Breaking down the Baucus bill

By: Carrie Budoff Brown and Patrick O'Connor September 17, 2009 05:13 AM EST

Senate Finance Committee Chairman Max Baucus (D-Mont.) worked for months to find common ground with Republicans on health care reform — but when he released his long-anticipated proposal Wednesday, the real problem quickly came into focus. He set the stage for a titanic struggle within his own party. Reaction from congressional Democratic leaders was lukewarm to worse, progressives were downright hostile and Republicans were scornful of what they described as brazen government grab. But Baucus may have provided lawmakers with the only viable blueprint for winning support across Congress, because he sought to find elements that pleased all sides. “There are honest and principled differences on all of us working for reform, and this package may not represent all of our first choices,” Baucus said. “But at the end of the day, we all share a common purpose: that is to make the lives of Americans better tomorrow than they are today and to get health care reform done, which means the time for action is now.” The next challenge for Baucus and the Senate leadership is to get the bill out of the Finance Committee — but after that, Senate Majority Leader Harry Reid (D-Nev.) will need to merge the Finance bill with one approved in July by the Senate Health, Education, Labor and Pensions Committee. Even Reid, who has generally supported Baucus’s efforts, sounded less than pleased, saying he needs to be convinced the bill is right for Nevada on a proposed Medicaid expansion. House Speaker Nancy Pelosi (D-Calif.) dug in on the element dear to her liberal caucus — the public insurance option — and whacked the Baucus bill for shunning it. Baucus has made the challenge clear for Democrats, who now must choose between competing visions of health reform: an employer mandate versus fees on employers, a public insurance option versus nonprofit insurance cooperatives, and taxes on millionaires versus industry and people with expensive health care plans. The proposal capped months of closed-door discussions that, in the end, produced no immediate Republican support — and critical comments from negotiators Chuck Grassley of Iowa and Mike Enzi of Wyoming, both of whom complained about “artificial deadlines” from the White House and Democratic leaders to push through a bill, as Grassley said. Baucus put the cost of his bill at $856 billion. It would require nearly all Americans to carry insurance and employers to help cover the costs of providing government subsidies, while prohibiting insurance companies from dropping or denying coverage for people with pre-existing conditions. The Congressional Budget Office estimated the bill would cost $774 billion over 10 years and cover 94 percent of Americans. It would leave 25 million people uninsured in 2019 — a third of whom are illegal immigrants — compared with 17 million in the House bill. The analysis came in $82 billion lower than Baucus had thought it would, suggesting there could be room for senators to make adjustments. However, any expenses added to the bill must be offset with new revenue, making the task politically difficult. Another looming battle between Baucus and fellow Democrats is over how to pay for the bill — especially since the Finance bill came in at least $100 billion cheaper than the House bill. The House would pay for health reform in part by taxing high earners, families who make at least $1 million, but Baucus proposed an excise tax on insurers for their top-of-the-line plans. And Republicans think both plans cost too much. “Bipartisanship on Capitol Hill is the equivalent of a child looking for the unicorn,” Rep. Anthony Weiner (D-N.Y.) said, referring to the months of negotiations between Baucus and three Republican senators on the committee — none of whom has embraced his bill. Weiner, an outspoken defender of the public option, said the Baucus bill would be “dead on arrival” in the House — a far stronger claim than that of his party’s leaders in that chamber. “It has been said that the Senate is the cooling saucer of our democracy,” Weiner said. “At this point, it is more akin to the meat locker. ... The Senate proposal will not pass muster in the House.” But Baucus aides said there is plenty for progressives to like: tax credits to purchase insurance for families with incomes of $88,200 or less, immediate creation of a high-risk pool to provide coverage to the uninsured and people with pre-existing conditions, an expansion of Medicaid, and Medicare coverage for annual prevention and wellness checkups. “It is common sense. It is a balanced bill. It certainly is a bill that can pass,” Baucus said. “And the choice now is up to those on the other side of the aisle — if they want to vote for it or not.”