Texas Today

MARCH 26, 2010

This Week in Health Insurance Reform

Health care reform legislation passed the House this week on a party-line vote. Late Sunday night, House Democrats approved the Senate health care reform package, sending the legislation to President Obama for his signature. On Tuesday, President Obama signed the underlying bill into law, yet the House has yet to finalize the package of “fixes” that will alter the final implications of the legislation.

Health Care Reform Negotiations

House Democrats Pass Health Insurance Reform Package: The House of Representatives approved the Senate health care reform bill Sunday night by a vote of 219 to 212. The vote marks the climactic finale to a year-long debate over health care reform. In the final vote, 34 Democrats joined all House Republicans in voting against the measure. Shortly thereafter, the House also passed a package of “fixes,” by a vote of 220-211, that was sent directly to the Senate for its approval through reconciliation. On Tuesday, President Obama signed into law the Senate health care reform bill, called the “Patient Protection and Affordable Care Act.”

Republicans Force Senate to Send the Reconciliation Bill Back to the House: Shortly after the President signed the Senate bill into law, Senators began deliberations on the reconciliation bill. Reconciliation protocol restricts Senators to 20 hours of debate on the measure, but it does not limit the number of amendments that can be filed. In an expression of opposition to the bill, Republicans filed 29 amendments to the reconciliation package.

After 10 hours of continuous debate, Republicans were successful in eliminating two provisions related to college financial aid in the non-health care portion of the bill. The Senate parliamentarian ruled early Thursday morning that those two provisions violated the chamber’s rules, sending the legislation back to the House for a new vote. As a result, on Thursday afternoon, the Senate voted on the reconciliation bill without those two provisions and sent the bill back to the House for a vote on final passage. The House vote will likely come Thursday evening.

What Does This Health Care Reform Legislation Mean: While the health care reform bill extends insurance coverage to 32 million more Americans by 2019, the legislation has other far-reaching implications that will be phased in sooner, during a multi-year implementation period.

Several features of the new health care overhaul bill that would take effect in 2010 under the measure passed Sunday include:

* New product requirements beginning 6 months after enactment, including:
o Coverage for dependents up to age 26
o No lifetime maximum benefit limits
o And no cost sharing on preventive care for certain policyholders
* Temporary federal high risk pools;
* Tax credits for small employers; and
* Prohibition on pre-existing condition exclusions for children (beginning 6 months after enactment).

Most Americans will have until 2014 to purchase insurance or pay a penalty. Other elements of the bill that will not take effect until at least 2014 include insurance marketplaces called “exchanges”; rules requiring insurers to accept all applicants regardless of pre-existing conditions, and an expansion of state Medicaid programs.

A number of experts question whether health care reform will really drive down insurance premiums. America’s Health Insurance Plans ( AHIP), the trade group representing health insurers, outlines a series of concerns related to the legislation including a lack of provisions that address underlying health care costs, improve quality of care or ensure a stable risk pool. In addition, AHIP expressed concerns regarding new taxes on health coverage, which will likely increase premiums.

Additional Activities

Obama’s Executive Order on Abortion Funding: On Sunday afternoon, prior to the final House vote on health care reform, President Obama agreed to issue an Executive Order that would uphold the ban on federal funding for abortion . In so doing, he secured about a half-dozen votes from anti-abortion Democrats, led by Rep. Bart Stupak (D-MI), who previously opposed the legislation. On Wednesday, President Obama signed the Executive Order banning the government from spending federal money to pay for abortions through plans offered on the insurance exchanges created under the measure.

States Filing Lawsuit to Fight Provision of Health Care Reform Bill: In response to the new health care reform legislation, states across the country have filed lawsuits asking the courts to declare the law unconstitutional and to bar its enforcement. On Monday,Attorneys General in 13 states, led by Florida, filed a joint lawsuit claiming that the new health care reforms violate state government rights in the U.S. Constitution and will force massive new spending on hard-pressed state governments. Joining Florida in the suit are Alabama, Colorado, Idaho, Louisiana, Michigan, Nebraska, Pennsylvania, South Carolina, South Dakota, Texas, Utah and Washington.

