Moderate Senate Democrats Seek Alternatives to Individual Mandate

In a thread to an earlier post on this blog, reader Curt Cella wrote ” I think if I heard just one Democrat admit that there might – MIGHT! – be some issues worth fixing with PPACA I’d feel a burst of optimism.” And he’s not alone. The sausage-making process that led to the Patient Protection and Affordable Care Act was even messier than usual. The result: legislation that is in dire need of fixing and a lot of people pessimistic about the future of health insurance.

Any changes to the new health care reform law, however, will require bipartisan support. Otherwise what emerges from the House will be defeated in the Senate and vice versa.  Which makes Curt’s wish especially meaningful. Unless some Democrats start calling for substantial changes to the PPACA (and repealing the 1099 reporting requirements in the law doesn’t count as substantial — worthwhile, yes, but not substantial) nothing important is going to change.

Fortunately, those waiting for “just one Democrat” to admit that the PPACA needs fixing are in for some good news. There are at least four Democratic Senators and one liberal columnist seeking meaningful change in the PPACA. The fix they are focusing on is the laws requirement that all consumers obtain health care coverage by 2014 (the individual mandate).

ABC News recently reported that a group of Democratic Senators are looking for alternatives to the individual mandate. (This is a provision in the law that requires all Americans to obtain health care coverage by 2014 or pay a modest penalty). As one of those Democrats, newly elected Senator Joe Manchin puts it “I’ve always had a concern and a problem with the mandate, that we were forcing it, basically saying by the law of the land you have to buy the product. But on the other hand, I know that’s been the lynchpin. I’m looking for flexibility any way I can.” Other Senators mentioned as engaged in this search for an alternative to the individual mandate are Senators Ben Nelson, Claire McCaskill and Jon Tester. ABC News describes them as seeking to “improve” the PPACA, not repeal it.

Needless to say, liberals are a bit unhappy with these moderate-to-conservative lawmakers. The Senators are not backing down, however. For evidence, take a look at an exchange between MSNBC host Rachel Maddow and Senator McCaskell on the individual mandate (the meat of the interview begins at about the 1 minute, 40 second mark).

That there are at least four Democrats looking for an alternative to the PPACA’s approach to the individual mandate is important. Together with the 47 Republicans they represent a majority of the Senate. Yes, Republicans in the last Congress proved that in the wacky world of the Senate a working majority requires 60 votes, but having a simple majority is no small accomplishment. If nothing else it puts pressure on others in the Democratic Caucus, especially moderates like Senators Joe Lieberman and Kent Conrad, to join in the fun.

Not all liberals are criticizing the Senators searching for alternatives to the individual mandate. Washington Post columnist Ezra Klein notes that “[r]eplacing the individual mandate wouldn’t be particularly hard” and then offers four suggestions. (For the record, I’ve offered my own individual mandate alternatives in previous posts).

Mr. Klein fixing the individual mandate as good public policy and winning politics for Democrats. “The danger …  is not that the law does get changed, but that it doesn’t. That the GOP won’t let it thrive and the Democrats won’t let it die and so it just limps along.”  Improving the PPACA makes it more difficult to repeal the law and more likely the legislation will be implemented in a constructive manner.

Of course, the individual mandate is just one part of the law that needs fixing, justifying a mere “burst of optimism.” Moderate Democrats should also look at teaming with Republicans to refine the medical loss ratio provision, make premium subsidies and tax credits available outside the exchanges, and enact meaningful medical cost containment.  Changes like these would justify long-lasting optimism.

Random Thoughts on Health Care Reform

Just some random thoughts while we see if the Democrats can muster enough votes to enact health care reform. None of them are worth a separate post (and may not be worth being in any post), but I thought I’d clear the decks before the real fun starts over the next few weeks.

It’s Franken’s Fault: If health care reform fails I blame Senator Al Franken. Elected by a mere 206 votes, Senator Franken became the 60th Democratic vote, the super-majority the caucus needed to overcome, in theory, any Republican filibuster. This enabled President Barack Obama and Democratic leaders in Congress to treat health care reform as a Democrats-only endeavor. Yes, Senator Max Baucus tried to work out a compromise with a few Republicans (and actually got one of them to vote for the Senate Finance bill). But liberals in the party and in the land of pundits were constantly and consistently pushing reforms to the left.  For example, Democrats insisted health care reform include a government-run health insurance plan far longer than would have been the case if they lacked a super-majority. Want proof? The public option fell to the wayside within 58 hours of the loss of their super-majority.

Of course, liberal Democrats had already made the mistake of believing that all Democrats think alike. Proud to be the party of inclusion, they forgot that they had included moderates and conservatives into their ranks. They somehow thought they could get Senators Ben Nelson, Joe Lieberman, Blanche Lincoln and other centrists to go along with the liberal wish list for health care reform. Having a super-majority masked this illusion. So if 104 Minnesotans had voted the other way, who knows, health care reform might have passed months ago.

Republicans Will Vote to Keep the Sweeteners.  Republicans hate being called the Party of No, but they’ve earned the epitaph. They seem to have adopted a political strategy that Democrats can achieve no victories. Whether that’s to embrace the Tea Party advocates who want the federal government to go away, acquiescence to Rush Limbaugh who is on record saying he wants President Obama to fail, or, who knows, a sincere expression of their public policy beliefs, the outcome is they act in near lockstep to defeat any proposal with the Administration’s finger prints on it. Which may create an interesting spectacle: Republicans voting to preserve the Cornhusker Kickback and the Louisiana Purchase.

