Senate Democrats hoping to convince Sen. Susan Collins (R-ME) to vote for health care reform may be disappointed by her rather unflattering portrayal of the Senate Finance health bill in this morning’s New York Times. “We should rewrite the whole bill,” Ms. Collins said. “There is considerable unease on both sides of the aisle about the impact of this bill, and as more analysis is done, I believe those concerns will only grow”:

Summarizing her study of the bill over the past 10 weeks, Ms. Collins said it was “too timid” in revamping the health care system to reward high-quality care. She said the bill included “billions of dollars in new taxes and fees that will drive up the cost of health insurance premiums.”

And she noted that many of the taxes would take effect before the government started providing subsidies to low- and middle-income people to help them buy insurance. Thus, Ms. Collins said, “there will be a gap for even low-income people where the effect of these fees will be passed on to consumers and increase premiums before any subsidies are available to offset those costs.” The bill sets standards for the value of insurance policies, stipulating that they must cover at least 65 percent of medical costs, on average.

Most policies sold in the individual insurance market in Maine do not meet those standards, Ms. Collins said, so many insurers would have to raise premiums to comply with the requirements. As a result, she said, the premium for a 40-year-old buying the most popular individual insurance policy in Maine would more than double, to $455 a month.

Experts agree with Collins that the bill could do more to contain costs. “[T]he measures take only baby steps toward revamping the current fee-for-service system, which drives up costs by paying health providers for each visit or procedure performed,” the New York Times writes, and some have suggested that the bill “could do more to reward quality care over quantity” than simply fund demonstration projects.

Indeed, the Senate could do more to reign in health care costs, but it’s up to senators like Collins to propose improvements. Why not insist on a robust health care exchange that can engage in prudent, selective purchasing of insurance, or a more powerful Medicare Commission that doesn’t protect large groups of providers from cuts? Collins can introduce amendments that limit Medicare’s payment updates to reflect productivity, limit payments in high-cost areas to encourage more appropriate utilization of health care products and services, or “allow private health insurance companies access to Medicare rates, requiring health care providers to accept those rates.” Changing reimbursement rates in Medicare and the private market could lower the cost of the bill, bend the cost curve, and reduce premiums for middle class families.

But Collins wants to reign in costs without voting for controversial cost containment policies. She opposes the existing Medicare reforms and rejects any kind of public option. She thinks plans in the exchange are too costly, but doesn’t want to increase subsidies to ensure that coverage is affordable. She agrees that the bill could go further to reign in costs, but not if she has anything to do with it.

Over at FiredogLake, Jon Walker points out that the Stupak Amendment “could effectively stop many employer-provided health insurance plans from covering abortions for tens of millions of Americans” and restrict any private plan in the Exchange from offering abortion coverage. The amendment stipulates that “no funds” authorized under the health care reform bill “may be used to pay for any abortion or to cover any part of the costs of any health plan that includes coverage of abortion, except in the case…[of a risk of death of the mother, rape, or incest].”

But as Walker explains, while the bulk of the federal money may lie in subsidizing coverage for middle class Americans, the federal dollars appropriated through HR 3962 touch “many insurance plans directly and indirectly.” The Stupak amendment would prohibit insurers from selling abortion coverage in the following ways:

1) Any policy that is sold within the Exchange: A strict interpretation of the Stupak language suggests that since the Exchange is established by the federal government, any plan that operates within the Exchange would not be able to provide abortion coverage. However, since Stupak allows insurers that operate plans within the Exchange to sell abortion riders, one could also assume that a policy in the Exchange could still offer abortion coverage.

2) Policies in the Exchange that receive risk-adjustment dollars: Even though the risk adjustment mechanism is distributed from a pool that is seeded with insurer dollars, the government distributes the dollars, which adjust for individuals who receive government-subsidized coverage. Moreover, one could also argue — like the Bishops did — that once insurer money enters a risk adjustment mechanism that is administered by the government, it automatically becomes government money. Under this explanation, insurers that sell abortion riders may not qualify for risk adjustment payments.

3) Policies in the Exchange that are directly subsidized by the government: Anyone who receives government affordability credits (Americans between 150-400% FPL) would not be able to purchase an insurance policy that includes abortion coverage. Insurers are also required to accept all applicants and would have to stop offering abortion coverage once it accepts its first federal-dollar beneficiary.

4) Employer-sponsored policies that receive reinsurance funds: The bill requires the Secretary of Health and Human Services to “establish a temporary reinsurance program to provide reimbursement to assist participating employment-based plans with the cost of providing health benefits to retirees and to eligible spouses, surviving spouses dependents of such retirees.” Employer-sponsored plans that offer abortion would not be eligible for this funding or would have to forego the benefit.

5) Employer-sponsored policies that receive “wellness program grants”: The bill allows the Secretary of Health and Human Services to award Wellness program grants to small employers. Employers would have to segregate their wellness programs from their health benefits in order to receive the credit and provide abortion coverage.

6) Employer-sponsored policies that receive small business credits: For small businesses that want to offer health insurance coverage, the bill provides a tax credit over a two-year period will help them transition to or continue providing health benefits to their employees. In order to receive the tax credit, small businesses would have to stop offering abortion coverage.

In 2015 and beyond, the Commissioner can allow larger employers to enter the Exchange, permitting the Stupak amendment to further restrict their ability to offer abortion coverage.

Pro-life proponents may claim that Stupak simply preserves current policy but if they bother to examine the implications of their amendment they would discover that it actually accomplishes their goal of significantly restricting access to abortion.

Hours before the House passed health care reform, the United States Conference of Catholic Bishops lobbied lawmakers against a provision that would have allowed an insurance policy to segregate public funds from private premiums that could be used to pay for abortion services. The group maintained that “premiums paid to that plan in the form of taxpayer-funded subsidies help support that abortion coverage even if individual abortion procedures are paid for out of a separate pool of privately-paid premium dollars.” Or, alternatively, if a woman uses federal subsidies to pay for a basic benefit, she would have more private money available to fund her abortion:

While all funds in the public plan begin as private funds, in the pockets of taxpayers and purchasers, they all become federal funds once they are paid to the government (whether paid as taxes or as premiums) – and all abortions in the plan are paid for by the federal government. … So this money-laundering system, aside from making the operation of the public plan more unwieldy, does nothing to address pro-life concerns.”

The organization also rejected a compromise offered by Brad Ellsworth (D-IN), which would have established “clear, strict rules for separating public funds from the premiums of private individuals” and allowed the public option to provide abortion coverage if it hired “a private contractor to pay abortion providers, thus avoiding direct federal payments.” The Bishops maintained that once funds enter the federal treasury, they cannot be properly segregated. If that’s the case, then the organization is, by its very own definition, condemning its very own accounting practices.

The Conference works to “unify, coordinate, encourage, promote and carry on Catholic activities in the United States; to organize and conduct religious, charitable and social welfare work at home and abroad; to aid in education; to care for immigrants; and generally to enter into and promote by education, publication and direction the objects of its being.” The Bishops receive federal grants to finance their “charitable and social work at home and abroad,” but, by law, they must segregate those funds from efforts “to organize and conduct religious” work. In fact, the Bishops provide subgrants to organizations that directly serve disadvantaged individuals and ensure that public funds are not spent on religious purposes. This is a practice that’s strikingly similar to what the public option could have done under the Ellsworth amendment.

If agencies are incapable of properly segregating funds, then perhaps they should stop receiving them.