At the same time, the Attorney General in Virginia filed a separate suit contending that Congress has exceeded its power in mandating that people buy health insurance. Virginia Attorney General Ken Cuccinelli argues that the new law’s requirement clashes with Virginia law that exempts citizens from federal fines imposed for not having health insurance.

Senate Voting to Extend COBRA Until May 5: Senate Democrats plan another short-term extension of unemployment aid this week, setting up a face-off with Republicans, who are vowing to fight the extension if the $10 billion cost isn’t offset with spending cuts. The bill, currently set to expire on April 5, would extend a series of emergency programs – including funding for unemployment insurance benefits and COBRA health coverage for the jobless – and would hold off a deep cut in reimbursement rates for doctors who serve Medicare patients. The long-term extension has already passed in both the House and Senate, but the two measures are not expected to be reconciled and sent to the President’s desk until after the Easter recess.

President Obama Heads to Iowa to Speak on Health Care: President Obama headed to Iowa on Thursday to increase support for his health care legislation. This was President Obama’sfirst trip out ofWashington since signing health care reform legislation earlier this week. He spoke at the University of Iowa, in the city where he first announced his health care proposal during the Presidential campaign.

Public Opinion

Most Americans Want Republicans to Fight Health Care Reform Bill: In a recent CBS News poll, 62 percent of Americans said they want congressional Republicans to continue challenging the bill, while 33 percent said they should not. Disapproval of the bill has remained steady, with 46 percent saying they disapprove, including 32 percent who “strongly” disapprove. A majority of Americans continue to say that they find the bill to be confusing and do not understand what it means for them or their family.

American’s Split on Health Care Reform Passage: In a recent USA Today/Gallup poll, 42 percent of Americans said they were angry or disappointed with the recent passage of health care reform legislation. When asked to reveal party affiliation, 79 percent identified themselves as Republicans.

Polling Shows Support for State Lawsuits Against Government: National polling reveals significant opposition to the individual mandate. In a newly released Rasmussen report , 53 percent of those polled oppose the new mandate requiring every American to buy or obtain health insurance. Further, 49 percent of voters are in favor of their state suing the federal government to fight the mandate. Fifty-one percent say individual states should have the right to opt out of the health care plan entirely.

Looking Ahead

After this week’s final health care reform vote, President Obama plans to travel the country in the next few months to discuss the new law. Republicans have begun their own discussions of the law, with an eye towards the November elections.

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MARCH 19, 2010

This Week in Health Care Reform

This week, President Obama continued traveling outside of Washington to rally support for his health insurance plan. Meanwhile, Democratic leaders increased their efforts to pull together enough votes to push the package through the House of Representatives by week’s end. House Speaker Nancy Pelosi (D-CA) needs to accumulate 216 votes to pass both the original Senate bill and the reconciliation bill of “fixes” before the Senate can take up the reconciliation bill next week.

Health Care Reform Negotiations

Democrats’ “Deem and Pass” Process: On Monday, the House Budget Committee voted 21-16 in favor of advancing the health care reform legislation toward a final floor vote later in the week. Two Democrats sided with all 14 Republicans on the Committee in voting against the plan.

Meanwhile, the House Rules Committee spent much of the week waiting for the final scoring from the Congressional Budget Office (CBO), which would clear the way for committee members to pass the reconciliation bill. Once the bill is approved, Democrats must wait 72 hours in order to give all lawmakers a chance to review both the original Senate bill and the reconciliation bill.

On Thursday, the CBO released its final cost estimate of the health insurance reform bill. The bill would cost taxpayers $940 billion over 10 years, while trimming the federal deficit by $130 billion in the first 10 years, plus an estimated $1.2 trillion in the second 10 years.

