nsurance and employer groups are talking about the lack of cost control provisions in H.R. 3590, the Patient Protection and Affordable Care Act bill, which passed by a 219-212 vote at 10:48 p.m. Sunday in the House.

H.R. 3590 is the same bill that the Senate passed early on Christmas Eve a few months back, and it now is awaiting the signature of President Obama.

House members also voted 220-211 at 11:36 p.m. to pass H.R. 4872, the Reconciliation Act of 2010. The Senate still must approve that bill, but it would revise and extend many provisions of H.R. 3590. Senate leaders have told House leaders that they have the votes to pass H.R. 4872 using a special budget reconciliation process.

Under normal Senate rules, bills need 60 votes to pass. Budget reconciliation measures need just 51 votes.

Some Republican lawmakers said during floor debate that they or colleagues would try to block implementation of H.R. 3590 — and of H.R. 4872, if H.R. 4872 becomes law — by turning to the courts for relief.

H.R. 3590 and H.R. 4872 passed with no Republican support; 34 Democrats voted against H.R. 3590, and 33 voted against H.R. 4872.

Democrats were jubilant about winning the H.R. 3590 battle and getting H.R. 4872 to the Senate.

“This is what change looks like,” Obama said during an appearance shortly after the vote on H.R. 3590 took place.

“I know this wasn’t an easy vote for a lot of people,” Obama said. “But it was the right vote.”

House Majority Leader Steny Hoyer, D-Md., smiled at the reporters at a press conference on Capitol Hill. “For all of you who pursued all of us: We had the votes,” Hoyer said.

Insurance say they still have concerns the current versions of the bills.

“The access expansions are a significant step forward” Karen Ignagni, president of America’s Health Insurance Plans, Washington, says in a statement about the health bills. “But this legislation will exacerbate the health care costs crisis facing many working families and small businesses.”

The bill “does little to stem the skyrocketing cost of health care and will be financed on the backs of small business during one of the most delicate financial periods in American history,” says Robert Rusbuldt, president of the Independent Insurance Agents and Brokers of America, Alexandria, Va..

WHAT’S IN H.R. 3590?

H.R. 3590 — the PPACA bill that the Senate passed late on Christmas Eve — is on track to become law whether or not the Senate approves H.R. 4872.

The final version of H.R. 3590 would:

- Enact the Community Living Assistance Services and Supports Act long long term care benefits program.

- Require insurers selling in the individual market, in the small group market and through the exchange system to sell coverage on a guaranteed issue and guaranteed renewable basis. Plans could base rating variations only on age, family use, tobacco use and location, and the rates for the oldest insureds could be only 3 times higher than the rates for the youngest insureds. Rates for tobacco users could be only 50% higher than the rates for non-tobacco users.

- Create a new health insurance exchange system that individuals and employers with up to 100 employees could use to buy subsidized health coverage, and 4 “tiers” of coverage, ranging from catastrophic plans to platinum plans.

- Create a new system of nonprofit health insurance co-ops.

- Permit states to form multi-state health insurance compacts, to create multi-state markets for health insurance.

- Create a health insurance tax credit for employers with 25 or fewer employees and average annual wages of less than $50,000.

- Impose penalties on employers with more than 50 employees that fail to provide health coverage and on inidividuals with incomes over a minimum income threshold who fail to have health coverage.

- Require employers with more than 200 employees to enroll employees in health plans automatically.

- Impose a $750 per-employee penalty on employers with more than 50 employees that fail to provide health coverage.

- Impose minimum medical loss ratios that are similar to those in H.R. 3590: 85% for group plans with more than 100 participants; 80% for small group plans; and 85% for Medicare Advantage plans.

- Impose a 40% “Cadillac plan” excise tax on insurers that sell relatively expensive health plans. Insurers now would pay the tax when they sold plans that cost more than $8,500 for individuals and $23,000 for families.

- Tighten health savings account and flexible savings account reimbursement rules. Individuals could not use account funds to pay for over-the-counter medications unless the medications were prescribed by doctors.

- Cap annual FSA contributions at $2,500, but increase the limit annually by a cost of living adjustment, starting Jan. 1, 2011.

