Research Briefing

Reid’s Latest Changes Just Meant To Get Votes, Not To Fix His Government-Run Health Care Bill

RNC CHAIRMAN MICHAEL STEELE: “Today we learned that Harry Reid’s backroom deals and closed-door meetings have led to a health care bill that will cost American taxpayers nearly a trillion dollars.  And get this: Harry Reid and the Democrats are celebrating.  While they claim victory, the American people will be faced with higher taxes, increased premiums and cuts to Medicare.  They are ramming this government-run health care program through Congress – when Americans don’t want it, and our country can’t afford it. At the beginning of this debate, eight ‘moderate’ Democrats insisted that Harry Reid pledge to allow senators and the American people 72 hours to read the full legislative text and CBO score prior to voting.  A number of those Democrats remain uncommitted to this bill - now is their chance to keep their word. Any so-called ‘moderate’ Democrats who try to use this CBO score as a fig-leaf to hide their vote to expand government and increase Americans’ health care costs, while denying the American people time to read and consider this bill, will quickly learn their constituents will not be fooled.”

REID IS USING HIS FINAL AMENDMENT TO TRADE FAVORS FOR VOTES

Sen. Harry Reid (D-NV) Is Using His Manager’s Amendment To “Craft [Bill] One Favor At A Time.” “For Reid, success means emerging from the marathon debate with a bill backed by the 60 senators needed for final passage, something he hopes will come to pass as soon as late next week. Democrats' concerns will be addressed in individual amendments, but many others will be crowded into an omnibus ‘manager's amendment,’ a package Reid is expected to offer at the end of the process that will include many of the perks and fixes that members of his caucus are requesting. As a longtime member of the Senate Appropriations Committee, where crafting bills is done one favor at a time, Reid is hardly a stranger to deal-making.” (Shailagh Murray, “Reid's Recipe For Getting Health-Care Deal Done,” The Washington Post, 12/4/09)

For Example, The Cornhusker Kickback In Manager’s Amendment “Specifically Identifies Nebraska” For Additional Federal Funding. “Nelson has recently complained that the proposed expansion of Medicaid to those earning below 133% of the Federal Poverty Line (FPL) would burden his state of Nebraska and suggested that states should be able to opt-in to the program. Under the current merged legislation (the version unveiled on November 18th), the federal government fully finances care for the expanded population for two years and increases its matching funds (known as FMAP) thereafter. Page 98 of the managers amendment specifically identifies Nebraska for higher federal matching funds, fully funding its expansion for an additional year …” (Igor Volsky, “Nelson’s Nebraska To Receive Extra Medicaid Funds Under Senate Bill,” Center For American Progress Wonk Room Blog, 12/19/09)

Reid Is Trying To Make Changes To Lock In One Senator Without Alienating Another. “The essence of Reid's calculus is to make sure that the cost of locking in one vote is not driving away another. Almost every Democratic senator has requested a special favor or exemption of one form or another, senior Senate aides said. And Reid already has established a dangerous precedent, by dangling $300 million in Medicaid funding for Louisiana to win Landrieu's support for bringing the bill to the Senate floor.” (Shailagh Murray, “Reid's Recipe For Getting Health-Care Deal Done,” The Washington Post, 12/4/09)

DEMS HOPING CBO DOESN’T BLOW THE DEAL UP

Dems “Putting A Lot Of Faith In” Getting Favorable Score, Otherwise Their Backroom Deal Falls Apart. “The Senate Democratic leadership is putting a lot of faith in the Congressional Budget Office (CBO) as time runs short to get healthcare reform finished this year. Majority Leader Harry Reid (D-Nev.) and other Democratic leaders are putting even more faith in themselves and the tentative compromise forged on contentious issues by five liberals and five centrists in their caucus this week… Leading Democrats are banking heavily on the CBO giving them the answers they need to cement the backing of a handful of key centrists without losing the liberals who make up the majority of their caucus.” (Jeffrey Young , “Senate Dems Betting Big On CBO Score,” The Hill, 12/12/09)

BUT SUBSTANCE HASN’T CHANGED, AND REID’S BILL STILL HIDES TRUE COSTS WITH “FISCAL SLEIGHT OF HAND”

