Research Briefing

AT FIRST GLANCE, SEEMS SO …

RUSHED THROUGH? Obama Pushed Deadlines To Force Action From House Dems. “Speaking in the Rose Garden Tuesday, President Obama demanded ‘action over inaction’ on health-care reform. But does that action have to happen by Aug. 7? As Obama himself has said, without deadlines, ‘nothing gets done in this town.’ Absent the urgency of a defined timeframe, the House and Senate could well have punted on health care by now. But at the same time, the White House's insistence on a deadline has helped fuel the current, widespread storyline that the reform effort is struggling.” (“Ben Pershing, “Health-Care Deadline a Double-Edged Sword for Obama,” The Washington Post’s “44” Blog, 7/22/09)

• CHECK: White House Pressured Baucus To Move Forward. “Baucus faced significant pressure from the White House … to show progress on health care reform, particularly ahead of the president’s joint speech to Congress on Wednesday.” (Carrie Budoff Brown and Chris Frates, “Max Baucus Moves Forward With Health Care Bill,” Politico, 9/9/09)

GOVERNMENT-RUN? “Public Option,” Supported By Obama And House Dems, A Government Takeover Of Health Care By Crowding Out Private Competitors. “But the federal government isn’t competition … It sets low prices, to be sure, lower than many insurers are able to match … A new public option may start small. But it could easily crowd out private plans depending on how premiums, benefits and subsidies are structured.”  (Editorial, “Hope And Experience,” The Chicago Tribune, 6/16/09)

• CHECK: Baucus Bill Would Form Co-Ops That Would Use Government Power To Monopolize Health Insurance Market. “[T]hese co-ops sound a lot like a health-care Fannie Mae and Freddie Mac, which Congress created because there was supposedly no secondary mortgage market. The duo proceeded to use their government subsidy to dominate the market and drive out private competitors. (Chairman’s Mark, “America’s Healthy Future Act Of 2009,” Introduced 9/16/09; Editorial, “Fannie Med,” The Wall Street Journal, 7/30/09)

DRIVING NATION FURTHER INTO DEBT? House Dems’ $1.6 Trillion Bill Creates $239 Billion Deficit Over Next Decade. “Democrats argue the number should be $1 trillion, a number provided by the Congressional Budget Office for the net cost of the portion of the bill affecting health insurance, and they boasted in press releases that the bill actually creates a $6 billion surplus over the coming decade. But the gross cost of the bill is much higher, more than $1.6 trillion, according to a Roll Call analysis of the CBO data. And despite more than $800 billion in tax and fee hikes, it actually adds $239 billion to the deficit ...” (Steven Dennis, “Analysis: House Health Care Bill’s Price Tag Tops $1.6 Trillion,” Roll Call, 7/20/09)

• CHECK: Baucus’ $856 Billion Bill Would Force States To Pick Up New Costs Of Government-Run Health Care. “Members of the Senate Finance Committee said they might require states to pay a larger share, perhaps 15 percent or 20 percent of the new costs. Governors of both parties object to such requirements as an ‘unfunded mandate.’” (Sen. Max Baucus, “Baucus Introduces Landmark Plan To Lower Health Care Costs, Provide Quality, Affordable Coverage,” Press Release, 9/16/09; Robert Pear and David M. Herszenhorn, “New Objections To Baucus Health Care Proposal,” The New York Times, 9/14/09)

HIGHER COSTS ON FAMILIES? House Dems’ Mandates Causes Price Of Health Insurance To Rise. “Each benefit mandate raises the price of health insurance a little bit.  These increases accumulate. … Because the House and Senate bills contain versions of community rating and guaranteed issue mandates, they would benefit those with predictably high costs.  At the same time, the President wants to slow the growth of overall (total/average) private health insurance premiums, and we need to understand how much the mandates in these bills would exacerbate that problem.” (Keith Hennessey, “New Health Insurance Mandates Would Increase Premiums,” KeithHennessey.com, 7/23/09)

• CHECK: Baucus Bill Will Tax Health Insurance Companies On Policies Over $8,000 Per Individual And $21,000 Per Family, With Costs Passed On To Consumers Through Higher Premiums. “The thinking behind the tax is that it would raise hundreds of millions of dollars while at the same time curbing health-care spending by leading insurers or employers to stop offering the costliest plans to avoid the tax, or passing the tax on to employees in the form of higher premiums, which might lead employees to seek cheaper plans.”  (Chairman’s Mark, “America’s Healthy Future Act Of 2009,” Introduced 9/16/09; Alec MacGillis, “Ahead Of Obama’s AFL-CIO Appearance, Labor Officials Express Concern Over Excise Tax,” The Washington Post’s “Daily Dose” Blog, 9/15/09)

HIGHER TAXES ON SMALL BUSINESSES? House Dems’ Small Business Tax Hikes To Pay For Government-Run Health Care Will Kill Jobs. “This [surtax] would hit job creators especially hard because more than six of every 10 who earn that much are small business owners, operators or investors, according to a 2007 Treasury study... America’s successful small businesses would pay higher tax rates than the Fortune 500, and for that matter than most companies around the world ...” (Editorial, “The Small Business Surtax,” The Wall Street Journal, 7/14/09)

