In their feverish effort to enact the Senate health bill, the House leadership recently released their 153 page bill to fix the underlying 2,409 page Senate legislation through the budget reconciliation process. As a matter of health policy, there is little that is substantively different between the Senate bill and this “fix it” bill. A closer look at the fine print shows that the latest version would only make the massive and unpopular Senate health bill even worse.
Based on a preliminary review of the key provisions, taxpayers should be aware of the following features of the legislation.
More Spending
- The House reconciliation bill increases taxpayer subsidies and lowers cost sharing for individuals receiving a federal subsidy to buy health coverage. This change adds to the overall cost of the bill, while depending on unproven savings and tax hikes to pay for it.
- Instead of removing special deals, the bill extends additional federal funding to all states for Medicaid. This “fix” is supposed to replace the scandalous requirement that federal taxpayers fund the Nebraska Medicaid expansion. In both case, however, the burden is back on the backs of federal taxpayers.
Raising Taxes on Americans for all Income Brackets
- The reconciliation bill increases the individual mandate penalty for some by requiring the penalty be the greater of two options. This mandate amounts to a new tax on those people who choose not to purchase a government-approved health plan regardless of income.
- The bill also increases taxes on all consumers who use prescription drugs, medical devices or have health insurance.
- The bill also keeps the Cadillac tax, the tax on high value health plans. But by delaying its start date and indexing the application of the tax to general inflation, it will hit more families harder when it goes into affect.
- Finally, the reconciliation bill adds a new Medicare tax on upper income individuals and families that extends to investment earnings as well.
Undercutting Job Creation and the Economy
- The reconciliation bill increases the penalties on businesses for not offering health insurance and continues the penalty on businesses whose employees claim the new health care subsidy.
Moving Backward on Entitlement Reform
- The reconciliation bill makes changes to Medicare and Medicaid that reverse course for reforming these struggling health care programs.
- The bill increases costs to seniors by requiring prescription drug plans in Medicare to offer more coverage and
- The bill also undercuts any reform of Medicare by linking Medicare Advantage payments to the flawed fee for services system and by eliminating demonstration projects that utilize competitive bidding to show how an alternative that would use real market pricing would work in practice.
- Although the sponsors of the House bill claim to address long term costs to Medicare, the bill’s dependence on traditional cuts to providers is not fundamental entitlement reform. It’s basically the same, old, tired cuts in hospital and physician payment.
- The bill would add millions of Americans to the already broken Medicaid program. Medicaid remains fiscally unsustainable (for state or federal taxpayers) and it is a notoriously poorly performing program for those who are forced depend on it. Moreover, when new federal funding expires, states will be left with an even heftier cost.
Taking Power Away from the States
- The House reconciliation bill would secure a massive federal take over of the regulation of health insurance. It nullifies state authority in rate regulation of premiums, setting standards for solvency and reserves. It creates, instead, a new federal rate authority in charge of authorizing changes in politically approved premium levels and imposing penalties on health insurance companies.
- The reconciliation bill would undercut the ability of state and local governments to control state and local government employee health plans. As a condition of receiving federal money, state and local governments must abide by the new federal regulations and bureaucracy.
Provides for Taxpayer Funded Abortions
- The House reconciliation bill includes major funding for community health centers with no Hyde Amendment type restrictions on federal taxpayer funding of abortions.
- The bill, of course, does not in any way address the large loopholes for taxpayer funded abortions included in the underlying Senate bill, which it is supposed to “fix”.
Co-authored by Ed Haislmaier and Robert Moffit.
As the beneficiary of 16 years of Catholic education, eight of them under the tutelage of the Sisters of Charity in Cincinnati, I am inclined by habit to nod in swift concurrence whenever the good sisters speak. Not today.
A letter released yesterday by 60 leaders of Catholic women’s religious orders argues that the Senate-passed version of health care reform does not provide for funding of elective abortion and is thus the “REAL [capitalization in original] pro-life” option. The Catholic bishops, the non-sectarian National Right to Life Committee and, this morning, the Council of Major Superiors of Women Religious strongly disagree.
The dispute has emerged with greater force after it became clear last week that any commitment by the Democratic leadership in Congress to “fix” the Senate bill’s defective abortion limitation language was unenforceable – a piecrust promise. Not only would the Senate’s traditionally stronger corps of anti-Hyde amendment votes ensure defeat of any abortion language fix, but 41 Republican senators signed a letter to oppose any policy-making on the reconciliation bill that would ferry the fix to enactment – a pledge that clearly would include the doomed abortion limitation.
As a consequence, the Senate bill’s multiple pathways to subsidize health plans that include elective abortion or to even fund abortion directly will become law once the House passes the Senate bill and sends it to President Obama. The women religious who have advocated this course are part of a small chorus of Catholic voices who argue that the Senate bill seals off taxpayer participation in abortion, and particularly that the community health services funding in the bill is covered by Department of Health and Human Services regulations that bar their use in any facility or program that provides elective abortion.
But the argument is circular. The regulations cited are based on the Hyde amendment itself, which applies to funds appropriated in the annual spending bill for HHS. The Senate health bill directly appropriates $8.5 billion over five years to HHS for community health centers, and if the Hyde amendment is to be construed as applicable to these funds it is clearly voluntary on HHS’s part. The case is strengthened by the fact that the Senate bill, H.R. 3590, explicitly applies an abortion funding exclusion to other new spending included in the Senate bill, for example, new money for school-based clinics.
The Senate bill contains no parallel exclusion for the community health centers. The White House and HHS officials contend that the existing Hyde Amendment regulations will be applied to these funds. House members inclined to disbelieve this pledge have evidence for their position. Within the past 14 months the Obama Administration has: 1) restored foreign assistance funds to family planning groups that provide and promote abortion overseas; 2) championed and achieved legislation for the District of Columbia to spend local government revenue on abortion even though the funds pass through the U.S. Treasury; and 3) rescinded regulations promulgated under the Bush administration to give teeth to statutory conscience rights that had hitherto lacked regulatory implementation. In short, regulatory interpretations and policies can change – and change overnight.
Moreover, fresh litigation from pro-choice groups over this issue is likely, as on many other provisions of the bill. Of the 17 states that currently provide public money for abortion under state insurance plans, 13 do so as a result of court decision.
The contention that the extant HHS regulations regarding the Hyde Amendment apply — when the Senate bill is silent on the matter, the Obama administration clearly favors the opposite outcome, and the issue is a primary stumbling block to passage of a bill strong majorities of Americans oppose on other grounds as well – is conveniently timed but ultimately unpersuasive, the good sisters notwithstanding.