David Broder, Dean Of The Washington Press Corps, Said Reid And Pelosi’s Bills “Are Budget-Busters.” “While the CBO said that both the House-passed bill and the one Reid has drafted meet Obama's test by being budget-neutral, every expert I have talked to says that the public has it right. These bills, as they stand, are budget-busters.” (David S. Broder, Op-Ed, “A Budget-Buster In The Making,” The Washington Post, 11/22/09)

Washington Post Editorial Board Says Reform Bills Pretend To Be Budget Neutral Because Of “A Fiscal Sleight Of Hand.” “First off, $247 billion -- the 10-year cost of the fix -- is one whopper of a ‘discrepancy.’ … President Obama has vowed that health reform will not add a single dime to the deficit -- but he is seemingly unfazed about adding more than a quarter-trillion dollars to the deficit by changing the Medicare reimbursement formula without finding a way to pay for it. … This latest maneuver only heightens the fiscal irresponsibility of what already was a fiscal sleight of hand.” (Editorial, “2.47 Trillion Dimes,” The Washington Post, 10/19/09)

STILL WON’T INSURE EVERYONE

Pro-Reform Democracy For America Said Reid’s Bill “Doesn’t Actually ‘Cover’ 30 Million More Americans – Instead It Makes Them Criminals If They Don’t Buy Insurance.” “Democracy for America, the successor to the Dean campaign, which is now run by his brother, is out today with an email attacking health care legislation on a vulnerable point: The individual mandate. … ‘[T]hey say that even without a public option, the bill still “covers” 30 million more Americans. What they are actually talking about is something called the “individual mandate.” That's a section of the law that requires every single American buy health insurance or break the law and face penalties and fines. So, the bill doesn't actually “cover” 30 million more Americans - instead it makes them criminals if they don't buy insurance from the same companies that got us into this mess.’” (Ben Smith, “Dean Group Attacks Mandate,” Politico’s “Live Pulse” Blog, 12/16/09)

STILL RAISES PREMIUMS

Obama’s Health Care Experiment Imposes New Regulations On Health Insurance That Will Make Premiums Even More Expensive. “A key feature of the House and Senate health bills would prevent insurance companies from denying coverage to anyone with preexisting conditions ... This well-intentioned feature would provide a strong incentive for someone who is healthy to drop his or her health insurance, saving the substantial premium costs ... As healthy individuals decline coverage in this way, insurance companies would come to have a sicker population. The higher cost of insuring that group would force insurers to raise their premiums.” (Martin Feldstein, Op-Ed, "Obamacare's Nasty Surprise," The Washington Post, 11/6/09)

STILL TAXES THE MIDDLE CLASS

Obama’s Health Care Experiment Is Paid For By Several New Taxes That Will Fall On Middle Class Americans. JCT Chief Of Staff Thomas Barthold: “Senator Grassley, the penalty proposed in the Chairman’s mark, is as you observed, it’s structured as a penalty excise tax, we have other penalty excise taxes in the internal revenue code ... we think that some people would be subject to the penalty excise tax when everything shakes out we would expect that some would have incomes less than $200,000 dollars.” (George Stephanopoulos, “Mandate Or Tax? Grassley V. Baucus,” ABC News’s “George’s Bottom Line” Blog, 9/22/09)

AND STILL KILLS JOBS

Reid’s Employer Mandate Encourages Hiring Higher-Income Workers And Incentivizes “Companies To Engage In Some New And Repulsive Forms Of Employment Discrimination.” “The Senate health care bill includes a well-known ‘employer mandate’ provision that would require employers to either offer a ‘qualified’ health plan and pay 60 percent of the premium or pay an annual tax penalty of $750 per full-time employee. What is less well-known is that the provision would also tax companies even if they do offer insurance -- but only if they hire people from low- and moderate-income families who qualify for, and elect to accept, premium subsidies. And the tax penalty for hiring those employees -- arguably the people who need jobs the most -- would be a whopping $3,000 per employee per year. The combination of this tax penalty and the rules for determining who qualifies for premium subsidies would encourage companies to engage in some new and repulsive forms of employment discrimination.” (Robert A. Book, Ph.D. “Employment Discrimination In The Senate Health Bill,” Heritage Foundation Webmemo #2737, 12/17/09)