Thursday, July 30, 2009

Henry Waxman wins breakthrough on health bill - Patrick O'Connor and Carrie Budoff Brown

A quartet of moderate Blue Dog Democrats on the Energy and Commerce Committee agreed to support the Democrats' sweeping health care bill as long as party leaders postpone a House vote until the fall and Chairman Henry Waxman (D-Calif.) cut its costs by $100 billion, exempt more small businesses from a requirement to provide health care to their employees and allow doctors, hospitals and other providers to negotiate their payments directly with the government under any public coverage plan.

News of this breakthrough follows some rare positive news for Senate Democrats from the nonpartisan Congressional Budget Office; legislation being cobbled together by a bipartisan group of six senators on the Finance Committee would cost less than $900 billion and cover 95 percent of Americans.

The new version of the bill would allow for states to set up health care co-ops, which the Senate Finance Committee has advanced as an alternative to the government-run insurance plan advanced in the House. The House bill still includes the public insurance option, but liberals are concerned that the co-ops create a backdoor for states and insurers to avoid using these public plans.

In the deal, Waxman would have to cut somewhere in the neighborhood of $50 to $65 billion in subsidies to help lower-income people purchase insurance through the newly-established exchanges and another $30 to $35 billion from Medicaid.

But allowing doctors and other health care providers to negotiate rates with the government under a public option would cost the government about $60 billion, according to a preliminary CBO estimate. And exempting small businesses with a combined salary of $250,000-a-year to $500,000-a-year would cost the government $30 billion, according to the same estimates.
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