Senate gets 60 votes to allow debate on health bill

On Saturday night, November 21, the U.S. Senate Democrats got a filibuster proof 60 votes that will allow them to bring their version of health care reform to the Senate floor for debate. The vote is historic, but it in no way ensures ultimate passage of the bill. And even if the bill passes the Senate, it is different enough from the health care reform bill that passed the House to require a concerted reconciliation effort that would pass muster in both chambers.

But in broad outlines, the House and Senate bills are similar. Both would expand coverage to the uninsured through a system of mandates on individuals to buy insurance coupled with subsidies to households with incomes below 400 percent of the poverty line, $88,200 for family of four. The bills would create insurance exchanges where individuals can shop for coverage.

The House bill requires employers with payrolls of more than $500,000 to pay 65 percent of health care premiums for employees or pay a penalty. The Senate bill fines employers with more than 50 employees if one or more of its employees gets subsidized health insurance through the newly created insurance exchanges.

Both bills expand Medicaid to cover more low income earners, the House bill being a bit more generous than the Senate bill.

Each bill creates a government run insurance option, but the Senate version allows states to decide if it were to be available in their state.

Each bill also treads carefully on the abortion issue, with the Senate version barring the use of federal funds for abortion, but it does require at least one plan in the insurance exchange to offer abortion coverage and at least one that doesn’t. The House version bans abortion coverage in the public plan and in the plans offered in the insurance exchange.

Neither of these bills have strong cost cutting provisions, and while each have been judged by the Congressional Budget Office to budget neutral, that neutrality depends in large measure on controlling Medicare and Medicaid costs by squeezing payments to doctors and hospitals to extract billions of dollars in savings, something that many experts regard as dubious at best.

On the revenue side, the Senate bill imposes a tax on high cost health care policies and a five percent tax on elective cosmetic surgery. The House bill would impose surtaxes on high income earners, those earning more than $500,000.

Both bills require health insurers to end denying coverage for preexisting conditions and dropping coverage for those who get sick.

If a final bill gets passed, the United States will be at least half way towards decent health care reform, the half that gets us to near universal coverage. The more difficult half of reform, cost containment, will have to come later.