Finance Panel Wraps Up Work on Reform Bill; Vote on Tap Next Week
The Senate Finance Committee completed markup of its draft reform bill around 2 a.m. today, after seven days of debate over hundreds of amendments, the Washington Post reports (Murray/Montgomery, Washington Post, 10/2).
President Obama said, "We are now closer than ever before to finally passing reform that will offer security to those who have coverage and affordable insurance to those who don't" (Smith, Reuters, 10/2).
The Finance Committee will not hold a final vote on the draft bill until next week, to give the Congressional Budget Office time to score the new amendments and make sure that the legislation does not add to the federal deficit (Espo, AP/San Diego Union-Tribune, 10/2).
Cantwell Amendment Would Establish State-Run Public Plans
The panel voted 12-11 to pass an amendment by Sen. Maria Cantwell (D-Wash.) that would let states form their own public plans. The vote largely was along party lines, with Sen. Blanche Lincoln (D-Ark.) the only Democrat to vote against the amendment.
Under the amendment, U.S. residents with incomes between 133% and 200% of the federal poverty level who do not have employer-sponsored health benefits would enroll in a state-based public plan. Under the proposal, the federal tax credits that would otherwise go to those individuals would instead be given to the states to finance the plan.
States could choose whether to set up their own public plan, but those that do would be required to maintain coverage as good as Medicaid or through a private plan sold through the health insurance exchange that would be created by the committee's legislation.
In addition, the state plans would negotiate payment rates directly with providers, rather than base them on Medicare reimbursement rates, which other public plan proposals would have done (Young , The Hill, 10/1).
According to CongressDaily, the amendment could smooth efforts by Democrats to use the government as a means of increasing competition in the health insurance market.
Cantwell said that the plan -- which is modeled after her state's "basic health plan" -- does not mean she will stop advocating for a full-fledged public plan within reform legislation. However, she said the amendment represents a "foothold" in the proposal (Edney, CongressDaily, 10/2).
Bipartisan Amendment for More Affordable Insurance
The Finance Committee voted 22-1 to pass an amendment by Sens. Charles Schumer (D-N.Y.) and Olympia Snowe (R-Maine) that is designed to make health insurance more affordable for U.S. residents with moderate incomes, The Hill reports (Young , The Hill, 10/1).
The original draft bill presented by committee Chair Max Baucus (D-Mont.) would require that U.S. residents obtain health coverage, but it exempts those who cannot find an insurance plan that costs less than 10% of their income. The amendment would increase the amount of people who qualify for the exemption by lowering the threshold to 8% of an individual's income.
The amendment also would postpone and reduce the financial penalty individuals would incur if they do not purchase health insurance. Under the amendment, individuals would not be penalized if they do not buy insurance during the first year reform legislation takes effect, which likely would be 2013 (Young , The Hill, 10/1).
The amendment would establish a maximum penalty of $200 for a family that does not obtain coverage, beginning in 2014. The penalty would rise to $800 in 2017.
The amendment also would eliminate the potential for criminal penalties for U.S. residents who do not obtain coverage (Pear/Calmes, New York Times, 10/1).
The penalties would be linked to income level, with higher-income individuals and families paying larger penalties. The original bill started the penalties in 2013 at $950 for individuals and $1,900 for families and increased them to a maximum penalty of $3,800 for families.
The amendment also would require the Government Accountability Office to present a report on health insurance costs to Congress in 2014. Congress would be required to act on any finding that coverage is not available to enough people (Young , The Hill, 10/1).
The Finance Committee also approved and rejected several other amendments. Details are below.
- The panel voted 11-12 to reject an amendment by Sen. Mike Crapo (R-Idaho) that would have prevented individuals making $200,000 and families earning $250,000 or less from being taxed to fund reform legislation (Edney, CongressDaily, 10/1).
- The committee voted 14-8 to approve an amendment that would limit the amount health insurers can deduct on their taxes for their executives' salaries at $500,000 annually. Under current law, businesses can deduct up to $1 million a year for executives' compensation (Hitt/Adamy, Wall Street Journal, 10/2).
- By voice vote, the committee adopted an amendment by Snowe that would increase Medicare payments to community health centers for qualified services and give aid to employers for providing health insurance to seasonal workers (CongressDaily, 10/1).
Overhaul Will Not Fix Payment Rates for Medicare Physicians
The Finance Committee's reform bill will not include a permanent fix for the Medicare payment formula for physicians participating in the program, known as the Sustainable Growth Rate, CQ Today reports. Since 1997, the system has ordered cuts or increases depending on the system's spending on physicians in previous years.
In almost every year since 2002, Congress has stepped in to prevent payment cuts for physicians, which many lawmakers see as politically unacceptable.
In 2010, the formula will call for a 22% reduction in payments.The Finance Committee's bill offers another one-year protection from the cuts. However, the SGR formula will categorize that patch as a spending increase. As a result, the formula will call for even deeper cuts in coming years (Armstrong, CQ Today, 10/1). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.