08 January 2010

Health Care Leaders Sand-Bag GOP Plans to Stall!

Senate and House Iron Out The Differences in Their Health Reform
Bills Without a Formal Conference Committee Process.

Senate passage of its version of health reform legislation on
Christmas Eve completed a historic year in Congress and in the
nation's domestic policy debate. The House and Senate will still
have to resolve important differences in their bills this month
before they can send a final bill to President Obama.

Whether to tax health benefits to fund coverage for the uninsured;
whether to create a public insurance health plan option to hold down
health costs and keep insurers honest; and how to address the
"doughnut hole" gap in prescription drug coverage are three top

Instead of a formal conference committee, the process
will involve leaders shuttling the measure back and forth, until
both chambers have agreed to the same text. Democratic leaders
believe that many Senators and Representatives would use a
formal conference to delay, not improve, health care reform.

Both the House and Senate bills provide more affordable coverage
for retirees and seniors. They each provide cost relief for
early retiree coverage: a new re-insurance program will pick up
85% of the cost of treatments between $15,000 and $90,000 for
retirees ages 55-64. They also offer a $500 immediate increase
in the Medicare drug allowance; a phased closing of the doughnut
hole, during which seniors have to pay 100% of drug costs; and a
50% cut in the price of brand name drugs for seniors in the
doughnut hole until the gap is eliminated.

On Monday,the Alliance for Retired Americans signed onto a letter
from the Leadership Council of Aging Organizations, a broad
coalition of seniors groups, urging Senators to close the gap as
quickly as possible.

Both bills would also contain costs in a variety of ways. For
instance, they would reduce over-payments to private Medicare
Advantage plans by $135-$170 billion over ten years; eliminate
co-payments for preventive care, thereby lowering the odds of a
more expensive, catastrophic illness down the line; and
ultimately reduce the federal deficit by approximately $130
billion over ten years. Both bills prohibit denial of coverage
or higher rates due to pre-existing conditions and ban annual or
lifetime limits on claims payments by insurers. They also reduce
age-based variation in premium rates. Differences between the
bills include whom to tax and how many people to cover.

The Senate wants to tax higher-end health plans valued at over
$8,500 for most individuals and $23,000 for couples, raising
$150 billion. For retirees, the amounts are higher: $9,850 for
individuals and $26,000 for family coverage. However, the House
wants to increase income taxes on the wealthiest Americans - a
plan the Alliance for Retired Americans considers fairer.
"While the final version is unlikely to include all that we have
been fighting for, I believe our grassroots efforts have helped
immensely in building political support," said Barbara J.
Easterling, President of the Alliance.

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