Sunday, October 4, 2009
THE BILL that will emerge this week from the Senate Finance Committee is the best version of health-care reform that Congress has mustered so far. That is both a testament to the committee chairman, Max Baucus (D-Mont.), and a rebuke to Congress, for even this latest version falls short of the standards that President Obama has set. And it is a warning, too, because from here on most of the pressures in Congress will push the legislation in a less responsible direction. If Congress is to pass a bill that greatly expands coverage, does not expand the deficit and begins to reduce health-care costs -- Mr. Obama's criteria -- he will have to begin playing a larger role.
Let's start with the Baucus bill's imperfections. It lays claim to passing Mr. Obama's test of not raising the deficit but manages to do so only by failing to pay for increases in Medicare physician reimbursement rates that everyone knows that Congress will approve -- about $230 billion over 10 years. This is akin to announcing that you have fully paid for renovating your house when one room has a big blue tarp where its roof should be. As House Majority Leader Steny H. Hoyer (D-Md.) put it, this may "look better, but it's a facade of looking better."
Even so, it's not clear that the working poor will be able to afford insurance under this bill's provisions. For example, a family of four making $44,000, or twice the poverty level, would have to pay more than $3,000 in premiums -- and would also face a typical deductible likely to be around $700 plus co-payments. The panel approved an amendment from Sens. Charles E. Schumer (D-N.Y.) and Olympia J. Snowe (R-Maine) to excuse more people from having to pay a penalty if they fail to obtain insurance. This does not make health insurance more affordable; it just makes not having insurance more affordable, and it means that 2 million more people will remain uncovered.
The pushing and pulling needed to win a committee majority has shaped a system that looks increasingly confused. Individuals earning up to 133 percent of the poverty level will be covered by Medicaid. The committee adopted an amendment from Sen. Maria Cantwell (D-Wash.) that would allow states to establish a different, privately administered program to cover those earning between 133 and 200 percent of the poverty level. Sen. John D. Rockefeller IV (D-W.Va.) won approval of his amendment to reinstate the CHIP program for children in low- and middle-income families. Then there are the newly created exchanges for small businesses and those without employer-sponsored insurance. This is an awfully balkanized arrangement in a field that benefits from clear enrollment rules and large risk pools.
Yet the Finance Committee bill emerges with an architecture for a reasonable compromise that would both expand coverage and help bend the cost curve. It at least begins to tax, albeit indirectly, employer-provided health insurance, which would be key to raising revenue and controlling costs. It moves in the direction of establishing a medical board that could mandate cost-efficient medicine with a minimum of political interference. And it envisions the sensible trade-off whereby everyone is required to obtain insurance and, in exchange for these new (and often healthy) customers, insurance companies stop discriminating based on prior unhealthy conditions.
The work now shifts behind closed doors, where the Finance bill will be melded with a significantly different version of reform produced by the Senate Committee on Health, Education, Labor and Pensions prior to floor consideration toward the end of the month. Most of the pressure will be toward giving away more goodies while raising less revenue. To get to the final result he has promised, Mr. Obama will have to push hard in the opposite direction.