New Health Dialogue - logo

HEALTH REFORM: Passing the Baton

The House's historic vote on Saturday feels almost like ancient history. By Monday, all eyes turned back to the Senate and the progress of the merged legislation being shepherded by Majority Leader Harry Reid.

H.R. 3962 passed by a margin of 220-215 with 39 Democrats voting against the bill and one Republican representative crossing party lines. (The New York Times has a great graphic illustrating the politics of this vote.) Speaking from the White House Rose Garden on Sunday, President Obama thanked lawmakers for their "courageous vote," and called on the Senate "to take the baton and bring this effort to the finish line on behalf of the American people."

The relay is being held up, however, as Reid waits for the CBO to return scores of the various proposals and options he submitted. Estimates are expected to be released by the end of this week, and merged legislation could be released soon after. Still the Senate is not expected to begin debating the legislation until after Thanksgiving, giving Congress essentially four weeks to try and meet President Obama's goal of signing health reform legislation into law before year's end.

It will be a sprint to say the least. You know our stance on the issue, and the White House, too, is stepping up its pressure to not let this slip into 2010.

At the very minimum, it currently seems Reid will try to pass legislation through the Senate before Christmas.That leaves open the option for conferees to work on merging the House and Senate Bills over the holiday recess and clear the way for a vote on final passage early in January.

In addition to the simple logistics of moving historic legislation through the historically slow moving Senate, Kaiser Health News, Slate, and the Wall Street Journal all give a good lay of the land, and here's our quick overview of some of the biggest issues going forward:

  • Affordability and Costs: The House is more generous in it's subsidies than the Senate Finance Bill. Splitting the difference requires tough tradeoffs between expanding affordable coverage to all Americans and keeping the total costs of the bill in line. Both bills subsidize coverage up to 400 percent of poverty, but the Senate Finance bill does so at a less generous rate. According to the CBO estimates, the House bill comes in just over a $1 trillion dollars over 10 years while the Senate finance bill weighs in at $821 billion.
  • Coverage: The House bill will decrease the number of uninsured by 36 million over ten years -- compared to the 29 million in the Senate Finance legislation. The House bill accomplishes this with more generous subsidies, a higher Medicaid eligibility rate, and stronger individual and employer mandates -- meaning there will be plenty of details to be worked out in conference.
  • The Public Plan: Speaker of the House Nancy Pelosi (D-CA) couldn't get the votes to pass a robust public plan with rates tied to Medicare and settled for a public health insurance option that would negotiate rates directly with providers. Reid faces trouble getting moderate Senate Democrats to pass a similar plan, even with the proposal to allow state opt-outs.
  • Financing: Pay-fors are never pretty. The House added a tax on bio fuels in the Managers Amendment after one of the bill's funding mechanisms was used by the Senate in legislation to extend unemployment insurance. One of the biggest challenges going forward will be melding the financing mechanisms of the House and Senate legislation: the House raises some $461 billion through a 5.4 percent surtax on individuals earning more than $500,000 and couples earning more than $1 million. The Senate is no fan of this revenue source -- particularly because it's not indexed to inflation. The House is equally unhappy with the Senate Finance Committee's proposed 40 percent excise tax on high value plans -- which they worry will hit organized labor. Despite the divisions, there's probably room for compromise -- maybe by raising the thresholds on each, and indexing the surtax to inflation and/or lowering the rate.
  • Politics: If pay-fors aren't pretty, politics are even uglier. The abortion debate may not be as intense in the Senate, but it is far from over and will likely come back in conference if not earlier. Other potential wild cards that could derail the debate include immigration and the questions surrounding a certain independent Senator from a small northeastern state. (Not Bernie Sanders)