Oct. 9, 2009

This Week in Health Care Reform

This week,
legislators from the Senate Finance Committee waited for the
Congressional Budget Office (CBO) to provide a cost estimate for the
revised health care reform bill before bringing the legislation to a
committee vote, now expected to take place next week.

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Senate Negotiations

CBO
Provides Revised Cost Estimate: On Wednesday, the CBO estimated that
the revised Senate Finance Committee bill would cost $829 billion over
the next 10 years, reducing the budget deficit by $81 billion over the
same time period. The CBO also projected that the health reform
legislation would expand health care coverage to 94% of Americans by
2019 . This estimate provides a significant political boost to the
Finance Committee bill, as it is the only proposed health care reform
legislation that meets President Barack Obama's guidelines, which
include having a price tag of $900 billion or less over 10 years,
vastly expanding coverage and not adding to the budget deficit.
However, the CBO's estimate did not include the impact of the
legislation on premiums.

Senate Finance Committee Finalizes
Bill: Last Friday, the Senate Finance Committee wrapped up days of
negotiations and finalized its bill to overhaul the U.S. health care
system. In the last days of committee negotiations, lawmakers voted to:

*
Reduce penalties on those who do not obtain insurance;
*
Modify the proposed tax on high-cost insurance policies;
*
Prevent health insurance companies from taking tax deductions for compensation in excess of $500,000; and
*
Create a government plan to offer a state option operated by private insurers.

The
committee originally planned to vote on the bill this week. However,
the vote was delayed to give the CBO time to assess the cost of the
revised package and to give the committee time to review the
legislation before the vote.

Sen. Max Baucus (D-MT) has
indicated he has the necessary votes to bring his bill across the
committee finish line. Yet, it is still unclear whether or not he will
achieve bipartisan support of the bill. In addition, at least two
Democrats , Sens. Ron Wyden (D-OR) and John D. Rockefeller IV (D-WV)
have refused to support the bill in its current form.

Joint
Committee on Taxation Reports Increase in Industry Fees: On Tuesday,
the Joint Committee on Taxation indicated that the revised bill coming
out of the Senate Finance Committee would raise $121 billion from fees
on drug companies, health insurers and medical device manufacturers, up
from the original $92 billion previously reported. The increase in tax
revenue stems from restrictions prohibiting companies from deducting
the proposed industry fees from their corporate taxes. The new estimate
has fueled increased Republican opposition to the reform legislation.

Senators
Call for 72-Hour Window for Public Review: On Tuesday, a group of six
moderate Democratic senators and one independent senator sent a letter
to Senate Majority Leader Harry Reid (D-NV). The letter called for a
72-hour period for public review of the upcoming combined Senate health
care reform legislation, along with the complete budget score from the
CBO, prior to a full Senate vote.

House Activities

House
Democrats Reject Taxing "Cadillac" Plans: On Wednesday, 154 House
Democrats signed a letter addressed to Speaker of the House Nancy
Pelosi (D-CA) denouncing a plan to pay for health care reform by taxing
high-end health insurance plans, known as "Cadillac" plans. The letter
urged the Speaker to reject proposals with a tax on Cadillac plans
because it could potentially place a heavy burden on the middle class.
This letter is in contrast with legislation moving through the Senate
Finance Committee that includes a tax on insurers who offer these
high-end plans. Speaker Pelosi has indicated she is considering adding
a tax on health insurance to the House bill.

Public Opinion

Poll
Shows Increased Public Support: The latest Associated Press-GfK poll
has found that public support for President Obama's health care reform
initiative has increased, split evenly between those who support reform
(40%) and those who do not (40%). In September, 34% of the public
supported Congressional proposals and 49% opposed them.

Additional Activities

President
Obama Pitches Health Care Reform to Doctors: President Obama addressed
approximately 150 doctors from across all 50 states on the White House
lawn to win their support for health care reform. Many doctors oppose
reform efforts, particularly due to potential cuts in Medicare and lack
of protection from "abusive" malpractice lawsuits.

Looking Ahead

Following
the Senate Finance Committee vote expected next week, Sen. Reid will
work to merge the Senate Finance Committee bill with the other proposed
legislation from the Senate Health, Education, Labor and Pensions
Committee. He expects that the debate before the full Senate will begin
after Columbus Day (October 12). House Speaker Pelosi expects to have
merged the three proposed bills coming out of the House and to begin
full House voting by mid-October.