Health Reformers Split On How To Proceed

(MoneyWatch)  With President Obama's State of The Union address looming, Democrats in Congress are scrambling to reach a consensus on how or whether they should proceed with healthcare reform. At this point, it seems unlikely that the detailed legislation, assembled with painstaking effort over the past year, will simply be abandoned. But there is a division of opinion over whether to prune the bill severely in hopes of gaining final passage or using a parliamentary maneuver to pass the whole shebang.

Under the latter approach, favored by a number of liberal opinion leaders, the House would approve the current Senate reform bill with the proviso that the Senate would revise some of its objectionable provisions in a separate vote. The idea is to include these changes in a budget reconciliation bill that the Senate could pass with a simple majority. In the wake of Republican Scott Brown's victory in the Massachusetts Senate race, the Democrats no longer have the super-majority they need to adopt a reconciled House-Senate measure.

But it is still unclear that the Democrats have the votes they need to pull off this maneuver in the House. For one thing, Brown's victory has put many Democratic Representatives in panic mode regarding their chances for re-election next November. Also, many Congressmen resent the special deal for Nebraska in the Senate bill, which allows that state to expand Medicaid without having to pay anything for it, while other states will be required to fund their share of the expansion. Sen. Ben Nelson of Nebraska, for whom this loophole was created to get his vote, has disavowed it, but it's still in the legislation. (Referring to Nebraska's "cornhusker" image, Calif. Gov. Arnold Schwarzenegger quipped, "He got the corn and we got the husk.") There are also questions about whether some differences between the House and Senate bills, such as the language on abortion restrictions, can be smoothed over in a budget reconciliation measure that has to be related to the federal budget.

So if this excellent idea doesn't work, what's the alternative? It's pretty grisly. The White House has floated the idea of a pared-down package that would include provider reimbursement cuts to extend the life of Medicare, closing the "donut hole" in Medicare drug coverage, giving tax breaks to small employers who provide insurance to their workers, and helping people with pre-existing conditions buy insurance and cap out-of-pocket medical costs. Talk about the elephant laboring mightily to bring forth a mouse!

The Republicans are also offering their usual ideas about letting people buy insurance across state borders, making insurance tax-deductible to individuals as well as companies, and reforming malpractice liability laws. The latter would be a worthy addition to reform, but buying insurance across state lines would only gut consumer protection laws, and most people who can afford individual insurance are self-employed and already can deduct the cost.

Meanwhile, a new poll shows that about a third of the public is nervous about reform and believes that it will adversely affect their own access to care. On the other hand, a different survey shows that few Americans understand the basic features of the pending reform legislation. Not surprisingly, people fear what they don't know, and opponents of reform have been very happy to exploit their ignorance. Perhaps the President can explain what it's all about in his address to the nation on Wednesday night. If he can't, significant reform may be doomed.