These are among the legislative sweeteners added to the Senate health care reform bill to gain the support of Senators Ben Nelson and Mary Landrieu. And to deprive President Obama of a victory on health care reform Republican may need to defeat legislation to repeal them. Here’s why:

Under the legislative dance Democrats are likely to use to pass health care reform, the House will pass the Senate’s version health care reform bill. Since the Senate bill already passed that legislation – with a super-majority no less, House passage sends it directly to the President’s desk for his signature. At the same time Democrats will introduce legislation aimed at modifying the Senate legislation to, among other provisions, repeal the sweeteners, bribes, backroom deals, whatever you want to call them. Among those “other provisions,” by the way, are a number of items on Republican’s health care reform wish list. To deny Democrats the a victory on health care reform, Republicans may have to defeat the clean-up legislation – a vote to keep the sweeteners and to defeat their own reform proposals. The word “ironic” comes to mind – along with many others.

Politicians Need an Asterisk Projector. President Obama likes to say that “If you like your current health insurance you can keep it.” Well, in theory maybe. For awhile perhaps. But even in the short-term there’s a huge caveat: there’s no guarantee you can keep your health insurance in the current health insurance system and the reform bills do nothing to change that. When employers changes coverage, their employees change coverage. Whether they want to make that change or not. If a carrier drops a particular health plan in the individual market, insureds have to choose another plan. So when President Obama makes this pronouncement, he should project an asterisk over his head to cover these contingencies.

When Republicans condemn Democrats for even thinking about using the reconciliation process to pass the health care reform clean-up legislation discussed above they should project an asterisk. That’s because they were very happy to pass tax cuts a few years ago using the reconciliation process. So what Republicans mean when they oppose reconciliation is that they’re for it when it’s helpful to them and they think it’s un-American when it’s not.

For a Rookie He’s Gotten Pretty Far. Regardless of what you think of President Obama’s ideas or his tactics, you have to give him credit for getting further with health care reform than any of his predecessors. Pretty impressive for someone who was a State Senator just five years ago.

Whether It’ll Make Things Better or Worse is A Guess. Of course, it would be nice if the health care reform package he may get through was better than what will emerge from Congress, but let’s face it: no reform proposal would be popular. This is one of those issues in which there are no popular options. Everyone recognizes the status quo can’t endure. Everyone knows every proposal to fix the system is gravely flawed.

My first political mentor, Cathy O’Neill, used to say, however, “The test of whether to vote for something is not whether it’s perfect, but whether it’s better than what we’ve got.” When it comes to health care reform, however, there’s no way to know if a particular bill will make things “better” or not. The system is too complex. The opportunity for unintended consequences is too great. It’s likely only comprehensive reform can fix the system, but there’s no way to truly understand what comprehensive reform will accomplish until well after it’s implemented. Not a reassuring prospect, but it’s reality.

We’ve Only Just Begun.  Let’s say health care reform passes. That’s just the start. States and regulators will need to interpret and implement the reforms. Future Congress’ may seek to change or repeal the bills. Yogi Berra is supposed to have said, “It’s not over until it’s over.” When it comes to health care reform, “It’s not over even when it’s over.”

Health Care Reform Not Inevitable, But Still Likely

Passing major health care reform was never going to be easy. The issues are hard. Partisanship in Washington has rarely been greater. The status quo may be a road to disaster, but it’s a familiar road. Moving America’s health care system in a new direction is a Herculean task. Yet for the past year or more, most observers considered passage of some legislation a better than 50/50 proposition. Now, with negotiations over reconciling differences between the Senate and House versions of reform bills comes down to the wire, what are the chances of Congress passing a bill President Barack Obama will sign into law?

According to the Associated Press, House Republican leader John Boehner is claiming that Speaker Nancy Pelosi may not be able to push health care reform through their chamber. He maintains that “dozens” of Democrats who supported the bill passed by the House in November could turn against the final bill, especially if the there are significant changes to provisions dealing with abortion, aid to the states to pay for Medicaid expansion and Medicare cuts.

The outcome of the Massachusetts Senate race to replace the late Senator Edward Kennedy could also result in some Democrats reconsidering their willingness to go along with this version of reform. Not long ago the conventional wisdom was that winning the Democratic primary in Massachusetts was tantamount to election. However, recent polls show the the Democratic nominee, the state’s Attorney General, Martha Coakley, in a dead heat against Republican State Senator Scott Brown within two percentage points of the Democrat. Special elections are always difficult to predict because turnout is usually so low. Were Senator Brown to win the election on January 19th it would not only deny the Senate Democratic caucus the 60 votes they need to push health care reform through the upper house, but it would make moderate Democrats in Congress recalculate the political price of supporting the current version of reform.

Senator Brown doesn’t need to win the seat to scare Democrats. The race has been described by the media as a proxy on health care reform. Republicans are pointing to the Massachusetts Senate race  to bolster their argument that they can retake Congress in the upcoming elections. While that might be wishful thinking, it certainly would make obvious the political reality that Democratic majorities in Congress will be smaller next year than they are this year.