With the November midterm elections looming, House Democrats are weighing multiple options for passing this health care reform legislation. One option Democratic leaders are currently considering would allow the House to ” deem” the original Senate health care reform bill passed without actually voting on it. Instead, a so-called “self-executing rule ” would deem the Senate’s version of health care reform legislation approved so long as House members also vote on the reconciliation package. A vote on final passage is expected on the House floor this Sunday.

Kucinich Changes Vote to Yes on Health Care Reform: On Wednesday, Rep. Dennis Kucinich (D-OH) changed his vote on the health care reform legislation from no to yes, signaling a shift in votes and a chance for Democrats to win over former opponents of the bill. Members of the news media report that President Obama lobbied Rep. Kucinich both privately and publicly to vote in favor of the bill. Rep. Kucinich’s decision signals the first Democrat who originally opposed the House legislation in November to change his vote, moving the party closer to the 216 votes needed by this weekend.

Abortion Issue Remains at Forefront of Debate: Rep. Dale Kildee (D-MI) announced on Wednesday that he will support the health care reform legislation and will not oppose it based on the abortion issue. Rep. Kildee, a strong ally of Rep. Bart Stupak (D-MI), says he is satisfied with the provisions in the Senate-passed bill that seek to limit the use of federal money for insurance coverage of abortion. This announcement gave a huge lift to House Democratic leaders, who have been working to assure abortion opponents that a vote for the bill would not reflect any change in policy on abortion.

President Obama Continues to Campaign for Health Care Reform: Throughout the week, the President has been working to garner increased support for health care reform through a variety of public forums. On Monday, President Obama traveled to Strongsville , Ohio, to build support for his health care plan. In his speech, the President cited rising costs, declining insurance coverage and the inability of millions of Americans to pay rising insurance premiums as reasons for overhauling the health care system.

On Wednesdayevening, the President appeared on Fox News to reiterate his stance for necessary and immediate reform. And on Friday , the President heads to the Patriot Center in Fairfax, Virginia, to hold his fourth and final rally on health care reform.

CBO Scoring of Reconciliation Bill: On Thursday, the Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) released their preliminary scoring of the House reconciliation proposal. Upon release of the legislative language in the proposal, the CBO will need to review that language and refine its estimate accordingly.

The CBO estimates that enacting the Senate and reconciliation bills together would result in a net reduction to the federal deficit of $138 billion over the 2010-19 period. The reconciliation bill itself would add $20 billion of net deficit reduction to the Senate bill’s $118 billion net deficit reduction previously estimated by the CBO.

The Congressional Budget Office also estimated that the deficit reduction effect of the Senate and reconciliation bills together for the period 2020-29 would be approximately one-half percent of the GDP. However, the CBO states that this estimate is imprecise and has a great degree of uncertainty.

Public Opinion

Americans Continue to Oppose Reform: Opposition to the health care reform plan is still prevalent in national polling. In a newly released Rasmussen Reports survey , 53 percent of American voters continue to oppose the health care reform plan proposed by President Obama and congressional Democrats. Similar to the numbers last week, 55 percent of those polled believe health care costs will continue to rise, and 52 percent think the quality of care will go down. Further, 57 percent believe passage of the proposal currently working its way through Congress will hurt the economy.

In a recent Wall Street Journal/NBC poll, 48 percent of voters considered the health care reform bill a “bad idea” and 36 percent considered it a “good idea,” when given a choice between those two answers. According to the survey, Americans are unhappy with the job Congress is doing, which is evident by their 17 percent approval rating. Further, 50 percent of those polled said they would vote every member of Congress out of office regardless of party affiliation.

Looking Ahead

Sunday’s vote is expected to move the House closer to final passage of the two bills. And next week, Senate leaders await their chance to debate the reconciliation bill on the Senate floor.

