Health-Care Reform Is Moving Ahead, But Outlook Still Cloudy

Barack Obama has pushed closer than any president in generations to creating a basic health care safety net for most Americans, yet the fate of legislation delivering on his promise is far from certain.

Stethescope and money
Stethescope and money

Republicans are nearly unified in opposition. Senate Minority Leader Mitch McConnell, R-Ky., warned Friday that the latest version, completed about 2 a.m. by the Senate Finance Committee but not yet formally ratified by the panel, would have "a dampening effect on what is already clearly a very, very difficult economic situation."

McConnell argued that the bill would cut benefits for seniors and raise taxes on individuals and businesses, something a nation reeling from recession and widespread job losses can ill afford.

Democrats are hardly united in support of the plan, either, with deep divisions over whether to allow the government to sell insurance in competition with private industry. There also are disagreements over the broad scope and cost of the legislation.

The Finance Committee wrapped up work early Friday morning on the most sweeping set of changes in a half-century. Obama hailed the developments as a milestone, and said, "We are now closer than ever before to finally passing reform that will offer security to those who have coverage and affordable insurance to those who don't."

The legislation is designed to spread health insurance to millions who now lack it, and it would crack down on industry practices such as denying coverage on the basis of pre-existing medical conditions.

More than $400 billion in federal subsidies would help defray premium costs for lower-income families and help small businesses offer coverage to their workers. Most policies would be required to cover preventive care as well as treatment for medical illness and vision, dental and mental health needs.

"This bill will lower taxes for more than 42 million Americans and reduce the federal deficit," said Sen. Max Baucus, D-Mont., the committee chairman, as the panel wrapped up its work. "This bill will protect Medicare benefits for seniors. This bill will significantly expand health coverage."

A final vote was delayed until next week so budget officials can certify the legislation would not add to federal deficits. Given the Democrats' 13-10 majority, only the final margin is in doubt.

Sen. Olympia Snowe, R-Maine, said she had not yet decided how to vote. "I've got a lot to think about," she said. All other Republicans on the committee have criticized the bill and are certain to oppose it.

The full Senate already is scheduled to begin a historic debate at mid-month on the legislation to meet one of Obama's principal campaign promises — and a goal of presidents since Harry Truman sat in the White House at mid-20th century.

The legislation was built on the wreckage of failed bipartisan negotiations among six members of the committee, and tilted at several points to appeal to Democratic moderates more than liberals. Baucus said that was the only strategy that could succeed in gaining 60 votes in the Senate, needed to overcome a threatened Republican filibuster.

As a result, it lacks a provision to permit the government to sell insurance in competition with private industry. Instead, it allows nonprofit cooperatives to fill that role.

Unlike legislation taking shape in the House and a bill that passed a different Senate committee earlier in the year, it does not require businesses to offer insurance to their employees. Instead, companies that do not would be required to offset the cost of any federal subsidies their workers receive when they buy their own insurance in a new federally regulated exchange that would be established.


On the other side of the Capitol, Democratic House leaders have struggled in recent days to agree on a bill to send to the floor for a vote later this month. Aides have said the pace of progress could accelerate following the Finance Committee's work.

That's because the bill that Baucus steered toward committee approval is viewed as the most middle-of-the-road of all the Democratic alternatives pending in Congress, and House Speaker Nancy Pelosi and her lieutenants are now better able to calculate which elements they can accept and which they may want change in final compromise talks between the two houses.

Democrats were in control throughout a two-week debate in the Senate committee, and on the final day of deliberations rejected Republican attempts to strip out tax increases they said violated Obama's campaign promises.

They made a number of major changes in the final hours.

One would allow a new commission designed to wring savings from Medicare to recommend cuts in federal subsidies paid to low-income seniors who have prescription drug coverage under the program.

Other last-minute modifications were designed to build support among the Democratic rank and file and blunt any impact on millions of working class families.

One change would exempt millions of people from a requirement to purchase insurance that is currently in the bill and reduce the penalties on millions more who defy the mandate.

Another would narrow the impact of a proposed tax on high cost insurance policies.

A third would allow the states to negotiate for coverage for individuals and families with incomes slightly higher than the cutoff for the Medicaid programs that provides health care for the poor.

Sen. Maria Cantwell, D-Wash. said the proposal was based on a system in effect in her home state that has resulted from lower-cost quality care as the state uses its purchasing power to negotiate better prices from insurance companies.