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Senate Health Bill Sets Stage for Tough Negotiations With House

December 24, 2009 at 12:00 AM EDT
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In a landmark vote Thursday, the U.S. Senate voted 60-39 to approve an overhaul to the nation's health care system. Judy Woodruff examines the negotiations ahead to reconcile Senate and House versions of the bill, and what the measures might mean for patients.
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JUDY WOODRUFF: Christmas Eve morning brought a landmark moment in the U.S. Senate today: Democrats pushed through their health care reform legislation.

“NewsHour” health correspondent Betty Ann Bowser begins our coverage.

BETTY ANN BOWSER: Senators began gathering before sunrise to make history. It was their first session on Christmas Eve since 1963.

U.S. VICE PRESIDENT JOSEPH BIDEN: The Senate will resume consideration of HR-3590.

BETTY ANN BOWSER: Vice President Joe Biden made a rare appearance in his formal role as Senate president. And senators also honored the memory of the late Edward Kennedy, a longtime champion of health care reform who died in August.

SEN. HARRY REID, D-Nev.: With Senator Ted Kennedy’s voice booming in our ears, with his passion in our hearts, we say, as he said, the work goes on; the cause endures.

BETTY ANN BOWSER: And then came the long-awaited vote on the bill to extend coverage to 30 million people.

U.S. VICE PRESIDENT JOSEPH BIDEN: Clerk, call the roll.

CLERK: Mr. Akaka.

SEN. DANIEL AKAKA, D-Hawaii: Aye.

CLERK: Mr. Akaka, aye.

BETTY ANN BOWSER: The outcome produced no surprises, falling along party lines, 60-39.

CLERK: Mr. Alexander.

SEN. LAMAR ALEXANDER, R-Tenn.: No.

CLERK: Mr. Alexander, no.

BETTY ANN BOWSER: Clearly exhausted from weeks of marathon negotiations, Majority Leader Harry Reid mistakenly voted no, before realizing his mistake and changing his vote.

CLERK: Mr. Reid of Nevada. Mr. Reid of Nevada, aye.

U.S. VICE PRESIDENT JOSEPH BIDEN: The yeas are 60. The nays are 39. HR-3590, as amended, the Patient Protection and Affordable Care Act, is passed.

BETTY ANN BOWSER: Through 24 days of grueling debate, Republicans had done everything they could to stop the bill, and they warned today, it’s not over.

Minority Leader Mitch McConnell:

SEN. MITCH MCCONNELL, R-Ky.: I guarantee you that people who voted for this bill are going to get an earful when they finally get home, for the first time since Thanksgiving.

BETTY ANN BOWSER: But Democratic leaders were triumphant as they spoke to reporters afterward.

SEN. HARRY REID: This is a victory because we have affirmed that the ability to live a healthy life in our great country is a right, and not merely a privilege for the select few. I look forward to working with my friends in the House, so we can send a bill to the president as soon as possible.

SEN. CHRISTOPHER DODD, D-Conn.: This is probably the most important vote that every sitting member of the Senate will cast in their tenure here. And I’m just proud to have been a part of it. And I thank my colleagues for staying with this.

BETTY ANN BOWSER: And President Obama had his own words of praise at the White House.

U.S. PRESIDENT BARACK OBAMA: Having passed reform bills in both the House and the Senate, we now have to take up the last and most important step and reach an agreement on a final reform bill that I can sign into law. And I look forward to working with members of Congress in both chambers over the coming weeks to do exactly that.

BETTY ANN BOWSER: While today’s vote is seen as a big victory for the president’s top domestic priority, getting a bill to his desk still presents challenges. The Senate version now has to be merged with a more liberal bill passed by the House in November.

For example, the House bill includes a government-run insurance option; the Senate bill doesn’t. And the House measure prohibits federal funding of insurance that covers abortions. The two bills also differ over funding the health care overhaul. The House would add an income surtax on the wealthy. The Senate would tax high-cost insurance plans.

The president said yesterday he supports taxing the so-called Cadillac plans. And he told the “NewsHour”‘s Jim Lehrer he plans to be heavily involved in reconciling the two bills into a final version.