- Apply the existing Medicare payroll tax to investment income starting in 2013, and increase the tax by 0.9 percentage points, to 2.35%, for wages over $200,000 per year for individuals and over $250,000 per year for couples.

- Adopt a national standard for eligibility verification and claims status by Jan. 1, 2013; a standard for electronic fund transfers by Jan. 1, 2014); and a variety of other standards by Jan. 1, 2016.

- Give states 5-year grants to develop medical malpractice reform programs.

WHAT’S IN H.R. 4872?

Originally, the Reconciliation Act was going to include health insurance rate regulation provisions. The version passed Sunday by the House excludes that version, because the Senate parliamentarian ruled that H.R. 4872 backers could not handle the provision using the budget reconciliation process.

H.R. 4872 echoes the language of H.R. 3590 in many places and changes it in others.

Provisions that are still in H.R. 4872 would:

- Create a $1 billion Health Insurance Reform Implementation Fund.

- Exempt the first 30 employees of any employer from the no-coverage penalty.

- Increase the per-employee penalty imposed on employers that fail to provide health coverage to $2,000 per employee, from $750.

- Require individuals making more than $200,000 per year and couples making more than $250,000 per to pay a new 3.8% tax on interest, dividends, capital gains and other investment income. (This new tax is higher than the 2.9% tax on investment income recently proposed by President Obama.)

- Increase the Cadillac plan tax limits to $10,200 for individuals and $27,500 for families, and to $11,850 and $30,950 for for retirees and high-risk professionals. Calculations of health benefits value now will exclude dental plans and stand-alone vision plans.- Push the effective date of the $2,500 cap on annual FSA contributions back to Jan. 1, 2013.

- Increase the no-coverage penalty for individuals with relatively high incomes and decrease the penalty for low-income individuals.

Tags: Health Care Bill H.R. 3590, Health Care Legislation, House Health Care Bill, House of Representives Passes Health Care Bill

As we head into July, the federal debate has become more defined as four of the five Congressional committees with jurisdiction over health reform have released draft health reform bills. On June 19th , the Education and Labor, Energy and Commerce, and Ways and Means Committees in the House of Representatives released a joint tri-committee draft health reform bill. Earlier in June, the Senate Health, Education, Labor, and Pensions (HELP) Committee released its health reform bill. The final committee with jurisdiction over health reform, the Senate Finance Committee, is expected to release its health reform bill soon after the 4th of July Congressional recess. House and Senate leadership hope to pass legislation in their respective chambers before August and get a final compromise bill to the President in October. Key components of the recently released House tri-committee bill include:

National Health Insurance Exchange: By 2013, a National Health Insurance Exchange is to be established to replace the current individual health insurance market and provide an option for employers and public program enrollees in Medicaid and the Children’s Health Insurance Program (CHIP). States would be allowed to apply to the federal government to establish state or regional exchanges. The Exchange is to establish health plan standards, facilitate the provision of comparative information, enrollment, billing, and other administrative functions, administer coverage subsidies, and respond to consumer grievances.

Public Plan: No later than 2013, the Department of Health and Human Services is to develop and offer a Public Plan through the Exchange to compete with private insurers. The Public Plan is to comply with the same requirements as other private health plans participating in the Exchange, but provider payments from the Public Plan are to be similar to Medicare rates and providers participating in Medicare would be required to participate in the Public Plan for five years. The federal government would provide start up funding for the Public Plan, but it must become self-sustaining after initial start up.

Insurance Market Reform: The legislation requires changes to the individual and group markets that prohibit pre-existing condition exclusions, prohibit premium rating based on health status, gender, or occupation and limit rating by age, require guarantee issue and renewal of coverage, require a medical loss ratio of 85 percent, prohibit annual or lifetime benefit limits and limit annual cost sharing, establish a Benefits Advisory Committee to recommend a minimum benefit package and three additional standard benefit plans, and establish a risk spreading mechanism to minimize unequal risk selection in health plans.