Week of March 15, 2010

The White House last week continued to rail against rising health insurance premiums to help build popular support for his health care reform package. But the effort to focus the blame for rising costs on insurers was questioned, in particular, by state insurance experts and economists quoted in a New York Times story last week. Insurance commissioners said that trying to hold down premiums before costs were under control would be very risky. This approach could mean solvency issues in some cases, they told the Times. To help educate Americans about the true drivers of rising health care costs, America’s Health Insurance Plans, the industry trade association, last week launched a new national ad campaign. The ad demonstrates that health insurance company costs represent a small slice of the overall health care cost pie.

Federal

With a cadre of staff operatives searching for the right health insurance reform provisions among those previously discarded from the House, Senate and the President’s proposals, Democratic leadership has been relentlessly pursuing every possible pathway to pass a final bill. The expected process would have: 1) the House pass the Senate-adopted reform bill (which most House members hate), 2) the House passing a bill to “fix” all the things it hates using a reconciliation legislative vehicle, followed by 3) the Senate passing the very same reconciliation bill — requiring only 51 votes in the Senate. The House Budget and Rules Committees are expected to start the review, hearing and mark-up process of the reconciliation bill this week. The Senate commitment to using reconciliation was made official in a scathing letter from Leader Harry Reid to the Minority Leader. Along the way the two Chambers will need to see the latest CBO “scores” on the bill before voting, and 216 House Democrats will have to resolve policy disagreements over abortion, federal health insurance rate review and authority, and other substantive issues. Additionally, the House will have to trust that the Senate can pass the reconciliation measure without changing one comma. Partisanship has blossomed into open hostility over health reform. Whether Congress can overcome these policy, process and political mine fields remains as murky as ever, but Democrats have chosen to try and will push for resolution by the Easter recess.

The Senate has passed Jobs Bill II and shipped it off to the House, where passage is not certain. Within the bill are two health-related items of note. First, the COBRA eligibility and subsidy program will be extended to the end of 2010. (These provisions are set to expire at the end of March.) Second, the bill contains a suspension until September 30, 2010 of the cut to physician Medicare reimbursements for the current calendar year. (This provision is also set to expire at the end of March.) Aetna urged Congress to apply the “doc fix” to next year’s reimbursement as well, since insurers’ Medicare rates are based on what doctors are paid, but in the end Congress failed to make this change. Aetna and the industry will continue to find ways both to establish a more lasting, if not permanent, doc fix and to devise a legislative solution to the disconnect between doctor reimbursement and Medicare Advantage rates for 2011 and beyond.

States

ARIZONA: Budget issues remain front and center as the governor and Republican leadership proposed a plan they hope will close the $700 million deficit this year and reduce the anticipated $2.6 billion deficit in 2011. Righting the state’s fiscal ship has become a very partisan exercise, with the Republicans supporting reductions in Medicaid and KidsCare, and the elimination of full-day kindergarten. As the special session on the budget is running concurrently with the regular session, no other bill hearings were held. The oral chemotherapy parity bill may be dead for this year as proponents did not meet the deadline for submitting amendatory language.

CALIFORNIA: The Assembly Accountability and Administrative Review Committee chaired by Assemblyman Hector De La Torre held a hearing last week to examine how the Department of Managed Health Care (DMHC) and the Department of Insurance (CDI) has handled issues surrounding the rescission of policies in the individual market. According to a report prepared for the committee by Bryan Liang, director of the Institute of Health Law Studies at the California Western School of Law, fewer than 300 of 6,000 former policyholders are participating in health insurers’ agreements to settle such cases. Republican committee members were highly critical of this witness, while De La Torre was critical of the Departments. The DMHC reported that since their settlements were completed there have only been nine rescissions over the past two years, proof that the DMHC and the health plans have revamped their processes for rescission and have worked to address the problem.

COLORADO: A bill mandating maternity and contraceptive coverage in individual policies continues to receive significant attention in the Senate. The most recent amendment proposes requiring maternity coverage in at least three of the plans marketed by an insurer. It would also allow a current member of a plan without maternity coverage to switch to a plan with maternity coverage from the same carrier during the first trimester. The other major bill would require that second level appeals be performed by physicians who are actively involved in clinical practice. This measure is counterintuitive in the current economy, since it would result in outsourcing appeals and drive up costs for plan sponsors and their employees.