All of this is some evidence that health care reform could be in trouble. My opinion: passage of health care reform is more likely now than it was in December. Here’s why:

First, Senate Majority Leader Harry Reid, Speaker Pelosi and President Obama are closer than ever to an agreement. "’Prospects of reaching agreement between the Senate and the House are better than they were 24 hours ago. We’re getting close,’ the Associated Press reports House Majority Leader Steny Hoyer saying on Tuesday. Finding a compromise that will earn 218 votes in the House and 60 in the Senate is not inevitable, but it’s doable. And with President Obama more personally involved in the health care reform negotiations now than he has been in the past year, the chances of finding that combination of trade-offs is closer than ever.

Second, by emphasizing what’s at stake in the Massachusetts Senate race, Republicans have mobilized Democrat voters in the state. That’s the point made by E.J. Dionne in a Washington Post blog. Instead of staying home next Tuesday, counting on the inevitability of Attorney General Coakley’s pre-ordained victory, Massachusetts Democrats know they have to get to the polls. And they are likely to do so.

There are other tea leaves increasing the likelihood of a health care reform bill becoming law in the next few weeks. Senator Reid made some fairly obvious deals to get the 60 votes he needed to move health care reform out of the Senate. The most egregious was promising to pay Nebraska’s increased Medicaid costs in perpetuity at the request of Senator Ben Nelson. Republicans jumped all over that deal. Even the Republican Governor of Nebraska attacked the deal.

Well, fine. Senator Nelson can now head back to Nebraska and show he fought hard for the state, but Governor Dave Heineman killed the deal. (At the moment, Senator Nelson is calling for all states to get the same Medicaid relief as he negotiated for his own state). Yet Senator Nelson is still likely to support whatever health care reform bill emerges from the current negotiations, unless the abortion language is significantly weakened. What else can he do, proclaim that unless Nebraska gets a windfall he’ll torpedo reform for the rest of the country? So what’s likely to happen is that the GOP will likely to embarrass Democrats into eliminating the most glaringly unjustified deals, but not strip away any votes as a result. Meaning the bill will be “better” (for containing less pork), but will still keep the votes recruited by the eliminated pork.

Another reason health care reform is likely to pass is that Democrats can’t afford to have it defeated. The Democratic Congress has actually accomplished a significant amount in the past year (you may not agree with what they’ve done, but they’ve done a lot). That’s the argument made by Newsweek columnist Jonathan Alter. But in the public’s mind, Congress will be judged by what they do on health care reform. Their constituents, both at home and in the political arena, are demanding results. If they pass something now they will have 10 months to convince voters their fix is better than the status quo. If they fail, they will demonstrate they’re a do-nothing Congress. In these circumstances, something is better than nothing.

Painting a scenario in which health care reform goes down in flames is easy. And I’m not saying health care reform is inevitable. But this Congress and this President have gotten closer to passing health care reform than any lawmakers since the push for comprehensive reform began in the 1940s. President Obama and Democrats in Congress have bet their political credibility on producing a bill. They’re close to the finish line. Odds are, they cross it.

Of course, signing health care reform legislation into law is only the beginning. But that’s a topic for a future post.

Why Liberals Won’t Kill Health Care Reform

For those opposed to the current versions of health care reform moving through Congress it might be enjoyable to see the Democrat versus Democrat circus currently underway in Washington. Both parties are susceptible to the joys of circular firing squads, but the Democrats are embracing the concept with exceptional glee of late as liberals and moderates in the Democratic caucus brawl over the shape of health care reform legislation. But at the end of the day there’s several reasons why it’s highly likely all 60 members of the Democratic caucus will vote to move the bill forward.

