New Health Dialogue - logo
 

HEALTH POLITICS: Mark Me Up Buttercup

September 25, 2009 - 12:56pm

During mark ups of the America's Healthy Future Act in the Senate Finance Committee yesterday afternoon, Senator Chuck Grassley asked Chairman Baucus if he should book a plane ticket home or if they would be their all weekend.

It looks like the ranking Republican from Iowa got his wish, as the Senate Finance Committee adjourned at 12 pm Friday. The Committee will resume markups next Tuesday, when, as Politico reports, they are expected to take up amendments related to the public health insurance option.

So while we wait patiently for what may be the most closely watched debate in C-Span 3's history, here's rundown of some of the major changes to the chairman's mark, as well as some outstanding issues going forward:

  • Affordability: One of the biggest criticisms of the Baucus bill when it was released was that it didn't go far enough on issues of affordability. To address such concerns, out-of-pocket limits have been lowered, as has the percent of income a family receiving subsidies could spend on insurance. Yet the subsidies are expensive, and expect the question of what's affordable for Americans versus what's affordable for our government to be an ongoing issue in mark-ups and on the floor.
  • Small Businesses: Helping small businesses access affordable health insurance through an exchange is an issue near and dear to the heart of potential swing vote Senator Olympia Snowe (R-ME). The idea is at the heart of the SHOP Act coauthored and long championed by Snowe and fellow Finance Committee moderate, Senator Blanche Lincoln (D-AR), so expect the issue of small business participation in the exchange to get a lot of play. Already firm-size eligibility has been raised to 100 workers, with new provisions allowing firms that grow beyond 100 to stay in the exchange and states to choose to open the exchange to firms of over 100. More businesses will likely be eligible for the full value of the proposed small business tax credit. An amendment from Senator Lincoln would increase the threshold at which small business tax credits begin to phase-out from an annual average wage of $20,000 to $30,000.
  • Taxes, Fees, and Revenue: Cost is key as the Finance Committee looks at its options for paying for reform. The $750 million fee on clinical labs has been eliminated -- offset by a change in Medicare payment rates. Fees on insurance providers increased from $6 billion to $6.7 billion. The threshold for a tax on high-end insurance plans to take effect was increased as was the rate at which insurers would be taxed. An amendment by Senator Bill Nelson (D-FL) to require drug companies to give dual eligibles (Americans who qualify for both Medicare and Medicaid) the Medicaid drug discount  was defeated by a vote of 10-13.  Nelson hoped to use the savings to fully close the Medicare "donut hole" and further reduce the deficit.
  • Big Ticket Provisions Efforts to weaken or remove key provisions from the bill, such as individual mandate or the Medicare Commission, were defeated in a show of solidarity from Committee Democrats. Some have called the advisory committee a MedPAC on steroids (with steroids meaning actual authority to influence Medicare policy) and Baucus views it as one of the key provisions that will actually help bend the cost curve over the long run. One issue, being pushed by Senator Maria Cantwell, is how to provide low income individuals who are on Medicaid or receiving subsidies with a lower cost health insurance plan.  The example of Washington Basic Health in Cantwell's home state might be of interest to CBO and others when looking for ways to control costs while providing quality care.

Health Care Affordability

I think this is the most important part of this debate. If you are going to make health insurance mandatory then it also has to be affordable. Unfortunately I have not seen much in the way of lowering costs.