health care reform 2009
After ten plus years of sitting on the sidelines of political debate, health care reform is back on center court.
Obama made health care one of his key campaign issues and top administration priorties. True to the president's style, he's pushing his dual goals - reining in health care costs and extending coverage to all Americans - without prescribing the details of how to pull them off. Those details he's leaving to lawmakers at the same time as pressuring Congress to have a final bill passed by the end of the year. The president's stance of keeping an open mind on the details notwithstanding, Obama has made many of his views known through speeches; those view are outlined below.
Congressional committees have okayed no less than three comprehensive health care reform bills (with a fourth still in the drafting) which they will certainly struggle to knit together in the fall. All of the bills are outlined below, although congress watchers have voted the drafts coming out of the Senate Finance and House Energy committees to be "most likely to be our next Health Care law."
President Obama's priorities
- supports an "exchange" where families can shop around for health coverage (WP)
- thinks a plan should include a "public option' - either a government run insurance plan, a la Medicare for the under-65, or a nonprofit health insurance 'coop' that is partially backed by the government (WP)
- taxing the wealthiest Americans to pay for health care reform (which he included in his budget proposal) (NYT)
- finding other savings by cutting back on payments to hospitals (NYT & WP) and getting drug companies to pitch in (NYT) - by $155b and $80b, respectively, over ten years
- contrary to many Democrats, is open to protecting doctors from medical malpractice suits (NYT)
- getting medical records into electronic databases (a universally popular measure that already received $19b in funding as part of the 2009 stimulus bill)
The House has two bills in the running. HR 3200, okayed by the health committee and the Ways and Means committee, was first considered a shoe-in for house approval, but a "Blue Dog" insurrection (of fiscally conservative Democrats) forced the house energy committee to draft a slightly slimmer bill that may end up getting more support.
The Health Committee and Ways and Committee Bill:
- sets up a a government-run insurance plan that the uninsured could buy into and that would compete with private plans (WP)
- requires all Americans to buy health insurance (2.5% tax penalty if you don’t) (WP)
- subsidizes premiums on a sliding scale based on income up to 400% of the federal poverty level (about $43,000 for an individual and $88,000 for a family of four) (WP)
- would cover 97% of Americans by 2015 (but the CBO hasn't confirmed that number yet) (WP)
- would cost $1.2 trillion over ten years (WP, WP)
- requires that all Americans get a health plan and gives subsidies to families with incomes up to 400% of poverty (and taxes those who don't have coverage) (NYT)
- require all companies to either provide health insurance to workers or pay a penalty (NYT)
- sets stricter regulations on private health insurers including requiring that they take patients with pre-existing conditions and not charge them extra, as well limiting how much doctors can charge patients (NYT & WP)
- expands Medicaid for families with incomes at or below 133% of the poverty level (NYT)
- close the "doughnut hole" in Medicare's drug coverage (NYT)
- would pay doctors more than Medicare's rate, but pay hospitals the same (WP)
- require drug companies pay for part of drug benefits for the poor (NYT)
- caps annual out-of-pocket spending in the form of deductibles & copayments
- increases federal funding for primary care services for low-income children or individuals with disabilities or mental illnesses
- bans copay or coinsurance requirements for screening and preventive procedures
- creates an education program for end-of-life issues
- extends COBRA coverage to laid off workers until they become eligible for coverage under a different plan
- funds community-based health centers and prevention programs
- lets states opt out of the national plan and set up their own single-payer medical coverage systems
How are they planning to pay for it?
About $544 billion of the cash is expected from scaled taxes on the relatively rich: those with incomes over $1 million will get a 5.4% added tax, while Americans with incomes over $280,000 (individuals) and $350,000 (joint-filing couples) will have to hand over 1%. About $30 billion will come from employers with annual payrolls over $250,000 who don't offer health insurance to their employees; they will have to pay an additional payroll tax of 2% to 8% on a sliding scale (the highest, 8% rate applies to payrolls of $400,000 or more). The CBO estimates another $500 billion would be raised through cost savings in the Medicare program. (WP & WP)
Read the full text of the bill.
The House Energy and Commerce Committee Bill:
- in general, looks a lot like HR 3200 with a "public option" for health care coverage, mandates that everyone get health coverage, an expansion of Medicaid for the poor, a requirement that businesses provide coverage or pay a penalty, a tax on wealthy Americans, but it also has some trims around the edge including: (WP)
- cuts of about $100 billion from the Health and Ways and Means Committee bills (WP),
- more money for rural health care (WP),
- fewer businesses would be required to provide health coverage (or pay a penalty); businesses with a payroll of less than $500,000 would be exempted, instead of a $250,000 payroll as in other House bills (WP),
- a smaller tax on wealthy Americans to pay for the bill (WP),
- payments to doctors in the public plan would not be tied to Medicare's fee tables; instead the government plan would negotiate prices with health care providers (WP),
- fewer subsidies to middle income families to help pay for the insurance they buy (WP),
- a provision that lets Medicare negotiate down prescription drug prices (which previous laws said it could not do) (WP)
Health reform bills are being drafted by two Senate committees. The Health Education Labor and Pension Committee's bill (still in draft form) is considered the more liberal bill, so is predicted to be elbowed out by the Finance Committee's bill, which has not even been released in draft yet (although the press keeps reporting on proposed snippets).
The Finance Committee's bill is in flux, but the press is reporting that it:
will either include a semi-independent nonprofit cooperative insurance plan that uninsured Americans could buy into (rather than a government run "public option" that is in other plans (WP)
require all Americans to buy insurance, subsidizing middle and low income families to do so (WP)
create an "exchange" for families to shop around for coverage (WP)
would encourage more employees to cover their workers through incentives (rather than through penalties as in all the other bills (WP)
pay for $300b of the plan by taxes - although it's still not clear if those taxes would be on employer provided health care benefits of Americans with expensive "Cadillac" plans or on directly taxing America's wealthiest (WP & WP)
The Health Committee's bill
- would cost $661 billion over 10 years and would cove a net total of 21 million (of the 54 million would otherwise be uninsured). (An earlier draft ran figures of $1 trillion, covering 16 million more Americans; the difference comes from a combo of charging employers more and giving fewer Americans subsidies). (CBO, WP)
would be partially paid for by complanies with more than 25 employees (WP)
assumes that the Finance committee would expand Medicaid to families at 150% of the poverty level, covering most of the Americans left uninsured (although it is not clear if this cost is included in the $661 billion figure (WP, WP)
would create a new government backed insurance program that Americans could buy into (WP)
- would also create insurance exchanges, or "connectors," to let families shop around for coverage (WP)
would place stricter regulations on private insurers, for example requiring they take clients with pre-existing conditions (WP)