CHN: House Overcomes Some Hurdles on Health Reform Before the August Recess

All three House Committees completed work on their parts of health reform legislation (H.R. 3200) before leaving town for the August recess. It was uncertain whether the House Energy and Commerce Committee would be able to finalize work on the bill before the month-long summer break. Nonetheless, after balancing demands from different sectors of his party, Chairman Henry Waxman (D-CA) was able to secure the votes needed to pass the bill out of committee. On July 31, the Energy and Commerce Committee approved H.R. 3200 on a vote of 31-28. Five Democrats, along with all 23 Republicans on the Committee, voted against the bill. Three of the five Democrats who voted against the bill are members of the Blue Dog Coalition, a fiscally conservative group of Democrats who were in large part the reason for the delays in the Energy and Commerce Committee mark-up.
The Seven Committee Blue Dogs, whose votes were critical to passage in the Committee, threatened to vote against the bill because of its overall cost and concerns over the new public plan. In order to win some of their support Chairman Waxman accepted a set of changes to the bill, including:

  • Reducing the federal contribution for the Medicaid expansion from 100 percent in years 2013 and 2014 to 90 percent in 2015 and beyond;
  • Lowering the subsidy amount that moderate-income families (with incomes below 400 percent of the federal poverty line, for example, $73,240 for a three-person family) would receive to help offset the cost of coverage;
  • Requiring that the Health and Human Services (HHS) Secretary negotiate payment rates in the public plan instead of paying lower Medicare rates as was originally proposed; and
  • Exempting a greater number of small businesses from the ‘pay or play’ penalty – only employers with payrolls over $500,000 would be required to provide insurance or pay a surcharge. Originally the exemption was for small businesses with payrolls under $250,000.

However, the Blue Dog compromise had the negative effect of upsetting members of the House Progressive Caucus. Sixty Progressives signed a letter to Speaker Nancy Pelosi (D-CA) threatening to remove their support from the bill. They objected to reducing the lower-income subsidies and to weakening the position of the new public plan by requiring it to negotiate payment rates. In response to their objections improvements to the bill were won. The Committee agreed to restore reductions to the subsidies lower-income people would receive if cost containment measures in Medicare and Medicaid approved by the Committee yielded savings.

A handful of amendments that would improve coverage for children were also adopted in Committee. Representatives Jerry McNerney (D-CA) and Patrick Murphy (D-PA) offered an amendment, which was accepted, that would eliminate waiting periods under CHIP for any child under the age of two whose parents lose employer-sponsored coverage. Representative Diana DeGette’s (D-CO) amendment was adopted, ensuring that no children would be moved from CHIP to the new insurance exchange until the HHS Secretary certified that the exchange coverage is comparable to the average CHIP plan. The Committee also agreed to an amendment by Representative Tammy Baldwin (D-WI) that would provide Medicaid coverage for foster children needing therapeutic care and another by Representative Patrick Murphy (D-CA) to allow the immediate renewal of Medicaid benefits for youth exiting juvenile justice facilities rather than having them reapply.

Although Congress is on break, work on H.R. 3200 will continue throughout August. The House Rules Committee now has the job of putting all amended bills produced by the three Committees – Energy and Commerce, Education and Labor, and Ways and Means – together into one bill.  The hope is to have a joint bill on the floor early in September.

On the Senate side the Finance Committee, which has been working to develop a bipartisan proposal, has not agreed upon a timeline for completing its work. The other Senate committee with jurisdiction over health reform, the Health, Education, Labor and Pensions (HELP) Committee, completed work on its bill in mid-July.  Key negotiations on the Senate Finance Committee bill are proceeding with a bipartisan group of six senators (Baucus (D-MT), Bingaman (D-NM), Conrad (D-ND), Enzi (R-WY), Grassley (R-IA), and Snowe (R-ME).  Because they have so far been unable to agree on adequate revenues and/or savings, it is reported that they are contemplating doing less than the House bills to make coverage accessible and affordable,  reducing the subsidies for moderate-income people and perhaps providing less federal help through Medicaid and CHIP.

For a comprehensive and easy-to-understand comparison of H.R. 3200 and the HELP bill, see the Georgetown Center for Children and Families’ side-by-side table summarizing some of the key provisions affecting children and families:

Budget Report 2012 - Self-Inflicted Wounds