The Senate Finance Committee late last night finished amending the chairman's mark. The amended bill will be sent to the CBO for analysis. It is assumed that by Tuesday the CBO will have a preliminary score of the bill. If bill scores as not adding to the deficit, the committee should vote on the piece of legislation.
The bill is expected to pass despite the fact that several Democratic members of the committee are unhappy with the shape of the legislation. Committee members have been lobbied by administration officials to keep the process moving forward.
The big question is whether Republican Sen. Olympia Snowe will vote for the bill. Snowe appears to be the only Republican senator who might possibly vote for health care reform. She could vote against the bill in committee, but eventually vote for the bill after it is amended on the floor. If she voted for the bill in committee it might give her greater sway in deciding on how the two Senate bills (FinCom and HELP) are merged. HELP Committee Chairman Tom Harkin does not see room at the table for Republicans when the bills are merged.
Once out of committee, the bill must be merged with the Senate HELP Committee bill. The HELP bill contains a public option, tougher regulations, and more generous subsidies. Majority Leader Harry Reid will be responsible for merging the two bills. It is up to Reid as to whether or not the bill that is brought to the floor contains a public option.
Showing posts with label HELP committee. Show all posts
Showing posts with label HELP committee. Show all posts
Harkin's Good News For Progressives
Senator Harkin decision to take the chairmanship of the Senate HELP committee should be some positive news for progressives. He is a strong support of the public option and made it clear today that he is willing to play hard ball on the issue. Being the chairman of the Senate HELP committee should insure that senator Harkin is one of the senators who goes to the conference committee. Since senator Dodd was responsible for shepherded the health care bill through the HELP committee he should likely also be part of the conference committee even though he turned down the HELP committee chair.
NFR Throws Tantrum Over Small Employer Mandate
Tracy Mullin, the president of National Federation of Retailers, sent an over the top letter to its members asking them to fight against a very small employer mandate penalty.
The employer mandate that is part of the Senate HELP Committee's bill is very modest. If a firm with more than 25 workers does not provide health insurance benefits, it will be required to pay a penalty of $750 a year for full time employees and $375 for part time employees.
In the absolute worst case scenario (an employee working for federal minimum wage and exact minimum number of hours a year to be declare full time), the penalty would add only 5% to the cost of hiring an employee. For the vast majority of employees of large retail firms, it would only increase the cost of employing them by 2-3%. And that is only for firms who do not and do not plan to offer their employees some form of health insurance.
She attacks Wal-Mart for agreeing that an employer mandate might need to be part of health care reform. In the letter she makes ridiculous claims that the minor employer mandate “could quickly push our economic recovery back decades” and “could have long-lasting, devastating consequences to retailers throughout the country.”
Really, Ms. Mullin? That small percent-increase in cost will devastate retailers? I find that claim very hard to take seriously. For example, when the federal minimum wage is raised from $6.55 to $7.25, it will increase the cost of a full time employee by nearly twice the proposed penalty.
It is understandable that many retailers, who don't help their employees get health insurance, don't want to pay a small penalty. But it would be neither “catastrophic” or “devastating.” It is the over the top, sky is falling rhetoric that endangers health care reform. If you are serious about working “diligently on real solutions that would help fix our health care system,” you state your concerns, but tone down your childish temper tantrums.
The employer mandate that is part of the Senate HELP Committee's bill is very modest. If a firm with more than 25 workers does not provide health insurance benefits, it will be required to pay a penalty of $750 a year for full time employees and $375 for part time employees.
In the absolute worst case scenario (an employee working for federal minimum wage and exact minimum number of hours a year to be declare full time), the penalty would add only 5% to the cost of hiring an employee. For the vast majority of employees of large retail firms, it would only increase the cost of employing them by 2-3%. And that is only for firms who do not and do not plan to offer their employees some form of health insurance.
She attacks Wal-Mart for agreeing that an employer mandate might need to be part of health care reform. In the letter she makes ridiculous claims that the minor employer mandate “could quickly push our economic recovery back decades” and “could have long-lasting, devastating consequences to retailers throughout the country.”