• CHECK: Baucus Bill Will Require Small Businesses Who Can’t Afford Health Insurance For Their Employees To Pay Large Tax, Making It More Difficult For Employers To Hire Workers They Need. “[E]mployers who do not offer ‘affordable’ coverage to employees would have to help pay the cost of such benefits for their low-income workers ... The Center on Budget and Policy Priorities, a liberal research and advocacy group, said this proposal ‘could unintentionally discourage the hiring of lower-income people,’ by adding a new ‘health surcharge’ to the cost of employing them.” (Chairman’s Mark, “America’s Healthy Future Act Of 2009,” Introduced 9/16/09; Jeff Zeleny and Robert Pear, “Obama Says Government Health Coverage Plan Would Not Hurt Private Insurers,” The New York Times, 6/23/09)

GOVERNMENT INTERFERENCE WITH PATIENT CARE? White House Proposed “Independent Medicare Advisory Commission” That Would Set New Regulations For Doctors, Hospitals. “Not only would the council make recommendations on payment updates, it would also have the authority to propose other ‘Medicare reforms’ which would go into effect unless Congress could muster veto override majorities in opposition. What are ‘Medicare reforms’? From the write-up, it seems they could be just about anything. Changes in beneficiary cost-sharing. New rules for establishing qualified hospitals and doctors. Penalties for physicians who don’t follow government guidelines. Pretty much anything except for the payroll tax and premium structure.” (Peter Orszag, OMB Director, “Sectional Analysis Of IMAC Draft Legislation,” Letter to House Speaker Nancy Pelosi, 7/17/09; James C. Capretta, “On-The-Fly Audacity,” The New Atlantis’s “Diagnosis” Blog,” 7/20/09)

• CHECK: Baucus Bill Creates “Independent Medicare Commission” That Would Have Increased Ability To Deny Treatments. “[N]ew body … would enhance Medicare’s ability to deny care to the elderly and disabled based on government bureaucrats’ arbitrary valuations of those patients’ lives. It is right there in the legislation now before Congress, and it is called the Independent Medicare Advisory Council.” (Chairman’s Mark, “America’s Healthy Future Act Of 2009,” Introduced 9/16/09; Michael F. Cannon, Op-Ed, “Sorry Folks, Sarah Palin Is (Partly) Right,” The Detroit Free-Press, 8/19/09)

 BUT IT’S JUST NOT A BIG ENOUGH TAKEOVER … YET

Sen. Jay Rockefeller (D-WV) Opposes Baucus Bill. “‘I have sat beside Max Baucus for 22 years on the Finance Committee. I’m probably his best friend among Democrats on the Finance Committee, but I cannot agree to this bill,’ Rockefeller said … ‘The way it is now, there’s no way I can vote for the Senate [Finance] package for a lot of reasons,’ Rockefeller said on a conference call with reporters.” (Jeffrey Young, “Rockefeller Won’t Vote for Baucus Health Bill”, The Hill, 9/15/2009)

Sen. Ron Wyden (D-OR) Opposes Baucus Bill, Calls For Additional Steps. “‘Additional steps are going to have to be taken to make coverage more affordable,’ Wyden said, ‘and my sense is that will be a concern to members on both sides of the aisle.’” (Lori Montgomery and Shailagh Murray, “Reform Bill Will Address GOP Fears,” The Washington Post, 9/15/09)

Sen. Tom Harkin (D-IA) Vows Fight For Government-Run “Public Option.” “‘Mark my word — I’m the chairman — it’s going to have a strong public option,’ Harkin said his annual Harkin Steak Fry fundraiser, according to the Iowa Independent… Harkin’s position stands in contrast to the work continuing in the Senate Finance Committee, the other Senate group responsible for writing health care.” (Stephanie Condon, “New Sen. Health Panel Chair Endorses Public Option,” CBS News’ “Political Hotsheet“ Blog, 9/14/09)

Sen. John Kerry (D-MA) Argues Baucus Bill “Not Going To Be The Bill We’re Going To Vote On.” “Senator John Kerry, a Massachusetts Democrat, said the measure Baucus introduces will only be a beginning as other lawmakers on the committee get ready to do their work… ‘It’s not going to be the bill we’re going to vote on,’ Kerry told reporters.” (Laura Litvan and Nicole Gaouette, “Baucus Faces Objections From Democrats Over Health-Care Plan,” Bloomberg, 9/15/09)

Baucus Plan Long Way From Senate Floor As Rockefeller Threatens Bill With Slew Of Amendments. “The committee will begin its deliberations over the proposal next week, and Rockefeller signaled he would have dozens of amendments to offer during the panel’s markup. ‘I mean I got so many amendments that it’s really quite impressive,’ Rockefeller said.” (Manu Raju, “Rockefeller Rips Baucus Bill,” Politico, 9/16/09)