New Health Care Bill Lowers Cost, Has Public Option

(AP Photo/Charles Dharapak, File)

A key Senate committee on Thursday unveiled significant new elements of health care reform legislation, including a plan for government-sponsored insurance and an employer mandate. The revised legislation is substantially cheaper than previous versions of the bill, according to the non-partisan Congressional Budget Office (CBO), with the changes bringing down the cost from previous estimates of $1 trillion to $611.4 billion over 10 years.

"We are on the cusp, on the brink of doing something here that is critical," said Sen. Chris Dodd (D-Conn.), who is leading health care reform efforts in the Senate Health, Education, Labor and Pensions Committee.

The HELP Committee will have to combine its legislation with legislation from the Senate Finance Committee, which is responsible for Medicaid provisions. The inclusion of Medicaid reforms could add to the total cost of reform significantly, but it would also help bring down the number of people in the United States left uninsured.

Analysis of the HELP bill (called the Affordable Choices Act) shows that it could bring down the number of uninsured to 34 million by 2019. If the Finance Committee expands Medicaid to anyone at 150 percent of the poverty line, as it is expected to do, it would cover an additional 20 million people. The combined result would bring coverage to 97 percent of Americans.

Dodd said he hopes to wrap up work on the HELP bill by the end of next week and combine it with the Finance bill by the end of July.

The committee was able to bring down the cost of its bill by nearly half a trillion largely by including an employer mandate, or pay or play, provision.

"This is a strong number that will allow us to achieve the president's goals," Dodd said. "We believe these numbers are going to be very encouraging to people concerned about cost."

Under the pay or play provision, employers that do not offer their workers "adequate" coverage, covering at least 60 percent of monthly premiums, will be charged an annual fee -- $750 for each uncovered full-time employee, and $375 for each part-time employee. Firms with fewer than 25 employees will be exempt from the mandate.

"It's a cost, but a modest cost," Dodd said.

The CBO estimates that the employer mandate would virtually eliminate the migration of employees from their employer-based insurance to public insurance, thereby reducing the financial burden on the government. In its initial analysis, which was conducted before the employer mandate was included, it said about 15 million people would have left the employer-sponsored system.

The new version of the HELP bill also includes a federally-run, government-sponsored insurance option that all 13 Democrats on the committee have endorsed. Dodd and other HELP committee members told reporters Thursday that the public option is meant to complement rather than supplant the nation's largely employer-based system. However, said Sen. Sheldon Whitehouse (D-R.I.), it will "also help move us forward to a better and different business model for health insurance."

"Too much of that model involves trying to avoid people... trying to toss them over the side if they are insured and become sick," he said.

The public option would be fully operated and administered by the Department of Health and Human Services and made available in every state. The HHS would negotiate premium and reimbursement rates, taking into account regional differences. The payment rates paid by the public option would be no more than the local average private rates, but they could be less.

The plan would require each state to have an advisory board to develop strategies for quality improvement and affordability.

President Obama in a statement thanked Dodd and other members of the HELP committee for producing "legislation that lowers costs, protects choice of doctors and plans and assures quality and affordable health care for Americans."

Dodd said he would like to "build the bipartisan support we'd all like to have, but we have to begin with a plan that is accessible will reduce costs."

The newly-revised bill also includes 87 Republican amendments that were introduced over weeks of negotiations.

[patti77777]

I would like someone to break the cost down into something that I can relate to. What will the cost be per year, per taxpaying household? Will it be a percentage of my income added to my existing tax bill? How can anyone know how they really feel if they don't know how it will impacet them personally? HEALTHCARE FOR ALL IS A GREAT IDEA! If it costs me $200.00 per month to make sure that our emergency rooms are no longer filled with uninsured poor people, then it is worth it. If someone whose income is ten times more than mine, has to pay $2,000.00 a month, that is a drop in the bucket to them.

Please, let's not let fear mongering keep us from making a good decision. It is do-able and if I have to give up a few lattes and a new handbag, I am willing. The public option is the way to go!

[moonchildmama]

I'll break down the cost for you. For one go to WSJ.com to check out the translated fine print, which for example explains how some of the extra money WE will be spending for less coverage will go to communtiy education for crack heads and such. These programs are already in place in most if not all communties. Telling a crack head not to smoke crack because it is bad for their health seems like a huge waste of my hard earned cash. Also, if you don't pay your share you get fined, unless you are an illegal immigrant, you are excempt. I already don't have much of a paycheck after my insurance is pulled, and if this bill passes I guess I'll end up in jail and my son will have go live with his nana. This bill will be the straw that breaks the camels back. Don't get me wrong I think everyone should have the OPTION to get affordable healthcare. My boyfriend doesn't have any because his Boss at BONEFISH in Chattanooga, TN messed up the paperwork. But this is not the way to do it. It should be more based on how much each person uses the coverage. I pay 2/3 of my income in insurance and I go to the doctor maybe once every 2 or 3 YEARS! and my son now once or twice a year. Please read the article "What the Pelosi Health-Care Bill Really Says" and maybe you'd rather spend that extra $ on a latte. Also, if this passes, my family business will go under and we will be unemployeed feeding off someone elses income.

[G_Turner]

Earlysaid failed MOST subjects, apparently, including Government, World History, and Econ!

The CAUSE of rising Healthcare costs is the FEDERAL GOVERNMENT meddling in the markets. If your business is providing health services to the elderly, then the Govt commandeers your market with something like Medicare and begins DICTATING the fees it will pay for certain services, what do you think the logical reaction is going to be? Just what we've seen: Reduced quality (at least in that segment of your market) and INCREASED costs everywhere ELSE.

I know its popular these days to villify the "evil insurance companies" (look what happened to the "evil Auto companies", for crying out loud). However, the logical outcome of this "Public Option" is the DECIMATION of the private insurance networks. G'head and support the Statists currently in power if you must, but recognize that EVERY country with Social Medicine experiences rationing and poor quality of care. Dont be surprised when your "private plan" choices are GONE...

[stevecb2]

earlysaid, did you fail basic math in school? Even the Democrats admit healthcare costs are going up $100 billion a year. Where do you think that money is coming from? Get a clue.

[stevecb2]

Healthcare reform is supposed to address two problems: the rapidly rising cost of healthcare, and the uninsured. All these bills seem aimed at reducing the number of uninsured. In the process they are making healthcare even more expensive, by about $100 billion a year. That means health insurance for the average family of four is going to go up about $1400 a year - not counting the usual outrageous cost increases. How does this help the 260 million insured Americans?

[earlysaid]

That is a bunch of republican misinformation if I ever heard it. The rising price of health care is one of the main reasons for health care reform. The health care industry in America is profit driven and becoming more and more expensive. That is why President Obama is working to bring about health care reform. If you are happy with your health insurance you will be able to keep it. The only reason someone would pay more would be because their insurance company raised their premiums. That is the reason for so much distress and heartache for people who are sick, have health insurance and still are left with large amounts that they must pay. Keeping prices down and reasonable is the goal of this reform.