What the HELP and House Bills Tell Us about the Administration’s Priorities– It May Be Time for Baucus to Join His Caucus Part I

Today, the the Senate Health, Education, Labor, and Pensions (HELP) Committee passed its reform bill on a party-line vote, thirteen to ten. Yesterday, the three House committees writing healthcare legislation released the final text of their bill. Left behind in the dust, the Senate Finance Committee remains bogged down as Committee Chairman Senator Max Baucus vainly struggles to engineer a “bi-partisan bill.” (And yes, I mean “vainly” in both sense of the word.) 

I suspect Senator Baucus is about to discover that he is not as important as he thought he was. As I have been suggesting in recent weeks, in the end he will not be the ultimate architect of health care reform. That job belongs to President Barack Obama.

What’s most interesting about the two pieces of legislation put forward by HELP and House Democrats this week is what they tell us about President Obama’s priorities.

    There is a public insurance option in both plans. Despite recent media reports that the administration is “backing away” from public insurance, I remain convinced that the White House will insist on the public sector alternative “to provide choices and keep private sector insurers honest.”

    The president would like bipartisan reform, and is happy to both listen to and include Republican suggestions in the final legislation. But he will not water down reform in order to win Republican votes—as both Rahm Emanuel and David Axlerod, Obama’s senior political strategist made clear when talking to Bloomberg here.

    The president also won’t be rushed. The House version of healthcare legislation lays out a timetable: the subsidies and the public insurance option do not kick in until 2013.  As the President has always said, his goal is to roll out national health reform “by the end of my first term.”

    The details of the House bill make it clear that Medicare reform will pave the way for healthcare reform as Medicare leads the way by changing what we pay for, how we pay for it and how healthcare is delivered.

    The House bill will tax the very rich to help raise the needed funds.In the Senate, the Finance Committee is charged with figuring out how to raise the money—and that Committee will not be happy with the House suggestion. But from the beginning, the president has suggested that it may well be necessary to hike taxes for the wealthy

    The basic plan guaranteed to all Americans would be more than “good enough”—it would be quite comprehensive.

    Private insurers will be regulated

    Payments to primary care providers will rise. Payments to other providers will not be cut across the board.             

    Medicaid will not be forgotten. Indeed, the federal government will pick up the tab for expanding Medicaid—which could be a first step toward turning Medicaid into a fully-funded federal program.

As for Senator Baucus, earlier this month The Senate Agenda blog warned that, “What Baucus is ignoring at his own peril is that other Senators like Sen. Sanders will not support a plan that taxes health benefits and lacks a public option. He’s also ignoring the possibility that the Republicans are stringing him along to run out the clock on health care in order to prevent a health care debate before the August recess.
“Sen. Reid said he wants the bill passed out of his chamber by July 31st.” 

Today, President Obama reiterated the importance of getting legislation passed before August 1.Does Baucus really want to be the person who foiled that plan?

The advice from Senate Agenda: “Time to swallow your pride Mr. Baucus and get in line with the prerogatives of the Democratic Caucus”

In part 2 of this post I will elaborate on those items in the HELP and House plans that reflect the goals that President Obama has stressed from the very beginning.

20 thoughts on “What the HELP and House Bills Tell Us about the Administration’s Priorities– It May Be Time for Baucus to Join His Caucus Part I

  1. Thanks Maggie- Very instructive for you to weigh in with your summary today since I do not have time or energy to read all the legislation.
    The train is definitely moving.
    I agree that Max Baucus must yield at this point with some face saving mechanism that his Dem colleagues will provide to him.
    We are witnessing history and YOU have played no small role.
    Thanks!
    Dr. Rick Lippin
    Southampton,Pa

  2. Unsure how this will play in senate finally, two sick senators- Kennedy and Byrd. They need 60 votes. Why aren’t they allowed to vote if not in Washington, no absentee vote? Maybe that should be something congress should look into. Kennedy dedicated years on this, unfortunate if he cann’t vote.