U.S. PRESIDENT BARACK OBAMA: We hope to have a whole bunch of folks over here in the West Wing, and I will be rolling up my sleeves and spending some time before the full Congress even gets into session, because the American people need it now.

BETTY ANN BOWSER: Mr. Obama has said he hopes to have a health care bill on his desk before delivering his State of the Union address early next year.

Meeting that deadline may be tougher than it sounds.

Naftali Bendavid has covering the battles on Capitol Hill for The Wall Street Journal. And he has more about some of the potential pitfalls ahead.

Naftali, thanks for joining us.

NAFTALI BENDAVID, The Wall Street Journal: Thanks for having me.

JUDY WOODRUFF: So, this has been — they have been at this for years, months on this particular piece of legislation. How big a deal is this?

NAFTALI BENDAVID: I actually think it’s a huge deal.

You know, for a century, you could say, liberals and progressives have been fighting for something like this. Never before has even one chamber of Congress come close to considering this. And now you have both chambers passing it.

You know, as recently as a few months ago, after all those tea party demonstrations in August, people thought it was dead. Just a few days ago, they thought Senator Nelson might leave the talks and they might collapse. So, I think getting this through, whatever you think about it substantively, as a legislative accomplishment, really can’t be minimized.

JUDY WOODRUFF: All right, let’s talk about some of these things that we heard in Betty Ann Bowser’s piece that have to be resolved before you get it completely finished, first off all, the public option.

In the House language, there is a public option, a government-run insurance plan. The Senate has something different, 50 state exchanges. How does that get worked through?

NAFTALI BENDAVID: Well, I think that the liberals are going to have to give up a lot of what they want and what they care about in this legislation.

You know, it passed the Senate with no room for error. It got exactly 60 votes. Sixty votes is what it needed. They can’t afford to lose a single Democrat or independent. And with something like the public option, I think that the liberal House Democrats are just going to have to accept the fact that, if they want this bill, they are going to have to give up on that.

JUDY WOODRUFF: What are the political forces against the public option, I mean, and how is that at play? I mean, as you say, that there is a delicate balance in the Senate. No room for give?

NAFTALI BENDAVID: I think there is almost no room for give on the public option. Harry Reid tried almost everything. Obviously, the insurance companies don’t like the public option. They see that as unfair competition by the government with what they do.

But, just from an ideological perspective, a lot of conservatives and some of the more centrist Democrats don’t like this idea. And people like Ben Nelson, like Joe Lieberman are just absolutely refusing to give their vote to health reform if there is public option in it. And it is hard for me to see any way out of that for the liberals.

JUDY WOODRUFF: All right, let’s talk about another area of difference. And that is how you pay for this.

The House taxes the so-called Cadillac plans, high, expensive health insurance plans. The Senate imposes a tax on the wealthy. How do you expect to see that resolved?

I have it backwards. The House taxes wealthy Americans. The Senate would tax the so-called high-end Cadillac plans. How does that get resolved?

NAFTALI BENDAVID: Well, cost, unlike certain other areas, you can sort of split the difference, and they may end up trying to mix and match a little bit. But, clearly, the momentum right now is with the Senate plan, I think, of taxing the high-end insurance plans. That is something that the White House has said it prefers.

And there is a certain sentiment that paying for this should come from within the health care system, that just applying a broad-based tax on the wealthy doesn’t make as much sense as trying to get those dollars from the health care system itself.

And my sense is that is where it’s going to have to go. You know, just in general, because the Senate passed it with no room to spare, I think that the chances are that the House bill is going to have to become more like the Senate bill. The Senate bill can make a few changes, but, ultimately, if they make too many changes to it, they will lose a senator. They can’t afford to lose even one. So, I think that is the dynamic that we’re going to see in the next few weeks.

JUDY WOODRUFF: But, among others, the labor unions are going to be screaming, are screaming, they don’t want this change. They don’t want those plans taxed.

NAFTALI BENDAVID: They don’t want a tax. They feel their members have worked for years and then bargained other rights in order to get these fairly expensive health insurance plans. And the idea of now having them taxed is something that is very objectionable to them.

