This Week in Health Care Reform EasyToInsureME health insurance

JANUARY 22, 2010

This Week in Health Care Reform

After
months of public debate and private negotiations, health care reform
discussions stalled following Tuesday's Senate vote in Massachusetts.
The Democratic Senate lost its 60th vote supermajority when Republican
Scott Brown was elected to the United States Senate in the
Massachusetts special election.

Health Care Reform Negotiations Post-Massachusetts Special Election

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Massachusetts
Election of Senate Republican Recasts Debate: Following the election of
Republican Scott Brown to the Massachusetts Senate seat Tuesday night,
Democratic leaders have been scrambling to revive what could now be a
dying bill. The loss of the Democrat's 60th vote in the Senate opens up
the legislation to a Republican filibuster - something the Democrats
have managed to avoid thus far in the debate.

House and Senate
Democrats met this week to discuss how to move forward with the reform
legislation in light of this election and promised Wednesday that they
would push ahead. There are a number of options that Democrats are
considering, but at this point they have not charted their course.

On
Wednesday, Speaker of the House Nancy Pelosi (D-CA) attempted to rally
House Democrats around a strategy to push the Senate bill through the
House and onto President Barack Obama's desk so as to avoid the need to
again secure 60 Senate votes. However, the Speaker indicated on
Thursday morning that she did not believe she has the needed 218 House
votes necessary to move forward. This option would have allowed
lawmakersto then propose additional modifications to the approved
legislation through a process called "reconciliation," which only
requires 51 votes in the Senate.

Other remaining options:

1.
House and Senate Democrats could also quickly complete the merging of
the two bills and vote on the combined package before Mr. Brown is
sworn in.
2.
Democratic leaders could attempt to re-engage
Sen. Olympia Snowe (R-ME), the only Republican who voted for the Senate
Finance Committee's bill passed in October. Democrats would need to
allow her to amend the bill so that she could support its passage and
give Democrats the needed 60th vote; or,
3. House and Senate
Democrats could essentially start over in their respective chambers and
propose scaled-back versions of the bill under "reconciliation"
procedures or regular order. Reconciliation procedures would greatly
limit the scope of the legislation to issues only related to raising or
spending federal funds; therefore, many provisions, such as creating
new insurance exchanges and an individual mandate, might be excluded.

President
Obama seemed to indicate that he favors having House and Senate
lawmakers start over again and produce a scaled-back bill. In addition,
more moderate Senate Democrats - hesitant to push through such a huge
partisan bill in light of the Massachusetts election - urged leaders to
slow down.
Sen. Jim Webb (D-VA) has called on Senate leaders to
suspend voting on health care reform until Mr. Brown is sworn into
office. President Obama and Senate Majority Leader Harry Reid (D-NV)
have iterated this same message. Further, Sen. Joe Lieberman (D-CT)
called for a bipartisan effort as the best way to achieve health care
reform legislation.

Health Care Reform Negotiations Prior to Massachusetts Special Election

Senators
Urge Guarantee of Government Savings: In a letter sent last Thursday to
Sen. Reid, five Democratic Senators asked for the inclusion of a
"fail-safe mechanism" in the final bill. This mechanism would give
Congress "the tools to keep costs under control should the current
savings estimates fail to materialize."

Both the Senate and
House versions of the bill rely heavily on reductions in government
spending, particularly around Medicare, to help pay for reform.
Republicans and some nonpartisan analysts believe the government will
not follow through on these spending reductions, which will lead to
soaring costs.

President Obama Pushes for Less Protection for
Biologic Drugs: Last Thursday President Obama pushed for a change in
the health care reform legislation that would reduce the number of
years that biologic drugs were patent protected from generic
competition, previously set at 12 years. White House officials and Rep.
Henry Waxman (D-CA) were negotiating for 10 years protection or less.

Members
of the news media speculated that the move to reduce biologic drug
protections could be a leverage point for President Obama to pressure
the drug industry to increase contributions to pay for health care
reform. In fact, the Wall Street Journal reported that Congressional
Democrats had already asked drug companies to contribute an additional
$10 billion or more, over and above the $80 billion which the industry
agreed to early on in the reform negotiations.

President Obama
Strikes Deal with Unions: Last week Democratic negotiators struck a
deal with union officials and conceded to union demands to scale back a
tax on high-end insurance plans. The deal would exempt union workers
from having to pay the tax until 2018, five years after the tax would
apply to other workers. While the deal would help gain union support
for the bill, it would also reduce the amount of tax revenue generated
by about 40 percent, to $90 billion. As such, Democratic leaders would
need to find other sources of revenue to make up the difference.

Public Opinion

Exit
Poll Indicates Health Care Reform as Hot Button Issue: As the ballot
polls closed on Tuesday night's Massachusetts Senate election, an exit
poll conducted by Frabrizio, McLaughlin & Associates indicated that
52 percent of voters said that they oppose the federal health care
reform measure and 42 percent said they cast their ballot to help stop
President Obama from passing this legislation. In addition, 48 percent
said that health care was the single issue driving their vote.

Polls
Show Discontent: The latest Wall Street Journal/NBC News poll indicated
that almost half of Americans believe the health care reform bill in
Congress is a bad idea (46 percent). This figure is up dramatically
from April when only 26 percent believed the plan was a bad idea.
Further, just 33 percent say the plan is a good idea. Nearly half of
those surveyed (48 percent) believe that passing the current
legislation would be a "step backward."

In addition, a new
Quinnipiac University poll showed that public support for health care
reform continues to decline. Thirty-four percent mostly approve, while
54 percent mostly disapprove. At the end of December, 53 percent of
Americans mostly approved, while 36 mostly disapproved.

Looking Ahead

Currently,
the path to health care reform is unclear. Democrats seek a way to
secure the necessary votes to pass the legislation, and some now
question the value of pushing such a large bill. President Obama had
hoped to see a final bill prior to his State of the Union address,
which has been scheduled for January 27; however, it appears this goal
is likely out of reach.