when a key Senate panel wrapped up work on its bill and House and Senate leaders prepared for historic floor debates.
The Senate Finance Committee, the fifth and final congressional panel to contribute to the legislation, dispensed with its last amendment at 2:08 a.m., sending President Obama's top domestic policy initiative to a threshold that has eluded presidents since Harry S. Truman. As the panel completed the measure that is expected to form the backbone of health-insurance reform legislation, a political consensus large enough to carry the plan to final passage appeared to emerge.
In a statement issued early Friday, Obama hailed the bill authored by Senate Finance Committee Chairman Max Baucus, calling it "another milestone in our effort to pass health insurance reform." As a result of lawmakers' work, "we are now closer than ever before to finally passing reform that will offer security to those who have coverage and affordable insurance to those who don't," he said.
"We have a long way to go," Obama said, but he expressed confidence that Congress would pass a reform package "this year."
Baucus (D-Mont.) delayed a committee vote on the overall bill until next week, though he said he has enough support to pass the package out of committee. The bill, which Senate Majority Leader Harry M. Reid (D-Nev.) will merge with a Senate health committee measure, appears to meet the reform criteria Obama laid out last month in an address to Congress.
"We can all be very proud of what we have achieved here," Baucus said as the committee's work drew to a close, after churning through 564 amendments.
"This bill will lower taxes for more than 42 million Americans and reduce the federal deficit," he said in announcing the completion of work on the package. "This bill will protect Medicare benefits for seniors. This bill will significantly expand health coverage."
The battle lines for the remainder of the debate were clearly drawn during the committee's deliberations and centered on how the bill would affect the middle class.
Republicans on the panel said the measure was riddled with revenue provisions that would violate Obama's 2008 campaign promise not to raise taxes on middle-class Americans. "There are going to be a lot of people whose taxes are increased by this legislation," said Sen. Michael D. Crapo (R-Idaho).
Democrats said broad support for reform would drive the effort forward. "Every Democrat, from the most liberal to the most conservative, realizes that it serves America's interest and our own interest to pass a bill," said Sen. Charles E. Schumer (D-N.Y.).
The Finance Committee's package seeks to dramatically reshape the health insurance system by improving coverage for those who have it and making it more affordable for the millions of Americans who do not. It would prohibit private insurers from denying coverage based on preexisting conditions and bar them from limiting benefits, either annually or over a lifetime.
For the uninsured, the measure would create state-run insurance exchanges, where low- and moderate-income people without access to affordable coverage through an employer could shop for policies and apply for federal subsidies to mitigate the cost of premiums. And the bill would vastly expand Medicaid, the government health program for the poor, adding more than 10 million people over the next decade, according to the nonpartisan Congressional Budget Office.
One final piece of committee business was among the most significant: a measure that would have the effect of exempting 2 million people from the requirement to buy insurance and remove any possibility that people could face criminal penalties if they did not do so. The amendment was one of the few to garner broad bipartisan support.
Another area of consensus was the bipartisan opposition to creating a government plan that would compete with private insurers. The defection of five Democrats on a "public option" proposal offered Tuesday by Sen. John D. Rockefeller IV (D-W.Va.) underscored the reservations among moderate Democrats of venturing too far from the private, employer-based system that has long defined the nation's health coverage.
The Congressional Budget Office initially pegged the cost of expanding coverage under the Finance Committee's proposal at $774 billion over the next decade, making the package far cheaper than the $1 trillion plan House leaders proposed and the only bill that meets Obama's demand to keep costs under $900 billion. Baucus has said that adjustments made during two weeks of deliberations are likely to bring the final cost closer to that mark.
Baucus's staff members spent much of Thursday negotiating with individual senators to lock down their support. Obama has maintained an active, if behind-the-scenes, role in coaxing the committee across the finish line. White House officials said he called Sen. Olympia J. Snowe (Maine), the only Republican who may support the plan, on Tuesday, and phoned half a dozen committee Democrats on Thursday to ask about last-minute concerns.
The panel is expected to reconvene for a final vote Tuesday or Wednesday, giving congressional budget analysts time to determine whether the bill meets Obama's twin goals of significantly expanding coverage to the uninsured and not increasing the federal budget deficit. Reid then plans to merge the package with a measure approved by the Senate health committee and begin debate before the full Senate shortly after Columbus Day. The House also expects to begin action in mid-October.
Schumer, a strong advocate of a public option, said he was working to build support for the idea among moderate Democrats, who have been skeptical of any plan to expand the federal government's role in the health-care system. One idea that appeared to be gaining traction is a proposal by Sen. Thomas R. Carper (D-Del.) to let states decide how to encourage competition in their insurance markets, including through a public plan.
Beginning in 2013, the finance panel's package would require people to buy insurance or face penalties ranging up to $1,900, to be assessed on their income tax returns. It also would make it harder for taxpayers younger than 65 to deduct catastrophic medical expenses. Both provisions would fall heavily on the very taxpayers that Obama has vowed to protect, according to congressional tax analysts.
White House press secretary Robert Gibbs dismissed Republican claims that the middle class would suffer, noting that the fines would hit only people who do not buy coverage and called the GOP charge "a silly argument that we can easily dispense with."
GOP proposals to exempt middle-class taxpayers from fees and taxes in the bill were defeated on narrow 12 to 11 votes, but the proposals attracted the backing of two moderates on the committee -- Snowe and Sen. Blanche Lincoln (D-Ark.) -- suggesting that the issue could resurface as the debate advances.
Heading into the committee room mid-afternoon Thursday, Snowe said she was undecided about whether to support the bill and remained concerned that people could be forced to break their family budgets to buy insurance. She said she told Obama that any penalties should be deferred until "you're sure it's working on the affordability question."
Later, during committee debate, Snowe made the point more forcefully. "The obligation should be first and foremost on the United States government to ensure that these policies will be affordable in the marketplace. And right now we don't know that."