And, you know, they have made some changes in it in the Senate. They have agreed to tax higher and higher-cost plans to exclude more and more of them that union members have. But, ultimately, there is enough support for this that my sense is that some version of that is going to ultimately pass.

JUDY WOODRUFF: One other area of difference, of course, is abortion. You have got different language in the House from in the Senate. How do you see that being worked through?

NAFTALI BENDAVID: Well, when it comes right down to it, the language, in a certain way, isn’t that different. Ben Nelson, conservative senator from Nebraska, but a Democrat, insisted on fairly tough restrictions. You know, in both bills, women who want to get abortion coverage will have to write a separate check to get that coverage.

You know, in the House bill, they actually have to get a completely different policy, which is something that the Senate doesn’t have. But, ultimately, the differences are small. And I think that they are just going to have to try to find a way to — you know, ultimately this is going to come down to hard political calculation. Whatever they can do and still get 60 votes in the Senate and get 218 votes in the House, that is what they are going to.

JUDY WOODRUFF: Role of the Catholic Church in this?

NAFTALI BENDAVID: The Catholic Church has been very outspoken in an unusual way. The U.S. Conference of Catholic Bishops has made it clear that there is only some language that they are going to accept. And it may be that they win on this one, that this is one area where the House language prevails, because, if they insist on it, a lot of these House Democratic members are simply not going to change.

JUDY WOODRUFF: All right, Naftali Bendavid, from Wall Street Journal, thanks very much.

NAFTALI BENDAVID: Thank you.

JUDY WOODRUFF: Now let’s look more closely at some of the major areas of agreement and what these changes will mean for individuals, for employers and insurers, among others.

Susan Dentzer is back to help us with that. She’s the editor of the journal “Health Affairs” and an analyst for the NewsHour.

Susan, thanks for being with us again on this day that it passed the Senate.

OK. So, setting aside these differences that I just talked about with Naftali, we know that some big things could change in American health care. Let’s start with just ordinary working American who has health coverage. Say, I work and I have coverage through my employer. How are things going to change for me and for my family?

SUSAN DENTZER: Well, Judy, immediately, that is to say, in 2010, presuming that this is signed into law next year, which looks like it will be the case, there are some changes that go into effect that shore up and stabilize the health insurance market, which even will help people who do now have coverage.

For example, some things that insurance companies now are able to do, rescissions — that is to say, they can cancel coverage on you if they have discovered that you have not necessarily told them about a preexisting condition or whatever — they can now rescind your coverage — that would be outlawed as of next year.

In addition to that, certain benefits that people now have, preventative benefits, wellness-oriented things that people now have to make a contribution towards for all new health insurance policies that would be issued starting in 2010. Those cost-sharing arrangements, as they are called, would be — would go away. In effect, these people wouldn’t have to pay for those.

JUDY WOODRUFF: Now, that is in the short term.

SUSAN DENTZER: That is in the short term.

In the longer run, many, many more changes would take place in 2013 and 2014, depending on whether the House or the Senate version prevails. In effect, sweeping health insurance regulatory changes take place. Not only will rescissions of course already have been taken care of. Preexisting condition restrictions will go away, so that no insurer will be able to not cover you for a preexisting condition. They have got to actually insure you. If you have diabetes, they have to give — sell you a policy that covers your diabetes.

And a whole array of those changes take place involving regulation of insurance at both a federal and state level that will really shore up insurance coverage for people.

JUDY WOODRUFF: All right, let’s talk about if — if — so I’m someone who doesn’t have coverage right now, either because I can’t get it through my employer, or I just don’t — I don’t have access to it.

SUSAN DENTZER: In — again, short-term and long-term changes, short term, for example, $10 billion under the Senate bill would be put into community health centers. So, people who now go to those centers, largely lower-income people, will probably be able to much more easily access care through those entities.

In addition to that, small — certain small businesses will get tax credits, so that, to the degree are you working for a small business that doesn’t now provide coverage, possibly your small business will start to offer you coverage. Again, those are short-term changes in 2010.