  1. The Senate is not voting on a final health care bill. Yes, passage of health care reform by the U.S. Senate would be a historic milestone, but just a milestone. What emerges from the Senate will go to a conference committee where the final health care reform bill will be drafted. This makes it easier for Senate Majority Leader Harry Reid to muster the necessary votes. For example, Senator Ben Nelson who is threatening to vote against allowing a vote on the legislation unless it’s abortion language is modified, can make it clear he’ll vote “aye” now to keep the health care bill alive, but he’ll vote against it if the conference committee doesn’t address his concerns. The liberals who are claiming the legislation is a bail-out of the insurance industry can make the same claim: “I’ll vote for it now, but it needs to get better in conference.”
  2. Liberals opposing the bill don’t vote. With the exception of Senator Bernie Sanders, an Independent who caucuses with the Democrats, most of the complaints have come from liberals outside of the Senate. Former Governor Howard Dean was the first well-known liberal to call for defeating the Senate health care reform bill. he was soon joined by Keith Olbermann of MSNBC and folks at the Daily Kos blog. The AFL-CIO and SEIU are also making noises about killing the bill and starting over. But killing the bill would require liberals to tell millions of Americans that preventing health insurance companies from denying them coverage isn’t adequately progressive. Or that preventing carriers from dropping insureds when they get sick isn’t sufficiently liberal. Or that eliminating annual and lifetime caps on insurance coverage is unimportant to liberals. Or that making health insurance accessible and affordable (through subsidies) for millions of the currently uninsured fails to meet the definition of “good enough.” Liberals will complain. They’ll whine and threaten. At the end of the day, however, it’s unlikely any liberal wants to go down in history as the vote that postponed health care reform for a generation (see reason #4, below). Mr. Olbermann gets paid to talk so the commercials on his Countdown show don’t run together. He doesn’t have vote in Congress. Neither does Governor Dean. What they say matters only within the bubble known as cable news. Having a vote in Congress is a responsibility the pundits lack, but lawmakers take very seriously – seriously enough to keep health care reform legislation moving forward.
  3. Liberals are upset over more than just the public option. While dropping a “robust” public option from the Senate health care bill is generating the most recent complaints from the left, threats to defeat the bill result from several disappointments. Many liberals support a single payer system and see a government-run health plan as a compromise. They look at the requirement for everyone to purchase health insurance and ask a reasonable question: what is to stop carriers from gouging the public? (Hence proposals for requiring high medical loss ratios). Then there’s efforts by anti-abortion groups to use health care reform to insert language that goes beyond the current status quo embodied by the Hyde amendment. Some progressives also are upset pure community rating is absent from the bill and the fact Health Savings Accounts will survive the reform effort. As the end game approaches, it’s not surprising that passions rise and frustration bubbles over. Especially for liberals about to vote for what they consider disappointing legislation, venting their displeasure is to be expected. Venting displeasure, however, is not the same as blocking health care reform.
  4. Liberals won’t get a better bill any time soon. Progressives were understandably delighted by the 2008 election results. President Barack Obama had a demonstrably liberal voting record and still won in what can legitimately be called a landslide. Democrats had substantial majorities in both houses of Congress. What was overlooked is that the Democratic Party (and the president) is more centrist than true liberals like to believe. In fact, nearly one-third of the Democratic Caucus are also members of the Senate Moderate Dems Working Group. Anyone not trying to sell Viagra and auto insurance (which leaves out Mr. Olbermann) has known for months that health care reform would be shaped by these moderate Democrats Senators. And if liberals think they’ll be replacing these moderates with more liberal Democrats they’re spending too much time in a different space-time continuum than the rest of us. The chances of liberals taking the seats of Senators Blanche Lincoln and Mark Pryor (Arkansas), Evan Bayh (Indiana), Ben Nelson (Nebraska), Mary Landrieu (Louisiana), Kay Hagan (North Carolina), or Clare McCaskill (Missouri) any time soon are extremely slight. The reality is that Republicans are likely to pick up several seats in the Senate and House in 2010. Historically, the mid-term elections go poorly for the party in the White House. What this means is that for liberals, the current Congress is as good as it gets. Starting over would likely result in reforms even more moderate than what’s being considered today. That’s why Republicans are doing everything they can to slow down the health care reform process. They know the longer the process takes the more likely health care reform is likely to fail and that future attempts will be more to their liking. Liberals in the Senate know this. The Governor Deans of the world can ignore this fact, but lawmakers have to deal with reality, not the fantasies of ideologues.
  5. There’s always tomorrow. To think that whatever health care reform legislation President Barack signs into law health care reform legislation early next year will end debate on the issue for the rest of his Administration is naive. As Republicans gain strength they’ll seek to modify whatever is enacted. Democrats will attempt to expand reforms through more targeted legislation. Whatever health care reform bill emerges from Congress this session should be viewed as a foundation for future political fights, not the end of them.

Could health care reform fail because of attacks from both the left and the right? Yes. Is it likely to fail because liberals join Republicans in torpedoing health care reform? Not really. I don’t envy Senate Majority Leader Reid his task, but my guess is he’ll soon have the 60 votes needed to bring health care reform legislation to the floor of the Senate. Then if some of the liberals want to make a symbolic vote against the reform package they can go right ahead. Once the bill is brought before the Senate It only take 51 votes to move the legislation forward to the conference committee.

Of course, whether whatever health care reform legislation the conference committee can draft will secure enough votes is still very uncertain. But we will have the chance to find out.

Health Care Reform Makes It Clear: Howard Dean is No Ted Kennedy

Dr. Howard Dean was governor of Vermont for 12 years. He was a front runner briefly during the 2004 presidential campaign. He became chair of the Democratic National Committee. And now he is demonstrating why he failed for Governor and why Democrat are better off having him as the “former” chair of their party.

As Democrats in the Senate struggle to cobble together a super-majority in support of health care reform, Governor Dean is busy throwing bricks into the room. Upset that the legislation likely to emerge from the Senate will contain neither a government-run health plan nor the ability for 55-to-64 year olds to buy-in to Medicare, Governor Dean is urging defeat of the bill. The reason, according to a report by the Associated Press, the Senate health care reform bill is “an insurance company’s dream.” Which is malarkey. I don’t know any insurance carriers happy with the direction of health care reform in Washington. As the AP reports White House spokesman Robert Gibbs putting it, “If this is an insurance company’s dream, I don’t think the insurance companies have gotten the memo.”

Governor Dean asserts that “You will be forced to buy insurance. If you don’t you’ll pay a fine.” True enough, although in the Senate bill the fine is $750, far less than the cost of coverage. Then he goes on to assert that insurance companies would not be prohibited from denying coverage for preexisting conditions. And that older Americans would pay more than their younger neighbors for coverage.

Let’s look at the substance of the Governor’s complaints. Does he seriously believe that whatever health care reform bill emerges from Congress will allow health insurance companies to deny applicants for coverage? If so, he’s the only pundit in the country who does. Even Republicans support guarantee issue of health insurance coverage.

As for older people paying more for coverage than younger people, he’s right. Both legislation passed by the House and being considered in the Senate allow carriers some flexibility in setting rates by age. But both bills substantially reduce the differential that exists today. In California, for example, a 64 year old can expect to pay six times more than a 19 year old for the same coverage. (Anthem Blue Cross offers a $3500 deductible PPO that costs a single 19 year old in Los Angeles $110 per month and his 64 year old neighbor $664 a month). Under the legislation being considered in the Senate, the ratio would could be no more than 3-to-1. The House bill limits the differential to 2-to-1. Governor Dean never complained about this premium spread before. Now that the public option is likely to be cut from the Senate bill, a 3-to-1 limit on premiums becomes a decisive factor for him?

