The Power of A

Yesterday, the Senate Finance Committee leaked its outline for its health care legislation, partly in response to the Congressional Budget Office’s scoring of previous draft language.  The document (seen here) is not legislative language, but the concepts do have some impact on small businesses and associations if they were enacted:

• The draft incorporates the Small business Health Options Program (SHOP) Act exchange idea, where small businesses can determine their coverage through one centralized location.  There is not a specified role for associations or “navigators” mentioned in the draft.
• To reduce the cost, the proposal grants tax credits to individuals and families up to 300% of the federal poverty level.  This is down from the 400% level proposed by the Senate HELP Committee.
• The legislation defines small businesses eligible for a small business tax credit as fewer than 25 employees with average wages below $40,000 until their state creates an Exchange.  Some in the small business community object to this arbitrary definition of a small business.  This concept and the numbers are also contained in the HELP Committee draft.
• The tax exclusion for employer-based coverage would be capped at either 10% or 20% above the Federal Health benefits Program.  This is a limited cap, as opposed to completely removing the tax exclusion for the benefit.
• There is no public plan in the draft.  Instead, the draft incorporates Senator Conrad’s (D-ND) cooperative concept.  The Department of Health and Human Services would provide seed money for individuals to create a “co-op” to purchase or create health insurance plans.  Based on the language released so far, this is not association health plans, as it is driven by individuals or small businesses.
• The legislation has a mandate for everyone to have health insurance.  The draft also has a “free rider” approach to an employer mandate: there is no absolute mandate for employers to provide insurance for employees, but employers whose workers receive Medicaid or a tax credit through an Exchange must contribute half of the average Medicaid cost for workers or 100% of the cost of the tax credit received for providing the workers with health insurance.  This is an idea incorporated from the Wyden-Bennett health care bill.  Additionally, workers could only leave their employer-sponsored coverage and go through an exchange if their employer’s insurance plan was costing the worker more than 12.5% of their income.

Do you think that this draft has the best chance of passage, or is it contrasting itself to the HELP bill to allow the final Senate bill to be a compromise of the two?

Quick Hits

Congratulations to Paco Saldana, the winner of the U.S. Travel Association’s contest to find the best grassroots lobbyist to advocate for increased U.S. travel.  Details on USTA’s innovative campaign can be found here… The Consumer Electronics Association has launched its new campaign “The Innovation Movement“.  The goal of the campaign is to tap into the industry’s brain trust to show how the industry drives economic improvement… The House “Tri-Com” health care draft will be released this afternoon.  Check back here to find more details and analysis on the language.