Health Insurance Exchange Reform Weekly EasyToInsureME

DECEMBER 23, 2009

This Week in Health Reform

Senate
Majority Leader Harry Reid (D-NV), may just reach his goal of getting a
health care reform package approved by the Senate by Christmas. This
past week, Sen. Reid clinched the 60th vote needed to pass the
legislation. As of this communication, he has scheduled the final
Senate vote for 7 a.m. on Christmas Eve day. In an effort to shore up
votes, Sen. Reid and his colleagues struck deals to overcome hot-button
issues such as abortion funding.

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Senate Negotiations

Senate
Eyes Finish Line: After weeks of rancorous debate and more than 20
straight days and nights spent negotiating on Capitol Hill, Senate
lawmakers cleared all three major procedural hurdles prior to a final
vote on the legislation.

* The first procedural motion passed
on a 60-40 vote early Monday morning , ending debate on Sen. Reid's
proposed amendments, called the "manager's package," and cutting off a
Republican filibuster. The "manager's package" represented a series of
last-minute deals and compromises to shore up support for the
legislation.
* The second procedural motion to approve the "manager's package" passed 60-39 on Tuesday morning.
* The third motion came Wednesday and ended debate on the final
legislation in a 60-39 vote, setting up the reform bill for a final
vote just in time for Sen. Reid's Christmas deadline.

Sen. Reid
Carves Out State-Specific Deals to Secure the 60 Votes: On Saturday,
Sen. Reid secured the 60 votes needed to pass the historic legislation,
winning over Sen. Ben Nelson, (D-NE), with an amendment to prevent
federal subsidies from being used for abortions. Under the new abortion
provisions, states can opt out of allowing coverage for abortion. If
states do offer coverage, enrollees must pay for abortion coverage
separately - a compromise that has sparked criticism from both sides of
the abortion divide. Sen. Nelson also secured other benefits for the
state of Nebraska, including:

* Millions of dollars from the federal government to pay for the proposed cost of the Medicaid expansion in his state; and
* An exemption for Blue Cross Blue Shield of Nebraska from an annual fee on insurers.

Throughout
his amendment package, Sen. Reid included several other state-specific
deals to secure the 60 votes. Such last-minute deals have been
criticized by Republicans, including:

* For Sen. Max Baucus,
(D-MT), the package included a provision to help 2,900 residents of
Libby, Mont., sign up for Medicare benefits. Many residents have
asbestos-related illnesses;
* For Sen. Christopher Dodd, (D-CT), it
included a measure to provide $100 million for the construction of a
hospital at a public university;
* Sen. Patrick Leahy, (D-VT), negotiated for $600 million in additional Medicaid benefits for his state over 10 years;
* Sen. Bernie Sanders, (I-VT), got a $10 billion increase for community health centers over a number of years;
* Sen. Mary Landrieu, (D-LA), procured at least $100 million in 2011 from the federal government for help with Medicaid; and
* For Sen. Bill Nelson, (D-FL), the package included a measure allowing
some 800,000 Florida senior citizens currently enrolled in private
Medicare Advantage plans to keep their extra benefits.

Sen. Reid's negotiations also included:

* The removal of a 5 percent tax on elective cosmetic surgeries, and
the inclusion of a 10 percent tax on indoor tanning services;
* 12 years of patent protection for the makers of brand-name biotech drugs;
* An increase in the Medicare payroll tax percent of an additional 0.9
percent of income for those making $200,000 as an individual and
$250,000 for couples;
* An exemption from taxes on high-value
insurance plans for those with certain professions, such as
firefighters, policemen, construction workers, emergency first
responders and longshoremen;
* A provision allowing for doctors and
hospitals in Montana, North Dakota, South Dakota, Utah and Wyoming to
get paid more than providers elsewhere; and
* About $1 billion extra in Medicaid payments for visiting nurses and other in-home or community services.

CBO
Updates Estimates on Health Care Bill's Impact: In a letter sent to
Sen. Reid, the Congressional Budget Office (CBO) said that it had
over-estimated the latest Senate health care bill's impact on deficit
reduction during the second decade of enactment. The original estimate
indicated the overhaul would yield deficit reductions by one-half
percent of GDP; the revised estimates indicate a reduction of between
one-quarter and one-half percent of GDP. The CBO confirmed that its
estimate over the first 10 years remains accurate, reducing the deficit
by up to $132 billion by 2019.

