Senate Panel Rejects 'Public Option,' or Government-run Health Insurance Plan

Senate Panel Rejects Health Care Public Option

September 29, 2009

McClatchy Newspapers - In the first significant setback for the centerpiece of President Barack Obama's health care overhaul, the Senate Finance Committee on Tuesday soundly rejected the "public option," or government-run health insurance plan.

Two efforts to adopt a public plan lost, one by 15 to 8, the other by 13 to 10. Three Democrats — Chairman Max Baucus of Montana, Blanche Lincoln of Arkansas and Kent Conrad of North Dakota — voted against both proposals.

Sens. Bill Nelson, D-Fla., and Tom Carper, D-Del., backed a public plan that could negotiate rates with doctors, hospitals and other health providers, while opposing an alternative that would've tied the plan's rates to those paid by Medicare for two years.

Reid Cherlin, a White House spokesman, said that while Obama believes in making a public option available to the uninsured, the president is "open to other constructive ideas of increasing choice and competition."

The votes, however, sent sobering signals to the White House about prospects for any public plan.

Democrats control 60 seats in the 100-member Senate, just enough to overcome procedural hurdles if they all vote together, but Baucus explained that while that margin "would help hold insurance companies' feet to the fire . . . no one shows me how to get to 60 votes with a public option."

Under a rules change effective Oct. 15, Democrats would need only 51 votes to pass health care, but losing up to five Democratic votes in a single committee suggests even that could be difficult.

Still, every committee Democrat suggested that they want some kind of law to change how people obtain health care coverage. They railed against the insurance industry, saying it too often cares more about profits than patients.

Democrats suggested that they'd be open to different ideas, notably the "co-ops," or nonprofit member-run companies that the Finance Committee's draft would allow to be set up, or perhaps a "trigger" that would allow a public option to take effect if private insurers didn't meet certain standards.

The Finance Committee is expected to finish drafting its version of the legislation later this week. It then will be merged with a quite different measure, approved in the summer by the Senate Health, Education, Labor and Pensions Committee, that includes a public option. Senate leaders hope to begin full Senate debate in mid-to-late October. If the final bill doesn't include a public option, an amendment seeking to include one is likely to reach a floor vote.

In the House of Representatives, three committees have written bills, and all include a public option. Democratic leaders are trying to combine them into one bill. A House floor debate and vote also is expected next month, and there the public option is likely to pass.

That would set up another test for Obama's plan, as negotiators from the two chambers try to iron out a final compromise.

Tuesday's Finance Committee deliberations gave a preview of the debate likely to dominate the House and Senate floors later this fall.

The five-hour debate was waged on two levels, one between Democrats and Republicans over whether the federal government should play a role in the nation's health insurance system, and the other among Democrats about how extensively the government should be involved.

Sen. Jay Rockefeller, D-W.Va., the public option's chief advocate, said that "our insurance companies have failed to meet their obligations in this whole matter of how do you unroll health care reform. The insurance companies, in my judgment, are determined to protect their profits and put their customers second. It's a harsh statement, but a true statement."

Sen. Charles Grassley, R-Iowa, the committee's top Republican, hammered away at the idea that big government aims to take over health care. "Over time, the government plan will be the only viable option for most Americans," he said, and that will lead to "rationing or delay of care."

Not so, countered Sen. Bob Menendez, D-N.J. "The public option clearly increases competition. It keeps insurers honest and drives down cost," he said.

The Democrats' disagreement among themselves was gentler. They generally accepted that some kind of public involvement is needed to help people obtain coverage, but they disagreed, sometimes sharply, on what kind.

Senators from rural states were concerned that a public plan that relies on Medicare rates for reimbursing providers would be disastrous. Current Medicare rates in North Dakota, Conrad said, are now well below the actual cost of care. "I can't possibly support (a provision) that does that," he said. Rockefeller's plan would've kept the Medicare rates in effect for a public plan's first two years, and then have the plan negotiate rates.

