WASHINGTON — At heart, the House and Senate versions of health-care reform legislation are very much the same. Both require virtually all Americans to have health insurance, while offering low- and middle-income people subsidies to make that mandate more affordable. Both would establish new marketplaces, called “exchanges,” where individuals who don’t get insurance from employers could buy coverage.
Both would cost about $1 trillion over 10 years and pay for themselves via cuts in projected Medicare spending and tax and fee increases. Both would ban insurance firms from denying anyone coverage due to pre-existing health conditions.
But though their frameworks are the same, the two bills are very different in some of the details. So different, in fact, that harmonizing the bills could be a daunting task for a conference committee of House and Senate negotiators.
Here are three of the biggest obstacles to melding the bills together:
Financing. The largest source of new revenue in the House version of health-care reform legislation is a tax on wealthy Americans. It consists of a 5.4 percent surcharge on families with annual incomes over $1 million and on individuals with incomes over $500,000. It’s estimated to bring in $461 billion over the next decade.
In contrast, the largest source of new revenue in the Senate version of the bill is an excise tax on high-cost health insurance plans. The Congressional Budget Office estimates this would raise $149 billion over 10 years. The Senate raises another $238 billion over the decade via a mix of fees on insurers and some health device manufacturers, and other provisions.
Public option. The House version has a public option – a government-run insurance plan that would negotiate payment rates with doctors and hospitals. (Liberals would have preferred that it use the Medicare rates set by the government, which would probably have been lower.)
The House bill allocates $2 billion for public option start-up money. But premiums from beneficiaries would have to pay for the full cost of the plan after it got up and running.
The Senate bill … well, that was kind of a struggle, wasn’t it? The Senate bill has no public option, following objections from Sen. Joseph Lieberman (I) of Connecticut and moderate Democrats about government intervention in the marketplace.
Instead, under the Senate bill, the federal Office of Personnel Management would oversee two national health plans from private firms offered through the exchanges to individuals, families, and small businesses. At least one of those plans would have to be operated on a nonprofit basis.
Abortion. Under the House bill, health plans, in general, could choose whether to cover abortion or not. But federal money couldn’t be used for abortions, except in cases of rape or incest, or if the life of the pregnant woman was in danger.
The public option plan would not provide abortion coverage, for instance, in the House version of the bill. Nor could individuals who received federal subsidies to buy insurance choose a plan that covers elective abortions.
Abortion language in the Senate bill is different in important details. As in the House version, the Senate language allows health plans, in general, to choose whether to cover abortion or not. But states could block plans that cover abortion from being offered through the new insurance exchanges.
The Senate would allow people who receive federal subsidies to buy insurance to enroll in plans that cover abortion. But they would have to make two separate monthly payments: one for abortion coverage, and one for all other health coverage.