Governor Dean’s attack on the Senate bill is a loud reminder of how much Senator Edward Kennedy is missed in Washington. Senator Kennedy was as liberal, if not more liberal, than Governor Dean. The difference is that Senator Kennedy accomplished a great many things on the national stage. Governor Dean has accomplished nothing nationally. Senator Kennedy was successful in large part because he recognized the need to seize progress when and where he could. He knew there would be future opportunities. Even more importantly, he understood that, in broad terms, America becomes more progressive over time. Consider: it wasn’t that long ago that the fight was over whether the government should provide a medical safety net for older citizens. Republicans called Medicare socialism. Now they defend the program.

There’s a lot in the current health care reform bill I don’t like. There’s a lot about the status quo I don’t like either. What is infuriating about Governor Dean’s attack on the bill is that it is as nonsensical as those of the right. His “insurance company dream” is to the left what former-Governor Sarah Palin’s “death panels” are to the right – ideology masquerading as dire warnings.

Liberals in Congress will probably come around to supporting what they consider a watered down, insufficient health care reform bill. Liberals outside of Congress, like the former Governor from Vermont, will call on them to defeat the bill and start over. Underlying their logic is apparantly the belief that it’s possible to pass an even more liberal Congress.

What liberals like Governor Dean need to realize is that moderate Senators like Ben Nelson and Blanche Lincoln are just a part of the party as liberals like Senators Jay Rockefeller and Charles Schumer. I suppose Governor Dean could recruit liberals to run for the Senate in Nebraska, Arkansas, Indiana, Louisiana and other states from which moderate Democrats hail. There’s only one problem. Liberals don’t get elected to the Senate from those states. Not in 2010.

Members of Congress understand the need for compromise. They may not like it, but they accept that their less-than-liberal colleagues represent their constituencies. Those on the sidelines have the freedom to ignore such realities and to throw bricks with abandon. These ideologues won’t solve many problems, but I guess the brick throwing makes them feel better.

Senator Kennedy understood the need to work with those less liberal than himself, to keep issues alive by passing significant reforms that may not be all he wanted to achieve, but laid the groundwork for future efforts. Governor Dean is blind to this approach. But then, Howard Dean is no Ted Kennedy. Never was. Never will be.

Medicare Buy-in Compromise Unraveling?

Nothing lasts forever … not even health care reform compromises. The Congressional Budget Office is expected to come out with its analysis of the latest proposal – replacing a the creation of a new government-run health plan (the controversial “public option”) with a program in which Americans 55-64 could buy Medicare coverage. However, it’s looking like even if the CBO determines the idea makes financial sense, the votes to go forward with the proposal there doesn’t seem to be enough votes around for it to move forward. Which means the public option remains the big make-or-break element of health care reform in the Senate.

Only a few days ago, along with the idea of empowering the Office of Personnel Management to organize a coverage program, the Medicare buy-in compromise  seemed to be the solution to breaking the public option impasse. Now the idea seems to be losing steam.

First, doctors and hospital groups came out in opposition to the Medicare buy-in compromise, with the Washington Post reporting them as claiming the approach “would be financially untenable and would jeopardize access to health-care services for millions of Americans.”  The medical and hospital groups are concerned, according to the Washington Post, “because the program pays providers at much lower rates than private insurers, and because older Americans are the greatest consumers of health-care services.”

And then two conservative members of the Democratic caucus indicated their disapproval of the Medicare buy-in. According to the Associated Press, Senator Joe Lieberman, who had originally sounded open to the idea, now considers it “a bad deal for taxpayers and the deficit.” And the AP quotes Senator Ben Nelson as saying “I’m concerned that it’s the forerunner of single-payer, maybe even more directly than the public option.”

So while, as the Washington Post and others are reporting, the President Barack Obama and many Democrats are praising the compromise, the fact is, the Democrat’s need 100 percent buy-in by their caucus to pass any bill. (Yes, it’s possible Senators Olympia Snowe and Susan Collins might cross party lines and vote for a bill, but it’s hard to see how these Republican Senators could support any legislation conservative Democrats like Senators Lieberman and Nelson could not).

Democrats are trying to dodge a nasty choice: dropping the public option from health care reform. Liberals have made inclusion of a public option their litmus test for meaningful reform. As the liberal blog Daily Kos put it this past summer, the public option is the compromise progressives are willing to make between a single payer system and the status quo.

In the end, however, liberals will need to decide whether the absence of a public option is enough to get them to walk away from reform. Because there does not seem to be any way they will obtain 60 votes in the Senate for a bill that includes a new government-run health plan. My guess? Liberals will complain bitterly, but ultimately vote for a bill without a public option. Health care reform has been on their agenda for decades and they have moved the issue further through Congress  than ever before. To abandon it now would set back health care reform for at least a decade if not longer. Failure would hand Republicans a huge stick to use against them in the 2010 elections.

Passing reform, even reform liberals perceive as too weak, provides a foundation for future efforts. This might seem like a hollow victory for many progressives, but it would be a victory for them nonetheless. And I just don’t see them trading even a hollow victory for a hard defeat.

