With 60 Votes for Health Reform Lined Up, the Senate Plans a Christmas Eve Vote

senate-has-60-votes-for-health-care-bill-christmas-eve-vote-plannedIn a procedural vote at 1 a.m. Monday, Democrats showed they have lined up the 60 votes they need in the Senate to pass sweeping health-care reform, and they've set in motion plans for a vote on the bill on Christmas Eve.

The Senate version of the bill will extend health insurance coverage to over 30 million Americans and, according to the nonpartisan Congressional Budget Office, reduce the federal deficit by $132 billion over the next decade. The reforms are forecast to drop the deficit by another $1.3 trillion between 2019 and 2029.

%%DynaPub-Enhancement class="enhancement contentType-HTML Content fragmentId-1 payloadId-61603 alignment-right size-small"%%After the bill is passed by the Senate, the House and Senate will caucus to reconcile the differences between their two bills, and a final version will emerge that must then be voted on by both chambers. It's that final version that will determine what will happen to health care in this country.

A Public-Option Alternative

Most experts expect the Senate's version is likely to survive the reconciliation process virtually intact because the Democrats can't afford the loss of even one senator's vote. The key provision House liberals want that Senate moderates won't accept is a public option. Instead, the Senate has created health-insurance exchanges through which uninsured individuals and small businesses will be able to shop for coverage. These will be private, nonprofit exchanges. By pooling their resources, self-employed and unemployed people will be able to purchase less-expensive insurance.

The Senate bill leaves the existing employer-based health insurance system intact. If you already get health insurance from your employer, you likely won't see any big immediate changes. But if your employer does not, you may.

Under the Senate's plan, employers with more than 50 employees must offer health coverage or pay a fine of up to $750 per employee if any employee obtains federal subsidies for coverage. Employers face stiffer penalties under the House bill. Companies with a payroll of more than $500,000 must provide insurance or pay a penalty of up to 8% of their payroll.

Here are key provisions on which the House and Senate bills agree:
  • Both will subsidize insurance for a family of four making up to about $88,000 annually, or 400% of the federal poverty level;
  • Both will eventually limit out-of-pocket expenses;
  • Both will prevent insurance companies from denying coverage for pre-existing conditions;
  • Insurers will be barred from charging higher premiums based on a person's gender or medical history.
Medicaid would be expanded under both bills, but the House bill extends coverage to individuals earning up to 150% of the poverty level, or about $33,000 for a family of four. The Senate plan ensures coverage to those earning up to 133% of the poverty level, or just over $29,000 for a family of four.

Where the Money Comes From

The biggest remaining differences between the bills center around how health care reform will be financed. The House uses a combination of a tax surcharge on wealthy Americans and new Medicare spending reductions. Individuals with annual incomes over $500,000 -- as well as families earning more than $1 million -- would face a 5.4% income tax surcharge.

The Senate bill cuts Medicare by $480 billion through cost-control measures that will reduce payments to providers of Medicare. The bill also imposes a 40% tax on so-called "Cadillac" health plans valued at more than $8,500 for individuals and $23,000 for families. The Senate bill would also hike Medicare payroll taxes on families making over $250,000; the House bill does not.

If you don't have insurance now, you will be required to purchase coverage. The House bill imposes a fine of up to 2.5% of your income. The Senate plan requires individuals to purchase health insurance coverage or pay a fine of up to $750, or 2% of their income, whichever is greater. Both versions include a hardship exemption for poorer Americans.

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