Health Care Reform Legislation Update

Without getting into too much of the excruciating detail, I want to encourage continued vigilance and participation by all parties in this important debate. The outcome will affect us all substantially and will shape, not only our health care, but also our lives in the future as our representatives consider attempting to control over 1/6 of the US economy now primarily in the private sector.

To ease the burden of a planned 21% reimbursement cut for Medicare doctors in 2010, Senate Democrats tried to pass a stand-alone bill that would have wiped out both next year’s cut and all future cuts. Eliminating the cut for one year would cost $10.9 billion. To totally eliminate the fee cuts for all years would cost $245 billion. Such a bill would add close to a quarter-trillion dollars to the deficit. This is precisely the bill Majority Leader Harry Reid brought forward. Senator Reid needed 60 votes, but he garnered only 47 as all Republicans and 13 Democrats voted against cutting off debate. Senate Democrats had hoped to gain physician support for health care reform by providing relief from the cuts. The results should serve as a “wake-up” call to the Democratic leadership that health reform will not be a walk in the park. The strong vote could also embolden moderate Democrats to band together and make “hard votes” on health care reform as well.

In the House, legislative activity for the week came down to passage in the Judiciary Committee of a bill that Democratic sponsors describe as repeal of the health insurer antitrust immunity known as the McCarran-Ferguson Act. The bill more accurately can be described as codifying various court interpretations of the Act, all of which the industry lives with day in and day out. The bill specifically says health insurers can’t hide behind McCarran-Ferguson to price-fix, bid-rig or engage in market allocations with competitors. Insurers can’t do that now, so the bill is much more of a vehicle for some in Congress to further demonize a well thought-out piece of legislation with positive policy underpinnings. Whether this item gets added to a health care reform bill or progresses on its own remains to be seen.

The timing for floor debate on health care reform will likely ebb and flow for several weeks, but the current thinking is that this process may take all of 2009 and possibly into 2010 to complete. There is a real chance that too many variables will get in the way and neither Chamber will get to the floor until December, which, if true, would translate into a January Conference.