Then, again, when we get to 2013 or 2014, a large array of changes, a dramatic expansion of the Medicaid program, so that single adults largely, those who do not have dependent children who now don’t have Medicaid coverage will be able to access it. In all, a total of 15 million more people are able to go into Medicaid.

Then, for other better-off people, they will be able to buy coverage through new insurance exchanges, either at the federal level or at the state level. And this will give people a choice of an array of products with a federal help, depending on your income, tax credits to help support the purchase of the coverage.

JUDY WOODRUFF: Now, quickly, Susan, some people still will not, even under this legislation, will still not be able to get health coverage; is that right?

SUSAN DENTZER: That’s right.

JUDY WOODRUFF: And who are they?

SUSAN DENTZER: They will be people without will be able to claim that they need to be exempt from a new individual mandate on coverage that will go into effect starting in 2013 or 2014, people who can’t afford it, for affordability grounds. People who are in the country illegally will not be able to access — will not have any provision of coverage.

They will be able to get care in many instances through the community health centers, but not coverage. So, depending on whether it is the Senate or the House version, there could be as many as 18 to 23 million people without coverage at the end of the line.

JUDY WOODRUFF: All right, and let me tick off a couple other groups I want to ask you about. What about health care providers, doctors, nurses? Obviously, this a big subject of discussion. But what essentially will change for the providers?

SUSAN DENTZER: For providers, I think, in the longer run, they’re — we’re going to see emerging a number of very new and different arrangements under which people will be given their health care.

And that will mean that many doctors, nurses, nurse practitioners and others will be practicing medicine in different ways. They will be delivering care through things that we call medical homes and accountable care organizations, arrangements like that.

In the nearer term, hospitals are going — have agreed to give up some of the payment increases that they would normally expect to help pay for coverage. Physicians, some primary care physicians under Medicare in certain regions of the country that don’t have a lot of doctors are actually going to be paid more.

So, it’s going to be a kind of mixed bag for providers. Some will benefit. For many, life will change.

JUDY WOODRUFF: And there will be changes, presumably, for nurses, for physical therapists and other people who work in the health care field.

SUSAN DENTZER: Yes, and lots of effort to support education and training for people, particularly people who are in the business of providing primary care, but who are not physicians, like nurse practitioners, scholarships, programs to shore up the National Health Service Corps, which gives people loans in order to go to medical school or other education, and then practice in communities that don’t have much access to medicine.

JUDY WOODRUFF: You mentioned some of the effect on hospitals. What about on the pharmaceutical industry?

SUSAN DENTZER: Across the board, many players in an array of health businesses are going to have to pay higher fees. Insurance companies will be paying higher fees to contribute toward the cost of financing it, medical device manufacturers. Pharmaceutical companies are fighting having some of those fees exacted on them.

They also, though, under various different provisions, are actually going to get paid less for the drugs they now make, particularly those that go to Medicaid patients. So, they will — they will hurt. And they have also agreed for people on Medicare who fall into the doughnut hole, the pharmaceutical companies have agreed to sell those people branded prescription drugs at a 50 percent discount to help make drugs affordable for people who are in so-called Part D coverage in Medicare and fall into this doughnut hole.

JUDY WOODRUFF: That is that — that point at which you — you reach it, and you don’t get coverage, but then you do again.

And finally, very quickly, the insurance industry.

SUSAN DENTZER: The insurance industry sees an array of changes, a whole new layer, probably, of federal regulation, as well as all of these new state regulations.

They also will see, depending on the version of the bill, a requirement that they have to pay out 80 percent or to 85 percent of all the premium dollars they collect. Those have to be paid out in benefits, not in returns to shareholders, not in CEO salaries. If not, if they don’t achieve that threshold, they have to give rebates to their policy-holders.

So, they will be subject to a very large array of changes.

JUDY WOODRUFF: OK, a lot for us to digest over the holiday season.

SUSAN DENTZER: Indeed.

JUDY WOODRUFF: Susan Dentzer, thanks very much.

SUSAN DENTZER: Great to be with you, Judy. Thanks.