New Elements Added to Health Care Reform Debate

I haven’t been writing much of late. The Senate debate has simply been too predictable to merit much comment. The partisan attacks could have been scripted months ago. The votes unsurprising, and the difficulty Democratic Leaders face in fashioning a 60-vote majority is to be expected.

Consider: Republicans charge the Democrats will destroy Medicare. The fact that not long ago it was the GOP wanting to eliminate waste and abuse from the program seems to be forgotten. Democrats, meanwhile, seem incapable of understanding the relationship between medical costs and insurance costs. Listening to their claims that cracking down on evil insurance companies will lower health care spending is disappointing. It would be nice if now and then a Senator would acknowledge that medical costs drives up premiums and not vice versa – a wish not likely to be realized any time soon.  I heard on the radio last week (sorry, not sure what station) a lawmaker complaining that health insurance companies use actuaries, an unfair advantage they wield to the detriment of consumers.

But in the past few days some ideas seem to be gaining traction that could mix things up considerably. One proposal is to allow 55 through 64 year olds to buy into Medicare. The Washington Post’s Ezra Klein seems to be the first blogger to report the Medicare buy-in proposal is “attracting the most interest” as an alternative to creating a new government-run health plan to compete with private carriers. The under 65 cohort would not get basic Medicare coverage for free nor does it look like this approach includes subsidies not already on the table. It simply is a way to create access for some Americans to a public health plan without creating a new public health plan. And as with the public option, participation by 55 year olds would be voluntary.

That the idea of a Medicare buy-in option is gaining traction would seem to indicate that chances for a “true public option” are diminishing. Even liberal bloggers like AntonRobb at Benzinga.com are reaching this conclusion. “… proponents of the public option may be compelled to get behind this plan as an alternative. The severeley (sic) comprised … versions of the public option that have any chance of passing … would probably be worthless and probably do more damage politically to the Dems than good,” he writes.

The other interesting idea to emerge is to, as CBS News describes it, “establish national health insurance options, which would be administered by the Office of Personnel Management (OPM) but operated by private, nonprofit insurers ….” Since the OPM already administers the Federal Employees Health Benefit Program (FEHBP), which insures members of Congress and their staffs among others, this alternative to a public option is being viewed as the equivalent of opening up the FEHBP to non-government workers. (Incidentally, although the CBS reports implies the plans would be administered only by nonprofit carriers, this is far from certain. None of the other news reports mentioned this restriction – and there are for-profit carriers participating in the FEHBP.)

The “what’s good for Congress is good for the public” approach seems to appeal to moderate and conservative Democrats who have been objecting to the creation of a new government-run health plan run by the Department of Health and Human Services. As CBS notes, Senators like Ben Nelson describes this proposal as an alternative to, not a version of, a public option.

The import of these proposals go beyond the fact that new ideas are on the table. It also shows the influence likely to be wielded by the “gang of 10” Senators formed over the weekend. These 10 Senators, five liberals and five moderates, are charged with hammering out a compromise on the public option, according to MSNBC. While focused on the public option, it is likely this group of lawmakers will be called on to bridge the chasm that separates liberal Democratic Senators from their moderate and conservative colleagues. Remember, liberals have long claimed that health care reform without a public option is no reform at all. So if the gang of 10 manages to find a way to remove a government-run health plan from the legislation while still keeping liberals on board, they will position themselves to fashion compromises on other divisive issues as well.

(For those interested, the gang of 10 is comprised of Senators Sherrod Brown, Russ Feingold, Tom Harkin, Jay Rockefeller, and Charles Schumer from the liberal wing of the party and moderate Democratic Senators Tom Carper, Mary Landrieu, Blanche Lincoln, Ben Nelson and Mark Pryor).

As noted above, the momentum building behind the Medicare buy-in and an FEHBP-type proposal is that the public option is not going to make it into the Senate bill. Not with a trigger. Not with an opt-out. Instead it appears the public option won’t be in the legislation at all. This should mollify Senator Joe Lieberman who has promised to vote with Republicans against bringing a health care reform bill to the floor if it contains a public option.

All of this also makes clear the strong desire of Democrats, regardless of their ideology, to pass health care reform. The New York Times reports on various lawmakers’ description of President Barack Obama’s message to Senate Democrats on Sunday. “He reminded us why we are here. He reminded us why we run for office. And he reminded us how many people are counting on us to come through.” “Decades from now this will be the kind of vote you remember. It will be written in the faces of children and families who are relieved of the burden of anxiety and sorrow.”

Democrats consider this a historic moment. While grasping it carries political risk in the upcoming 2010 elections, failing to seize the opportunity poses even greater dangers. And the crushing of a dream many of these lawmakers have held for decades.

There are still controversies that could scuttle health care reform. And there will enough political charges and counter-charges bandied about to satiate even the most verbose pundits. But Senators are serious about finding a path to passage and it is increasingly likely they will pass some version of health care reform before years-end. Of course, this will only set the stage for the real work to begin: the House-Senate Conference Committee likely to convene shortly after New Year’s Day.

Senate Health Care Reform Still Alive, But Likely to Change

The Senate has just spent most of today (Saturday) engaging in a debate on whether to allow a debate on comprehensive health care reform. Later this evening 58 Democrats and 2 Independents will vote to allow Majority Leader Harry Reid’s health care reform bill come to floor for debate and consideration of amendments. 40 Republican Senators will vote unanimously against allowing this to happen. Senator Reid’s Patient Protection and Affordable Care Act is still alive. It is unlikely to survive in its current form for long, however.