Coverage Mandates: By 2013, all individuals would be required to have health insurance coverage. Those not complying with the mandate are to be assessed a tax up to the cost of the minimum benefit plan. Exceptions to the mandate are granted for religious objection and financial hardship. Employers would be required to provide 72.5 percent for single coverage and 65 percent for family coverage of the lowest cost minimum benefit set plan or pay an eight percent tax on wages. Certain small businesses with payroll below a set level would be exempt.

Coverage Subsidies: Sliding scale subsidies varying by income would be available through the Exchange for individuals and families with incomes below 400 percent of the federal poverty level ($88,000 for a family of four) so that premiums would not exceed 10 percent of income. Sliding scale subsidies varying by employee income and employer size worth up to 50 percent of premium would be available to employers with less than 25 employees whose average wage is below $40,000.

Medicaid Reform: The legislation expands Medicaid eligibility for all individuals to 133 percent of the federal poverty level ($14,000 for an individual) and requires an 85 percent medical loss ratio for Medicaid managed care organizations. It also establishes new preventive services benefits, increases payments for primary care, and implements a medical home pilot project to reduce costs and improve outcomes through use of preventive services and care coordination.

Medicare Reform: The legislation restructures provider payment rates and requires the Department of Health and Human Services to develop new payment methods to promote coordinated care and reward quality and efficiency in areas such as hospital readmissions, post-acute care, imaging, and primary care. The bill reduces payment rates and establishes an 85 percent medical loss ratio for Medicare Advantage plans. The legislation also eliminates the coverage gap (donut hole) in Part D by 2023 and reauthorizes Special Needs Plans (SNPs) that integrate care for beneficiaries with coverage through Medicaid and Medicare.

Other Health System Reforms: The legislation also makes investments in the health care workforce to improve access to primary care, makes investments in prevention and public health programs, establishes national centers for quality improvement and comparative effectiveness research, establishes mechanisms to simplify administrative functions, and enhances efforts to reduce fraud, waste, and abuse.

Tags: House Health Committee bill, House Health Subcomittee, House insurance bill, House of representative insurance proposal

The House and Senate have approved a compromise budget resolution that sets parameters for spending and revenue legislation. As requested by the President, the budget resolution includes a reserve fund for health care reform initiatives that must be deficit-neutral for fiscal years 2009 through 2014 or fiscal years 2009 through 2019. The resolution allows Medicare physician payment legislation, that would likely prevent cuts to physician payment rates for two years, to be exempt from the deficit-neutral requirement.

The budget resolution also allows for the ability to consider health care reform legislation under the reconciliation process. Reconciliation is a procedure that Congress may use to make it easier to pass budget bills related to tax and entitlement spending programs. A reconciliation bill can not be filibustered as debate is limited to 20 hours, and this allows a bill to be passed quickly with a simple majority vote.

Tags: Health care reform, health care reform agreement

Original Article from Businessweek

U.S. workers and employers get 23% less value from their health-care spending than those in Britain, Canada, France, Germany, or Japan, and 46% less value than in Brazil, China, or India, according to a Business Roundtable study that examined the cost and performance of the U.S. health-care system.

That value gap exists even though the U.S. spends far more on health care per worker than the other countries examined. The study, released on Mar. 12, found that for every dollar the U.S. spent on health care, Britain Canada, France, Germany, and Japan spent 63¢, yet the health of the U.S. workforce lags by 10% on a composite measure. As for Brazil, China, and India, they spend just 15¢ for each U.S. dollar spent, yet the health of the U.S. workforce lags behind those three by 5%.

The Business Roundtable, an influential association of CEOs of large U.S. companies, is actively lobbying Congress for health-care reforms, but it wants to maintain the current employer-based insurance system. Most business leaders say they see health insurance as a valuable recruitment benefit. Also, “companies know they are going to end up paying the bill somehow or other, so they want to have an influence on how those benefits are designed,” says James A. Klein, president of the American Benefits Council, a trade association for employer-based benefit plans.

