Pelosi Unveils Historic Health Care Reform Bill, Touts Public Option

Thursday, 29 October 2009 14:30 By Jason Leopold, t r u t h o u t | Report | name.

Pelosi Unveils Historic Health Care Reform Bill, Touts Public Option
(Photo Illustration: Lance Page / t r u t h o u t; Adapted from: Obama-Biden Transition Project, AlbinoFlea / flickr)

Some progressives, like Rep. Dennis Kucinich, (D-Ohio), a proponent of a single-payer system, said the bill Pelosi made public Thursday does not go far enough and provides too many concessions to health insurance companies.

House Speaker Nancy Pelosi unveiled an $894 billion health-care reform bill Thursday that includes a government-run insurance program, otherwise known as a "public option," that is stronger than the public plan unveiled earlier this week by Senate Majority Leader Harry Reid, but still far short of what many progressive and liberal Democrats had expected.

Unlike the Senate bill, the legislation touted by Pelosi does not provide individual states with an "opt-out" provision. The House bill requires that Americans purchase insurance by 2013 (or pay a 2.5 percent penalty based on their annual income, subject to a "hardship exemption") and large businesses to provide employees with coverage. The bill melds three separate pieces of legislation House committees passed earlier this year.

It comes in at just under the $900 billion ceiling President Obama set and, according to the Congressional Budget Office (CBO), enacting the legislation will result "in a net reduction in federal budget deficits of $104 billion over the 2010–2019 period."

The legislation would prohibit health insurance companies from denying coverage to people who have a preexisting condition. It also calls for Medicare to negotiate drug prices with insurance companies, a provision the pharmaceutical industry spent millions of dollars lobbying against and would eliminate the federal antitrust exemption that shielded health care providers from investigations into price-fixing and other unlawful business practices.

At a rally in front of the Capitol where she discussed details of the "Affordable Health Care for America Act," Pelosi said the nearly 2,000-page bill aims to provide health benefits to 36 million uninsured Americans and will cover 96 percent of the population. It would also expand Medicare and Medicaid coverage, and offer low to moderate income Americans subsidies to purchase insurance from a government plan or private health care providers through a regulated exchange.

According to a letter to CBO Director Douglas Elmendorf sent Thursday to Rep. Charles Rangel, (D-New York), the chairman of the House Ways and Means Committee, "certain employers could allow all of their workers to choose among the plans available in the exchanges, but those enrollees would not be eligible to receive subsidies via the exchanges.

The Budget Office estimates that about "9 million people would obtain coverage in that way in 2019, bringing the total number of people enrolled in exchange plans to about 30 million in that year. Roughly one-fifth of the people purchasing coverage through the exchanges would enroll in the public plan, meaning that total enrollment in that plan would be about 6 million.

"That estimate of enrollment reflects CBO’s assessment that a public plan paying negotiated rates would attract a broad network of providers but would typically have premiums that are somewhat higher than the average premiums for the private plans in the exchanges. The rates the public plan pays to providers would, on average, probably be comparable to the rates paid by private insurers participating in the exchanges. The public plan would have lower administrative costs than those private plans but would probably engage in less management of utilization by its enrollees and attract a less healthy pool of enrollees.

At Thursday's rally, Pelosi, who was flanked by House Majority Leader Steny Hoyer and other Democratic leaders said, "for nearly a century, it's really over a century, leaders of all political parties... have called and fought for health care and health insurance reform. Today, we are about to deliver on the promise of making affordable, quality health care available for all Americans."

Obama, who has made health care reform his top domestic priority, lauded the House bill Thursday, saying it marks "another critical milestone in our effort to reform our health care system."

"I'm also pleased that the bill includes a public option offered in an exchange," Obama said. "As I've said throughout this process, a public option that competes with private insurers is the best way to ensure choice and competition that are so badly needed in today's market. And the House bill clearly meets two of the fundamental criteria I have set out: it is fully paid for and will reduce the deficit in the long term."

