As “Jumping-Off” Point for Discussions on Health Care, White House Will Post Senate Democratic Bill + Potential Fixes

Feb 22, 2010 7:00am

As what White House officials call “a jumping-off point” for Thursday’s bipartisan discussion on health care reform, on Monday at 10 am EST, on the White House website, officials will post the Democratic health care reform legislation that passed the Senate on December 24, 2009, and a list of changes they would like to make to that bill.


Some of the changes include more generous subsidies for low and middle income Americans to purchase health insurance, and a removal of the controversial Medicaid subsidies that Sen. Ben Nelson, D-Neb., secured for his state in order to win his vote.


The White House will also include a new proposal from Sen. Dianne Feinstein, D-Calif., that would give the Secretary of the Department of Health and Human Services the power to block insurance company premium increases if they don’t meet certain criteria, for states where regulators do not already have that authority. Feinstein came up with the proposal after news that the largest insurer in her home state, Anthem Blue Cross, was proposing premium increases of up to 39% on individual health insurance plans.


“This is our take on the best way to merge the House and Senate bills,” a senior White House official told ABC News. The official said the proposal was “informed by our conversations from negotiations” before Sen. Scott Brown, R-Mass., was elected, thus depriving Democrats of their 60-vote supermajority, as well as from subsequent discussions.


“We thought it would be a more productive meeting if we brought one consolidated plan to use as jumping-off point,” the official said. “We hope the Republicans do the same.”


By posting their proposals in such a form, White House officials are providing a roadmap for how they think they can best pass health care reform in the new post-Massachusetts Senate race reality: have the House pass the Senate bill, then use reconciliation rules requiring only a majority Senate vote to pass the “fix” to make the bill more palatable.


White House officials are thus signaling that Thursday’s discussion won’t be just a parlor to chat about health care principles, though they insist their minds will be open to incorporate some Republican ideas.


“Maybe we’ll sit across from each other and identify 10 things we can move forward on,” the official said. “We hope new ideas come to the table. The proposal we’re walking into the meeting with is not the same one we will walk out of the meeting with.”


Under the new proposal suggested by Sen. Feinstein, the HHS Secretary would work with state regulators to develop an annual review of rate increases. A new body called the “Health Insurance Rate Authority” would be created and would every year issue a report setting guidelines for reasonable rate increases. If proposed premium increases are not justifiable per those Health Insurance Rate Authority guidelines, the HHS Secretary or state regulators could block them.


The Democratic Senate bill includes a tax on insurance companies for high-cost health so-called “Cadillac” insurance plans, but the White House is proposing as a “fix” offering to everyone the phased-out exemption for union members that had been worked out in post-Christmas negotiations to secure the support of labor unions.


Health insurance exchanges for consumers would be created at the state level, and all Americans would be mandated to have health insurance coverage. The bill expands Medicaid to cover those at 133% of the poverty level, adding 15 million to the Medicaid rolls.


The bill does not include a provision many House Democrats believe to be key to bringing down health insurance costs: a government-run “public option” to compete with private insurers. Rather, the Senate bill empowers the Office of Personnel Management, which administers the Federal Employees Health Benefit Program, to enter into contracts with private insurers so at last two multi-state plans in each health insurance exchange, including at least one offered by a non-profit.


As with the House bill, the Senate bill proposes insurance reforms, such as prohibiting insurers from being able to deny coverage because of a consumer’s pre-existing condition. The Senate bill also would limit the potential profits an insurance company could make by requiring insurers to spend around 85 cents of every dollar from premiums on medical care.


The language regarding abortion, also from Nelson, would allow women who receive government subsidies to purchase insurance policies that cover abortion, but they would have to write separate checks. In some ways this is less restrictive than the House language from Rep. Bart Stupak, D-Mich., that would prohibit women who receive government subsidies from taking out plans that provide abortion coverage.


House Speaker Nancy Pelosi, D-Calif., has signaled to the White House that it’s unclear if there are enough votes in the House to pass the Senate bill.


The House version passed in November by a vote of 220-215, but since then three “yea” votes have vanished: Rep. Robert Wexler, D-Florida, retired; Rep. John Murtha, D-Penn., passed away; and Rep. Anh “Joseph” Cao, R-Louisiana, has signaled he will not vote for the final bill.


That puts Pelosi in a starting-off point of 217 votes which is a majority of the current 433-member House of Representatives, but is also a tough starting line given the prevailing political winds and the lack of desire of many House Democrats to re-enter this discussion at a time when many Americans want the Capitol to focus on job creation.


Other senior Democrats argue that passing nothing will be a worse option, politically speaking, because Democrats have already been branded with the caricature of the bill.


Pelosi believes passing the bill is “possibly doable,” the senior White House official said. “But she may ultimately decide the math is impossible.”


Were that to happen, White House official plan on pushing for a more modest bill, perhaps including the insurance reforms, some tax breaks for small businesses to help provide insurance for employees, a more modest expansion of Medicaid, and the creation of the health insurance exchanges.


Watch our GMA report here:

-jpt

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