CONNECTICUT: A proposal that would require health insurance plans to cover oral chemotherapy in the same way that intravenous chemotherapy is covered made it through the legislature’s Insurance and Real Estate Committee last week. Currently, many health plans treat the two kinds of cancer treatments differently. Chemotherapy treatments that come in pill form are often categorized as prescription drug benefits that can require patients to pay a larger share of the cost. Cancer patients, doctors and patient advocates spoke in favor of the bill, while insurers and the Connecticut Business and Industry Association opposed it, arguing that it would put a mandate on health plans that could raise costs and make it more difficult for employers to afford insurance.

GEORGIA: A bill restricting the use of rescissions in individual health insurance policies passed a Senate committee last week. Aetna continues to work with its trade organizations to educate legislators about the adverse effect of this type of legislation. Discussions also continue regarding legislation affecting the use of rental networks.

KANSAS: Roughly half way through the legislative session, several health care bills are still moving through the process. On the regulatory front, the Insurance Department has proposed a regulation that would mandate coverage of routine patient care costs while the insured is enrolled in a cancer clinical trial – a mandate that was rejected by the legislature in 2008. A hearing will be held on April 20, and Aetna will have an opportunity to present testimony on this issue. Bills still alive include mandates for autism and orally administered chemotherapy, legislation prohibiting dental contracts that require the dentist to follow a fee schedule for non-covered services, and a ban on “most favored nation” clauses by some insurers. Another bill would allow small employers to create individual HRAs to fund premium payments on individual policies, require administering insurers to offer employees the option of receiving health insurance coverage through a high-deductible health plan with an HSA, and requiring insurers who offer small group health plans to offer high-deductible health plans with HSAs, while authorizing tax deductions for health insurance premiums for individual insurance policies. Separate legislation would amend the definition of “eligible employee” to include part-time workers (currently less than 30 hours per week). Pending legislation concerning hospital charges would prohibit charging private-pay patients more than 25 percent of what the hospital’s highest volume private payer would pay for the same goods or services. Legislation that died includes a telemedicine mandate and creation of a health care insurance database for employers.

KENTUCKY: Health issues that are being hotly debated by the legislature right now include an autism mandate, a dental bill that would not allow insurers to hold dentists, optometrists or ophthalmologists to a fee schedule for non-covered services, and a bill setting a reimbursement floor for chiropractic services. The chiropractic services proposal would allow chiropractors to bill, and would require insurers to reimburse, an evaluation and management (E&M) CPT code on each and every visit. In addition to billing for follow-up services for manipulations and other therapies, the chiropractor would be allowed to submit, and the insurer required to pay, for another E&M code on each and every visit. The legislation would also add a new mandated benefit to the Kentucky statutes. Currently, reimbursement for chiropractor visits is required only if the chiropractor performs a service already covered by the health benefit plan. Under the proposal, any service within the scope of practice of a chiropractor that is billed would become a mandated benefit. Finally, the bill would require health benefit plans to provide reimbursement without the chiropractor having to provide any documentation that the services were medically necessary. Each of these bills has, or is expected to, pass at least one chamber.

SOUTH DAKOTA: Several important legislative deadlines are approaching, resulting in a flurry of activity. Bills or resolutions not passed by the second chamber by March 9 died. But the Governor has already signed a bill that amends the premium rate-setting procedure for the high-risk pool so that rates for a given classification are 150 percent of the average actively marketed premium. The pool will have to offer three or more plan designs, remove coverage requirements for the plans (such as disease management) and remove set cost-sharing values. The bill was signed by the Governor on March 1 and will become effective on July 1, 2010. The Governor has also signed a bill prohibiting rating based on injuries caused by domestic violence and legislation requiring refunds of premiums for partial months, in the case of mid-month cancellations. Both chambers have passed legislation prohibiting contract language requiring dentists to accept a fee schedule for non-covered services, and the bill awaits the Governor’s signature. Finally, the legislature passed a resolution opposing the federal health care reform proposals passed in the U.S. Senate and House.

