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Healthcare Reform in the Senate: Three Areas that Will Need to Be Addressed

 |  By HealthLeaders Media Staff  
   November 09, 2009

With the House's passage of HR 3962 Saturday night, many predictions abounded if healthcare reform was on its way to passage or dead on arrival.

While the compromise bill has yet to emerge from the Senate, here are three areas that will need to be addressed if healthcare reform can move forward in the Senate:

Public insurance option. The public option proposal in the House bill requires the Health and Human Services (HHS) secretary to negotiate rates with healthcare providers as private insurers currently do. The version under consideration in the Senate would permit states to opt out.

Some Democratic senators, such as Mary Landrieau (D-LA) and Joseph Lieberman (I-CT), who usually has voted with the Democrats, have said that they would not support the current proposal. Possibly the suggestion put forth by Sen. Olympia Snowe (R-ME) this summer—"the trigger plan"—could make a reappearance.

The trigger plan would feature nonprofit agencies offering health insurance only in instances in which private insurers could not cover 95% of the people in their regions with plans costing no more than about 15% of the individual's or household's annual income. Snowe has said that her option could be made available in states from "day one in any state" where "affordable, competitive plans" currently do not exist.

Paying for healthcare. In the Senate, the Finance Committee had proposed a tax on higher priced—or "Cadillac" insurance policies. This area remained under intense debate during the current reconciliation process because many unions believed that concern felt by some of their members—who accepted generous insurance packages over wage increases—were being targeted.

The House bill, however, did not look at the higher-priced plans. It instead chose to look at the wealthiest 0.3% of the population, with individuals making more than $500,000 and families making above $1 million would paying a surcharge.

Medicaid expansion. Under the revised House version, individuals and families with incomes now at or below 150% percent of the federal poverty level would be eligible for an expanded Medicaid program. This is higher than the levels currently under consideration in the Senate.

This expansion will initially be fully federally financed, then transitioned to include a 9% contribution from states starting in 2015. The proposed expansion overall has many states, now strapped for funding themselves, worried about how this could impact their bottom lines.

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