The Power of A

According to multiple sources, Senate Majority Leader Harry Reid (D-NV) told Senate Finance Committee Chair Max Baucus (D-MT) to stop trying to negotiate with committee Republicans and to begin pushing his health care bill out of committee.

Reid expressed concerns that Baucus’s proposed legislation would not have a public plan but would include language removing the deduction for employer-based health care coverage.  Public plan proponents have been increasingly vocal this week, with House Democrats yesterday criticizing White House Chief of Staff Rahm Emanuel over comments suggesting the public plan was not a mandatory part of health care reform.

Reports of the criticism came after yesterday’s weekly Democratic leadership meeting.  Roll Call reports that Reid’s message was delivered through an intermediary after the majority leader had consulted with the caucus leaders.  The newspaper also reports that Reid’s message told Baucus the lack of a public plan would cost his bill 10-15 Democratic votes, and that losing so many in the caucus was not worth the effort to gain a few Republican votes.

Additionally, concern has been raised in the Democratic caucus over the employer-deduction proposal after polling shows 70% of Americans are opposed to removing the deduction.  An idea being discussed is a surtax on families with income above $250,000 as an alternative to pay for the reform legislation, but there is a general uncertainty as to what is going to be used to pay for the Finance Committee’s legislation.  Senator Baucus acknowledged as much by saying: “It’s a very complex bill.  People are getting skittish all around.”

If you were a member of Congress, how would you propose to pay for health care reform?

Quick Hits

The American Hospital Association, Catholic Health Association, and Federation of American Hospitals will announce with Vice President Joe Biden $155 billion in health care savings over 10 years… Washington Post examines the idea of “rationing” in health care reform… Congressional Budget Office scores the House Tri-Committee health care bill (subscription) at $1.5 trillion over ten years, House leaders expected to announce their revenue raisers today… the HELP Committee finishes debate on the long-term care sections of their health care bill.

In an interview with the Associated Press, Maine Senator Olympia Snowe (R-ME) outlined her support for a public plan with a trigger option as a possible compromise to the stalemate over inclusion of a public plan in comprehensive health care reform.

The trigger option would mean a government-run insurance company would only come into existence if private insurance companies failed to enact specified reforms. Senator Snowe stated her opposition to a public plan that is immediately created, saying: “If you establish a public option at the forefront that goes head-to-head and competes with the private health insurance market … the public option will have significant price advantages”

However, in the interview she expressed a desire to reform the insurance market. “I don’t think we can entirely depend on the private insurance market to deliver. They haven’t delivered thus far, and that’s why we’re in the predicament we’re in today,” she said.

Also this morning, Politico obtained a Senate Health Education Labor and Pension (HELP) Committee document outlining its proposal for a public plan in its legislation. The proposal would be a weaker version of the House version of the public plan, but more government-oriented than the co-op proposal. Details of the “Community Health Insurance Option” can be found here, but highlights include:

- The public plan would be an offering to the bill’s insurance exchange, and would follow the same rules as private insurers except the federal government would set reserve requirements.

- For the first three months, the government (specifically HHS) would pay the plan’s claims. This would be considered a loan to be repaid by the plan.

- The payment rates paid by the public plan would be no more than the local average of private rates, but could be less.

- There is no requirement that a health care provider participate in the plan.

Quick Hits

White House Press Secretary Robert Gibbs gives a non-committal answer (subscription) to whether the president is open to taxing employer-provided health care… the Small Business Coalition for Affordable Healthcare releases its first YouTube video… a list of other groups advertising (subscription) over the Congressional recess.

President Obama yesterday addressed the annual meeting of the American Medical Association (AMA) and waded into some of the controversies surrounding health care reform.

Last week, the AMA issued a statement expressing discomfort with the idea of a public insurance plan, and has scheduled a vote this week during the annual meeting to establish a position on the idea. The president tried to woo the membership by addressing the issue head on and reiterating the argument that it was needed to level the playing field with traditional insurance companies.

President Obama also ruled-out the idea of reform including a “single payer system” or all health insurance provided by the government: “There are countries where a single-payer system may be working. But I believe - and I’ve even taken some flak from members of my own party for this belief - that it is important for us to build on our traditions here in the United States. So, when you hear the naysayers claim that I’m trying to bring about government-run health care, know this - they are not telling the truth.”

In addition, the president reiterated his support for legislation with employer and individual mandates as well as calling for a revenue-neutral bill paid for by his charitable tax deduction rate reduction proposal and elimination of waste in the health care system. He also referred to health care costs as a “ticking time-bomb” that needs to be addressed to prevent a long-term budget disaster.

Rep. Tom Price (R-GA), a non-practicing orthopedic surgeon and AMA member, held a pre-speech conference call with reporters to argue against any proposed public plan. “When the government is running something, it subsidizes it to the point private industry can’t compete,” he said on the call.

Did you find President Obama’s speech convincing (especially if you work in a medical profession)?

Quick Hits

Congressional Budget Office releases HELP bill estimates (letter here)… Kaiser Family Foundation Poll finds Americans support health care reforms, but not pay-fors… American Hospital Association CEO (and ASAE member) Richard Umbdenstock speaks out against president’s plan to cut Medicare and Medicaid… Today’s 2:30 PM HELP Committee hearing has been moved to tomorrow (Wednesday) at 10:00 AM.

Senators from both parties and key committees are beginning to voice support for an idea proposed by Senator Kent Conrad (D-ND) earlier this week that is an alternative to a government-run public insurance company (”public plan”).

While complete details have not been released, Conrad’s proposal would allow the creation of a series of state and regional consumer health cooperatives (”co-ops”). The co-ops would be non-profit, non-government insurance options for the self-employed or small businesses regulated by standards from the National Association of Insurance Commissioners. These types of arrangements are found in other sectors of the economy, including agriculture. The National Cooperative Business Association and National Rural Electric Cooperative Association provide good examples of how current cooperatives operate.

Since the cooperatives would not be government run and exist currently, the idea has gained support from Republicans such as Finance Committee ranking member Charles Grassley (R-IA): “If it can be presented as an entirely…private-sector operation and incentive and like co-ops that we know, generally in the Midwest, I think it’s got some possibilities.” However, the idea still is under-development; the National Journal is reporting (subscription) that Senator Charles Schumer (D-NY) is working with Senator Conrad to make the idea palatable to pro-public plan Democrats.

Associations such as ASAE have been pushing for pooling ideas such as cooperatives (like the Small Business CHOICE Act) as a way to provide savings for small businesses and the self-employed. Can cooperatives (run by associations or not) be a viable alternative to a public plan?

Quick Hits

Baucus staff threatens Democratic health care lobbyists - again (subscription)… Baucus announces a June 23^rd mark-up of health care legislation, with a “draft mark” released June 17… Democratic infighting on health care examined by Politico… The American Medical Association comes out against the public plan… President Obama takes health care push to Wisconsin… The Washington Post profiles maybe the most important person in the health care debate.