  3. I don’t think that the public option is to ‘keep the privates honest’; I think it is to eliminate them. I regret, but expected, that the House’s collective wisdom and creativity on how to fund health care led to more taxation. Although you indicated in your post that the House bill will ‘tax the very rich’, I don’t think this is the whole story. First, an employer pay or play mandate is a tax on the ‘not so very rich’. In addition, over time, the health care beast will require more and more funds to survive, and taxes will be forced upon the ‘slightly rich’ and others. Look what has happened in Massachusettes, the model for universal coverage. The New York Times reported today that they are running out of money and had to cut medical coverage from 30.000 residents. More and more taxes won’t raise medical quality or control the avalanche of excessive medical care being practiced in nearly every hospital or doctor’s office. http://www.MDWhistleblower.blogspot.com

  4. Michael Kirsch, M.D. you said:
    “I don’t think that the public option is to ‘keep the privates honest’; I think it is to eliminate them.”
    And this is a bad thing? Let’s face it: The HMOs were making a lot of money, but jilting a lot of folks out of their insurance. Not only should a public option should be around, but that public option should be single payer based.

  5. “I don’t think that the public option is to ‘keep the privates honest’; I think it is to eliminate them.”
    The public option is essential to controlling skyrocketing health care costs and achieving affordable coverage for all. Former health insurance executive Wendell Potter, in an interview with PBS’s Bill Moyers, argued that health companies biggest concern is that the federal government might adopt a broader program like our Medicare program which could potentially reduce the profits of these big companies. The industry doesn’t want to have any competitor. The industry has been consolidating quite a bit over the last decade. While Potter doesn’t expect the public option to rid the health care system of financial incentive, he does think it would keep insurers honest by offering a standard benefit plan that provides comprehensive coverage.
    Critics of the public option and other health care reform are ideologically aligned with the health care industry (“charmed” by the industry’s offensive). Potter says they want to believe that the free market system can and should work in this country, like it does in other industries. But they don’t understand from an insider’s perspective like Potter has, what that actually means and the consequences of that to Americans. Bill Moyers said there is an irony, you hear the companies and their trade groups talking about how we don’t want a public option that would put a bureaucrat between a patient and his doctor. Potter retorted, “what you have now is a corporate bureaucrat between you and your doctor.”

  6. To Ray: Kennedy is voting by proxy, through Sen. Conrad I believe, or so CNN said earlier today.
    I’m worried that the so called Blue Dog Democrats will align with Republicans and derail the public options. They say it costs too much, but they buy into Republican rigged numbers.
    To Dr. Kirsch: you’re right that a public option alone, and increasing taxes, won’t fix skyrocketing costs. But allowing Medpac to take a proactive role in controlling reimbursement will help eliminate a lot of unnecessary tests and treatments done purely for financial gain. Which, IMHO, is a worse problem than defensive medicine.

  7. Maybe I missed it, but you did not mention that the House bill mandated that the 45 million of uninsured folks *BUY* insurance from the very bureaucracy that is now draining massive health care dollars, like in the area of 22% for overhead.
    So we are adding TO the waste, and we are taxing the rich to do so?
    But don’t you worry, we’ll subsidize the poor so that the insurance industry keeps getting funds passed through from the taxpayers.
    I recognize that you support insurance mandates, Maggie, but can you tell me what’s wrong with this picture?