Don’t get me wrong. Tonight’s vote is significant, very significant.  The vote is a test of President Barack Obama’s and Senator Reid’s ability to line up enough votes to keep the bill alive.  The debate leading up to the vote has been an opportunity for Republican Senators to present their opposition to HR 3590. (Yes, the Senate has taken a bill passed by the House and moved to the Senate, gutted that language and substituted their health care reform package. Consequently, the Senate legislation has a House bill number.) And the vote to allow debate has served as an action forcing event, sort of, for Democratic moderates.

Those moderates could have sided with the Republicans killing the bill before it could be brought to the floor. Instead, they joined with their liberal colleagues and kept health care reform alive. While there are 18 moderate Democratic Senators (including Senator Joe Lieberman, who is an Independent), it eventually came down to three:  Senators Mary Landrieu, Blanche Lincoln and Ben Nelson. All three made clear they would seek amendments to the bill before voting for it. And all three are among those moderates making it clear further changes to the Patient Protection and Affordable Care Act is necessary before they’ll commit to voting for it.

We’ll learn more about the changes moderates will demand over the several weeks before a final vote on health care reform is held in the Senate.  Democratic leaders are hoping to hold that vote before the end of the year. The legislation would then move on to a conference committee that will attempt to reconcile it with legislation the House passed earlier this month.  More importantly, that conference committee, made up of an equal number of Senators and House members, will seek to fashion legislation they hope will earn the support of a majority of House members and 60% of Senators. As I’ve noted before, passage of legislation by the Senate is merely the final playoff game. The World Series — the conference committee — is yet to come.

Uniting the Democrats to allow debate on health care reform is a victory for the Obama Administration and for Senator Reid personally. That it took this much effort, however, demonstrates the challenges they yet face. Republicans appear to be uniting in opposition to the legislation. Even Senator Olympia Snowe, who voted for a health care reform bill in the Senate Finance Committee, is expected to vote against bringing HR 3590 to the floor.

I’ve written before about the power moderates have to determine if health care reform legislation will pass Congress and what the final bill will contain.  Now we’ll see that power put forward. Some of what they’ll ask for will be parochial. (That there’s a provision in Senator Reid’s bill that would send additional Medicaid money to Senator Landrieu’s state of Louisiana is neither a coincidence or accidental). But most of their demands wil concern public policy issues. Moderate Democrats tend to be more fiscally cautious than their more liberal colleagues, giving them pause to legislation that greatly expands governmental powers,  spends nearly a trillion dollars over the next decade and taxes corporations and individuals to pay for it. These are the issues on which they will focus.

Republicans will have their own pet issues, but those are unlikely to influence the outcome. Having already declared their unmoving opposition to any health care reform Democrats could claim keeps their campaign promises, the GOP has removed themselves from negotiations. (A couple of the Republicans, most notably Senator Snowe and her colleague from Maine, Susan Collins, might vote what moderate Democrats fashion. But whether they’ll be able to insert provisions without committing to voting for the bill if their amendments are accepted is unlikely. 

We don’t know yet what changes to HR 3950 moderate Democrats will demand, but the possibilities are extensive. They could eliminate a public option — or at least postpone its implementation until after other reforms have had a chance to take effect. They could  demand additional cost containment provisions. They could strengthen — or weaken — the requirement that all consumers obtain coverage. Certainly they will modify what taxes and fees are imposed to pay for health care reform.

What’s important to remember is that moderate Senators will have two shots at the bill. They’ll extract as much as they can during the current Senate debate. Then at least two or three of them are likely to agree to vote for the bill “in order to keep the process moving forward.” However, they’ll also make clear they want significant changes made to the legislation by the conference committee before they’ll commit to a vote that would place the legislation on the president’s desk. Liberals will insist they have compromised all they can, but in reality, the moderates (and the liberals) know that the progressives are likely to accept any legislation that can be called “health care reform” with a straight face. And as politicians, they have great skill in passing the straight face test.

Yes, Democrats have won the debate on whether to debate health care reform. What legislation eventually emerges from the Senate, if any, is still uncertain.

Senator Reid Attempts to Find Middle Ground on Public Option

Senate Majority Leader Harry Reid’s challenge was to blend the liberal Senate Health, Education, Labor and Pensions health care reform legislation with the more moderate bill passed by the Senate Finance Committee. One of the most contentious issues concerned the creation of a public insurance plan to compete with private carriers — the Senate HELP Committee called for one; the Senate Finance Committee explicitly rejected the concept.

The problem for Senator Reid was that some members of his caucus were threatening to oppose a bill without a government-run plan while others were making the same threat if the legislation included such a provision. And Senator Reid’s number one priority was to find a compromise that could garner the 60 votes needed to pass a bill in the Senate.

His decision:  include a public option in the blended health care reform legislation he will be bringing to the Senate floor in the next few weeks, but include restrictions on it that, while appealing to moderates, are not enough to turn off liberals.

The legislation is being reviewed by the Congressional Budget Office and is not yet available online. But Senator Reid has announced he will allow states to opt out of participating in the public plan. This approach is very appealing to moderate Democrats such as Senator Tom Carper, who voted against one of the attempts to add a government plan to the Senate Finance bill. According to the National Underwriter, Senator Carper “has been a key advocate of letting states opt out of the public option health program and create their own alternatives to private plans.”

