Health-Care Reform 2009

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Last week, the Senate Finance Committee voted 14 to 9 to approve its health reform bill -- the fifth legislative committee to pass reform legislation. Here's a rundown of where things stand -- and what to expect in coming weeks.

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#1 Why was last Tuesday's Senate Finance Committee vote seen as such a big deal?

The Senate Finance Committee was the graveyard of health-care reform in 1994 and proved the toughest panel to conquer this year because of its high concentration of moderate Democrats. It was the last of the five congressional committees engaged in health-care reform to complete its work, but it also has the most sweeping jurisdiction. After months of negotiations and substantial Republican input, the committee produced the least costly and most comprehensive of the pending reform bills, and the legislation is expected to serve as the foundation for a final bill. It also is the only version of reform to have gained some GOP support, with the committee vote of Sen. Olympia J. Snowe (Maine). Chairman Max Baucus (D-Mont.) will remain a key negotiator for the duration.

#2 Where does the debate go from here?

Senate Majority Leader Harry Reid and Speaker of the House Nancy Pelosi

House and Senate leaders are attempting to turn a patchwork of committee efforts into full-fledged bills. In the Senate, Majority Leader Harry M. Reid (D-Nev.) is working with a small team in his office to meld the Finance Committee bill with the more narrow legislation approved by the Senate health committee. In the House, Speaker Nancy Pelosi (D-Calif.) is leading the effort to combine the work of three House committees. Once the mergers are complete, the nonpartisan Congressional Budget Office will determine how much each bill costs, and they will move separately to the House and Senate floors, likely in early November.

Assuming both measures are approved, the House and Senate will form a conference committee to combine the two bills for one final vote in their respective chambers. Then it's on to the White House for President Obama's signature. Democrats are confident of enacting health-care reform this year -- although many of the provisions won't take effect until 2014.

#3 What are the prospects for a government-run insurance option -- and who would be eligible?

The public option is one of the most serious areas of disagreement among Democrats. Liberals view it as an essential safeguard against skyrocketing premiums and a pathway to a single-payer system, a kind of national Medicare for all. Moderates recognize the potential cost benefits but are reluctant to add to the substantial federal responsibility of providing health coverage to senior citizens, veterans and the poor. The House bill is likely to include a strong public option, but the issue remains unresolved in the Senate as Democrats search for less controversial alternatives. One idea on the table would give states the leeway to devise their own insurance packages, including a public plan, as they see fit. Another would "trigger" the creation of a public option if private insurers fail to deliver affordable plans.

Whichever version, if any, Congress decides to adopt, the public option won't be available to everyone. It would compete for the business of uninsured people who do not qualify for Medicaid or don't have access to affordable coverage through their employers.

#4 What are the main things the three bills have in common?

In the broadest sense, the House bill and the two Senate packages are remarkably in sync. They agree that individuals should be required to buy insurance and that all but the smallest employers ought to contribute to the cost of coverage. They would provide for a historic Medicaid expansion that would benefit all low-income people, not just select groups, while extracting significant cost savings from Medicare. The bills would create a new insurance market for individuals and families without access to employer coverage, and would provide subsidies to help those with incomes below 400 percent of the national poverty level to choose from a menu of plans.

Reforming insurance practices is another area of broad consensus. The House and Senate agree that insurers must stop widely derided practices, including charging more to cover women and denying coverage for pre-existing medical conditions.

#5 What are the major differences between the various bills?

Other than the public option, the House and Senate versions have several major differences. The House and Senate health committee bills would impose a mandate on employers to provide coverage, but the Senate Finance Committee bill takes a less punitive approach, merely fining companies whose employees enroll in Medicaid or receive federal coverage subsidies. To pay for the bill, the committee would slap an excise tax on insurers for issuing "Cadillac" insurance policies. But House Democrats are wary about the effect on union households and prefer a surcharge on very wealthy households. The surcharge idea is a non-starter in the Senate, leaving negotiators scrambling for new revenue sources to plug the gap.

#6 Why does everyone keep talking about 60 votes in the Senate?

[an icon of the number 60]

Sixty is the magic number needed to overcome a filibuster in the Senate. On paper, Democrats have 60 votes. But to reach that threshold, they will need Sen. Robert C. Byrd (D-W.Va.), who has been in frail health, and independent Sens. Joseph I. Lieberman (Conn.) and Bernard Sanders (Vt.).

Further complicating the math, a handful of centrist Democrats say they are not yet sold on the health-care bills approved by two Senate committees. The narrow margin helps explain why the White House and Democratic leaders have aggressively courted Snowe as a possible crossover vote.

Democrats have a procedural fallback -- a maneuver known as "reconciliation," which requires a simple majority. However, parliamentary experts say it is not clear that Democrats could achieve the sweeping health-care reform Obama envisions under this approach. Reconciliation is reserved for legislation related to the budget.

#7 How do the bills measure up to Obama's goals?

It is difficult to say whether the legislation will achieve the president's desire to reach near-universal coverage, improve the quality of care and tame skyrocketing health-care costs.

All of the bills would make great strides in reducing the number of uninsured Americans, by expanding the Medicaid program for the poor and offering credits to some small businesses and working-class people to purchase insurance.

The Congressional Budget Office estimates that the leading bills in both chambers would not increase the deficit, one of Obama's requirements for any bill he signs. The CBO has not been able to evaluate the impact of the bills on total national medical spending or insurance premiums.

Every bill includes the president's proposed changes to the insurance practice known as medical underwriting. Under the legislation, insurers would be prohibited from denying coverage or raising premiums based on factors such as a person's health status.

There is debate about whether the bills under consideration would address Obama's concerns about quality or truly rein in overall health-care spending.

#8 Where do the major health-care stakeholders stand?

Most of the major industry and special-interest groups have endorsed the broad concept of health reform but have withheld full-throated support.

Drug makers and hospitals struck deals with the White House several months ago to accept reduced Medicare payments in the future in return for tens of millions of newly-insured customers. But the hospitals have expressed concern that the Senate Finance Committee bill violates the agreement by leaving 25 million people uninsured.

Doctors are divided. The American Medical Association gave its blessing to House legislation that would prevent $228 billion in payment reductions over the next decade. Another group, Physicians for a National Health Program, have lobbied for a European-style single-payer system.

In recent days, the insurance industry has waged a strenuous attack on the Finance Committee bill, complaining that it will raise premiums for many.

Labor unions, among Obama's strongest supporters, maintain they will oppose legislation that does not include a government-sponsored insurance option to compete against private plans.

AARP, the nation's largest seniors lobby, has backed many provisions in the legislation, such as ending discriminatory practices by insurers and closing a gap in the Medicare Part D prescription drug benefit.

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