House Speaker Nancy Pelosi unveils Health Care Bill

story by Politico.com
written by Patrick O'Conner & Chris Frates

House Speaker Nancy Pelosi unveiled a $894 billion health care bill Thursday that would extend coverage to 36 million Americans through a mix of subsidies, tax incentives and penalties on individuals and small businesses, but the final package falls short of the more liberal vision of a public health insurance option.

Party leaders would like to start debate on the bill next week and hope to have a final vote before Veteran's Day on Nov. 11.

The long-awaited introduction of a combined House health care bill that totals 1,990 pages produced few major surprises. After weeks of public hand-wringing, leaders – and party liberals – bowed to political reality by allowing doctors and hospitals to negotiate their rates with the government under the public plans.

Unveiling the bill at the Capitol, Pelosi said the bill would meet the goals of “affordability of the middle class, security for our seniors, responsibility to our children. It reduces the deficit, meets President Obama’s call to keep the costs under $900 billion over 10 years and it insures 36 million more Americans.”

“The bill is fiscally sound, will not add one dime to the deficit as it expands coverage, implements key insurance reforms and promotes prevention and wellness across the health system,” Pelosi said.

The bill would cut the deficit by about $30 billion over the next 10 years.

Pelosi, however, backed down from a deal granting liberals a vote to establish single-payer government-run health care. She cut the deal with New York Rep. Anthony Weiner to break a last-minute logjam on the Energy and Commerce Committee. But, in the end, party leaders were concerned the final cost would be astronomical and the vote would fail to garner votes from even half the caucus.

The legislation would require health insurers to offer broader coverage and end practices that discriminate against higher-risk individuals. It would also establish a national insurance exchange with subsidies to lower- and middle-income households to make coverage more affordable.

The Congressional Budget Office offered Pelosi and her team some good news and some bad news. The good news is that the bill shouldn’t add to the deficit over the first decade after its enactment. The bad is that the legislation is projected to create deficits over the second five years, a fact that should give budget hawks plenty to worry about.

Pelosi’s decision to strip a $245 billion package of doctors’ payments also threatens to anger party moderates. The so-called “doc fix,” which would fill a long-standing shortfall under Medicare reimbursement rates, would put the overall cost of the bill well over $1 trillion and create more than $200 billion in red ink for the federal government over the next 10 years – two big “no-nos” from President Barack Obama’s perspective.

The bill should cause plenty of headaches for the industries impacted.

The legislation imposes as much as $150 billion in Medicare cuts on the prescription-drug industry – almost double the $80 billion cuts in the Senate bill. It imposes a 2.5 percent tax on medical device manufacturers, a quietly influential force on Capitol Hill. And health insurers, who have already agreed to end many of the practices banned by the bill, would have to compete with a government-run insurance vehicle that would put pressure on them to lower premiums.

“The promise of health care reform has been that if you like your current coverage, you can keep it," said Karen Ignagni, the president and CEO of America's Health Insurance Plans. "We are concerned that this proposal will break this promise by increasing health care costs for families and employers across the country and significantly disrupting the quality coverage on which millions of Americans rely today."

The American Medical Association withheld judgment on the bill in a statement Thursday and reminded Congress of its commitment to enacting a permanent “doc fix.”

In addition, businesses with a combined annual payroll exceeding $500,000 will be forced to pay penalties for its uninsured workers.

As expected, the House bill generates most of its income by imposing a graduated surtax on married couples who make more than $1 million and individuals whose adjusted gross income exceeds $500,000. The initial income thresholds were $350,000 for couples and $280,000 for individuals.

Democrats leaving a meeting with their leaders Thursday morning sounded bullish about the prospects for the vote.

"I think it's probably going to be our best-faith effort at health reform in the House," said first-year Virginia Rep. Gerry Connolly. "I'm looking forward to being supportive."

North Dakota Rep. Earl Pomeroy, one of three Democrats on the Ways and Means Committee to vote against the bill, told colleagues Thursday that he plans to support this bill.

"This is a very big step," Pomeroy said of the current bill. "The action the speaker has taken, it will pass the House."

The two biggest hurdles that remain involve abortion and immigration. Party leaders plan to offer an amendment to the final bill that will address members concerns on both issues, people familiar said Thursday. But the details remain unclear.

A number of abortion opponents believe the current bill creates a backdoor for the federal government to fund the procedure through subsidies created by the exchange system. Others argue that's not the case; they make the case that an amendment by California Rep. Lois Capps preserves current laws, which prohibit the federal government from funding abortions and require insurance companies to use private premiums to fund the procedure.

"Many of us who are concerned about the issue feel that the protections are there." said Pennsylvania Rep. Mike Doyle, a staunch abortion foe who voted for the bill on the Energy and Commerce Committee.

Michigan Rep. Bart Stupak has been carrying to mantle for anti-abortion Democrats, but there has been an effort to go around him on this issue in order to pick up votes without heeding his request to codify a current ban that has to be updated each year through the Appropriations process.

On immigration, a bloc of mostly moderate Democrats is pushing party leaders to impose a verification system similar to the one includled in the Senate bill, but Hispanic members, in particular, are fighting to block that change.

Now that they have a final bill, House Democrats are now calling on Obama to put his thumb on the scale.

"I guess the time has come for the President of the United States to get in here a little bit,” Weiner said after emerging from a closed-door caucus meeting Thursday. “I understand the idea of letting the legislature work its will, but unless we have the president in there putting his finger on the scale and his hands on the shoulders of some of my colleagues we are not gonna be successful with our red-zone offense."

Yvette Clarke, one of the strongest voices for the robust public option behind closed doors, says progressives will vote for the bill.

"We're going to have to," she said. "We've done what we can do."

Jonathan Allen and Jake Sherman contributed to this story.