Conrad is a leading supporter of co-ops, but there was little vocal support for them — another signal that a battle looms on the Senate floor. "Co-ops may be a term used in North Dakota and is understood, but is not in other states," said Florida's Nelson.

Democrats Step Up Pressure on Insurers Over Public Option for Health Care

September 28, 2009

Bloomberg - Health insurers will come under renewed pressure this week when Democrats push for the creation of a competing government program and new industry taxes as part of an overhaul of the U.S. health-care system.

The Senate Finance Committee will probably vote tomorrow on the so-called public option insurance program. Democratic Senators Charles Schumer of New York and Jay Rockefeller of West Virginia are pressing the issue after the panel’s chairman, Democrat Max Baucus of Montana, endorsed more limited health cooperatives in a bid to draw Republican support.

Baucus’s panel is the last of five in Congress still working on legislation designed to tame rising medical costs and cover tens of millions of uninsured Americans. His proposal also includes a tax on high-end, or Cadillac, insurance plans, an idea that’s gaining traction in the House as well...

The insurance industry opposes new taxes as well as the public option, saying it would disrupt coverage.

“A new government-run plan would dismantle employer coverage, bankrupt hospitals, and increase the federal deficit,” said Robert Zirkelbach, a spokesman for America’s Health Insurance Plans in Washington. “The American people want policymakers to enact reforms that will ease the burden of rising health-care costs, not new taxes that will increase the cost coverage for families and small businesses.”

...If the finance panel passes its legislation, Senate leaders have to combine the measure with one passed by the Senate health committee and then schedule a chamber vote. It would have to be combined with a House version before more votes.

Three House committees have voted on versions of the legislation, and leaders in that chamber are trying to combine the bills. All three versions contain a public option, and Democrats are debating whether the program should be allowed to peg the reimbursements it gives to providers to the lower rates paid by Medicare, the government program for the elderly.

Democratic leaders are also considering following the Senate finance panel in taxing insurers on Cadillac plans to help pay for the legislation, House Speaker Nancy Pelosi said. The idea offers an alternative to the House plan for a surtax on the wealthiest Americans, which has drawn objections from first-term members and has little Senate support.

The House is also trying to reduce the cost of the legislation to less than $900 billion over 10 years, a goal of President Barack Obama.

Baucus’s staff has estimated his measure would cost $900 billion and reduce the federal deficit by $23 billion. During debate last week, the finance panel of 13 Democrats and 10 Republicans embraced other changes that may affect the cost and have ramifications for industries.

The panel accepted a Schumer proposal to encourage the use of biosimilar drugs, or copies of expensive medicines made from living organisms. Biotechnology drugs are made by companies including Amgen Inc. of Thousand Oaks, California.

Committee members also approved a proposal to require pharmacy benefit managers such as Woonsocket, Rhode Island- based CVS Caremark Corp. and Franklin Lakes, New Jersey-based Medco Health Solutions Inc. to disclose rebates from drugmakers if they participate in exchanges created by the new law.

Baucus joined with fellow Democrats Robert Menendez of New Jersey and Thomas Carper of Delaware to help defeat a proposal that would have required drugmakers to provide $106 billion in rebates over 10 years.

The amendment would have torpedoed an earlier deal Baucus reached with the industry and hurt the bill’s chances, said Menendez, who represents drugmakers including Whitehouse Station, New Jersey-based Merck & Co.

It’s “dangerous to the overall goal,” Menendez said.

45% Of Doctors Would Consider Quitting If Congress Passes Health Care Overhaul

September 16, 2009

Investor’s Business Daily - Two of every three practicing physicians oppose the medical overhaul plan under consideration in Washington, and hundreds of thousands would think about shutting down their practices or retiring early if it were adopted, a new IBD/TIPP Poll has found.

The poll contradicts the claims of not only the White House, but also doctors’ own lobby — the powerful American Medical Association — both of which suggest the medical profession is behind the proposed overhaul.

It also calls into question whether an overhaul is even doable; 72% of the doctors polled disagree with the administration’s claim that the government can cover 47 million more people with better-quality care at lower cost...