Sept. 21 (Bloomberg) -- Five U.S. congressional committees have worked on legislation to overhaul the U.S. health-care system, with the aim of expanding coverage to tens of millions of uninsured Americans and curtailing costs.
The Senate Health, Education, Labor and Pensions Committee has approved a measure, while the finance committee this week will begin debate on a draft released by Montana Senator Max Baucus, the panel’s chairman. In the House of Representatives, the ways and means, education and labor, and energy and commerce panels have passed legislation.
Baucus spent months trying to achieve a bipartisan compromise before releasing his plan, which as yet has no Republican support. The four other Democratic-controlled committees approved their measures on party-line votes.
The following outlines some of the biggest similarities and differences in those plans:
Common Ground
INDIVIDUAL MANDATE: All the plans require individuals to get health insurance, with government subsidies or expanded programs to help people with lower incomes purchase coverage. New online exchanges would be created to help people shop for policies at more affordable group rates. About 15 percent of U.S. residents, or some 46 million, lacked health insurance in 2008, according to the U.S. Census Bureau.
EXPANDING COVERAGE: President Barack Obama and top Democrats in Congress say they want to cover all Americans, yet the proposals would still leave millions of people not eligible for Medicare uninsured, according to the nonpartisan Congressional Budget Office. Under the House proposal, about 17 million people, almost half of them illegal immigrants, would lack coverage, the CBO estimated. The plan by Senate Finance Committee Chairman Baucus would leave about 25 million uninsured, a third of them illegal immigrants, the CBO said.
INSURER REQUIREMENTS: Insurers would no longer be able to reject new customers with pre-existing medical conditions; new restrictions would be placed on their ability to set premiums.
REDUCING COSTS: The legislation is intended to lower long- term health-care costs for consumers and the government.
All the plans call for greater access to preventive care, either with new programs or the elimination of co-payments, a change that proponents claim will save money by keeping people from developing diseases that are more costly to treat. They also call for more use of electronic systems to promote better record-keeping and reduce overhead costs.
Obama favors a new independent commission to set reimbursement rates for providers who treat patients in Medicare, the federal program for the elderly. The Senate finance committee draft embraced this idea, saying it would reduce costs by taking authority away from Congress and making payment decisions less politically charged. Members of the Blue Dog Coalition, a group of self-described fiscally conservative House Democrats, also support the plan.
BIOLOGICS: Biologic drugs, which are made from living cells by companies such as Thousand Oaks, California-based Amgen Inc., would get 12 years of protection from generic competition under a plan passed by the Senate health panel and the House Energy and Commerce Committee. The White House had sought to limit the exclusivity to seven years as a way of bringing prices down.
COMPARING TREATMENTS: Legislation in both the House and Senate would create research centers to examine the efficacy of various health-care services, devices, treatments and procedures. None of the bills require the research be used to force health providers to adopt new procedures or policies to cut costs, which is an administration priority. Obama provided $1.1 billion in the stimulus act to fund so-called comparative effectiveness research.
Differences
PUBLIC OPTION: The three House panels and Senate health committee would create a new government-run insurance program designed to compete with private companies such as Minnetonka, Minnesota-based UnitedHealth Group Inc. and help reduce prices for insurance in the market. The House Energy and Commerce Committee and the Senate health panel require that the new entity negotiate rates with health-care providers as private insurers do, instead of pegging rates to the lower fees paid by Medicare.
Baucus’s Senate finance panel draft dropped this option altogether.
COOPERATIVES: Instead of a government-run insurer, the Senate finance draft creates nonprofit cooperatives, or networks of health-insurance plans owned by the customers they serve, that would get started with money from the government. The House Energy and Commerce Committee included both co-ops and a public option in its plan.
EMPLOYER MANDATE: The three House committees and the Senate health panel require that employers cover their workers or pay a penalty, with potential exemptions for some businesses because of size or hardship. The Senate Finance Committee proposal omitted that mandate, instead requiring that employers with more than 50 full-time workers pay a fee for every lower-income employee who qualifies for a new tax credit to obtain care.
HOW TO PAY FOR IT: The House version, approved by all three panels, would add a surtax on the wealthiest Americans, graduating from 1 percent on couples whose income exceeds $350,000 a year to 5.4 percent for those with income of more than $1 million.
The Senate health committee didn’t address new sources of revenue, leaving that work to the finance panel. Baucus opted against a surtax. Instead, he proposed to tax insurers on the most generous “Cadillac” benefit plans. He also includes about $13 billion in new annual fees on insurers, medical-device manufacturers, drugmakers and clinical laboratories beginning in 2010 and imposed based on market share.
What’s Next
The chairmen of the three House committees are working with Speaker Nancy Pelosi and other top Democrats in Congress to come up with a single piece of legislation that reflects changes made by the panels in July. The measure will then go for a vote by the full chamber, controlled 256-178 by Democrats.
Baucus said the Senate finance panel will probably spend three days next week amending, or “marking up” its version. Then Senate Majority Leader Harry Reid will work with lawmakers to merge that measure with the health committee’s plan before a vote by the full chamber, controlled 59-40 by Democrats and the two independents who caucus with them.
Senate Democrats are still working to win Republican backing because they need at least 60 votes to overcome a legislative maneuver known as a filibuster that’s likely to come from opponents. Otherwise, Democrats could resort to a budget process known as reconciliation, whose rules require only a majority for passage yet might force a scaled-back measure.
If measures pass both chambers, the House and Senate would work together to fashion a compromise for another round of votes. The final legislation would go to Obama to be signed into law. Both Obama and Democratic leaders in Congress say they want the bill signed into law by the end of this year.
To contact the reporters on this story: Kristin Jensen in Washington at kjensen@bloomberg.net ; Nicole Gaouette in Washington at ngaouette@bloomberg.net
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