However, in a Wednesday letter to
Sen. Jeffery Sessions, (R-AL), the CBO indicated that the current
Senate bill may potentially double count the savings from Medicare as a
means to pay for the Senate health care bill. In the letter, CBO
Director Doug Elmendorf writes: "The key point is that the savings to
the (Hospital Insurance) trust fund under the (Patient Protection and
Affordable Care Act) would be received by the government only once, so
they cannot be set aside to pay for future Medicare spending and, at
the same time, pay for current spending on other parts of the
legislation or on other programs." Republicans quickly jumped on the
letter as proof that the Senate's bill will not decrease the federal
deficit over time, but rather add to it.

Late last week, the CBO
estimated that the revised Senate bill will cost $871 billion over the
next decade to extend coverage to the uninsured. It would dramatically
expand Medicaid and offer federal subsidies to those who lack
affordable coverage through employers. The nation will pay for the
overhaul with about $400 billion in new taxes and about $500 billion in
cuts to programs such as Medicare.

Sen. Snowe Indicates "No"
Vote: Despite many weeks of negotiations with Republican Sen. Olympia
Snowe of Maine and several one-on-one meetings with President Barack
Obama, Sen. Snowe indicated that she will vote against the Senate's
legislation without significant changes. Sen. Snowe has been a pivotal
figure in the health care reform debate as the only Republican to have
voted for the Senate Finance Committee's bill, which passed in October.
The loss of Sen. Snowe's support comes as a blow to Democratic leaders
who were hoping to achieve some level of bipartisan support.

Other Activities

AMA,
AHA, AARP and FAH Show Support; AHIP Opposes: On Monday, both the
American Medical Association (AMA) and the American Hospital
Association ( AHA) sent letters to Sen. Reid indicating support for the
latest version of the Senate health care bill, while highlighting
requests for changes. The AMA, for example, hopes to see changes to the
independent board that would be created to slow the growth of Medicare
costs. Among other adjustments, the AHA requested a change that would
lower Medicare payments to hospitals with high readmission rates.
Endorsements also came from AARP and from the Federation of American
Hospitals (FAH). In contrast, a statement Friday from America's Health
Insurance Plans (AHIP) voiced opposition to the bill, citing cuts to
Medicare Advantage programs and caps on insurers' administrative costs
as problematic.

Public Opinion

December Polls Show
Americans Disapprove: As a final vote on the Senate's health care
reform package nears, Americans are increasingly wary of its impact.
The December Kaiser Health Tracking Poll found that:

* Only 35
percent of Americans said they would personally be better off if health
care reform passes - down from 42 percent last month;
* Only
forty-five percent of voters said the country would be better off with
health reform - down from 54 percent last month.

The latest poll results released Tuesday from Quinnipiac University show that:

* Americans "mostly disapprove" (53 percent to 36 percent) of the Senate's plan;
* A majority (56 percent to 38 percent) disapprove of President Obama's handling of health care reform;
* Voters oppose (72 percent to 23 percent) using any public money in the health care overhaul to pay for abortions;
* Americans support (56 percent to 38 percent) giving people the option
of coverage by a government health insurance plan; and
* A majority (64 percent to 30 percent) support allowing younger people to buy into Medicare.

As
a volatile year in health care reform comes to a close, an average of
monthly polls since April shows that 82 percent of Americans say an
overhaul of the nation's health care system is important for recharging
the economy. However, in the most recent Robert Wood Johnson Foundation
poll taken in November, 60 percent said an overhaul will not affect
their personal access to health care or their family finances, and only
about 40 percent said a revamping will improve access to care in the
nation overall. Further, only about 30 percent believe health care
reform will help the county's financial status.

Looking Ahead

Senate
lawmakers are expected to vote on their final health care reform
legislation early Thursday morning, setting the stage for
reconciliation with the House bill passed in November. When lawmakers
return from holiday break in January, the conference committee between
the two chambers is expected to begin discussions about merging the two
bills. Leaders of the House and Senate had hoped to have a final bill
approved by Congress and sent to President Obama before the State of
the Union address, scheduled for late January or early February.
However, White House officials now indicate that given January's tight
legislative calendar, this timeframe is unlikely.