A Drag on Business

But business leaders also desperately want the costs of the current system brought under control, since most of their global competitors operate in nations with government-subsidized, universal care that is far less onerous. “Health-care costs are one of the top cost pressures facing American business today, inhibiting job creation and hurting America’s ability to compete in global markets,” Harold McGraw III, CEO of The McGraw-Hill Companies (MHP) (which publishes BusinessWeek) and chairman of the Business Roundtable, said at a news conference releasing the study. On that point the Business Roundtable is aligned with President Barack Obama, who at last week’s health-care summit at the White House called exploding health-care costs “one of the greatest threats, not just to the well-being of our families and the prosperity of our businesses, but to the very foundation of our economy.”

The study was led by Dr. Arnold Milstein, a consultant with Mercer Health & Benefits. To calculate the measure of value, the study weighed 17 separate measures of workforce health, chosen for their relevance to employers and employees, and how effectively each nation’s health system addressed them. These issues included life expectancy, mortality rates, deaths from heart disease, injuries and communicable diseases, blood pressure, cholesterol levels, medical errors, and work absence due to illness. Spending calculations were based on each nation’s employer-paid health benefits in manufacturing, and health-care spending that is financed through taxes paid by employers and workers. The researchers noted that in 2006, the U.S. spent $1,928 per capita on health care, compared with $1,100 in Britain, Canada, France, Germany, and Japan; and $274 in Brazil, China, and India.

The Business Roundtable said it plans to update the study annually in order to track U.S. competitiveness on health-care spending.

Tags: United States health care disadvantage, US health care system

I used to respect Rush Limbaugh, but he’s turned into a babbling shock jock that will say anything for ratings.

Tags: Limbaugh on health care, Rush Limbaugh and Ted Kennedy, Rush Limbaugh health care

U.S. President Barack Obama reversed controversial Bush administration orders limiting states from expanding a low-income children’s health insurance program.

Obama issued a memo reversing his predecessor’s orders on the same day he signed an extension of the State Children’s Health Insurance Program to include more participants in the state-run, federally funded insurance program for low-income children, The Hill reported Thursday.

Although the legislation Obama signed into law Wednesday provides more than $30 billion in additional SCHIP funding to permit states to enroll 4 million more children in addition to the 7 million already receiving benefits, it didn’t specifically address Bush administration letters sent outlining its SCHIP policies in 2007 and 2008.

“These requirements have limited coverage under several state plans that otherwise would have covered additional uninsured children. As a result, tens of thousands of children have been denied healthcare coverage,” Obama wrote.

Tags: Obama SCHIp news, SCHIP

With Michigan’s governor looking on, President Barack Obama reauthorized an expanded health insurance program for children this afternoon, calling it a “down payment on my commitment” to ensure coverage for every American.

The $74-billion reauthorization of the state Childrens’ Health Insurance Program — representing an increase of about $33 billion over the next five years — represented what Obama called “one of the highest responsibilities we have.”

SCHIP already covers about 7 million kids; congressional estimates are that the additional money should allow the states to cover about 4 million more, including legal immigrant children in some cases. The House approved the legislation on a vote of 290-135 earlier today.

President George W. Bush had vetoed the expansion twice in the last Congress.

Obama said parents without insurance for their children are often forced into decisions they should never have to make — “how long to put off that doctor’s appointment, whether to fill that prescription, whether to let a child play outside, knowing that all it takes is one accident, one injury, to send your family into financial ruin.”

“This is not who we are,” added Obama. “We are not a nation that leaves struggling families to fend for themselves.”

Also attending the bill signing at the White House this afternoon from Michigan were Rep. John Dingell, a Dearborn Democrat, and U.S. Sen. Debbie Stabenow.

In Michigan, the additional funding could result in more than 71,000 additional kids receiving basic health care coverage, according to the Families USA, a health care advocacy group based in Washington, D.C. Right now, about 114,000 children in Michigan receive health care through Michigan’s SCHIP program, known as MiChild.

“Enactment of this bill represents a clear example of the change voters demanded last fall,” said Rep. Gary Peters, a Bloomfield Township Democrat who last fall defeated Republican Joe Knollenberg, who was criticized in some quarters for voting against the legislation last year. “Thousands of Michigan kids went without health care for years while Washington bickered.”

