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What To Expect From The Senate Health Bill

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"What To Expect From The Senate Health Bill"

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ReidHopefullWhen Senate Majority Leader Harry Reid (D-NV) unveils the merged Senate bill and its CBO score this afternoon at 5pm to the Democratic caucus, he will not have the commitment of all 60 senators for a procedural vote to begin considering the legislation on the Senate floor.. Reid remains “cautiously optimistic” that the Senate will start considering the bill on Friday, although several Senate moderates have insisted on taking 72 hours to review the legislation before voting to start debate.

Democrats are also indicating that they may “short-circuit the legislative process” to pass health care reform by December 18th, the last day Congress is in session. “The most talked about method is end running the formal conference committee process in favor of some sort of mini-conference. Democratic officials in the White House and Congress are envisioning an end game similar to the way the $787 billion stimulus package came together with congressional leaders and White House aides hashing out the differences behind closed doors.”

Details of the merged legislation remain elusive but here is the latest:

- Bill will cost less than $894B/10 years: The “preliminary estimates by the nonpartisan Congressional Budget Office, the legislation’s official scorekeeper, have indicated that the Senate measure would cost far less than the bill the House approved last week, while lowering the federal deficit further over the long term.” This suggests that Reid was able to bring down the price tag and increase the new revenue. To lower the price tag he could have lowered the amount the bill spends on subsidies, further expanded Medicaid, decreased funding for prevention and wellness, or tinkered with a few other provisions like the tax credit for small businesses. Reid may also replace the opt-out national public option with Sen. Tom Carper’s (D-DE) ‘non profit board’ trigger compromise.

- Bill may lower the maximum contribution for premiums for families 133-150% FPL from 12% to 10%: Family USA’s Ron Pollack tells TNR’s Suzy Khimm that “the Senate leadership has basically decided to give more help to middle-class families on the higher of the subsidy spectrum, whose incomes are 300 to 400% above the poverty line.” The legislation may lower the maximum premium contribution from 12% to 10%, but increase the premium contribution for the lower end of the spectrum (Americans between 133-150% of the federal poverty line) from 2% to about 3%.

- Roll back Cadillac health plan tax, replace some of the revenue with a payroll tax: “To scale back a plan to tax high-cost insurance policies, an idea that is highly unpopular among labor unions, Reid is expected to propose an increase in the Medicare payroll tax for families earning more than $250,000 a year.” “The provision would be expected to generate about $50 billion over the next 10 years” and “the extra revenue would allow Reid to reduce the number of people who would be hit by a new 40 percent tax on the most expensive insurance policies.” According to the Dow Jones, “Reid has already raised the family threshold by $2,000 for everybody.”

- Bill will invest in the CLASS Act: Reid is expected to incorporate the Community Living Assistance Services and Supports Act, or CLASS Act, a long-term care program championed by the late Sen. Ted Kennedy. The program was part of the HELP Committee’s bill and generated some $59 billion in new revenues from premiums to help fund reform. The CLASS Act establishes “a national insurance program to be financed by voluntary payroll deductions to provide benefits to adults who become severely functionally impaired.” All working adults will be automatically enrolled in the program, unless they choose to opt out. “Fiscal conservatives and government economists have questioned whether the program would be financially sustainable over the long run, and insurance companies are lobbying to strip it from the health care bill.”

- Bill could remove a provision that removes insurers’ anti-trust exemption: The New York Times suggests that in response to demands from Sen. Ben Nelson (D-NE), “the leaders appear willing to drop plans to use the bill to strip health insurance companies of their antitrust exemption.”

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