Health-Care Bill Inches Forward     Permalink

Yesterday the House came a bit closer to passing a health-care reform bill when the Ways and Means Committee passed a bill to raise taxes on couples making more than $350,000 a year in order to pay for covering uninsured Americans. All but three Democrats voted for the bill while all the Republicans opposed it. A key obstacle to providing coverage for everyone is deciding who is going to pay for it. This bill provides a possible answer. The tax will fall on only the richest 1% of the population. So to summarize the state of play, at this point the House has a single health-care bill and a way to pay for it. The bill forbids insurance companies from discriminating against people with pre-existing medical conditions and provides a limited public option that will begin in 2013 (which gives the Congress elected in 2012 the opportunity to kill it). Speaker Nancy Pelosi said the full House will vote on the bill the week after next.

In a surprise move, the American Medical Association, which has opposed government involvement in the medical system for 70 years, sent a letter yesterday to Ways and Means chairman Charlie Rangel supporting the bill (HR 3200). These guys aren't stupid. They sense which way the wind is blowing and want to be on the winning side. The letter includes the sentence: "The AMA looks forward to further constructive dialog during the committee mark-up process." (English translation: we concede there is going to be a bill but we want to at least kill the most obnoxious parts of it.) The bill is over 1000 pages and there are many items the AMA might want to gut, such as requirng physicians who participate in Medicare to participate in the public option. It should also be remembered that while many Americans regard the AMA as an impartial organization representing America's doctors, the reality is that it is a highly political (and conservative) organization representing fewer than 20% of all practicing physicians. Still, with this letter, the Republicans have lost a key ally in their fight to kill the bill.

Over in the Senate things are murkier. The Heath, Education, Labor, and Pensions Committee, chaired by the ailing Sen. Ted Kennedy (D-MA), has written a bill under the de facto leadership of Sen. Chris Dodd (D-CT). However, a competing bill is still being thrashed out by Sen. Max Baucus (D-MT), chairman of the Senate Finance Committee. Baucus is much more conservative than Dodd and vastly more conservative than Rangel, who represents Harlem in the House. Baucus criticized President Obama yesterday for his reluctance to tax employer-sponsored health benefits, something Obama campaigned against but which Baucus favors because it would generate hundreds of billions of dollars a year and avoid Rangel's income tax increase on the richest 1% of the population. But Baucus is hesitant to write a bill containing something his own President has repeatedly opposed, so he is still trying to work with the ranking member, Sen. Chuck Grassley (R-IA) to find a compromise. Although Grassley is conservative, he is an old-school conservative and likes to see the Senate actually function and solve problems. Baucus and Grassley might yet be able to strike a deal. If the House bill levies a surtax on the top 1% of the population and the Senate bill taxes employer health benefits, then the conference committee will have to work something out, probably by splitting the difference.

The implications of all this maneuvering for 2010 and 2012 are enormous. If President Obama signs a health-reform bill into law this Fall, it will become the dominant issue in next year's elections. The Democrats will say: "You voted for change and we delivered. Now you don't have to worry about losing your health care if you get sick or lose your job." The Republicans will say: "The Democrats are back to their old tax-and-spend ways. We told you so." If the bill fails, the Democrats will plead for more members of Congress to pass it in 2011 and the Republicans will say we need more Republicans to make it even harder for them to pass it."

One of the points that will be central to the 2010 campaign debates is the issue of rationing health care. It is completely taboo in America but of course it happens. Suppose you are unemployed and don't have health insurance and only a $500,000 heart transplant can save your life but you don't have the money. What happens next? Answer: you die. That's called rationing. There is no way the U.S. or any other country can provide every citizen with unlimited health care. In particular, somebody has to decide if, of example, it is worth spending $54,000 for a drug that slows the spread of kidney cancer that might increase the patient's life by 6 months, but will increase everyone else's insurance premiums. Nobody ever wants to talk about these tradeoffs in public, but they are there of course. What a health bill will do is create some kind of committee to make decisions like how much a 6-month life extension is worth (in dollars) for 20-year-olds, 50-year-olds, and 80-year olds. Right now, private insurance companies quietly make such decisions every day. Any health bill will force the process into daylight and cause an uproar. There is an excellent article in the NY Times about the subject. Well worth reading. If the bill passes, you are going to hear a lot about government rationing.

Dean Supports Gillibrand     Permalink

Sen. Kirsten Gillibrand (D-NY) is continuing to collect as many endorsements as she can in advance of the possible announcement of a primary challenge from Rep. Carolyn Maloney (D-NY). Now former DNC chairman Howard Dean has endorsed, Gillibrand along with the President, the state's senior senator, Chuck Schumer, nearly all the state's Democratic county chairman, and many others. The idea is to make Maloney look like a spoilsport who only cares about herself, not the state or the party. Maloney is clearly miffed at being passed over by Gov. David Paterson when he appointed Gillibrand to Hillary Clinton's seat. While Gillibrand was somewhat conservative when she represented a rural upstate district in the House, she has rapidly moved to the left as a senator, so Maloney doesn't really have much of an ideological argument any more. But the subtext is: "I've been elected to the House nine times. I've paid my dues. It was my turn." She clearly is unhappy about Paterson's giving in to pressure from Schumer to appoint his protege, Gillibrand.

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