Health Reform Takes A Body Blow

Greene's comments were echoed by Joel Wood, senior vice president of government relations for the Council of Insurance Agents and Brokers.

"At this moment, history seems to be demonstrating that comprehensive health reform is a Bermuda Triangle for presidents and Congress," Wood says.

Specifically, Greene says Senate Democrats "seem to have already done their pivot to consideration of a jobs bill," and, in fact did not discuss healthcare in their last joint meeting.

He also says that a number of senators, including Sen. Evan Bayh, D-Indiana, and Sen. Blanche Lincoln, D-Ark., both of whom are running for re-election, have already expressed their opposition to using reconciliation as a means to modify and pass the current bill.

At the same time, the House leadership has made clear it doesn't have the votes, Greene says, "particularly in light of the comments made so far coming from the Senate."

Greene says that as a result, he hopes that President Obama will seek to move forward in a bipartisan way with no deadlines, but to just get it right this time."

Beth Mantz-Steindecker, an analyst at Washington Analysis in Washington, says she believes that while action on reform has "slowed down considerably" as Democrats try to determine "what support they have for certain pieces of the healthcare bill," especially in light of the fact that the reaction of Democrats to Brown's victory is a "series of conflicting messages."

Wood believes that while there are legitimate means through which congressional leaders could pass significant health reforms, the problem for the administration and Democrats is that "a number of rank-and-file members have been running to the exits."

Congress and the administration, he says, "clearly want to recalibrate and are searching for ways to achieve consensus around 'popular' provisions, mostly on the insurance market reform front."

As for CIAB members, Wood says, "We too would like to see some of these reforms."

But, he adds, "the problem is that market reforms don't work unless there's an enforceable individual mandate–and a mandate doesn't work unless insurance is affordable.

"Nothing that's popular is easy. Things could change, of course, and we're incredibly mindful of the fact that both chambers have passed very big bills," Wood says.

But, he adds, CIAB members have great concerns about many of the underpinnings of those bills because "they create an open incentive for employers to dump their health plans."

At the same time, William Oldaker, a founding partner of The Oldaker Group LLC, Washington, D.C., says he sees growing bipartisan support for repealing the McCarran-Ferguson Act's antitrust exemption for health insurers as a means of helping control healthcare costs.

He also says that stakeholders were looking to President Obama's State of the Union address for further signs on what the president will do on healthcare reform in the wake of Brown's victory.

At the same time, he says that if a bill doesn't go through in some form, "it will be viewed as a major, major defeat for the President and a tremendous blow to Congress."

Oldaker made his comments about McCarran-Ferguson in the context of next-steps if the bill collapses.

If that is the case, he says, then Sen. Tom Harkin, D-Iowa, chairman of the Health, Education, Labor and Pension Committee, has already said he will seek to take up the bill in pieces.

There seems to be some bipartisan support for ending McCarran-Ferguson for health insurers, even in a narrowed-down bill" that will be handled by Sen. Harkin, Oldaker says.

Regarding Medicare Advantage, Oldaker says he was surprised that the last proposal was to accept the Senate version of the legislation, which calls for cuts in the program to finance the broad bill through competitive bidding of MA.

The House bill proposes that over a three-year period MA expenditures will be the same as the Medicare fee-for-service program.

One proposal that had been under consideration, he says, is for competitive bidding in states with large populations, and another system for funding MA in rural states. "It is unclear how that will work out," he says.

Strong support remains for the bill among members of the Pharmaceutical Research and Manufacturers of America, the American Medical Association, the AARP and hospitals, especially because the bill will add 10 of millions of subscribers to the private insurance rolls through subsidies and mandates, Oldaker says.

At the same time, Lynn Shapiro
Snyder, a senior member of Epstein Becker & Green, P.C., Washington, says one positive about the bills as passed by the House and Senate is that there is limited instructions about congressional intent in the current version of the legislation, which will give a lot of leeway for federal regulators to write rules implementing it.

That means, Snyder says, "there is no congressional history. The less words the better because it gives stakeholders a stronger opportunity to shape the way the legislation is implemented."