By Shailagh Murray and Paul Kane
Washington Post Staff Writer
Friday, January 22, 2010; A06
As Democrats continued to grapple with the consequences of their loss in Massachusetts, House Speaker Nancy Pelosi on Thursday eliminated the most obvious avenue for completing health-care reform, saying the House will not embrace the version of the legislation already approved by the Senate.
"I don't think it's possible to pass the Senate bill in the House," Pelosi told reporters after meeting with her caucus. "I don't see the votes for it at this time."
Pelosi (D-Calif.) had struggled to sell the Senate legislation to reluctant Democrats since Tuesday, when Republican Scott Brown's upset victory in the Massachusetts Senate election cost Democrats their filibuster-proof Senate majority. House approval of the Senate package would have delivered the bill quickly to the president's desk, allowing Democrats to move on to job creation, their election year priority.
But many House members could not be persuaded to back the Senate version. They demanded that the Senate pass a separate bill amending the health-care legislation before they consent to support it.
Pelosi described her members as vehemently opposed to a provision that benefits only Nebraska's Medicaid system, language added to win the vote of Sen. Ben Nelson (D-Neb.). Also problematic are the federal subsidies the Senate would offer to uninsured individuals, which some House liberals view as insufficient, and the excise tax it would impose on high-value policies, which could hit union households.
"There are certain things the members simply cannot support," Pelosi said.
Senate Democrats agreed to many of the changes during negotiations this month to merge the chambers' respective bills. Brown's victory, however, leaves them unable to overcome a filibuster on their own.
The only other option under consideration is to write a new bill, possibly scaled back considerably to win Republican support, an undertaking that could consume months, with no guarantee of success.
Senior Democrats said they were still absorbing the implications of their election loss. "Obviously, you cannot just proceed as if nothing happened, because something very significant happened," said Sen. Charles E. Schumer (N.Y.), a member of the Democratic leadership. "There's a strong view in both caucuses that we want to do some good things in health care, and the question is how -- how much and how quickly?"
Schumer added: "I don't think we want to do health care [for] the next three months. So there are trade-offs here, and that's what everyone's exploring."
Senate Democratic leaders met late Thursday to assess their prospects. "We are going to pass health-care reform," said Senate Finance Chairman Max Baucus as he left the meeting. "We're just talking about the pros and cons" of different approaches.
White House spokesman Robert Gibbs said Obama thinks the best path is "giving this some time, by letting the dust settle, if you will, and looking for the best path forward."
Either scenario -- fixing the Senate bill or writing new legislation -- could involve the use of reconciliation, a fast-track budget procedure designed to make it easier to approve politically difficult measures that cut spending or raise taxes. Reconciliation bills cannot be filibustered, so Senate Democrats could pass the legislation with only 51 votes.
The drawback is that such bills are generally barred from including provisions that do not affect the federal budget, meaning much of the health-care package might have to be scrapped under such a scenario.
Experts on the congressional budget process said that Democrats could make use of a reconciliation health-care provision that was tucked into last year's budget but that the language will expire if a budget is approved in the spring. Also, reconciliation is politically volatile, and would inevitably be cast by Republicans as a heavy-handed maneuver to circumvent Brown's victory.
Many Democratic lawmakers were hesitant to commit to the idea of writing a new bill, and some urged House members to reconsider.
"Keep working on it. My message would be: Keep working on it," said Sen. Mary Landrieu (D-La.). "We can come back next year or the following year" to fix parts of the Senate bill that the House opposes.
One potentially promising approach would be to reduce the bill to its most popular components, including insurance industry reforms and certain incentives for expanding coverage, for instance, through small business pools and by allowing young adults to remain on their parents' employer policies. Obama spoke approvingly of such a package in an ABC News interview Wednesday, but White House aides made clear that he would prefer a broader bill.
A scaled-back bill might appeal to Republicans, although few have expressed interest in helping Democrats rescue their top domestic priority. The most likely convert would be Sen. Olympia J. Snowe (Maine), a Republican moderate who supported an earlier version of the Senate bill but backed off because she feared that it would require coverage unaffordable to most Americans.
"It's a question of going back to the drawing board," Snowe said of the reform effort. Obama "has to build a consensus, broader support," she said. "People were really very much concerned, if not opposed, to the size and scope of this legislation and the uncertainty that emanated from it."
Despite Pelosi's announcement, some Democrats said they remained hopeful that Congress to would find a way to keep the current legislation alive.
Nelson, whose Medicaid provision repelled House members and drew Republican ridicule, was the last Democrat to endorse allowing a vote on the Senate bill. He said he wasn't ready to abandon the effort. "Something could yet be done," Nelson said.
Rep. Henry A. Waxman (D-Calif.), one of the main authors of the House legislation, said he remained optimistic that some form of health legislation would pass. "I think there's still the political will to do health reform," Waxman, chairman of the Energy and Commerce Committee, told reporters. "I think it's an essential for us to accomplish."