August Has Lead to a More Progressive Healthcare BillSeptember 1, 2009 - by Donny Shaw
Bipartisanship on healthcare reform is just about dead. Two of the three Republicans in the Senate “Gang of Six” that has been meeting to work out a bipartisan deal have effectively backed out. The Democratic leader of the gang, Sen. Max Baucus [D, MT], seemed to admit so today for the first time.
One of the ironic elements of the negotiations coming to an end is that it makes it easier for Democrats to pass a more progressive bill. In fact, with no Republicans willing to participate, the Democrats will be forced to pass a bill with a strong public option, or none at all.
The death of Sen. Edward Kennedy [D, MA] has left Senate Democrats with only 59 votes, which is not enough to overcome a Republican filibuster. With no Republicans on board, they will have to go the budget reconciliation route – a parliamentary maneuver that allows for legislation that has an effect on the budget to pass the Senate with a simple majority of 51 votes. Whether or not legislation has an effect on the budget and is eligible for the reconciliation process is a decision ultimately given to the non-partisan Senate Parliamentarian.
In order to boost their chances that the Parliamentarian will allow the bill to go through reconciliation, Democrats are likely going to include the strongest, most progressive public option in the bill they can. The more effective the public option plan is at making affordable insurance available, the more likely it is to be scored to show that it will have a positive impact on the budget. For example, if it can provide cheap insurance premiums, the cost of subsidies that will be needed for low-income people to buy insurance according to the individual mandate will go down. Another example is that it could lead to increased tax revenues for the government because businesses that offered insurance through the Exchange would have more money to pay employees.
It’s entirely possible that a progressive public option, one based on Medicare rates, doesn’t have the votes to move through the Senate, the House, or both. Conservative Democrats in both chambers might balk. But with Republicans gone form the negotiating table, this appears to be the new target.
UPDATE: Brian Beutler at TPM has some more insights on what the Democrats are thinking:
“A very robust public option that scores significant savings would presumably be easy to justify doing through reconciliation,” says a Senate Democratic aide. “But it is still being studied whether other, more moderate versions of a public option could pass parliamentary muster.”
According to Martin Paone, a legislative expert who’s helping Democrats map out legislative strategy, a more robust public option—one that sets low prices, and provides cheap, subsidized insurance to low- and middle-class consumers—would have an easier time surviving the procedural demands of the so-called reconciliation process. However, he cautions that the cost of subsidies “will have to be offset and if [the health care plan] loses money beyond 2014…it will have to be sunsetted.”
And there the irony continues: Some experts, including on Capitol Hill, believe that a more robust public option will generate crucial savings needed to keep health care reform in the black—and thus prevent it from expiring. But though that may solve the procedural problems, conservative Democrats have balked at the idea creating such a momentous government program, and if they defected in great numbers, they could imperil the entire reform package. […]
As Gregg and Paone and the Democratic source indicate, a more liberal public option might be easier to push past these procedural hurdles than the public option that’s currently on the table. But That doesn’t mean some of the less robust options are completely off the table. According to Paone, "sufficient funds would probably be needed from the general revenue to subsidize the public option or to provide “seed” money for a coop plan," if either of them were to survive, indicating that creating private co-operative in lieu of a public option may still be feasible under the reconciliation process.