Healthcare Pressure Points

Healthcare Pressure Points

How do the House and Senate bills compare on affordability and enforceability?


At this writing, the Senate is finally poised to pass a healthcare bill that has frequently teetered on the brink of death. But the issues that have proved so difficult are the same ones that remain stumbling blocks to merging its version with the one passed by the House. The House includes a public option; the Senate does not. The Senate’s language on abortion coverage is less restrictive than that passed by the House.

Given that Democratic leaders in both chambers were forced to bow to party conservatives to win initial passage of legislation, progressives are almost certain to be disappointed with how these questions are resolved. But there are other important issues that divide the two bills that have not made headlines, and they will help determine how much good the positive parts can do.

1. Affordability. The House generally does a much better job of helping low- and moderate-income Americans afford coverage. For the very poor, it opens the Medicaid program to individuals who earn less than $16,245 per year, whereas the Senate makes the program available only to those earning less than $14,404. The Senate offers more subsidies than the House to help the middle class buy coverage. But the Senate’s subsidized insurance offers weaker coverage than that mandated by the House and leaves these Americans far more exposed to out-of-pocket costs.

2. Enforceability. The Senate would have insurers sell policies in state-based exchanges, relying on state officials to police the market. The House, on the other hand, sets up a national exchange, and many believe the federal government can do a much better job of protecting consumers than state regulators. There are also questions about whether the Senate’s legislative language protects consumers’ right to go to court if insurance companies violate the new regulations.

What’s more, there’s a minor provision in the Senate bill that could undermine one of health reform’s most important regulations. On paper the Senate bans underwriting–the practice of charging higher premiums to those with pre-existing conditions. The Senate, however, allows for the creation of “wellness incentives,” which are theoretically designed to encourage people to do things like quit smoking or exercise by reducing premiums for those who engage in healthy behaviors. But the Senate includes virtually no limits on the “wellness” indicators an insurance company can measure and allows for huge variations in premiums. This could mean people who have been pregnant, have high blood pressure or are HIV-positive could be hit with thousands of dollars in extra premiums. (Harry Reid did add one restriction at the last minute, however: gun owners can rest assured they will not pay more because their property explodes.)

3. Financing. The House bill is funded primarily through a progressive income tax on families earning more than $1million; it also requires employers to either cover employees or pay into the system. The Senate, on the other hand, imposes a poorly designed tax on “high cost” plans and an awkward alternative to an employer mandate, both of which could wind up hurting many of the Americans who most need help from this legislation.

Even the Senate bill would reduce the ranks of the uninsured by 31 million by 2019. If the House prevails on these key issues, an additional 5 million could be insured. Though progressives have swallowed many bitter pills, and covering everyone remains politically out of reach, it’s still worth fighting to cover every last person possible.

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