mcjoan: "Baucus Debacle Moves On"

mcjoan (Kos):

The bill coming out of Senate Finance is far from perfect, but they finished up last night with some key improvements adopted that mean some of the worst elements have been softened, and some of the worst Republican amendments were fought off. There's still some ugly there, though, for Harkin, Reid, and Baucus to deal with as the bills are merged, and when it eventually comes to the floor.

Probably the most significant improvement on affordability came last night when Schumer and Snowe successfully lowered the "Max Tax". The bill still has an individual mandate, but the penalties have been reduced.

Coming into the day’s debate, the bill would have penalized families as much as $1,900 for going uninsured — a provision that drew sharp criticism from Sen. Olympia Snowe, the Maine Republican being courted by Democrats as a possible supporter of the final bill.

“I just don’t understand,” Snowe said, “why there’s this impetus to punish people.”

Snowe struck a deal with Sen. Charles Schumer (D-N.Y.) to delay all penalties for one year, then phase them in over a five-year span — two years longer than Schumer’s original proposal. Heeding a criticism of Sen. John Ensign (R-Nev.), the Schumer/Snowe compromise also eliminated the possibility that folks might be slapped with criminal charges for failing to get coverage.

The proposal would also waive the individual mandate in cases when the cheapest available plan costs more than 8 percent of an individual’s income — a softening of the original Baucus bill, which set the threshold at 10 percent. Those exempt from the individual mandate would qualify for catastrophic coverage known as “young invincibles” plans.

The Schumer/Snowe amendment passed 22 to 1, with only Sen. Jon Kyl (R-Ariz.) voting against the measure.

That's an improvement, but having mandates for anyone without a public option is still unacceptable. And the bill still doesn't have a public option. In another affordability related amendment, they raised the thresholds at which high-cost insurance plans would be subject to an excise tax, a penalty that could have primarily hit employers with workers in high-risk jobs, like Sen. Rockefeller's coal miners. The very valid fear was that the employers would pass the costs on to employees.

Wyden's Free Choice Act, which would be the beginning of chipping away at the employer-based syste had a very frosty reception on the panel last night. The Act would allow both employers and employees greater participation in the exchange, opening it up essentially to everyone. Coupled with a public option, the FCA could significantly enhance both choice and competition. The proposal was too radical for the committee, and Baucus ruled it out of order.

Two of the more egregious Republican efforts were also defeated. On Wednesday, they defeated in a 10-13 vote a Hatch amendment that would "bar any insurer receiving federal funds from covering abortion, unless women used their own money to buy auxiliary policies covering the procedure." The effort could have ended private insurance coverage of abortion--any insurance provider that had subsidized participants would have to create those "auxiliary" policies to sell to women, and would have to have onerous accounting practices to prove that there was a firewall between their programs. Conrad voted with the Republicans on this one, Snowe with the Democrats.

In their ongoing hate fest against brown people, Republicans last night pushed Kyl's effort to force legal immigrants to endure a five year waiting perioed before they could participate in the exchange program--i.e., make them ineligible for subsidies--for five years. That one failed 13-10 on a strict party line vote.

Here's one of the uglier ones they passed, and in basic secrecy, that would give states increasing flexibility to drop Medicaid patients, starting next year.

The original bill would have prohibited such dropped coverage, instead requiring states to maintain current levels of Medicaid eligibility until state insurance exchanges are up and running, which is expected to occur by the start of 2013. But several lawmakers argued that some states simply can’t afford to keep eligibility levels steady that long because (1) tax revenues are down amid the recession, (2) Medicaid enrollment is up, also because of the recession and (3) billions of dollars in extra federal funding provided by the economic stimulus bill will run dry at the start of 2011 — leaving a two year gap when enrollment would remain high but federal help would decrease. The result, these lawmakers said, would be a bursting of already squeezed state budgets.

The Grassley/Snowe amendment, passed without public discussion and on a voice vote, allows states to start dropping non-pregnant, non-disabled adult earning above a 133% of poverty threshold. So if this amendment is preserved, from 2010 until 2013 when the exchange starts, we're likely to see more uninsured Americans in some of the most economically challenged states.

As David notes, they are scheduled to meet today, but as they were up into the very wee hours this morning, they'll likely not. They will meet sometime next week to vote on reporting the bill out.

After that, assuming that Rockefeller, Cantwell, and Wyden feel their primary objections have been met and vote for it, it's on to the merging process, where hopefully Senator Harkin will be able to prevail on a strong public option.