Not all moderates in the Senate are embracing the compromise yet. The Associated Press quote Senators Olympia Snowe, Ben Nelson and  Mary Landrieu as all expressing various levels of skepticism. But the White House is on-board with the compromise and will likely bring a great deal of pressure on these moderates to get at least vote in favor of ending the inevitable Republican filibuster on the health care reform legislation. By including an opt-out, these moderates can support the procedural movement and claim they were putting state rights above their opposition to the public option.

The other provision Senator Reid has apparently included in his compromise is that, in the words of Senate Charles Schumer as quoted in the National Underwriter article, “Any public option plan ought to operate on a level playing field with private insurers, and it ought to meet the same state requirements and use similar provider rates.”

How this limitation would be imposed on a government-run plan is, as yet, unknown. But if the public option must play by state-specific rules, it would be a step toward a more level playing field between the public option and private carriers — and certainly closer to the level playing field than is contemplated in the House version of health care reform.

What’s ironic is that, as I’ve written previously, a public option is likely to accomplish its primary public policy goal — reduce medical costs — only if it is allowed advantages in the marketplace such as the power to unilaterally impose reimbursement rates on providers. By restricting it to the same rules and pricing regulations as private carriers might meet, its effectiveness is reduced.

Whether a public health insurance option is part of the reform legislation eventually passed by Congress is far from certain. But Senator Reid’s proposed compromises keeps the possibility alive. At the same time, the restrictions he’s suggesting reduces the impact of the government plan. That’s a reality liberals will not accept willingly.

Senator Reid is doing what Majority Leaders have to do: find the middle ground that can garner the support of 60 Senators. It’s not an easy task. Nor will the result please everyone. It might even please no one.

 

Senate Finance Committee Rejects Government-run Health Insurance Plan

The Senate Finance Committee continues to refine its health care reform legislation. Today it broke ranks with other Congressional committees with jurisdiction over health care reform by defeating amendments to create a government-run health plan. The debate was passionate, but ultimately enough Democrats joined with Republican Senators to defeat two attempts by the panel’s more liberal members to insert public option language into the bill.

Keeping the public option out of the bill was a major victory for Senator Max Baucus, chair of the Finance Committee. While acknowledging that a public option would “hold insurance companies’ feet to the fire,” his opposition was based on the goal of enacting health care reform this year. According to ABC News Senator Baucus believes health care reform including a government-run program cannot pass the Senate.

Senator Jay Rockefeller insisted, however, that a public health insurance plan was absolutely essential to meaningful reform. Failure to to create a public, non-profit plan to compete with private carriers, the Associated Press reports the West Virginia Democrat as saying, “was a virtual invitation to insurance companies to continue placing profits over people, and he predicted they would raise their premiums substantially once the legislation went into effect.”

Senator Baucus countered that the legislation being developed by the Senate Finance Committee includes numerous consumer protections, including a provision to prevent insurance companies denying coverage based on pre-existing conditions. None of the lawmakers on either side of the aisle spent much effort in defending the behavior of private insurance companies. Senator Baucus said he agreed with the intent of the Rockefeller Amendment to “hold the insurance industry’s feet to the fire,” according to the Washington Post. The Associated Press quotes Senator Jim Bunning as observing that “the private sector is not doing exactly what it should do with medical services.”

Republican members of the committee were unanimous in their opposition to public options. The Washington Post quotes the ranking GOP member of the panel, Senator Charles Grassley, as warning that a government plan “will ultimately force private insurers out of business” and that “The government is not a fair competitor. It’s a predator.”

The first public option amendment, offered by Senator Rockefeller, would have permitted the government-run plan to set reimbursements to medical providers at levels paid by Medicare for the first two years. (After that period, I believe the Senators proposal would have permitted the public medical plan to, like Medicare, impose rates on providers). It should be noted, Medicare often pays doctors and hospitals less than the cost they incur providing services. The five Democrats joining with Republican committee members to defeat this amendment were Senators Baucus, Thomas Carper, Kent Conrad, Blanche Lincoln, and Bill Nelson.

Senator Charles Schumer then proposed an amendment that would have required the public plan to negotiate reimbursement rates with providers, much as private carriers do today. Three Democrats – Senators Baucus, Conrad and Lincoln – voted against accepting this amendment.

I’ve maintained for some time that a government-run health plan was unlikely to be part the health care reform plan passed by Congress. The Senate Finance Committee’s rejection of this provision increases the likelihood of this outcome, but the debate will continue. Senator Schumer, for one, pledged to continue the fight. 

"’The present system is broken’" the Washington Post reports him as saying. “He said he was pushing for a public option not for ideological or symbolic reasons but because ‘costs are going through the roof.’ And he expressed confidence that, ‘with some work and some compromise,’  proponents of the provision eventually could get 60 votes on the Senate floor. ‘We are going to get at this, and at this, and at this, until we succeed, because we believe in it so strongly.’"

With polls showing 65 percent of the public support a government-run health plan operating like Medicare to compete with private health insurance plans, President Barack Obama continuing to argue for a public option, and Speaker Nancy Pelosi claiming the House was unlikely the House would pass health care reform that did not include a public option, this debate is far from over. Assuming the Senate Finance Committee moves forward a reform package this week, the next step will be for it to be integrated into the bill passed by the Senate Health, Education and Pensions Committee – legislation that does include a public option.

Getting health care reform is a long hike. Today’s vote in the Senate Finance Committee is a step along the way – albeit a very significant step indeed.