Really, Ms. Mullin? That small percent-increase in cost will devastate retailers? I find that claim very hard to take seriously. For example, when the federal minimum wage is raised from $6.55 to $7.25, it will increase the cost of a full time employee by nearly twice the proposed penalty.
It is understandable that many retailers, who don't help their employees get health insurance, don't want to pay a small penalty. But it would be neither “catastrophic” or “devastating.” It is the over the top, sky is falling rhetoric that endangers health care reform. If you are serious about working “diligently on real solutions that would help fix our health care system,” you state your concerns, but tone down your childish temper tantrums.
How The Employer Mandate and Benefit Tax May Save The Public Option
While the public option is the part of health care reform which has received the most press, there are several other important, contentious issues which are making a bipartisan health care reform bill agreement elusive. Two difficult issues are the employer mandate and a new tax on employer-offered health care benefits.
Republicans are strongly against even the minor employer mandate in the HELP Committee bill. The problem is the employer mandate is currently the most cost effective way to expand coverage in the bill. It was almost solely responsible for reducing the CBO scoring of the HELP committee bill's cost per uninsured individual covered by roughly 50%. It also stops the politically damaging determination that millions of Americans will “lose” their employer coverage (even though they would still be getting coverage from the health care exchange). Without the employer mandate, they will need to dramatically slash subsidies offered to help people afford insurance to get a bill under $1 trillion.
The possible “compromise” Republicans might accept is a “free rider” provision that employers must pay for workers on Medicaid or getting insurance subsidies. This is strongly opposed by Wal-Mart (which for good reason supports the employer mandate instead) and presumably therefore unpopular with the two Democratic senators from Arkansas. Given how the “free rider” provision would disproportionately hurt low wage employers, it would be an incredibly tough pill for both liberal and conservative Democratic senators to swallow.
A new tax on employee health insurance benefits in any form is amazingly unpopular with the American people. It is a proposal that makes Democrats on the entire political spectrum very nervous. Not surprisingly Harry Reid was recently forced to tell Senator Baucus to drop the proposal. The Senate Finance Committee has started fresh the search for a possible funding source.
Yet, Republican Senator Grassley continue to push for this very unpopular tax on health insurance benefits. Grassley demands that all money for reform comes from the health care system. If Republicans are unwilling to agree to a new tax besides the one on health benefits, it will make a bipartisan bill unobtainable.
The more likely health care will be passed with a purely partisan vote, the more likely that it will include a real public option. If it were the sole point of contention standing in the way of bipartisanship, the pressure from centrist Democrats would probably be enough to kill it. At issue though are the other demands made by Republican senators which are unacceptable some liberal, moderate, and conservative Democrats. The public option may not be the issue which kills bipartisanship, but it should strongly benefit from its death.
Republicans are strongly against even the minor employer mandate in the HELP Committee bill. The problem is the employer mandate is currently the most cost effective way to expand coverage in the bill. It was almost solely responsible for reducing the CBO scoring of the HELP committee bill's cost per uninsured individual covered by roughly 50%. It also stops the politically damaging determination that millions of Americans will “lose” their employer coverage (even though they would still be getting coverage from the health care exchange). Without the employer mandate, they will need to dramatically slash subsidies offered to help people afford insurance to get a bill under $1 trillion.
The possible “compromise” Republicans might accept is a “free rider” provision that employers must pay for workers on Medicaid or getting insurance subsidies. This is strongly opposed by Wal-Mart (which for good reason supports the employer mandate instead) and presumably therefore unpopular with the two Democratic senators from Arkansas. Given how the “free rider” provision would disproportionately hurt low wage employers, it would be an incredibly tough pill for both liberal and conservative Democratic senators to swallow.
A new tax on employee health insurance benefits in any form is amazingly unpopular with the American people. It is a proposal that makes Democrats on the entire political spectrum very nervous. Not surprisingly Harry Reid was recently forced to tell Senator Baucus to drop the proposal. The Senate Finance Committee has started fresh the search for a possible funding source.