  8. Ray & Panacea, Michael
    Ray & Panacea:
    The Democrats only need 50 votes to pass healthcare reform in the Senate.
    And there are 60 Democrats in the Senate–so even if the blue-dogs defect, they can pass it.
    The reason they only need 50 votes is that in April, President Obama persuaded Senate Democrats to follow the House and include “reconciliation protection” for health care in the budget bill. This means that Republicans cannot block reform by filibustering –and Democrats need only a simple majority (50 votes ) to pass health care reform in the Senate.
    (I wrote about this at the time here http://takingnote.tcf.org/2009/04/health-care-reform-and-the-filibuster.html.
    Ezra Klein offers a good primer on “reconciliatoin” explaining that normally,
    in the Senate, “the time for debate is unlimited, and if a minority of 40 senators refuses to stop talking, then you need 60 of them to invoke the rule that shuts the others up and allows the bill to come to vote. If you don’t have 60 votes to break the filibuster, it doesn’t matter if you have 50 votes to pass the bill.
    “The reconciliation process, by contrast, limits debate to 20 hours and bypasses the filibuster altogether.”
    After the 20 hours of debate, the bill goes to the Senate floor for a straight up or down vote and only a simple majority (50 votes) is needed to pass it.
    As Ezra points out,reconciliastion ” was instituted to ensure that minority obstruction couldn’t block important business like passing a budget or reducing the deficit.”
    There are some constraints on when you can use reconciliation–it is supposed to be reserved for big bills that will have a significant impact on federal revenues.
    But under the Bush administration reconciliation was used mroe than once–to fast-track tax cuts for the wealthy, for instnace.
    The Democrats would prefer not to have to use reconciliation. But if have to, they will.
    Kennedy will vote by proxy.
    And, as Panacea points out, if Jay Rockefeller’s bill passes (Obama has endorsed it) MedPac will be able to implement its recommendations to reduce costs.
    Michael–Yes, look at what happened in Mass.
    They don’t have a public sector insurance plan setting the model for eliminating ineffective, unncessary care by raising co-pays and reducing fees for such care.
    Insurance in Massachuis so expensive because insurers have done little to reduce waste, and in this all-private system, administrative costs are high.
    Moreover, Mass. is the highest-spending state. When Medicare patients are treated there they undergo many more tests and treatments than very similiar patients in other states.
    Yet outcomes are no better–sometimes they are worse.
    You complain that the DEemocrats are not reining in spending. It seems you haven’t read the 1000-plus page House proposal. If you had, you would have seen the many proposals for having Medicare reduce spending over the next 3 1/2 years- setting the precedents for the public sector option, which won’t kick in until 2013.
    And today, the president asked Congress to give up its power to set Medicare fees–and turn it over to MedPac (or a similiar non-partisan body of physicains and health care experts.) This would all MedPac to begnin trimming fees on over-priced, marginally effective services.
    The bill already calls for raising fees for primary care providers.

  9. It seems a little light on cost controls.
    The greater good would have been better served by taxing health benefits, and break the stranglehold of employer based health insurance.
    Very expensive, and leaving ?37Million still uninsured.
    Very basic, NO FORMS coverage should be available as part of your taxes for every medical emergency.

  10. Maggie, maybe I didn’t ask the question directly enough: Does the House version include mandates that the uninsured buy health insurance? And does it provide for a taxpayer subsidy if the patient cannot afford an insurance policy?

  11. To call something that leaves 30 million Americans without health insurance “reform” is a debasement of the term. And it is so incredibly far from what Mr. Obama, a veteran senator who certainly knew how things work in DC, promised in his inspirational presidential campaign that I am embarrassed to even look at his old stump speeches.
    Here in Connecticut, Anthem just announced that it will be raising premiums for individual plans by as much as 32%. A new study projects that we’ll have 50,000 more uninsured residents by the end of 2010. Frankly, I don’t see any of these “uber-compromised” national reform proposals making much of a dent – if any – in our state’s deteriorating health care situation.
    If this is the best we (as progressives) can do, I say dump all of these bills, go back to square one, confront the insurance industry head-on and hard, and count on the will and the power of the people to carry the day.

  12. Maggie, You make very interesting points here and in the blog regarding health-care dollar expenditures. Please comment on the role of malpractice tort and insurance on this issue. There are many dollars spent on this and as far as I can see it is the largest elephant sitting in the room getting no attention at all!

  13. The Democrats don’t want to use reconciliation either. Its basically a bluff that might get called. In reconciliation the employer and individual mandate go away and with that universal coverage.

