House Democrats pass health-care bill

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House passes health-care bill

The U.S. House narrowly passed landmark health care legislation Saturday night to expand coverage to tens of millions who lack it and place tough new restrictions on the insurance industry. The vote was 220-215.

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The deal cleared the way for dozens of antiabortion Democrats to back the package. The most passionate advocates of abortion rights were not happy, but few were prepared to vote down legislation that promises to achieve so many long-held party goals.

The House bill

The complex package would affect virtually every American and fundamentally alter vast swaths of the health insurance industry. Starting next year, private insurers could no longer deny anyone coverage based on preexisting conditions, place lifetime limits on coverage or abandon people when they become ill. Insurers would be required to disclose and justify proposed premium increases to regulators, and could not remove adult children younger than 27 from their parents' family policies.

For the elderly, the group that has been most skeptical of Obama's initiative, the House package would immediately offer discounts on prescription drugs and reduce a gap in Medicare prescription drug coverage, closing it entirely by 2019. Uninsured people who cannot get coverage could join temporary high-risk insurance pools, and unemployed workers would be permitted to keep their COBRA benefits until the public plan and insurance exchanges started in 2013.

In four years, the measure would establish a new insurance system. Businesses with payrolls exceeding $500,000 would be required to offer their workers insurance or pay a fine of as much as 8 percent of payroll. Individuals would be required to obtain insurance or pay a fine of as much as 2.5 percent of income. States would be required to extend Medicaid coverage to as many as 15 million additional people. Low- and middle-income individuals who still could not afford coverage could apply for federal subsidies through an insurance marketplace that would negotiate with private insurers to provide comprehensive policies alongside a government-run "public option."

Congressional budget analysts say the package would cover an additional 36 million Americans, leaving 18 million people without insurance by 2019, about a third of them illegal immigrants. To avoid increasing the deficit, Democrats would pay for the coverage expansion by slicing more than $400 billion from Medicare over the next decade, and by imposing a variety of new taxes, primarily a 5.4 percent surcharge on annual income over $500,000 for individuals and $1 million for families. Initially, the tax would hit only 0.3 percent of taxpayers, but that number would climb rapidly, because the income thresholds would not be indexed to inflation.

Obstacles overcome

Introduced on July 14, the House package was approved in sections by three House committees. Since August, Pelosi has huddled behind closed doors with various factions of her diverse caucus to merge the three parts into comprehensive legislation.

The sticking points were clear from the start. Conservatives opposed the bill's price tag and limited efforts to cut costs. Moderates, who face the toughest 2010 reelection battles, were wary of big-government overtones in the public option. Democrats from wealthy districts opposed the tax on high earners, which originally would have affected taxpayers with annual incomes as low as $280,000.

One after another, the obstacles were overcome -- except for the simmering dispute over abortion. In early October, Rep. Bart Stupak, an antiabortion Democrat from Michigan, met with Pelosi to express the strong objections of about 40 Democrats to a provision in the legislation that appeared to allow federal funding of abortion. Stupak said they would oppose the bill unless the language was changed. Pelosi was noncommittal.

Late Friday, the Stupak coalition was still holding strong, and had gained a powerful ally in the U.S. Conference of Catholic Bishops, whose leadership has close connections to Pelosi. Over the strong objections of Democrats who support abortion rights, the speaker relented to Stupak, awarding him the only Democratic amendment on the floor.

The Senate bill

Attention will now shift back to the Senate. If the Senate acts, negotiations to iron out differences between the two chambers could be wrenching. Among the toughest issues: whether the public option should include an "opt out" clause for states, as Reid has proposed; whether to require employers to provide coverage to their workers or take the less punitive approach preferred by Senate moderates; and whether to tax the rich or tax high-cost health-care policies, as the Senate proposed -- a provision economists call the most important provisions in either bill for reining in costs.

In his lunchtime speech to House Democrats, Obama did not touch on any of those issues. But he acknowledged the anxiety felt by lawmakers who watched independent voters abandon Democratic candidates in Virginia and New Jersey in Tuesday's elections, and he warned that voting down the most significant legislation of his young presidency would only complicate the party's political future.

"If you think the Republicans are not going to go after you if you vote no," the president said, according to several people present, "think again."