Yet, Republican Senator Grassley continue to push for this very unpopular tax on health insurance benefits. Grassley demands that all money for reform comes from the health care system. If Republicans are unwilling to agree to a new tax besides the one on health benefits, it will make a bipartisan bill unobtainable.
The more likely health care will be passed with a purely partisan vote, the more likely that it will include a real public option. If it were the sole point of contention standing in the way of bipartisanship, the pressure from centrist Democrats would probably be enough to kill it. At issue though are the other demands made by Republican senators which are unacceptable some liberal, moderate, and conservative Democrats. The public option may not be the issue which kills bipartisanship, but it should strongly benefit from its death.
Did CBO Determine the HELP Public Plan?
Today, draft language of the Senate HELP Committee's public plan was leaked to Politico. Overall, the HELP public plan is very similar to the “weak but workable” or “level playing field” public plan promoted by Senator Chuck Schumer. I suspect the “strong” Medicare-based public plan may have been dropped primarily for political and not economic reasons. But it is possible that the Congressional Budget Office (CBO) had a large role in deciding the structure of the HELP Committee's public option for two important reasons.
The first reason is optics. Back on May 27, the CBO released a briefing outlining how they would define possible changes to our health care system. They stated what proposals would and would not reflect on the federal budget.
And,
It is very possible the CBO would predict that a strong public plan would “dominate” the exchange and therefore decide to classify the entire exchange as part of the budget. While this would not effect the cost of the bill, it would dramatically change the optics. It could led to the CBO declaring health care reform a massive tens of trillions of dollars expansion of the federal budget.
The other possible reason is about cost reduction. If the CBO is unwilling/unable to quantify how the competition of the public plan would drive down the price of private insurance, a “strong” public plan would make reform legislation dramatically cheaper than a “weak” plan. If the CBO concludes that any national public option would do an equally good job of bringing down the cost of private insurance, the savings difference will be much less. (Federal subsidies will be based on the average of the three cheapest plans offered. Reducing the price of all plans could be more important to overall savings than just offering one cheaper plan.)
In the end, I think the CBO scoring will be the biggest single event in the whole reform debate. If the CBO says a specific public plan will reduce the cost of reform by hundreds of billions, I think it becomes politically unstoppable. If a public option is declared a massive expansion of government or found to do little to control cost, it will be in serious jeopardy. The CBO scoring could result in the debate over the public option shifting from an ideological battle to a fiscal one.
The first reason is optics. Back on May 27, the CBO released a briefing outlining how they would define possible changes to our health care system. They stated what proposals would and would not reflect on the federal budget.
In CBO’s view, the budgetary treatment of a public plan would depend critically on who bore the financial risk. If the federal government stood behind the plan financially, then its expenditures should be considered federal outlays, and the payments collected for premiums should be considered as either federal revenues or as offsets to outlays.
And,
Specifically, if a public plan dominated an exchange-based market, then that component of the health insurance system would, in practice, be largely governmental. In that case, all of the transactions of the exchange should properly be considered part of the budget.
It is very possible the CBO would predict that a strong public plan would “dominate” the exchange and therefore decide to classify the entire exchange as part of the budget. While this would not effect the cost of the bill, it would dramatically change the optics. It could led to the CBO declaring health care reform a massive tens of trillions of dollars expansion of the federal budget.
The other possible reason is about cost reduction. If the CBO is unwilling/unable to quantify how the competition of the public plan would drive down the price of private insurance, a “strong” public plan would make reform legislation dramatically cheaper than a “weak” plan. If the CBO concludes that any national public option would do an equally good job of bringing down the cost of private insurance, the savings difference will be much less. (Federal subsidies will be based on the average of the three cheapest plans offered. Reducing the price of all plans could be more important to overall savings than just offering one cheaper plan.)
In the end, I think the CBO scoring will be the biggest single event in the whole reform debate. If the CBO says a specific public plan will reduce the cost of reform by hundreds of billions, I think it becomes politically unstoppable. If a public option is declared a massive expansion of government or found to do little to control cost, it will be in serious jeopardy. The CBO scoring could result in the debate over the public option shifting from an ideological battle to a fiscal one.
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