But there remained concerns that waivers to the states could result in them authorizing funding for children whose families would otherwise qualify for private health insurance. Midland Republican Dave Camp — the ranking Republican on the House Ways and Means Committee — said in some cases families making up to $88,000 a year could be eligible for free healthcare and that private coverage could be eliminated for some 2.4 million people. But while waivers could be granted to allow states to offer coverage to families making more, there is nothing in the legislation that requires it.

Among Michigan’s delegation, all the Democrats voted for the legislation, as did four Republicans — Candice Miller of Harrison Township, Thad McCotter of Livonia, Vern Ehlers of Grand Rapids and Fred Upton of St. Joseph. Voting against were Republicans Camp, Mike Rogers of Brighton and Pete Hoekstra of Holland.

In all Democrats voted 250-2 in favor of the bill; among Republicans, 40 were supportive and 133 against.

In Michigan, the program covers kids ineligible for Medicaid whose families have incomes less than twice the national poverty level — $44,100 for a family of four. And while Michigan’s program has provided coverage to childless adults with incomes of less than 35% of the poverty level — $3,790.50 — the legislation phases out that coverage (though it includes a provision to provide SCHIP coverage to pregnant women).

The legislation would be paid for through a 62-cent-a-pack increase in the federal excise tax on cigarettes, which would hike that tax from 39 cents a pack to $1.01. It also raises taxes on other tobacco products. The congressional Joint Committee on Taxation estimates that will increase federal revenues by $71.4 billion — covering most of the cost — during the next five years.

Tags: Child health insurance legistlation, children's health insurance program, kids health insurance program, SCHIP

Prospects for health reform drop significantly when Americans hear potential financial trade-offs associated with expanding health insurance coverage, a poll indicates.

For example, nearly seven in 10 people say they favor the concept of requiring employers to provide their workers with health insurance or contribute into a fund that pays to cover the uninsured. President-elect Barack Obama has called for such an employer mandate for medium and large businesses.

But what if they heard the mandate would cause some employers to lay off workers? Support falls dramatically — to about three in 10 people, according to a new national survey conducted by the Kaiser Family Foundation and the Harvard School of Public Health.

Similarly, about two out of three people favor requiring all Americans to have health insurance. But when told some people may be required to buy insurance that’s too expensive or it’s something they don’t want, support for the individual mandate falls to 19 percent.

“As we have learned from past debates, public support looms for health reform largest at the beginning of the debate, but it’s relatively easy to chip away at that support with arguments about trade-offs,” said Mollyann Brodie, a Kaiser vice president.

Researchers said the economy is the overwhelming top concern in the United States — cited by nearly three quarters of the public. Health care is a top domestic concern too. But the survey suggests the public is split when it comes to a willingness to sacrifice financially to get more people insured.

About 47 percent were willing to pay higher insurance premiums or taxes, while 49 percent were not.

The study is based on a telephone survey of 1,628 adults conducted in early and mid-December. The margin of error was plus or minus 3 percentage points.

WASHINGTON (Reuters) – When Shirley Hunter reviewed her finances to make sure she could afford to retire in 1999, she never banked on health care costs more than doubling in less than a decade.

Now the 74-year-old former California kindergarten teacher finds herself under financial pressure. Despite taking lodgers to help pay the bills, she worries about losing her home or having to choose between mortgage, food and health insurance.

“I’m on a fixed income. Nothing else is fixed,” Hunter said. “I can’t afford to travel right now or anything. It’s very disappointing to work like I did and then have this happen.”

Hunter, who told her story to a community healthcare discussion in Costa Mesa, California, is one of millions of Americans looking for President-elect Barack Obama to make good on his campaign promise to tackle the U.S. healthcare crisis.

Obama’s choice to lead the reform effort, former Senate Majority Leader Tom Daschle, testifies at his Senate confirmation hearing on Thursday — beginning a process to change the nation’s healthcare that could be one of the most ambitious and expensive undertakings of the Obama presidency.

The United States spent $7,421 per person on health care in 2007, some 16 percent of Gross Domestic Product, but does worse in many areas of care than other developed countries.

