California’s Senators Face Tough Calls as Health Reform Bill Advances

The Senate Finance Committee has passed its health care reform bill, setting the stage for Senate Majority Leader Harry Reid (D-Nev.) and other Democratic leaders in the Senate to merge the measure with the Senate Health, Education, Labor and Pensions Committee’s legislation.

When the bill goes before the full Senate, it will be the first opportunity that California’s senators have to vote on it.  Media reports have not painted Democratic Sens. Barbara Boxer and Dianne Feinstein as likely swing votes on health care reform legislation, but they have raised concerns about some elements of the bill coming out of the Senate Finance Committee.

More than once, Feinstein has voiced her concerns that costs not be passed on to the states, warning that California cannot afford a major increase in its Medi-Cal budget. 

Similarly, in early October, Boxer said she won a verbal agreement from Reid that California would be classified as a “high-need” state already saddled with large Medicaid costs.

On Oct. 8, both California senators signed a letter voicing support for a government-run health plan as an option for consumers.  Boxer and Feinstein joined 28 of their Senate colleagues in questioning whether the insurance cooperatives included in the Senate Finance Committee’s legislation would be viable nationwide.  The senators added that the costs of launching insurance co-ops might exceed the startup costs of a public plan.

That wasn’t the only health care effort Boxer and Feinstein joined that day.  Both senators also signed a letter challenging a provision in the Senate Finance Committee’s proposal aimed at raising $4 billion annually through a tax on medical device makers. 

The letter questions whether the tax would push firms to move their operations overseas, resulting in job losses and pushing more investment in research and development to other countries.

As overhaul proposals move through the legislative process, the senators will be pressed to stake out positions on other aspects of the proposal. 

According to OpenSecrets.org, neither Boxer nor Feinstein counts the health care industry among their top five sources of campaign contributions, raising the likelihood that the senators will dodge the sort of criticism Senate Finance Committee Chair Max Baucus (D-Mont.) has drawn over contributions from health care interest groups to his campaigns.

For Boxer, the health care reform issue might grow as she heads into her 2010 re-election campaign.  Conservatives for Patients’ Rights is raising the cost of the proposed Medicaid expansion as an issue in the New Jersey and Virginia gubernatorial races this year.

Feinstein is not up for re-election until 2012.

Whether legislation passes or stalls, members of Congress up for re-election next year should expect their actions on health care reform to come back at them in the 2010 campaign.

Until then, here’s a look at recent news in the health care reform debate. 

Congressional Debate

• A group of six House Republicans and seven House Democrats said that it will continue an “informal conversation” this week on health care reform legislation, including changes to the insurance market, the medical malpractice system and interstate insurance portability, The Hill reports (Hooper, The Hill, 10/10).
• House lawmakers and aides from both sides of the aisle are finding it increasingly unlikely that any Republican member will vote for the chamber’s health reform bill when it comes to a final vote, the Washington Post reports (Pershing, Washington Post, 10/10).
• Republican lawmakers who met with HHS Secretary Kathleen Sebelius on Oct. 7 said they appreciated the “candid exchange” but are unmoved in their position on health reform legislation, Roll Call reports. About 40 members and staff from the Republican Study Committee, a group of conservative House Republicans, met with Sebelius to discuss their concerns about the leading health reform plans and share their own proposals (Kucinich, Roll Call, 10/7).
• On Oct. 6, seven Democratic senators wrote a letter to Senate Majority Leader Harry Reid (D-Nev.) demanding that he take steps to increase transparency as the chamber considers health reform legislation, Roll Call reports (Pierce, Roll Call, 10/6). The senators are calling for the Congressional Budget Office to conduct a formal assessment of the cost of the bill 72 hours before floor debate begins and for the full text of the legislation to be posted online. The letter also calls for any amendments offered on the floor to be posted before they are considered and for the text of the Senate bill to be updated and posted if any amendments are approved (Hunter, CQ Today, 10/6).

