Senate vote blocks plan for permanent fix to Medicare payments to doctors

White House Chief of Staff Rahm Emanuel, left, and Office of Management and Budget Director Peter Orszag, right, walk in the Capitol after they attended a Senate health care negotiators meeting Tuesday, Oct. 20, 2009, in Washington. (AP Photo/Manuel Balce Ceneta)
White House Chief of Staff Rahm Emanuel, left, and Office of Management and Budget Director Peter Orszag, right, walk in the Capitol after they attended a Senate health care negotiators meeting Tuesday, Oct. 20, 2009, in Washington. (AP Photo/Manuel Balce Ceneta) (Manuel Balce Ceneta - AP)
By Shailagh Murray
Washington Post Staff Writer
Thursday, October 22, 2009

The Senate found rare bipartisan agreement on a health-care issue Wednesday as 13 Democrats joined all 40 Republicans to block a permanent repeal of Medicare's payment formula for doctors.

Although sympathetic to fixing the root problem, lawmakers concluded that the legislation's $247 billion 10-year price tag was too steep in an era of record deficits.

The "doc fix" has become a near-annual ritual in Congress: Lawmakers routinely override the formula that sets Medicare payments to doctors, a move to prevent physicians from turning away Medicare patients because they are paid too little for the visits. While the vast majority in Congress agree that the formula, established in a 1997 deficit-reduction bill, is a failed model, producing the enormous sum needed to eliminate it has proven impossible. Instead, lawmakers resort to temporary fixes.

Although Republicans participated in talks to find ways to offset the $247 billion, no single revenue source found consensus, and GOP senators decided to turn Wednesday's vote into a referendum on deficit spending and the price tags of the huge health-care reform bills slated to come to the House and the Senate next month.

"Americans are increasingly alarmed by the expansion of our national debt and this spending binge that we're putting on the national credit card," said Senate Minority Leader Mitch McConnell (R-Ky.). "They're asking us to do what they've been doing: They want us to take out the scissors and cut the charge card."

To quell the concerns of moderates, meanwhile, Senate negotiators were leaning against imposing a mandate on employers to provide health-care coverage as they continued to piece together the bill they will bring to the floor. But this could further anger liberals, who consider the mandate a primary pillar of reform -- and who are already upset that a government-run insurance option may not be part of the package.

The employer mandate is among a handful of major differences between two Senate bills being melded into single vehicle by Senate Majority Leader Harry M. Reid (D-Nev.), two of his senior colleagues and White House aides. Those talks could wrap up as early as Friday, participants said. The House also is nearing completion of its final bill.

Unlike the House, which would force employers to offer insurance or pay a stiff fine, the Senate is split over how firmly to press companies into providing coverage. The Senate health panel's bill took an approach similar to the House's, but the Senate Finance Committee adopted a less punitive plan to win support from moderate Democrats and Sen. Olympia J. Snowe (Maine), the only Republican on the committee to vote for the bill.

Instead of a mandate, the finance panel's legislation includes a "free rider" provision that would require companies to reimburse the government if their workers do not have access to affordable coverage and qualify for federal subsidies to purchase insurance on the open market.

Critics have argued that this approach could discourage companies from hiring low-income workers, but Senate negotiators think they have found ways to adjust the provision to remove potential disincentives. Finance Committee Chairman Max Baucus (Mont.), who is working with Reid to craft the final Senate bill, said negotiators are considering a "significant penalty for those [companies] that don't provide coverage." But, he added, "there's not a mandate."

Other senior Democrats who are familiar with the talks said that the issue hasn't been conclusively decided but that a mandate akin to the one in the House bill seems unlikely.

Baucus said the group is also considering reducing the amount of coverage people would be required to buy under an individual mandate, which the Senate bill is likely to impose, to make policies more affordable. He said negotiators also are evaluating numerous versions of a government-run insurance plan. "Everybody's looking for the silver bullet, and I don't know that's been found yet," Baucus said.

Across the Capitol, the House Judiciary Committee took tough action against the health insurance industry, voting Wednesday to strip federal antitrust protections shielding companies from investigations into price-fixing and other practices.

Although Democrats have led the repeal push in recent weeks, the committee's 20 to 9 vote came with the support of three Republicans: Rep. Dan Lundgren, a former California attorney general; Rep. Louie Gohmert (Tex.), a former judge; and Rep. Tom Rooney (Fla.), a former state assistant attorney general.

"This measure fixes a mistake sitting on the federal statutes for over 60 years," said Judiciary Committee Chairman John Conyers Jr. (D-Mich.).

In a letter sent to Conyers before the vote, Karen Ignagni, president of America's Health Insurance Plans, the industry trade group, criticized the legislation as attempting "to remedy a problem that does not exist."

Senate Judiciary Committee Chairman Patrick J. Leahy (D-Vt.) said he also would seek to repeal the exemption in an amendment to the health-care bill when it reaches the Senate floor.

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