The Week in Health Reform—Federal Legislative Overview

The White House
On March 3, President Obama continued his push for Members of Congress to complete health insurance reform legislation within the upcoming weeks. He delivered a statement to a group of medical professionals in the East Room of the White House, in which he said that he has asked Senate and House leaders to finish work on health reform and schedule final votes in the next few weeks. The President went on to say that the issues have been debated thoroughly and that now is the time to make a decision. Although he did not specifically mention the budget reconciliation process, the President said that the American people deserve an “up or down” vote on health reform in the same way that welfare reform and tax cuts were approved by Congress in the past under reconciliation rules.

The President said that health insurance reform would change three things:

* End the “worst practices” of health insurance companies
* Give individuals and small businesses the same kind of choices members of Congress have
* Bring down health care costs for families, businesses and the government

The President made numerous references to the health insurance industry and stated that there is a fundamental disagreement between Republicans and Democrats about whether there should be more or less regulation of health insurance companies. The President concluded by emphasizing that he will do everything in his power to make the case for health reform in the coming weeks, and he also urged the American people to make their voices heard.

In addition, the President said he is open to exploring policy priorities identified by Republicans at the bipartisan summit such as:

* Conducting undercover investigations of health care providers that receive reimbursement from federal programs.
* Appropriating funds for state-based demonstration programs to test alternative approaches, including health courts, to resolving medical malpractice suits.
* Linking Medicaid eligibility expansions to higher Medicaid reimbursement for physicians.

* Clarifying that Health Savings Accounts (HSAs) may be offered through the proposed health insurance exchanges.

On March 4, Health Care Service Corporation President and CEO Pat Hemingway Hall attended a meeting at the White House, along with CEOs from other leading health insurance companies and officials from the National Association of Insurance Commissioners. The group met with Health and Human Services Secretary Kathleen Sebelius and President Obama to discuss premium issues in the individual market.

House and Senate
Congressional leaders are now focused intensely on developing legislative language that could be supported by a majority of members in both chambers. The President’s comments last week send a strong signal that such legislation, once finalized, would move through Congress under budget reconciliation procedures.

Under reconciliation rules, the House first would have to pass the Senate version of the health care reform bill, H.R. 3590, which passed on Christmas Eve last year. After that, the House would then be required to pass a separate “corrections” bill incorporating specific changes to that bill that will likely be negotiated among White House officials and House and Senate leaders. After the House passes the “corrections” bill, under budget reconciliation procedures, the Senate would need at least 50 senators to vote for the “corrections” bill. Under reconciliation rules, only a simple-majority vote of 51 votes are needed for passage (Vice President Joe Biden would be the 51st vote if only 50 senators vote for the bill) and filibusters are banned.

In order to meet the goal of sending a final health reform bill to the President’s desk before the Easter recess (which is scheduled to begin on March 29), congressional leaders would need to send legislative language to the Congressional Budget Office (CBO) for cost analysis in the very near future. On March 4, White House Press Secretary Robert Gibbs said that President Obama hopes the House of Representatives will pass the health reform bill by March 18, so the rest of the process can move swiftly.
Speaker Nancy Pelosi (D-CA) is now tasked with trying to corral votes in the House, while trying to assure those who are wary that the Senate will be willing to support the same measures. Some House members are worried about being left “holding the bag,” if the Senate decides it will not support some of the same legislative language.