Rep. Lynn Woolsey, who co-chairs the Congressional Progressive Caucus, is expected to meet with Obama Thursday to urge him to be much more vocal in his support for a public option. Obama had previously stated in interviews that a public option was not necessarily a deal-breaker as long as legislation he's presented with provides Americans with affordable health care coverage.

Although the House bill includes the coveted public option, it's seriously watered down from an previous version that included the so-called "robust" public option tying reimbursement rates to Medicare, which would have saved the government billions of dollars.

Pelosi was unable to muster up the votes needed to pass that version of the bill. For one thing, moderate and centrist Democrats objected to the earlier plan saying it could put hospitals in rural areas out of business because Medicare reimbursement rates are very low and doctors would end up being underpaid. The new version of the bill proposes that the government negotiate payment rates directly with health care companies. Reid's bill also proposes negotiating reimbursement rates with health care providers. The House and Senate bills will eventually be combined into a single piece of legislation.

Woolsey, whose caucus strongly favored a "robust" plan, said Thursday she and her colleagues are reviewing the new version of the bill to determine if it's within the "Medicare-plus-five" threshold. That's a reference to the fact that an earlier version of the bill would have reimbursed doctors five percent over Medicare's rates.

Woolsey's co-chair, Rep. Raul Grijalva, (D-Arizona), said his "inclination is not to support" the bill because it no longer contained the "robust" provision. He said he would continue to argue in favor of having the government set reimbursement rates.

Rep. Dennis Kucinich, (D-Ohio), a proponent of a single-payer system which would amount to government-funded heatlh-care, said the bill provides too many concessions to the health insurance companies.

Kucinich said a single-payer amendment he sponsored that was included in a version of the health care reform bill the Education and Labor committee passed was stripped out of the version Pelosi unveiled Thursday without his knowledge. The amendment would have allowed individual states to set up a single payer system modeled after Medicare. Kucinich said he had asked Pelosi about the status of his amendment for weeks, but she did not respond to his queries.

"Today, advocates of true health care reform were disappointed to learn that the Kucinich amendment was removed from the latest version of the health care reform bill," Kucinich said. "At the end of the day, states may be given the option to opt out, but won’t be allowed to opt into a proven system that provides all of a state’s residents with better health care.

"We compromised on single payer by backing a public option, and now we are being asked to compromise the public option with negotiated rates," Kucinich said. "In conference, we will likely be asked to compromise negotiated rates with a trigger. In each and every step of the health care debate, the insurance companies have won. If they get hundreds of billions of dollars in new taxpayer subsidies, they get to raise their premiums, and increase their co pays and deductibles, while the public is forced to pay for private insurance, then the insurance companies win big.

"If this is the best we can do, then our best isn’t good enough and we have to ask some hard questions about our political system: such as Health Care or Insurance Care? Government of the people or a government of the corporations."

Despite the concessions Pelosi made to appease moderate and centrist Democrats, the Speaker still does not appear to have secured the 218 votes needed to ensure the bill passes. Moderate and centrist Democrats say the bill is too costly, would increase taxes and expands the role of government. But the 5.4 surtax to help finance a major portion of the bill, along with changes to Medicare and Medicaid reimbursement rates, would only apply to couples earning more than $1 million and individuals who earn more than $500,000. The combined savings would generate about $500 billion over 10 years, according to the CBO's analysis.

At a news conference, House Republicans Leader John Boehner called the bill a "monstrosity" and falsely claimed that it would "kill jobs with tax hikes and new mandates in it and it’s going to cut senior’s health care benefits, if all that isn’t bad enough, the mandates on states are going to bankrupt states that already have huge financial problems to deal with."

Pelosi will continue to meet with House Democrats to shore up support for the legislation. Aides said she intends to move toward a floor vote as early as next week.

Last modified on Friday, 30 October 2009 15:54