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Senate Dems trim cost of health care bill

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July 2, 2009

Determined to advance President Barack Obama’s health care agenda, key Senate Democrats are calling for a government-run insurance option to compete with private plans, as well as a $750-per-worker annual fee on larger companies that do not offer coverage to employees.

In a letter outlining the details, Sens. Edward M. Kennedy, D-Mass., and Christopher Dodd, D-Conn., said their revised plan would cost dramatically less than an earlier, incomplete proposal, and help show the way toward coverage for 97 percent of all Americans.

The two senators said the Congressional Budget Office put the cost of the proposal at $611.4 billion over 10 years, down from $1 trillion two weeks ago. The revising also "virtually eliminates" an earlier forecast that the proposal would cause many companies to drop coverage for their workers, they said.

Kennedy and Dodd wrote members of the Senate Health, Education, Labor and Pensions Committee on Wednesday. A copy was obtained by The Associated Press. They disclosed their plans as Congress neared the end of a July 4 vacation, and with lawmakers expected to turn quickly to health care legislation when they return to the Capitol.

The Health Committee could meet as soon as next week to complete its version of the bill, and the presence of a government health insurance option virtually assures a party-line vote.

Separately, the Senate Finance Committee is at work on a companion measure, although that effort is aimed at achieving a bipartisan compromise. As a result, a government-run option for coverage is unlikely to be included. Negotiations are centered on a proposal for a nonprofit cooperative to sell insurance as a competitor to private companies.

Three committees are collaborating in the House on legislation expected to come to a vote by the end of July. That measure is certain to include a government-run insurance option.

At their heart, all the bills would require insurance companies to sell coverage to any applicant, without charging higher premiums for pre-existing medical conditions. Poorer individuals and families would qualify for government subsidies to help with the cost of coverage. The government’s costs would be covered by a combination of higher taxes and cuts in projected Medicare and Medicaid spending.

Obama has urged Congress to pass legislation this year, both to control the costs of health care generally, and to make coverage available to an estimated 47 millions who lack it.

Kennedy, D-Mass., has devoted years to the struggle for universal health care, although he has been absent from the Capitol in recent weeks as he copes with a brain tumor. As chairman of the Health Committee, he and his aides have been heavily involved in drafting legislation, and in his absence Dodd has taken on a more prominent public role as the next senior Democrat on the panel.

"Like the president and a strong majority of Americans, we believe that a strong public option is an important component of any health reform bill that keeps costs down, expands coverage and offers American families a wide variety of affordable options," the two Democrats wrote.

They outlined an approach in which the Health and Human Services Department would negotiate rates and premiums, and poorer individuals and families would be entitled to the same subsidies as anyone buying coverage from private insurance firms.

"We must not settle for legislation that merely gestures at reform," the two Democrats wrote. "We must deliver on the promise of true change."

The letter indicated that the cost and coverage improvements resulted from two changes: the government-run health insurance option, which has drawn intense opposition from Republicans, and the employer fees.

The proposal calls for a $750 annual fee on employers for each full-time worker not offered coverage through their job. The fee would be set at $375 for part-time workers. Companies with fewer than 25 employees would be exempt. The fee was forecast to generate $52 billion over 10 years, money the government would use to help provide subsidies to those who cannot afford insurance.

The same provision is also estimated to greatly reduce the number of workers whose employers would drop coverage, thus addressing a major concern noted by CBO when it reviewed the earlier proposals.

4 Responses to Senate Dems trim cost of health care bill

  1. southgeorgia912

    July 2, 2009 at 10:49 am

    Dodd will say anything just for show; always has. It really sickens the hell out of me that Congress thinks they have the answers to everything. It will be a cold day in hell before I let some wacko liberal Democrat tell me what health insurance to obtain and which doctor they “think” I need to see. They need to keep their filthy hands out of our wallets and their nose out of our business.

  2. ekaton

    July 2, 2009 at 1:51 pm

    “wacko liberal Democrat”

    This is helpful.

    “wacko neoconservative Republican”

    Just as helpful.

    Both epithets are MOST conducive to getting others not exactly in line with your point of view to attempt to see your side, your point, your objective.

    We should definitely keep on using such slurs because they are most helpful in solving all of our problems. They help keep us separated, divided, so that agendas NONE of us would support can proceed as the master elite wish.

    Kent Shaw

  3. woody188

    July 2, 2009 at 4:35 pm

    Sounds like my small manufacturing company of 39 is about to drop to 25. Hard to believe we had over 50 just a year ago. We already have our layoffs planned through August. We honestly cannot afford this new tax or the cap and tax legislation. Between the two we’ll be out of business by year end.

    It’s really kind of scary. Talking to my executives I’ve been told we might try to run with just salaried people (10 or so out of 39) if it comes to that. We are doing everything we can just to survive at this point. This is without the new taxes. With the new taxes, we are probably done.

    5 more to fall this Friday. Down to 34. But isn’t the economy doing great? The Fed said so!

    BREAKING: Just been informed that Cox Communications is closing customer service centers, 220 are about to lose their jobs in the next few days. There are strong indicators the recession is about to smack white collar middle class America right in the face.

  4. Janice

    July 3, 2009 at 10:55 am

    We are seeing small businesses who have been holding on, starting to fail now. Jobs aren’t going to start back up until people have money in their pockets to spend. It’s a circular problem that the banks created, and are perpetuating with their lack of lending. We must have health care reform, but citizens also need jobs so they can pay for insurance.
    Personally, I think the stimulus funds should have gone to the households in this country with the direction to pay down debt. I figure 80% of the households would have; sending the money into the same places that received the direct stimulus funds, but with the added benefit of the citizens debt being dramatically reduced, with more available cash to fuel the ecoonomy. Common sense is tainted by greed at the top.