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September 22, 2009 at 08:00 PM
WASHINGTON BUREAU — Senate Finance Committee Chairman Max Baucus today brought a heavily revised version of his health reform proposal to a bill drafting session.
Baucus, D-Mont., said the changes would make the health care more affordable for low- and middle-income Americans.
Baucus unveiled new draft today as the Senate Finance Committee began a “markup” of the bill and the 564 amendments submitted by committee members. Baucus is hoping a completed bill can be reported out of the committee this week.
A description of the changes made to the original “chairman’s mark” version of Baucus’s America’s Healthy Future Act bill are available here.
That document and other documents related to the AHFA bill are available here.
Some of the changes Baucus made would increase the pressure on insurance companies. One would increase the excise tax the proposed plan would impose on insurers that sell high-cost health insurance policies.
Many of Baucus’s amendments incorporate changes sought by other committee members.
One revision would narrow the gap between the rates health insurers charge the oldest and youngest insureds to 4 to 1.
The revised bill would increase the proposed tax rate on so-called “Cadillac plans” to 40% percent, from 35%, and it would increase the health insurance provider fee to $6.7 billion per year, from $6 billion per year. This would be paid based on the market share of the insurer.
The new bill also would raise the threshold above which insurance companies would be subject to the “Cadillac tax” by $750 for individual plans and $2,000 for family plans for workers with high-risk jobs and for non-Medicare retirees ages 55 and up. The thresholds Baucus originally proposed were $8,000 for an individual and $21,000 for a family.
Baucus also is trying to keep insurers from discriminating against employees of midsize and large companies, by eliminating annual and lifetime limits for all plans participating in state exchanges and keeping midsize and large employers with group health plans from imposing unreasonable annual or lifetime limits on coverage.
Baucus is seeking to move the effective date of two proposed budget items that could squeeze revenue from flexible spending account and health savings account holders to Dec. 31, 2010, from Dec. 31, 2009.
One of the items would be a new limit on the amounts workers can contribute tax-free contributions to flexible spending accounts. The other would be an increase in the tax imposed on HSA withdrawals made before age 65 that are not used for qualified medical expenses to 20%.
Another Baucus bill HSA provision would impose a $2,500 cap on HSA contributions. The cap would not increase with inflation.
A Baucus bill FSA provision would combine FSAs with major medical plans in the calculations made to determine whether a health plan ought to be subject to the Cadillac plan tax.
Sen. Charles Grassley, R-Iowa, the highest-ranking Republican on the Senate Finance Committee, started the bill markup by praising Baucus but expressing concern about the health bill drafting process that the Obama administration set up.
