Baucus Bill Gets Mixed Reception

Hoping to keep you informed, and alert you to the fact that there is too much of a hand out to Big PhARMA and Big Insurance in this proposal, along with cuts to Medicaid and Medicare, NO CUTS to members of Congress' insurance plan.

And BTW, where is dental and vision coverage for citizens and parity for fitness programs equal to Congressional gym privileges?

I could say more but the bottom line for me is that this isn't good for consituents by a long shot.

Baucus Health Plan Gets a Mixed Reception
Wayne J. Guglielmo

September 17, 2009 — After Senate Finance Committee Chairman Max Baucus released his healthcare reform plan yesterday, White House Press Secretary Robert Gibbs characterized it as "an important building block" and a reform measure that "makes progress on the issue" in a briefing with reporters.

It was tepid praise for a bill that was so long in the making and so eagerly anticipated — but Gibbs's comments were also a clear acknowledgement that the "chairman's mark," as this kind of initial legislative draft is known in Washington-speak, will be amended in the week or so ahead, as both disgruntled Republicans and Democrats on the Finance Committee weigh in.

The Baucus plan as released garnered no Republican support, despite months of intense negotiation among the so-called Gang of Six, a bipartisan group of Finance Committee members that included on the GOP side Ranking Member Charles Grassley (IA), Olympia Snowe (ME), and Michael Enzi (WY).

In their postrelease statements, the Republicans voiced a variety of objections. Among other things, Sen. Enzi criticized the proposal's $856 billion price tag as still too expensive, although that 10-year cost is the lowest of any of the other major Congressional health reform bills and may even be overstated by $82 billion, according to a Congressional Budget Office analysis released Wednesday afternoon.

Enzi also said that the bill "does too little to cut cost for those with health insurance; expands "the unsustainable Medicaid program"; and calls for payment reforms in private Medicare or Medicare Advantage that could end up reducing beneficiary coverage. For his part, Sen. Grassley called for tougher measures in the bill to prevent "taxpayer funding of abortion services" and to prevent healthcare subsidies for "illegal aliens." He also called for a tougher stance on medical malpractice reform — as of now, the Baucus bill calls simply for the Senate to push Congress to establish "a state demonstration program to evaluate alternatives to the current civil litigation system" — and for cost-saving alternatives to the bill's "individual mandate" provision, which would require most Americans to have coverage or be subject to a penalty.

Of the 3 GOP members, Maine's Olympia Snowe was the most tempered in her reaction, which has given some Democrats heart that she may still join them to form a fillerbuster-proof 60-vote majority if and when reform legislation finally makes its way out of committee and onto the Senate floor. But Snowe has her own cost concerns — and she was clearly instrumental during negotiations in moving the Baucus proposal "in the right direction away from," as she says in her postrelease statement, "a government-run system contained in bills that have passed other Congressional committees."

In fact, in stark contrast to the Senate HELP Committee legislation and the House Tri-Committee bill, the Baucus proposal jettisons the much-debated "public option" — the government-run health program that would compete in the marketplace with private health insurance plans — in favor of a series of nonprofit member-run, member-oriented plans or co-ops. "Six billion dollars of federal seed money would be provided for start-up costs and to meet solvency requirements," notes the Senate Finance Committee press release.

Thumbs Down to the Co-op Alternative

But it is precisely this substitution of the public plan option with the co-op alternative that has some Democratic Finance Committee members seeing red.

West Virginia's Jay Rockefeller has been especially vocal in his opposition. "The proposed co-op model is untested and unsubstantiated — and should not be considered as a national model for health insurance," he said in a statement after the release of the Baucus plan. In a postrelease letter to Chairman Baucus and Ranking Member Grassley, he went a step further, not only reiterating his strong support for a public-plan option as "the only way to guarantee that all consumers can purchase affordable, meaningful, and accountable health insurance," but educing evidence from a variety of federal and private agencies that, as he puts it, "causes me even greater concern about the direction of the Finance Committee package."

Rockefeller makes 4 points. First, there has been little historical research done on consumer co-ops "as a model for the broad expansion of health insurance," and the research that has been done shows a history of failure. Second, there is no consistent data on the number of existing co-ops or their effect on consumers. Third, the majority of co-ops today "operate and function like existing health insurance companies." And fourth, because existing co-ops are regulated by the individual states in which they are headquartered, there have been no overall analyses of how successful regulators have been in preventing fraud and abuse, in guaranteeing adequate consumer representation, and in making sure co-ops actually fulfill their mandate to reduce costs.

But if the co-op alternative is a deal breaker for Democrats like Rockefeller, the public option is almost certainly a nonstarter for even moderate Republicans like Olympia Snowe. Which side will prevail during the "markup" or amendment process? And if the bill does make to the Senate floor, will the losing side try to make up during floor debate what it lost in committee?

As for President Obama himself, some observers think he has sent mixed signals about his commitment to the public-plan option. Is it simply a means to an end — enhanced competition and lower costs — as he indicated in his recent speech before a joint session of Congress, or is it something more? And if the former, can he keep Democrats like Rockefeller from bolting while enlisting moderate Democrats and a Republican or two to his cause?

Debate over the Baucus proposal in the next week or so ahead is likely to provide at least some partial insight into many of these questions.

Full text of Sen. Baucus' healthcare plan.