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Healthcare Reform Update - November 12-18, 2009


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Compiled by Andrew Fichter*

November 18, 2009

Both Sides Puzzle Over Abortion Amendment In House Health Bill
November 16, 2009

Newspapers continue to report on the Stupak amendment to the House health bill and how it will affect access to abortion.

"[T]he Stupak amendment, named for Rep. Bart Stupak (D-Mich.), would ban individuals from using new government subsidies to buy insurance plans that cover abortion, and it would prohibit a government-operated plan--the public option--from carrying abortion coverage," Politico reports. Supporters of the amendment "say that it simply extends an existing prohibition on federal funding for abortion--an annually renewed policy called the Hyde amendment --to the health care exchange that would be established for the uninsured under the health care bill making its way through Congress. But lawmakers who support abortion rights contend that, if the Stupak amendment's logic is extended to the
$250 billion in tax breaks Americans get to buy coverage through employer-based plans, it could strip abortion coverage from tens of millions of women who already have it."

Workers who have health benefits through their jobs are exempted from paying income taxes on their premium contribution. "Congress considers the income tax exclusion to be a massive 'tax expenditure'--a subsidy--for individuals to buy insurance." Many of those plans cover abortion. "Taking the concept of a subsidy one degree further--from individual purchasers to corporate providers--insurance companies that offer plans that cover abortion get tens of billions of dollars of subsidies through programs like Medicare Advantage and the 2003 prescription drug law. While few, if any, seniors have need for abortion coverage, the big insurers who administer those plans also offer insurance policies that cover abortion to younger women and their husbands and fathers" (Allen, 11/16).

Las Vegas Sun : "Days after the House voted to include stricter abortion restrictions in the health care bill, nearly 50,000 abortion rights supporters urged [Senate Majority Leader Harry] Reid in a petition to block the provision from the Senate bill he is crafting. Conventional wisdom says the majority leader faces a great dilemma: Reid is a Mormon who opposes abortion but is under great pressure from the Democratic base to prevent the House's strict Stupak-Pitts amendment from being included in the Senate" (Mascaro, 11/15).

The Los Angeles Times reports on the influence of Catholic bishops over abortion language in the health bills. "A number of groups oppose abortion rights, but the church is one of the few to also support Democratic efforts to overhaul healthcare. That has given the church a seat at the negotiating table. It used that influence this month as the House of Representatives prepared to vote on the healthcare legislation. Negotiators for the church worked with lawmakers to add an amendment to ensure that federal insurance subsidies do not wind up funding elective abortion." In addition, "[t]he church also had amassed goodwill during years of working with Democrats on such issues as tax credits for the working poor, immigration, climate change and nutrition programs. It had built a level of trust that other antiabortion groups could not" (Oliphant, 11/16).

NPR interviewed Rep. Diana DeGette, D-Colo., co-chair of the Congressional Pro-Choice Caucus. "She's authored a letter that has been co-signed by more than 40 of her colleagues saying they will not support a final bill that includes the Stupak Amendment" (Martin, 11/13).

KHN summaries from Sunday's abortion coverage: Democrats Stymied On Abortion In Health Bill

Federal Health Overhaul Could Force State Changes
November 16, 2009

The bills pending in Congress could alter some restrictions on insurers and channel money to state health programs.

The House bill includes, for instance, $23.5 billion to "allow Congress to continue pumping billions in new short-term aid to states to cover Medicaid costs that have increased with rising unemployment in the past year," The Washington Post reports. The stimulus bill in February also included Medicaid funding, but that package is due to run out next year (Davis, 11/16).

The bill could make it difficult for some states to enforce consumer protection laws, the Los Angeles Times reports. "Healthcare overhaul bills in both the Senate and the House would open the door to insurers selling policies across state lines--which some lawmakers fear could allow health plans to take advantage of the lenient rules in some jurisdictions while avoiding tougher enforcement regimes in places like California" (Girion, 11/16).

State insurance commissioners, however, could also be vested with sweeping new powers. "The Illinois Department of Insurance helps to oversee a health care system that has allowed insurance companies to essentially dictate how much consumers are charged and what kind of benefits they get," the Chicago Tribune reports. "But that would change under health care bills making their way through Congress. . . . [S]tate insurance directors, would be given unprecedented powers in helping to decide the benefits and cost of health plans for the proposed government-regulated insurance exchange" (Japsen, 11/16).

Senate Aides: Reid Considering Medicare Payroll Tax Increase On Wealthy
November 13, 2009

Senate Majority Leader Harry Reid pondering a proposal to increase the Medicare payroll tax on high earners "to help offset the costs of providing health insurance to millions of Americans, Senate aides said Thursday," The New York Times reports.

The proposal is in the health reform package that Reid has sent to the Congressional Budget Office for analysis. "The Medicare payroll tax is the primary source of financing for Medicare's hospital insurance trust fund, which pays hospital bills for beneficiaries, who are 65 and older or disabled. Employers and employees each pay a tax equal to 1.45 percent of wages. Unlike the payroll tax for Social Security, which applies to earnings up to an annual ceiling ($106,800 in 2009), the Medicare tax is levied on all of a worker's earnings without limit. Mr. Reid is apparently considering an increase in the Medicare payroll tax rate for workers with incomes of more than $250,000 a year, Senate aides said. One idea is to increase the tax rate by one-half of 1 percentage point, to 1.95 percent for high-income people, with an expectation that the government could raise $40 billion to $50 billion over 10 years" (Pear, 11/12).

The Washington Post : "Another option is applying the Medicare tax for the first time to capital gains income, White House budget director Peter Orszag said Thursday at a Washington summit organized by a corporate affiliate of Bloomberg News." Inclusion of that tax could allow so-called "Cadillac" plans to be taxed less than initially proposed, The Post reports. "But Reid is unlikely to completely abandon the Cadillac tax, Democrats say," because the tax could cause people to buy lower-cost health insurance policies (Montgomery, 11/12).

The Wall Street Journal reports that "Reid is looking at raising the threshold for insurance policies that would be subject to the 40 percent (Cadillac) tax to $8,500 for individuals and $23,000 for couples, Senate aides said." Levying a surtax on high income earners instead of on Cadillac plans is one that already has support in the House, which passed an income surtax in its health care reform bill on people who make more than $500,000 (Bendavid, 11/13).

Bloomberg reports that, also while speaking at the summit, Orszag said he sees a health care reform bill passing by the end of the year, but he "wouldn't say whether the White House supports" applying Medicare taxes to capital gains. "'We have to see the package as a whole,' he said" (Donmoyer and Jensen, 11/13).

AMA Takes On Social Issues, Backs Reform, Rebuts 100-Year Trend
November 13, 2009

After a century of health-reform opposition--with highlights such as coining the term "socialized medicine,"--the American Medical Association is now supporting Democrats' overhaul efforts, as well as taking on a few once taboo social issues, NPR 's Health Blog reports. At a recent meeting, the group called for the government "to revisit the classification of marijuana as a Schedule I drug," and for the military to sack the "don't ask, don't tell" policy on gays and lesbians in its ranks.

In an interview with Dr. James Rohack, the association's president, NPR asks "What's going on?" Rohack says, "In the past some have painted the AMA as an organization of 'no.' We oppose, we oppose, we oppose. In the 21st century, I think the AMA reflects an organization that looks to improve care and meet our mission of helping doctors help patients" (Hensley 11/12).

This information was reprinted from with permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery . © Henry J. Kaiser Family Foundation. All rights reserved.

*We would like to thank Andrew Fichter, PhD, JD (Widener University School of Law, Wilmington, DE), for selecting the articles for this week's update.

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