  14. jenga,dr. rosa
    jenga–You are mistaken about reconciliation.
    dr. rosa–
    Thanks for your comment.
    I think they’ll address the malpractice issue in a separate piece of legislation — just as Jay Rockefeller addresses giving MedPac power to implement its recommendations in a separate piece of legislation.
    We know that the types of malpractice caps that have been tried in the past don’t seem to work very well in reducing defensive medicine– Texas is a prime example. There’s much more overtreatment in Texas than in many other states.
    I think the Obama administration realizes that fear of malpractice suits is a major problem for many doctors. And that the system we use now needs major re-thinking.
    When they talk about encouraging doctors to go into “accountable care organizations” (see Atul Gawande’s June 1 New Yorker article) like Geisinger or InterMountain,
    where hospitals and doctors work together, there is also talk of making the hospital, rather than individual doctors, reponsible for lawsuits.
    (In most cases one individual is not responsible for what went wrong–if something went wrong, very often the problem is in the system.)
    There is also much support among progressives for an idea that has been working well in some places: full disclosure to the patient and family as to what happpened by doctors, nurses administrators. (Legal protection would be needed so that what they say can’t be used to incriminate them in court.) AFter disclosure–and saying sorrty– the hospital makes financial reparation–if necessary, through arbitration– but nobody goes to court. No need for lenghty “discovery” (you have already had disclosure.
    This saves money and time, and experience shows that when patients and family are not “stone-walled” they are much less likely to want to sue.
    This idea sounds very “Obama-like”– so I can see him backing legislation.
    Finally, the state of Washington has passed a law making it very difficult to sue if the patient went through the “shared decisoin-making” process-following the protocol. (I’ve written about this before.)
    And Wyden now has a bill in Congress that would have Medicare pay for shared decision-making.
    This could provide real protection for doctors.
    Finally, using comparative effectiveness reserach, a federal panel of physiciains, patients advocates, nurses, reserachers will be issuing guidelines on what treatments are most effective for particular patients.
    These will be recommended guidelines, not rules. But I think it’s likelly we’ll see legislation protecting doctors against lawsuits when they follow the guidelines.
    iblog– I don’t think you understand why so many people will be left uninsured.
    It is because many will choose to pay the penalty –even though they can afford the insurance.
    Many young, healthy affluent 20-somethings and single-thirty-somethings greatly resent the idea of having to pay into a “pool” that will then be paying out to take care of
    older people, sicker people, poorer people.
    So they will “opt out” and pay a penalty rather than buying insurance.
    The House bill regulates how much insurers can charge, and includes a public-sector option that will be $2,000 to $3,000 less expensive than the average private insurance plan for a family..
    The House bill also provides generous subsidies for people earning up to 4 times the federal poverty level.
    It also says that insurers can charge younger people 50% less than it charges older people in the same community.
    This is intended to try to eoncourage younger people to sign up.
    But it’s hard to force them–even if we tried to take the cost of insurance premiums out of paychecks, many people who are self-employed would hide their income. We’re talking about a tax revolt and major tax evasion. Trying to police it would be very expensive and cause great resentment among people who don’t want to be part of the pool.
    The administration is hopeful that, over time, more and more people will sign up– by 2017, they expect to cover 97% of the population.
    Also, some of the people who remain uncovered will be immigrants. Massachusetts is now saying it won’t cover legal immigrants (which seems to me totally unfair. They pay taxes.
    They are here legally.)
    Should legal “residents” be covered? What about the children of illegal immigrants? (Many people would say no, but I agree with Dr. Uwe REinhardt: The children didn’t decide to break the law. And these are children “not pets–these are young human beings who are gong to grow up in our society and be with us for a long time.” We want them to be healthy, to be educated– it is not in our interest to let them go without care when they are young.
    So these are the reasons why there are holes in universal coverage.

  15. As I expected, Maggie, the House version includes mandates that the uninsured buy health insurance. Okay, and you’ve stated your support for these. Don’t know why you are evading the question, but it’s your blog and you can use it for whatever agenda you wish to promote. But I’m disappointed. I thought you favored health reform that works.

  16. Because you said so?
    You have to do better than that even Keith Hennessey and Ezra Klein can agree that reconciliation could gut reform. It’s nothing more than a bluff and they do not want to do it. If Health care reform done through reconciliation includes the creation of a national health insurance exchange, or employer and individual mandates, or a wide range of other health care policy changes that are not principally about taxes or spending. They won’t pass secondary to the Byrd rule.

  17. Jegna–
    No, because President Obama said so.
    He made a major effort to make sure that the Senate voted for reconciliation.
    He did that beacuse he knew that he might need reconciliation to pass reform . (Obamas is not a bluffer–not his personality type. He’s very persistent, very strong and very patient.)
    And he knows he can use reconciliation, without compromising the reform bill.

  18. Not a valid reason. Because Obama said so? He’s not a deity. He wanted reconciliation because he wants to pass SOMETHING at all costs. It ensures that something is passed, which will be a compromised bill. I’ll take my chances with Ezra Klein and Keith Hennessey’s reasoned analysis, not blind faith and Obama worship.