In order to ensure the Democrats have enough votes, President Obama invited two groups of the Democratic Caucus to the White House on March 4 to continue to push for health reform passage. Members from the Congressional Progressive Caucus were:
Caucus Chairs Raúl Grijalva (AZ) and Lynn Woolsey (CA), Congressional Asian Pacific American Caucus Chairman Mike Honda (CA), Congressional Black Caucus Chairwoman Barbara Lee (CA), Congressional Hispanic Caucus Chairwoman Nydia Velázquez (NY), Reps. Dennis Kucinich (OH), Lucille Roybal-Allard (CA) and Jan Schakowsky (IL), as well as delegates Madeleine Bordallo (Guam) and Donna Christensen (Virgin Islands).

Afterward, Obama met with key members of the New Democrat Coalition. The New Democrats, like the Blue Dogs, are a group of fiscally conservative Democrats. Attendees of this meeting included: Reps. Jason Altmire (PA), Melissa Bean (IL), Lois Capps (CA), Joe Crowley (NY), Ron Kind (WI), Allyson Schwartz (PA) and Adam Smith (WA).

Overview: Extension of Physician Payment “Fix” and COBRA Provisions
On March 2, the Senate passed H.R. 4691, the “Temporary Extensions Act of 2010” and President Obama signed it into law. This legislation includes a one-month extension of the Medicare physician payment “fix,” premium assistance for unemployed workers with COBRA and state continuation coverage, unemployment insurance and several other legislative provisions that expired on February 28. Before voting on passage of the bill, the Senate first voted on an amendment by Senator Jim Bunning (R-KY) that would have offset the $10 billion cost of the “extenders” package. This amendment was defeated and therefore no further legislative action was needed. The bill was later signed by the President.

Overview: The “Health Insurance Industry Fair Competition Act” – H.R. 4626
In a letter dated March 3, 22 Democratic Senators wrote to Majority Leader Harry Reid (D-NV) urging him to bring H.R. 4626, the “Health Insurance Industry Fair Competition Act, to the Senate floor at its earliest opportunity. In the letter they state that “[this legislation] is an important step toward bringing competition to the health insurance market, and would ensure that anticompetitive abuses such as price fixing and monopolization are policed in the health insurance industry.” America’s Health Insurance Plans (AHIP) CEO Karen Ignagni maintains the position on the legislation saying, “The rhetoric surrounding repeal [anti-trust exemptions] does not match the reality of the situation. Health insurance is one of the most regulated industries in America at both the federal and the state levels. The Act is extremely limited in scope and has nothing to do with competition within the health insurance industry. In fact, a wide range of insurer activities, including mergers and many types of business practices, are and always have been subject to federal antitrust laws and to enforcement by the Department of Justice.”

MARCH 5, 2010

This Week in Health Insurance Reform

This week, President Barack Obama continued to pressure lawmakers to pass a final health insurance reform bill, calling for its passage through reconciliation, a process which only requires the support of a simple majority. Republicans continued to oppose the President’s proposal , vowing to fight the expedited reconciliation process, while House Democratic leaders began intense internal discussions to rein in the needed votes.

Health Care Reform Negotiations

Health Care Summit Ends in Stalemate: Last Thursday , President Obama and congressional leaders spent nearly seven hours debating how to overhaul the U.S. health care system. Republicans argued against this new proposal, labeling it a government takeover and suggesting a more incremental approach. The philosophical differences between the parties were evident throughout the summit and remained unchanged at day’s end. As predicted, no new agreement was reached, and Democratic leaders left the meeting determined to press forward with or without bipartisan support.

Tensions Increase Between the President and Congressional Republicans: After last week’s health care reform summit, which displayed deep rifts between both Democrats and Republicans, the President sent a letter Tuesday to Congressional leaders. In the letter, the President offered to incorporate a handful of Republican ideas into his bill, including: the expansion of health savings accounts; increases to Medicaid reimbursements to doctors; the implementation of undercover investigations to combat fraud in the Medicare system, and increases in funding for grants to states to explore alternatives to resolve medical malpractice lawsuits.

Republicans rejected his proposal, calling his bill “unsalvageable,” and asked him to listen to the American people and start the process from scratch.

