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10 Issues that Congress will Need to Resolve in Final Reform Bill

Janice Simmons, for HealthLeaders Media, December 24, 2009

It took a lot of debate, discussion, disagreement, and discourse, but the Senate approved its healthcare reform bill, the Patient Protection and Affordable Care Act (HR 3590), Thursday morning 60-39 along a straight party line vote.

But a long and complicated process lies ahead for this bill and the House bill (HR 3962), which was approved last month, as they are reconciled into a new bill to be presented back to each chamber.

After a short winter break—the House reconvenes Jan. 12 and the Senate Jan. 19—representatives from each body will meet in a conference committee to iron out differences between the bills. Tentatively, the aim was to have a bill prepared and passed before President Obama presents his State of the Union address in late January or earlier February, but many have speculated that the process could take much longer.

The House bill, with a cost estimated by the Congressional Budget Office at $1.1 trillion over the next decade, is projected to cover 36 million individuals by in 2019—about 96% of legal residents. The Senate bill, with an estimated cost of $871 billion over 10 years, is projected to cover about 31 million people, or 94% of legal residents.

Representatives Henry Waxman (D CA), Charles Rangel (D NY), and George Miller (D CA), the chairmen of the three committees with jurisdiction over health policy in the House, said in a statement on Thursday that they "are committed to producing a final bill that incorporates the best reforms for middle class families, small businesses, seniors, and our fiscal health [and] stays true to the values of our members."

The bills have a number of issues in common, such as establishing new rules requiring insurers to accept all individuals and employers that apply for coverage (known as guaranteed issue), eliminating rescissions, and preventing carriers from setting premiums based on health status.

Here's a look at 10 issues that they will need to reconcile:

1. Insurance exchanges. While the exchanges in the states would be open to small businesses and to individuals without access to employer coverage, different phase-in periods for other businesses appear in the bills.

The House bill calls for federal operation of the exchange, and offers states an option to create exchanges that are subject to federal guidelines. The Senate bill calls for states or regions to operate exchanges using federal guidelines. In the Senate bill, a health insurer's participation in the exchanges will depend on performance. For instance, insurers that increase their premiums before the exchanges begin will be excluded.

2. Public insurance option. Despite weeks of debate, the public insurance option was dropped from the final Senate bill. The House bill contains a public insurance option that requires the Health and Human Services (HHS) secretary to negotiate rates with healthcare providers as private insurers currently do.

The Senate bill instead has a provision in which multi state private insurance plans would be offered under contract with the federal Office of Personnel Management, with at least one of the plans being a nonprofit entity.

3. Medicaid expansion. Under the House bill, Medicaid would be expanded up to 150% of the federal poverty level (roughly $16,245 for a family of four). The House bill provides 100% federal financing of Medicaid expansions through 2014, and then 91% financing beginning in 2015.

In the Senate bill, the rate of eligibility is 133%. It would provide 100% federal financing of Medicaid expansions between 2014 and 2016. By 2017, most of the states would share in the cost of expanded coverage.

4. Financial assistance. For individuals with low or moderate incomes, subsidies would be available in the House bill on a sliding scale to offset the premium costs for plan enrollees living above 133% of the federal poverty level. Above that level, premium contributions would be capped at no more than 1.5% of income for those living at 133% of poverty to no more than 12% of income for those at 400%.

The Senate bill requires those families above the poverty level to contribute no more than 2% of income; this increases to no more than 9.8% of income for those at three to four times the poverty level.

5. Physician care. The House bill calls for a 5% increase in fees for primary care services, and a 10% increase in those areas with shortages. The Senate bill calls for a 10% increase for primary care physician fees, along with the fees for general surgeons practicing in areas with shortages.

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