Obama-Friendly Health Reform Moving Forward in the House

The House health reform bill has arrived, and President Obama likes it. The Americans' Affordable Health Choices Act, unveiled by House Speaker Nancy Pelosi and three committee chairmen, contains most of what Obama wants and leaves out at least one thing he doesn't want.

The bill creates a health insurance exchange or marketplace for consumers and small businesses to comparison shop for coverage from private insurers and a competing public plan. Insurance companies would have to cover people regardless of health status. The companies would not be allowed to limit lifetime or annual benefits or charge people more due to gender or health status.

A new advisory committee chaired by the surgeon general would recommend a basic benefit package for coverage in the exchange. Among its features would be preventive services with no cost-sharing, and a cap on how much a family would have to spend on covered services. People would pay for coverage on a sliding scale. The federal government would expand the Medicaid program for the poor. Upgrades in Medicare for the elderly would include eliminating the coverage gap in its prescription drug program.

Individuals would have to buy coverage. Businesses would have to offer insurance or contribute money to cover their employees. Businesses with payrolls under $250,000 would be exempt. Doctors and hospitals would be rewarded for "primary care services, care coordination and efficiency."

The nonpartisan Congressional Budget Office said Tuesday in a preliminary analysis that the bill would cover 37 million people who are currently uninsured and leave another 17 million uninsured, half of whom would be illegal immigrants. Estimated cost from 2010 to 2019: $1.04 trillion.

And how to find the money? House Democrats list billions in savings. They also propose a graduated surcharge on families with adjusted gross incomes above $350,000 and individuals with adjusted gross incomes above $280,000. The surcharges of 1 percent to 1.5 percent would only apply to income above those amounts. That type of financing is more in line with Obama's thinking than starting to tax employer health benefits above a certain level as income. He campaigned against that last year and has said he prefers other methods, but the benefits tax is not entirely off the table in the Senate.

Obama praised the "unprecedented cooperation" of Reps. Henry Waxman (D-Calif.), George Miller (D-Calif.), and Charles Rangel (D-N.Y.), the three committee chairman who hammered out the package as a joint effort. He said their product would lower costs, improve care for patients and ensure fair treatment of consumers by the insurance industry.

While the Senate proceeds at a relative snail's pace, committee work sessions to consider amendments to the House package could start as soon as Thursday. The goal is to pass a bill on the floor by the end of July.

Republicans are unlikely to derail this train, despite dire predictions of doom, gloom and creeping socialism. Rep. Trent Franks, (R-Ariz.), appearing with fellow Republicans to discuss a rival health bill, compared the Democrats' package to what he called government takeovers of the banking and car industries and "the largest tax increase in the history of the human species" -- that is, the landmark energy and climate bill the House passed last month.

"It represents a totally different worldview than really what America was founded on," Franks said of the Democrats' health bill. "It seems that the highway of history of our country has been littered with the wreckage of socialist ideas that somehow believed that they could catalyze productivity and lower prices better than free markets, and it has never, ever, ever worked."

House Minority Leader John Boehner (R-Ohio) merely charged House Democrats with "criminal malpractice" for pushing "a government takeover of health care and a new small business tax" in the midst of a recession. The Democrats say 96 percent of small businesses would see no tax increases from their package, and many of its provisions would help small businesses.

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