President Obama last week signaled an all-out push for major health care reform legislation this year–even if it has to be done through the politically risky reconciliation route.
Given that authority to pass the bill through reconciliation–that is, only with a simple majority in the Senate–runs out in mid-April, this means a showdown could be imminent.
His first move was to unveil an omnibus bill based on the version of the bill passed by the Senate on Christmas Eve that includes a provision giving the federal government the authority to roll back unreasonable rate increases, albeit with state support.
At the same time, the House voted overwhelmingly on February 24 to pass legislation that would repeal the antitrust exemption afforded to health insurers under the McCarran-Ferguson Act.
The White House voiced its support for the effort in advance of the House bill through a statement of administrative policy.
Additionally, Rep. Louise Slaughter, D-N.Y., argued on the House floor during debate on the issue, “We’ve heard too many complaints about the health insurance industry engaging in price fixing, bid rigging, and other anti-consumer and anti-competitive practices.”
She added, “This industry has enjoyed a big giveaway for far too long, and it’s about time that it plays by the same rules as everyone else.”
But, America’s Health Insurance Plans, Washington argued in a statement that the House bill is likely to do more harm than good.
AHIP officials said the rhetoric surrounding the call for repealing the antitrust exemption afforded to health insurers through the McCarran-Ferguson Act “does not match the reality of the situation.”
Moreover, provisions repealing the antitrust exemption afforded to medical malpractice insurers were removed from the bill before it was approved for floor action, and industry lobbyists indicated that stand-alone legislation repealing the antitrust exemption for health insurers is unlikely to even be voted on in the Senate.
The president was scheduled to meet with Republicans in a televised conference on February 25 in an effort–widely viewed as a political theater–to secure support for a bipartisan bill.
The battle lines were drawn before the meeting. First, Republicans requested that the president start all over on health care reform legislation.
One of the attendees, Rep. John Kline, R-Minn., ranking minority member, of the House Education and Labor Committee, said before the meeting, “We ought to start from a blank piece of paper.”
And Republicans in general proposed ways that the reform could be accomplished through the private sector, a non-starter to majority Democrats.
Sen. Michael Bennet, D-Colo., outlined what many industry lobbyists and even Republicans believe the Democrats will do over the next few weeks as part of a last-ditch effort to push through the “big solution.”
In a letter seeking support for a Senate vote on the public option, Bennet proposed passing health reform legislation that included a public option under budget reconciliation rules.
He cited findings from the non-partisan Congressional Budget Office that said a public option could yield cost savings of at least $25 billion. Bennet also pointed to the fact that a public option would provide Americans with a low-cost alternative to private insurance and improve market competitiveness.
In addition, Bennet’s letter noted that there is substantial Senate precedent for using reconciliation to enact important health care policies, including the Children’s Health Insurance Program (CHIP), COBRA, and Medicare Advantage.
“Too many people in Washington believe that just saying you are for health care reform is a substitute for actually getting something done,” said Bennet.
“While some choose to stall progress under the pretext of principle, more and more Americans are losing the health care coverage they need,” he said.
In comments to reporters last week, Sen. Judd Gregg, R-N.H., acknowledged that Republicans anticipate Democrats will seek to pass the Obama administration proposal through budget reconciliation.
But, in advance of the White House bipartisan summit, Rep. Steny Hoyer, D-Md., conceded that comprehensive reform would be best, but that it was not all or nothing.
“We may not be able to do all. I hope we can do all, a comprehensive piece of legislation that will provide affordable, accessible, quality health care to all Americans,” Hoyer said at his weekly media briefing.
“But having said that, if we can’t, then you know me–if you can’t do a whole, doing part is also good. I mean there are a number of things I think we can agree on,” Hoyer added.
Specifically, the bill unveiled by the president includes a provision creating a Health Insurance Rate Authority.
Oklahoma Insurance Commissioner Kim Holland, the secretary-treasurer of the National Association of Insurance Commissioners, immediately criticized such a plan, saying rate regulation is a prerogative of the states.
If White House health care reform proposals grant power to a federal rate authority to disallow increases approved by the states, Holland said, “I think we would work hard to make a strong case not to do that.”
The White House immediately sought to clarify what it is seeking. In a briefing after the president’s plan was unveiled, White House Press Secretary Robert Gibbs said that the proposal was a “starting point, and that the White House envisions the U.S. Department of Health and Human Services working with state insurance regulators to oversee health insurance prices, rather than creating a new price review agency.”
The president’s new proposal attempts to “bridge the gap” between the current House and Senate bills.
Among other provisions, it includes: a requirement that everyone have health insurance or pay a penalty; elements of both the House and Senate bills in rolling back Medicare Advantage costs; and closure of the so-called doughnut hole under Part D, the prescription drug program under Medicare.
The president’s proposal would also implement health insurance exchanges, as envisioned in the Senate bill, and adapt the medical loss ratio mandates included in the Senate bill.