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Senate Health Care Plan Would Cover 31 Million

BY Lea Winerman  November 19, 2009 at 11:52 AM EDT

Dem. Senators introduce health care bill; getty images

In a news conference Wednesday evening, Democratic leaders touted the plan, saying that it would save lives and save money.

“Not only do we make it [health insurance] more affordable for every American, we do it in a fiscally responsible way,” Reid said.

A Congressional Budget Office analysis of the bill, released late Wednesday night, found that the plan’s $848 billion cost would be more than offset by new taxes, cuts to Medicare and other savings, so that the bill would result in an overall reduction of the federal budget deficit by $130 billion by 2019. That’s the biggest cost savings of any proposed health reform legislation to come out of the House or Senate this year.

Democrats are hoping that the CBO estimate will convince wavering Democratic moderates to support the measure. Reid is aiming to hold a procedural vote to open debate on the bill as early as Friday. To pass that hurdle, though, he will need the support of all 58 Democrats and two independents in the Senate. He will need those same 60 votes later to stave off any Republican filibuster attempts.

Republicans came out swinging against the bill immediately.

“I think this bill was a disaster and I hope many of my friends on the other side of the aisle that care about this country’s longterms prospects, will come to their senses,” Sen. Bob Corker of Tennessee told the NewsHour.

“It’s going to be a holy war,” Sen. Orrin Hatch, R-Utah, said of the upcoming floor debate, according to the New York Times.

The Senate bill is broadly similar to the health care legislation that passed the House earlier this month. Both would require most Americans to buy health insurance, and would set up new state-based marketplaces called exchanges where people without employer-sponsored insurance could shop for coverage.

Both would provide subsidies to help low and moderate-income Americans purchase insurance on the exchanges. And both would include as one option on the exchanges a government-run public insurance plan.

Both would also impose new regulations on insurers that would prevent them from rejecting customers based on pre-existing conditions, among other new restrictions.

But there are also important differences between the House and Senate bills. First, most of the provisions in the Senate bill don’t take effect until 2014, one year later than those in the House bill.

The House bill requires all businesses with payrolls over $500,000 to provide insurance for their employees. The Senate bill, on the other hand, does not require employers to provide insurance. Instead, companies with more than 50 employees would have to pay a penalty fee for each employee they don’t cover who qualifies for a federal subsidy.

The House and Senate bills also levy different taxes to pay for their plans. The House bill would impose a 5.4 percent surtax on high wage earners — individuals who make more than $500,000 per year and families that earn more than $1 million.

The Senate bill would instead tax high-value insurance plans — those worth more than $8,500 for an individual or $23,000 for a family. It would also raise the Medicare payroll tax by .5 percent for individuals who earn more than $200,000 and families that earn more than $250,000. Finally, the Senate bill would levy a new 5 percent tax on elective cosmetic surgeries.

The Senate bill also does not go as far as the House bill in restricting access to abortion. That flashpoint issue nearly sunk the House bill. At the last minute, House Democratic leaders allowed an amendment to be added to the bill banning any insurance plans that people might buy with federal subsidy money from covering abortion.

The Senate bill includes language closer to what was originally in the House bill, requiring insurers to establish a “firewall” between federal subsidy money and private premium money, and pay for abortion services only with private money.

President Obama on Wednesday night released a statement praising Reid’s plan.

“Today, thanks to the Senate’s hard work, we’re closer than ever to enacting solutions to these problems,” he said. “I look forward to working with the Senate and House to get a finished bill to my desk as soon as possible.”

But the legislation still faces a bumpy road ahead. Senate Democratic leaders, aided by Vice President Joe Biden and Interior Secretary Ken Salazar, both former Senators, spent Wednesday meeting with Democratic legislators in an effort to lock down 60 votes.

Three conservative Democrats in particular — Sen. Blanche Lincoln of Arkansas, Sen. Mary Landrieu of Louisiana and Sen. Ben Nelson of Nebraska — have been holdouts. Reid needs their votes both for a procedural vote to open debate on the bill, and an eventual vote to pass it.

On Thursday Nelson told the NewsHour that he had not yet decided whether he would vote for the bill. He said he was still looking it over, and that although it was better than previous versions he was “not there yet.”

Reid said Wednesday he was “cautiously optimistic” that he could bring the bill to the floor, and he is aiming for the procedural vote Friday or Saturday.