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Max Baucus' "America's Healthy Future Act"

September 16, 2009 - by Donny Shaw

Senate Finance Committee Chairman Sen. Max Baucus [D, MT] has been working for months in his committee, and specifically with a bipartisan “Gang of Six” negotiating senators, to produce a healthcare reform bill that would appeal to Democrats and Republicans alike. Today he released a 223- page Chairman’s mark of the bill, which you can download here (pdf) or read online at OpenCongress.

It’s definitely worth taking a look at. Unlike the bills we’ve seen come out of other committees in Congress, the draft released today by the Finance Committee is written in plain language, so you can actually read it and understand it pretty easily. The Finance Committee will hold their mark-up session of the legislation next week. That’s when the bill presented in the document released today will be put into full legislative text and expanded to 1,000+ pages. Shortly after that, we’ll have it posted on OpenCongress like the House bill, so the process of public mark-up and review can begin.

In many ways, the basic framework of the Baucus bill matches Congress’ other healthcare bills and President Obama’s outline for reform. It would put in place new consumer protections, for example banning insurance companies from denying patients because of pre-existing conditions. It contains an individual mandate requiring all Americans to get some form of insurance. It would expand Medicaid and provide subsidies to help low-income people buy insurance. It would set up new state-wide marketplaces, or exchanges, to help people comparison shop for insurance plans.

How does the Baucus bill released today differ from the healthcare bills form other committees?

First off, it doesn’t contain a public insurance option. Instead, it sets up the Consumer Operated and Oriented Plan (CO-OP) program. Under the program, the government would allow and provide seed money for the creation of private, non-profit healthcare co-ops. The co-ops would be government by majority votes from its members, and all profits would have to be used to lower premiums, improve benefits, or otherwise improve the quality of healthcare delivered to its members.

Secondly, the Baucus bill contains fewer subsidies to help middle income people buy health insurance as it would require them to do.. Under the bill, people making above 300 percent of the federal poverty level would be expected to spend about 13 percent of their income on health insurance. And people in that income range would be subject to out-of-pocket limits. For example, a family of four making abover 300 percent of FPL would have an out-of-pocket limit of $11,600 on top of their $10,800 in premiums.

Third, it costs less. While most of the other bills coming out of congressional committees had price tags above $1 trillion over 10 years, Baucus’ bill has been scored by the Congressional Budget Office at $856 billion. The savings come from a combination of the reductions in subsidies for middle-income people and a plan to tax some of insurance companies’ most expensive plans.

Though the bill was specifically written to attract Republican support, no Republicans have said they are willing to vote for it. For example, Sen. Olympia Snowe [R, ME], the Democrat’s most likely Republican ally said yesterday that she could not back the bill, citing “concerns” that have yet to be addressed. On the other side of the spectrum, Democrats are beginning to come out against the bill. Finance Committee member Sen. John Rockefeller [D, WV] said today that he can’t support the bill because of its plan to tax insurance company’s premium plans. Rockefeller said that the tax will simply get passed down to the middle class in the form of higher premiums. He has also cited the lack of a public option as a reason for his opposition to Baucus’ bill.

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