Shaping the Debate

• The Democratic National Committee abandoned plans to broadcast a commercial promoting Republicans’ support for health reform efforts after receiving a complaint from former Senate Majority Leader Bob Dole (R-Kan.), according to the New York Times‘ “Prescriptions.” Through a spokesperson, Dole said that the ad was “deceptive” and “was not authorized” (Seelye, “Prescriptions,” New York Times, 10/11).
• A Congressional Budget Office report released on Oct. 9 estimates that placing limits on medical malpractice lawsuits could reduce government health care spending by $41 billion over the next decade, the AP/Boston Globe reports. That figure is nearly 10 times greater than CBO estimated last year (Alonso-Zaldivar, AP/Boston Globe, 10/10).
• More than 125 union leaders from 27 states are in Washington, D.C., to lobby House and Senate lawmakers who remain undecided on a public insurance option, the Times‘ “Prescriptions” reports. In addition to pushing for a public option, the labor leaders support a mandate requiring employers to provide insurance for workers, and they oppose taxes on employer-provided health insurance (Greenhouse, “Prescriptions,” New York Times, 10/8).
• A new television ad from the U.S. Chamber of Commerce criticizes health reform and says that new taxes under reform legislation would raise costs for businesses and families, Politico‘s “Live Pulse” reports. The advertisement will run in 16 states represented by key senators (Frates, “Live Pulse,” Politico, 10/8).
• While some stakeholders in the health care industry have been publicly vocal in the health reform debate, the Biotechnology Industry Organization — which includes businesses such as Amgen, Genentech, Merck and Pfizer — has used the health care debate to emphasize the difficulties faced by some of its smaller members to gain sympathy, Politico reports. According to Politico, the strategy has proved beneficial, as BIO has “scored some quiet victories” in drafts of health reform legislation compared with larger lobbying groups (O’Connor, Politico, 10/6).

Dollars and Cents

• Current health reform bills being considered in Congress do not do enough to control rising medical costs, according to some policy analysts, hospital executives, and current and former health officials, the New York Times‘ “Prescriptions” reports (Herszenhorn, “Prescriptions,” New York Times, 10/12). Legislation in both the House and the Senate includes incremental or slowly implemented programs designed to eliminate waste and reward quality and efficiency, according to the Boston Globe. However, none of the five reform bills include significant cost-cutting initiatives that aggressively alter the way care is organized and how physicians and hospitals are paid. They also do not invest intensively in researching the best treatments for diseases and aligning the results with reimbursements. In addition, the bills do not give people with employer-sponsored health insurance the opportunity to choose the best deal on a health plan and receive any savings (Wangsness, Boston Globe, 10/12).
• Members of the House Democratic Caucus have sent a letter to House Speaker Nancy Pelosi (D-Calif.) arguing that an excise tax on insurance companies that offer high-cost employer-sponsored health plans would be passed on to middle-income U.S. residents in the form of higher premiums and greater out-of-pocket costs, the Times reports (Herszenhorn/Pear, New York Times, 10/13). As an alternative to the excise tax, the House legislation includes a surtax on individuals who make more than $500,000 annually and couples who make more than $1 million, in an effort to generate nearly $460 billion over the next 10 years (O’Connor, Politico, 10/13).
• Hospital industry officials are concerned that coverage estimates from a recent Congressional Budget Office score of the Senate Finance Committee‘s health reform bill do not meet the numbers requested in the 10-year, $155 billion cost-savings deal that the industry agreed upon with committee Chair Max Baucus (D-Mont.) and the Obama administration over the summer, CQ HealthBeat reports (Reichard, CQ HealthBeat, 10/8).
• Older U.S. residents who buy coverage on the individual market or who are currently uninsured would pay nearly 50% more in health insurance premiums under the Senate Finance Committee reform bill than the Health, Education, Labor and Pensions Committee bill (S 1679), USA Today reports. People between ages 55 and 64 would face annual premiums averaging $8,650 under the Finance bill, compared with $5,930 under the HELP bill, according to a report by the Urban Institute and the Robert Wood Johnson Foundation. Single U.S. residents between ages 18 and 24 would pay $2,163 annually under the Finance bill, compared with $2,965 under the HELP bill and legislation pending in the House (Fritze, USA Today, 10/8).
• A bill (S 506) aimed at restricting the use of offshore tax havens and abusive tax shelters by foreign-based companies would generate nearly $23 billion over 10 years, which could be an “attractive offset” for health reform legislation that Democrats are developing in Congress, CongressDaily reports. Last month, the Joint Committee on Taxation told Sen. Carl Levin (D-Mich.), the bill’s main sponsor, that the proposal would raise a total of $29.8 billion over a decade, including $7.1 billion through a provision that would prohibit business transactions that seek to lower the resulting taxes (Cohn, CongressDaily, 10/6).

Polls

• Public opinion on health reform efforts is now evenly split between support and opposition, according to data from a new Associated Press/GfK poll, the AP/Boston Globe reports. The poll, conducted from Oct. 1 to Oct. 5, found that 40% of the public now favors health reform legislation, up from 34% in September, while 40% opposes it, down from 49%. The numbers show recovery in support for reform from August, when an outpouring of opposition to reform legislation was seen in town-hall meetings and prominent political protests (Alonso-Zaldivar, AP/Boston Globe, 10/7).
• A new survey finds that people generally oppose health reform by a 47%-34% margin but that they overwhelmingly support individual components of reform, such as a public health insurance option and an employer mandate, the Wall Street Journal‘s “Capital Journal” reports. The poll also found a 25% approval rating for Republican congressional leaders — the lowest in 15 years of Pew Research Center surveys (Seib, “Capital Journal,” Wall Street Journal, 10/8).