Weekly Pulse: What’s Next For Health Care Reform?


The Senate passed its health care bill in the early morning hours of
Christmas Eve. Senate Majority Leader Harry Reid (D-NV) had to make
major compromises to secure the votes of fence-sitters like Sens. Ben
Nelson (R-NE) and Joe Lieberman (I-CT). Reid sacrificed the public
option to keep Lieberman on board and tightened the bill’s abortion
restrictions to placate Nelson.

Next, representatives from the House and the Senate will merge their
respective bills in a conference committee, creating a single piece of
legislation that both houses will vote on. If the conference report
passes both houses, it will proceed to the president’s desk to be
signed into law. Conference will start after the winter recess. The
whole process could be complete by late January.

Despite the senate compromises, there’s still plenty for progressives to like in the new bill. Kevin Drum lists some of the bill’s positive attributes in Mother Jones:

  • Insurers have to take all comers: They can’t turn you down for a preexisting condition or cut you off after you get sick.
  • Community rating: Within a few broad classes, everyone gets charged the same amount for insurance.
  • Individual mandate, which would require everyone to have health
    insurance (Remember how we all argued that this was a progressive
    feature back when John Edwards and Hillary Clinton were championing it
    during the primaries?) On the progressive upside, a mandate would bring
    down costs and share risk more equitably. However, progressives realize
    that without a public option, it means forcing people to buy the
    insurance companies’ crappy product.
  • A significant expansion of Medicaid.
  • Subsidies for low and middle income workers that keeps premium costs under 10% of income.
  • Limits on ER charges to low-income, uninsured emergency patients.
  • Caps on out-of-pocket expenses.
  • A broad range of cost-containment measures.
  • A dedicated revenue stream to support all this.

The House version of the health care bill has a public option. In
theory, the public option could be added back in in conference, but
even the most optimistic progressives have given up hope on that score.
If the public option rose from the ashes, Lieberman could filibuster
the conference report, and no one doubts he’d do it. So, no matter how
tough and savvy House Speaker Nancy Pelosi (D-CA) is, she won’t have
much leverage in conference. One way or another, Pelosi can probably
pass just about anything that comes out of conference. Reid still has
the Sword of Damocles hanging over his head.

That doesn’t mean that everything is set in stone, though. J. Lester Feder of the Nation discusses what’s left
to be worked out in conference. Feder says the big three areas up for
discussion are affordability, enforceability, and financing. Compared
to the House bill, Senate version offers larger insurance subsidies,
but also weaker protections against high out-of-pocket costs.

Age bands are another key affordability issue: The House bill allows
insurers to charge seniors twice as much for coverage, the Senate up to
three times as much. The House bill calls for a national insurance
exchange to drive down costs, as opposed to the Senate bill which would
create state level exchanges. The smaller the exchange, the less power
it has to drive down costs, which means that progressives (and
hopefully fiscal conservatives) are lobbying hard for a national
exchange.

As for enforceability, Feder urges progressives to watch out for a
seemingly minor provision in the Senate bill that effectively guts the
ban on gouging those with preexisting conditions. Unlike the House, the
Senate voted to allow insurers to offer “discounts” to customers for
“wellness.” That might mean that people with conditions from pregnancy
to HIV could end up paying more for coverage than their healthier
counterparts.

Financing is sure to be a bitterly contested issue in conference.
The House wants to pay for reform by taxing the wealthy. The Senate
wants to tax so-called “Cadillac” insurance plans. Currently, those who
receive insurance through their employer don’t have to pay taxes on the
value of the coverage, as they would if they got an equal amount of
money in cash. The Senate bill would tax the value of insurance
coverage over a certain threshold.

The problem is that, despite the luxurious-sounding nickname, a lot
of so-called Cadillac plans are pretty ordinary insurance policies held
by middle class people. For example, many union workers accepted better
health benefits instead of wage increases because they seemed
advantageous tax-wise. At Working In These Times, Art Levine reports on
labor’s attempts to eliminate the insurance tax.

Mark Schmitt of the American Prospect concludes that the bill could be improved slightly
in conference by adding the House’s employer mandate or improving the
financing, “but everything will have to be cleared with the 59th and
60th most liberal senators.” His Prospect colleague Paul Waldman is more optimistic
about the prospects for improving the bill in conference. Abortion
access and the public option are set in stone, but the conference
committee still has power to shape the proposed expansion of Medicaid
(the House is more generous than the Senate), the timeline for
implementation (sooner is better for progressives), coverage for
immigrants, and other hot button issues.

I predict that abolishing the filibuster will be the big progressive
cause for 2010. Obama’s liberal base has seen so many of its fondest
hopes dashed by a Senate where 60 votes is the new 50. If the Democrats
are going to keep the “kill the bill” crowd in the fold, they’ll have
to channel that rage and frustration in a constructive direction. Sen.
Tom Harkin (D-IA) is proposing a symbolic bill to end the filibuster.
It won’t pass, of course: If Reid can’t defeat one filibuster without
gutting health care reform, there’s no way he can pass a bill to
abolish filibusters for good. It would get filibustered! That said,
Harkin’s bill is an important symbolic gesture and an opportunity to
galvanize support for structural Senate reform.

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