President Obama Calls for Passage through Reconciliation: On Wednesday, the President stepped up the pressure, urging lawmakers to finish work on health care reform legislation. He encouraged them to ignore the politics of the issue, saying, “I do not know how this plays politically, but I know it’s right.”

Additionally, the President expressed his support for using the reconciliation process to prevent a Republican filibuster. The process would involve legislators in the Senate working with House members to develop a reconciliation package. This package of “fixes” would only require a simple majority vote in the Senate, as opposed to the 60 votes usually required to pass legislation. Democrats can no longer rely on the normally required 60 votes to pass the bill , due to the election last fall of Republican Senator Scott Brown.

Republicans continued to express strong opposition for the reconciliation tactic, saying that it was never intended for such important legislation; it raises the specter of unlimited amendments and challenges to the bill’s provisions.

Democrats Work to Shore Up Votes: Democrats continued to work behind closed doors to garner enough votes to pass the Senate bill before the congressional Easter recess, which begins March 29, a deadline set by the President. A number of issues continue to present challenges for Democratic leaders, including Medicaid funding, immigration and abortion funding.

Abortion Issue Looms over Health Care Reform Bill: As final legislation begins to take shape, the debate around the use of federal funds for abortions continues to draw rancor from both sides of the issue.Currently, the new legislative package contains less restrictive language on federal funding of abortion, which diverges from the language included in the version passed by the House last fall. Rep. Bart Stupak (D-MI), a leader among anti-abortion Democrats, has intimated that this new language could cost House Speaker Nancy Pelosi (D-CA) the 10 to12 votes that she needs to pass the bill. On the other side, supporters of abortion rights fear the inclusion of more restrictive language.

Additional Activities

Jobs Bill Extends COBRA Coverage and Medicare Payments: This week, both the House and Senate passed bills giving unemployed Americans another month of health care coverage through COBRA and protecting physicians from a looming 21 percent cut in Medicare fees. This measure will now go to President Obama, as debate begins on a much broader bill that would extend the safety net programs through the end of the year.

House Energy and Commerce Committee Expands Investigation into Rate Increases: After recently examining the rate increases proposed by Anthem Blue Cross in California, House legislators signaled their intention to expand the investigation by summoning the chief executives of the nation’s four largest for-profit health insurance companies to testify before the committee on the topic of preexisting conditions. The top executives at WellPoint, UnitedHealth Group, Humana and Aetna have been invited to appear before the Subcommittee on Oversight and Investigations on March 23.

White House Meeting with Insurers: On Thursday, five health plan CEOs and representatives of the National Association of Insurance Commissioners met with Health and Human Services Secretary Kathleen Sebelius at the White House to discuss insurance premium increases and rising health care costs. The President also stopped by the meeting.

Public Opinion

Americans Support Incremental Steps to Reform: In a newly released Rasmussen Reports survey , 52 percent of American voters continue to oppose the health care plan proposed by President Obama and congressional Democrats. Further, 63 percent of those polled believe that passing smaller, more targeted bills is a better strategy for achieving health care reform. In addition, just over half think that health care costs will rise if the current plan passes into law. Only 17 percent are convinced that the plan will decrease health care costs.

Editorials Point to Failed Massachusetts Health Care Experiment: Also this week, both the Wall Street Journal and Boston Herald featured opinion pieces pointing to the high costs of health care in Massachusetts, which passed its own version of universal care in 2006. Talk radio host Michael Graham in the Boston Herald pointed out that the Massachusetts plan is already $47 million over budget this year, saying, “It’s killing us on costs: Average Massachusetts premiums are the highest in the nation and rising. We also spend 27 percent more on health care services, per capita, than the national average.”

Looking Ahead

The next major step will be for Senators to send the reconciliation bill to the Congressional Budget Office (CBO) for a cost estimate, which could take days or even weeks to finalize. As Democratic leaders continue to lock down a strategy on the process, timing and substance of the bill, President Obama plans to travel to Philadelphia and St. Louis next week to discuss the importance of the bill’s passage. www.easytoinsureme.com