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It's Over! House Gives Final Approval to Health Care Reform

March 25, 2010 - by Donny Shaw

Pelosi and Reid celebrate health care reform passage

More than a year after Congress began their health care reform effort, it officially came to an end today as the Senate and House both gave final votes of approval to the Health Care and Education Affordability Reconciliation Act of 2010. The bill amends the bigger health care reform bill, the Patient Protection and Affordable Care Act, that President Obama signed into law earlier this week.

The Senate voted first this afternoon, passing the reconciliation bill on a 56-43 vote, with Sen. Ben Nelson [D, NE], Sen. Blanche Lincoln [D, AR] and Sen. Mark Pry or [D, AR] crossing the aisle to vote with all Republicans agains it. The vote capped a marathon session of voting, running late into the night Wednesday, during which 40 Republican amendments were rejected. However, the Republicans did succeed in their efforts to alter the bill by appealing to the Senate Parliamentarian under the Byrd Rule and managed to strip 12 lines of insignificant text from the 150+ page bill.

Though the change was insignificant, it was enough to force the bill back to the House because the Constitution requires both chambers to approve the exact same bill before it can be signed into law. After an hour and a half of debate, the House agreed to the Senate changes by a vote of 220-207.

The bill now gets sent to President Obama, who is expected to sign it into law sometime next week, closing the book on health care reform for the 111th Congress.

Here are some of the top-line changes that the just-passed reconciliation bill would make to the new health care law:

Removes special deals — The health care bill picked up a few sweeteners for specific states along the way on its year-long journey towards becoming law. For the most part, the special deals exempt states from changes in Medicare law. The reconciliation bill eliminates many of these.

Increases subsidies — Adds more money for helping people who earn under 400% of the Federal Poverty Level and aren’t insured through work to afford insurance. Under the bill that was signed into law, the average subsidy for a person buying insurance on the exchanges would be $5,800. The reconciliation bill ups that to $6,000.

Softens individual mandate penalty — Starting in 2014, people without insurance may have to pay a tax penalty under the bill’s individual mandate provision. The reconciliation bill lowers the size of the penalty from $750 to $695 and adds a bigger exemption for people who can’t get insurance due to financial hardship.

Closes the Doughnut Hole — the reconciliation bill adds a $250 rebate in 2010 for all Medicare Part D enrollees who enter the gap in prescription drug coverage that currently exists between $2,830 and $6,440 and closes this “doughnut hole” completely by 2020 through gradualy increasing the rebate amount.

Scales Back the Cadillac Tax — The reconciliation bill delays until 2018 the excise tax on high-cost “Cadillac” health plans and increases the premium threshold for triggering the tax.

Strengthens Fraud Fighting — Adds $250 million in funding for the Health Care Fraud and Abuse Control Fund.

Student Loan Reform — Incorporates much of the Student Loan and Fiscal Responsibility Act, which ends a program that provides government subsidies to student loan companies and use the saving to increase Pell Grants and other scholarship programs.

As a reminder, here’s my description of the core mechanics of the underlying health care reform law that I posted on Sunday:

Insurance Regulations — The bill would outlaw a number of the most abusive practices from insurance companies. Most prominently, they would no longer be allowed to deny coverage based on pre-existing medical conditions. The bill would also ban them from rescinding coverage to customers who get sick, eliminate lifetime and annual limits on benefits, cap how much money from premiums insurers can spend on things like profit, administrative costs and advertising, and require insurers to cover preventative services and immunizations.

Individual Mandate — Starting in 2014, all Americans would be required to have some form of health insurance. Uninsured individuals would be penalized with a tax of $95 in 2014, $325 in 2015 and $695 in 2016 and beyond. Religious groups that are “conscientiously opposed” to insurance, like the Amish and Old Order Mennonites, would be exempt from this requirement. Members of non-profit “Health Care Sharing Ministries” would also be exempt.

Affordability Credits — New tax credits would be available for people with incomes between 133 and 400 percent of the Federal Poverty Level to help them afford insurance coverage. The average subsidy for people receiving government assistance would be $6,000 per year.

Medicaid Expansion — The biggest government expansion in the bill would be in Medicaid. All individuals earning less than 133 percent of FPL would get free insurance through Medicaid. The CBO has estimated that this expansion will cover 16 million Americans by 2019.

Health Care Exchanges — All individuals buying insurance on their own and businesses searching for a plan to offer their employees, would do their shopping on new state-based “exchanges.” The exchanges would, essentially, be websites displaying the various plans that are available with prices and services laid out side-by-side in a standard format. Think for health insurance. States would be allowed to join together to form regional exchanges under the bill.

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