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Tuesday, October 13, 2009


Health care restructuring cleared another hurdle when it was voted favorably out of the Senate Finance Committee 14-9 this afternoon. Republican Olympia Snowe (ME) along with every Democrat, voted to move the bill forward. Sen. Snowe, while maintaining that “My vote today is my vote today. It does not predict my vote tomorrow,” ultimately concluded that inaction was riskier than the “imperfect bill.” Several Republican senators continued to warn of the dangers of rationing – with Senator Roberts(KS) in particular noting that the bill contains “robust tools to ration your healthcare.” A good deal of time was spent in committee today by Democrats criticizing an industry-commissioned report by PriceWaterhouseCoopers that found health insurance premiums would increase faster under the Senate's bill than they would without it. Also, Sen. Rockefeller (D-WV) again lamented the lack of inclusion of end-of-life planning. The Senator will likely offer a related amendment on the Senate floor. For more on similar end-of-life planning provisions in the house bill see here.

The Finance committee product contains 1. cuts to Medicare, 2. the dangerous "Death Spiral" provision, 3. a grant of nearly unlimited power to the Medicare Commission to reduce Medicare payments to fit with the limits on growth, and 4. verbal promises to consider price controls.

Negotiations will now shift into a closed-door setting. After today’s vote, Sen. Baucus (D-MT), majority leader Reid (D-NV), and Sen. Dodd (D-CT), along with and a handful of top White House officials, will meet to meld the Finance bill alternative bill that Dodd led through the HELP committee in July.

Leaders in the House have been meeting over the past months in an effort to merge three bills passed out of committees and to bring down projected costs. House Speaker Pelosi (D-CA), has said she expects a final version for consideration by the full chamber soon, although she has not provided a specific timetable. While attempting to shave their $1.2 trillion plan down to $900 billion, the final bill is likely to reduce subsidies, place more people into state Medicaid programs, and employ several of the taxes raised in the Senate Finance Committee. However, House leaders have rejected the Senate Finance plan’s tax on high-value plans – the one financing mechanism that would keep pace with the rising resources devoted to health care would be the 40% levy on health insurance premiums. For more on this see here. House leaders are instead relying on a modified version of their original plan to impose a surcharge on higher income Americans.

It has also been reported today by the Washington Post that in order to come in under $900 billion dollars, House Democrats will cut out a provision that ensures that doctors receive their Medicare payment update formula. This would then be addressed in an expensive stand-alone bill. In the Senate version, the billions required to stop those same scheduled cuts in Medicare payments to physicians is only addressed for one year (then docs take a drastic 25% pay cut if no other action is taken). Not addressing this very integral and expensive aspect of healthcare in these comprehensive bills can give the incorrect appearance that the bills are able to be paid for - when that is not the case. And when inadequate financing is present, coupled with the dangerous mechanisms, rationing becomes a very real threat.

How soon floor action will occur in either chamber is unclear- though leadership insists that they mean to act soon.

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