Conservative Principles Now

Thursday, Democrats and Republicans will convene at the President’s request to discuss the way forward on achieving bipartisan health care reform.  In a recent paper, Heritage’s Nina Owcharenko discusses how congressional Democrats and the President can use this meeting to start over on health care reform by enlisting Republicans to pass legislation both sides agree on.

Says Owcharenko, “If the President is sincere and the summit is going to be successful, it must begin by setting aside the highly unpopular bills that the House and Senate have developed. Simply adjusting the magnitude of these proposals or adding new “conservative” provisions as suggested in the President’s latest proposal, does not change their fundamental direction.”

Polls show a majority of Americans stand in opposition to the left’s health care proposals, which fall short of meeting expectations established by promises made by the President. To restore the nation’s trust in Washington, Congress and the President should focus on areas of reform which have bipartisan support.  Owcharenko suggests the following as areas in which to move forward:

State-Based Reform: “Congress should embrace a federal–state partnership that would allow states to develop innovative ways to address their unique health care challenges. The federal government should set broad, national goals and then give wide leeway for states to try different approaches and learn from one another.”

Fixing Broken Entitlements: “Reform should begin with Congress reforming the flawed programs it already controls rather than overhauling one-sixth of the national economy.”  Congress could start by applying the President’s proposal to introduce competitive bidding to Medicare Advantage to all of Medicare, create a level playing field for all Medicare enrollees.

Reforming the Inequitable Tax Treatment of Insurance: “Congress should replace the current tax exclusion with a fairer and more equitable system of universal tax credits. Short of that, Congress should begin to realign the tax breaks for work-based health insurance with other tax-preferred forms of compensation by capping the tax exclusion.”

Targeted Insurance Reforms: “The current health insurance rules do not work for everyone, but the solution is not for the federal government to take over private health insurance…Congress can correct the gaps in the current system to make the market work better for those it serves without destroying the market for others.”

Americans are not concerned with the degree of reform that the left is seeking; they are concerned with the direction.  It is not too late for lawmakers to start over with incremental reform that will give Americans, not the government, more control of their health care.

Debate continues on the Senate floor on the Patient Protection and Affordable Care Act of 2009 (H.R.3590), and the focus continues to be on Medicare and Medicare Advantage. While proposing spending cuts in one program to create another, the Senate leadership is claiming that all of these Medicare cuts are possible without cutting benefits or services in current Medicare programs, such as Medicare Advantage and Home Health Care.

Stabenow’s Medicare Advantage Amendment. Senator Debbie Stabenow (D-MI) proposed an amendment which would ensure that spending reductions to the Medicare Advantage program would not result in a reduction or elimination in benefits that enrollees would receive. Sen. Stabenow’s amendment passed 97-1.

This amendment is a curious, as well as popular. Its popularity may reflect the substance of the legislation. The reason: Senate Majority Leader Harry Reid’s (D-NV) bill includes $118.1 billion in cuts to the Medicare Advantage program. It’s hard to imagine how cuts of this magnitude would not affect benefits for enrollees of the program — now more than one in five seniors. Examining similar provisions in the giant House-passed bill, the Chief Actuary of the Centers for Medicare and Medicaid Services said comparable spending cuts to Medicare Advantage would “reduce MA rebates to plans and thereby result in less generous benefit packages.”

The Hatch Amendment on Medicare Advantage Cuts. Senator Orrin Hatch (R-UT) made a motion to commit the bill to the Senate Finance Committee to remove Medicare spending cuts, which would have guaranteed Sen. Stabenow’s promise to protect the Medicare Advantage program. Sen. Hatch’s amendment failed with a vote of 41-57.

The Kerry Amendment on Home Health. Senator John Kerry (D-MA) offered an amendment that the Senate bill would guarantee home health benefits that Medicare enrollees receive under title XVIII of the Social Security Act. The Kerry Amendment to guarantee these benefits was very popular. It passed 96-0.

The Johanns Amendment on Home Health. Senator Mike Johanns (R-NE) then offered a motion to commit the bill to the Senate Finance Committee to remove spending cuts to the same home health benefits that Sen. Kerry’s amendment seeks to preserve. The health care bill currently contains $42.1 billion in cuts to home health benefits over ten years. Sen. Johann’s amendment was defeated by a vote of 41-53.

Whitehouse Amendment to Preserve Social Security. Senator Sheldon Whitehouse (D-RI) offered an amendment to ensure that surpluses created by the health care bill in the Social Security trust fund and savings generated by the CLASS Act would be reserved for Social Security and the CLASS program, respectively. The Senate voted to preserve savings from these programs 98-0.

It is worth noting that the Senate bill delays spending until after revenue collection begins. In examining the CLASS Act provisions, the Congressional Budget Office says, “…the program’s cash flows would show net receipts for a number of years, followed by net outlays in subsequent decades.”

Thune Amendment on Entitlement Spending. Senator John Thune (R-SD) proposed an amendment which would remove the CLASS act altogether in order to eliminate new entitlement spending and limit government control over health care. Thune warned that Congress should not be creating more problems like those inherent in Medicare, which, like the CLASS Act, was also intended to be fiscally self-reliant on premiums and revenues collected by users of the program. Sen. Thune’s amendment was defeated by a vote of 51-47.

Kathryn Nix currently is a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm