New Health Care Reform Outline

Washington Post----

The outline I was given today isn't the Finance Committee's final bill. It's not even necessarily the Chairman's Mark (the bill that will go to the rest of the committee for debate, changes, and modifications). But it's the clearest look at what Finance -- the key committee for health-care reform -- is currently considering.

You could write this story a couple of different ways. The first is to note is the Finance Committee has substantially retreated in the face of the $1.6 trillion price tag the Congressional Budget Office affixed to its original submission. This version of the plan is, comparatively, quite diminished.

The numbers tell the story. In that plan, subsidies reached 400 percent of poverty. In this plan, they've been cut to 300 percent. In that plan, Medicaid eligibility was as high as 150 percent of the poverty line. In this plan, it's 133 percent for pregnant women and children, and 100 percent for childless adults. In that plan, the "gold" coverage was 93 percent of a person's estimated expenses, and "bronze" coverage was 68 percent. In this plan, those numbers are 90 percent and 65 percent, respectively. That means people with a low-cost plan might be covered for only 65 percent of what they're likely to need.

Another way of looking at the plan is that it remains a significant step forward. Subsidies to 400 percent of poverty would be nice, but subsidies to 300 percent of poverty are far beyond anything we offer now. Coverage that protects against 65 percent of anticipated costs is better than no coverage at all. The co-op idea isn't a public plan, but with federal seed money to start new co-ops, it's a good idea on its own merits. There's an individual mandate, state-based health insurance exchanges, and a substantial health and wellness initiative. Insurers are barred from discriminating based on health history and Medicaid is sharply expanded.

People frequently refer to the goal of health-care reform as "comprehensive reform." But this is what I'd term "comprehensive incrementalism." It makes everything a bit better. It is not radical. It is not root-and-branch reform. For all the concerns about cost, there is no strong public plan able to negotiate low rates and implement aggressive reforms. The health insurance exchanges are a step forward, but they're state-based, and there's even room for multiple competing exchanges in a single state. They could be made substantially stronger. Revenue sources are not discussed in this draft, but it's clear that the employer tax exclusion -- which is to say, the employer-based system -- is preserved, and there's even an attempt to "grandfather" existing insurance arrangements from the individual market.

It is one of the paradoxes of the legislative process that something that is substantively quite timid can also be quite bold. This version of health reform is far from what the country needs. It is far from what any health-care experts would develop left to their own devices. But it is still a monumental initiative and, if passed, it would be the most significant step forward since the creation of Medicare and Medicaid.

It is also worth remembering, however, that this bill has not been merged with the more liberal legislation being considered by Sen. Ted Kennedy's HELP Committee. Nor has it been reconciled with the legislation being driven through the House of Representatives, which Speaker Pelosi promises will feature a strong public plan. And most importantly, the White House has not forcefully stepped in with its priorities and preferences. Health care reform still has a long road to travel. This is just one snapshot that helps to illustrate how the landscape is changing along the way.

Sources: Washington Post, Whitehouse.gov