Reid Leads Democrats In Carving Out Favors for States on Health

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Reid Leads Democrats In Carving Out Favors for States on Health

By Brian Faler

Oct. 20 (Bloomberg) -- Nevada would get help with its Medicaid bills. The elderly in Florida and New York would receive additional Medicare benefits. And workers in so-called high-risk professions such as firefighting and construction would get a break on a new insurance tax.

Those are provisions that Senate Democrats, including Majority Leader Harry Reid, put in an $829 billion health-care bill to shield constituents from measures intended to pay for the biggest overhaul of the medical system in four decades.

The result is the new policies may be unevenly administered, with some U.S. states getting preferential treatment, a possibility that has given Republican lawmakers ammunition to attack the legislation.

“It’s going to hurt the bill and raise the level of cynicism about Washington politics,” said Senator Lamar Alexander, a Tennessee Republican. “The provisions ought to be applied to all of the states.”

The number of special provisions is likely to grow as the full Senate begins debating the measure in coming weeks. Because Democrats are unlikely to win many Republican votes, individual lawmakers will have leverage to demand changes to satisfy parochial interests.

At the same time, those provisions may make it easier for Congress to approve a sweeping bill by giving lawmakers more of a stake in legislation they may not otherwise fully support.

Doing Their Jobs (Rationalization?)

“Members being able to convince colleagues of the special circumstances in their states?” said Senator Kent Conrad, a North Dakota Democrat. “That’s what members are here to do -- represent their state.”

Senate Democratic leaders are meeting behind closed doors with Obama administration officials to combine measures approved by the finance and health committees. Debate may begin next week on the legislation, which would expand health coverage to millions of uninsured Americans and place new restrictions on insurance companies.

Health-insurer stocks have lost ground in the last month on concern the overhaul will hurt profits. The Standard & Poor’s index of 13 managed-care companies dropped 13 percent, led by Hartford, Connecticut-based Aetna Inc.

Lawmakers have already made exceptions to some of the biggest policy changes under consideration.

$100 Billion Cut

Democrats such as Senators Bill Nelson of Florida and Ron Wyden of Oregon secured provisions setting aside $5 billion to shore up benefits for constituents who participate in Medicare Advantage. That program allows private insurers to contract with the government to provide Medicare benefits.

The bill that came out of Senator Max Baucus’s finance committee cuts more than $100 billion from Medicare Advantage to help fund the overhaul. Some lawmakers say they are concerned the elderly will see a reduction in benefits. (Several years ago didn't the Republicans try and change Medicare and didn't the dims fight like hell to block any changes? Didn't the dims demagogue the issue and demonize Republicans for even trying?)

The measure doesn’t identify which states could get the $5 billion. The language is so confusing -- those eligible include retirees in “counties where the MA benchmark amount in 2011 is equal to the legacy urban floor amount” -- that even congressional aides said they aren’t sure.

Nelson said the aid isn’t directed solely at Florida. “It affects several states, including New York,” he said. “We’re trying to grandfather in seniors so that they don’t lose the benefits they have.”

Wyden said it would go to states like Oregon that “would face hardships” under Medicare Advantage cuts.

Help for Unions

Lawmakers such as Senator Robert Menendez of New Jersey pushed for exceptions to a tax on expensive insurance plans. The tax would be phased in more slowly in states the government determines have the highest costs.

Democrat John Kerry, whose state of Massachusetts is likely to end up on the list, said the tax may disrupt his state’s own efforts to expand health coverage.

“If you change the way it’s working, you automatically upset people’s expectations,” Kerry said.

Those in professions deemed high risk like mining would also get a break. For them, the tax would kick in for family insurance plans worth $26,000 not $21,000.

Menendez said that was designed to protect those “who gave up money at the table in order to get better health-care packages,” referring to Democratic-supporting unions. Senator Dick Durbin of Illinois last week said lawmakers are considering additional changes to reduce the tax hit on union members.

Full Funding

Reid secured provisions to ensure his state of Nevada won’t face higher Medicaid costs.

Democrats want to expand coverage by loosening eligibility rules for the joint federal-state health-care program for the poor. Some governors say that could saddle them with higher bills. State spending would increase by $33 billon under Baucus’s plan, the Congressional Budget Office says.

The plan calls for “full federal funding” of Medicaid for new beneficiaries in only those states that had unemployment rates of at least 12 percent in August and whose Medicaid enrollment is below the national average.

Only Nevada, Rhode Island, Michigan and Oregon meet that criteria. That prompted complaints from other lawmakers that their states would have to pay more.

“We cut special favors for special states, not based on need or requirements but on the influence of the individual senator,” said Arizona Republican John McCain.

Reid responded: “I make absolutely no apologies -- none - - for helping people in my state.” (And I don't care how much I screw people in other states!)

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[Auburn85 434]

And I'm sure a C-SPAN camera crew followed them in that backroom meeting. It's probably live on CSPAN right now.

I wonder what will get added 90 seconds before a vote.

And finally, if you're against this bill, you're against helping people. You're against choice. So what if they won't give you that same choice to opt out of Social Security taxes to move them into private accounts. Or to not pay the Medicare payroll taxes. You will now have a choice as you pay all of these taxes and then fight to pay for your private insurance or anything private. But the people are hurting. Yeah, the ones that are working are hurting so much that some still have at least a 20% income tax liability. Afterall, you're against healthcare reform, not just this particular legislation.

[OldNewby 27]

When all is said and done, will someone please rate the states getting the largest breaks. We need to know where to move.