Employers complain that rising healthcare costs put them at a competitive disadvantage in the global economy, driving up the price of everything from a car to a cup of coffee. This has become more acute during the current economic turmoil.

“We can’t afford to put domestic priorities like health care on the back burner,” said Obama spokeswoman Jen Psaki. “This will certainly be a priority for him and for the new administration once he’s sworn in.”

Daschle and his team have helped organize thousands of grass-roots meetings across the country to try to understand the health problems people face and the changes they want.

Some 8,500 people signed up to host the sessions like the one Hunter attended in Costa Mesa. Daschle himself attended two — one in an Indiana firehouse and the other at a Washington, D.C., senior center.

Feedback from people contacted by telephone after the meetings shows the scope of the problem.

“As a nation we’re spending way too much money and we’re not getting much value for it,” said Dr. Allan Wilke, a family practitioner who attended a discussion with other doctors at a medical center in Huntsville, Alabama. “I think we all know the system has got to be fixed.”

COVERING THE UNINSURED

The doctors’ biggest worry was the 46 million uninsured who put off going to the doctor until they visit a hospital emergency room, a costly form of care for conditions that are often preventable.

“I think that was probably the major concern — the number of people that don’t have insurance, that end up getting sick and using the emergency rooms for their primary care,” Wilke said.

Expanding health insurance coverage was a frequent topic. Teenagers who participated in a discussion sponsored by Planned Parenthood in Utica, New York, worried about workers who earn too much to receive government-sponsored health care but cannot afford health insurance.

Preventive care came up at the session in Alabama, where obesity is a problem, and again in Frankfort, Kentucky, where a group of health professionals and public health officials met.

“Prevention was the big topic for us,” said Anne Donworth, a hospice executive at the Frankfort discussion. “As a society we need to focus more on emphasizing taking good care of yourself and … early diagnosis and prevention measures.”

The industry’s economic structure also was seen as flawed.

Attorney Kenneth Zwick, who attended the session in Costa Mesa, said he thought the profit motive warps how the healthcare system works.

“As long as insurance companies, who I sometimes litigate against, are as concerned with their bottom line as they are with the health of their people … we will never have, I don’t think, an effective or appropriate healthcare system,” he said.

The Alabama doctors discussed placing more emphasis on paying for preventive care.

“If you incentivize the system so that the quality measure is lower blood pressure, better control of diabetes, etcetera, etcetera, if you pay me to do that, you’ll get what you pay for,” Wilke said.

Tags: Obama healthcare

Health care costs are daunting to nearly a fifth of the people who took part in a recent AARP survey.

The telephone survey, conducted in November by Woelfel Research, included 1,001 U.S. adults age 45 and older. All but 10% of them have health insurance, either from their employer, their spouse’s employer, private insurance, or Medicare.

One survey question was, “How confident are you that you will be able to afford medical care next year?”

Most people — 81% — said they were at least somewhat confident. That leaves the remaining 19% unsure that they will be able to foot their health care bills in 2009. Here are the details:

* Extremely confident: 26%
* Very confident: 33%
* Somewhat confident: 22%
* Not very confident: 9%
* Not at all confident: 10%

People age 65 and older (and thus eligible for Medicare) were especially confident that they’ll be able to afford health care next year. People earning less than $30,000 per year were least confident about being able to pay for healthcare.

Likewise, when asked specifically about affording prescription drug costs next year, most people — 83% — were at least somewhat confident. But 9% were not very confident and 8% were not at all confident that they could afford their prescription drugs. Most participants reported spending up to $200 per month for up to six prescription drugs in 2008.

Taking Action

Survey participants were also asked what they had done to try to contain their health care costs.

* 58% said that when a doctor prescribes a new drug, they always ask if there’s a generic equivalent.
* 62% said they always pick the generic version, if one is available.
* 49% said they’ve asked their doctor if there are things they can do (such as physical activity and diet change) to lower their number of medications.
* 77% said they’ve never been prescribed a brand-name drug that they couldn’t afford.
* 85% said they hadn’t cut back on medications in the past year because of costs.

The survey has a margin of error of three percentage points.

Tags: aarp, Healthcare 2009