Since it is pretty clear that some version of health reform will pass within the next month or so, these are my lay person predictions about what the final bill will look like. You can rate my predictions on a scale of 1 to 5. 1 = No way it will happen, Linda, you are nuts; 2 = It might happen; 3 = Can't predict one way or the other; 4 = A good chance; and 5 = Sure to happen, you are a genius.
Provide a comprehensive set of "early deliverables," starting in 2010, which include (1) initial insurance reforms and consumer protections, (2) a new insurance pool to make coverage available to individuals with pre-existing conditions or chronic illnesses who can't get coverage today, and (3) disclosure, review and justification of insurance rate increases.
-- Improve insurance coverage by implementing major coverage reforms (2013 in House bill, 2014 in Senate) and providing financial assistance to lower- and middle-income families and small businesses.
-- Improve Medicare coverage for prescription drugs and preventive services, and implement major Medicare delivery system and payment reforms to make Medicare more efficient and restrain future spending growth. Both bills institute numerous long-term reforms that experts have called for to enhance quality and value for Medicare beneficiaries and the entire health care system.
-- Provide revenues that, coupled with the program savings above, meet the commitment of the President, the Speaker and the leaders of the House and Senate that the bill be fully paid for. In fact, both bills actually reduce the deficit by more than $100 billion over the first 10 years, and are projected to yield savings in the second 10 years.
But that's where the similarities start to end. A rough rule of thumb to follow is that the Senate bill will likely dominate the discussions, with a few bones thrown to the House version. The tough issues to decide are the following, with my predictions about whether the provision will endure, and whether or not the House or the Senate version will win out.
1. The individual mandate -- Both the House and the Senate bills have individual mandates, with varying degrees of subsidy to help people buy the insurance. Both the left and the right oppose an individual mandate, and Obama did not include it in his campaign health reform promises.
My prediction: The individual mandate survives but penalties are weak and subsidies for hardship increased.
2. The employer mandate -- Both bills have an employer mandate of various kinds.
My prediction: The mandate will survive but penalties will be weak and revenue from it will be more like the Senate version.
3. The subsidies to help people purchase insurance in the exchange -- The House version has larger subsidies than the Senate and helps lower income people more.
My prediction: If they can find the money, the more generous House subsidy level will prevail.
4. The insurance exchanges -- the House has a national exchange; the Senate has state by state exchanges and allows states to opt out.
My prediction: The Senate state by state exchange approach wins.
5. The abortion amendment -- The House or "Stupak amendment" on abortion is much more drastic than the Senate or "Nelson amendment".
My prediction: The Senate version wins. Ladies, take out your check writing pens. We can only hope it's not implementable.
6. Sources of revenue -- (Read the Politico piece to see the many ways revenue is proposed to be raised by both bills.) The largest piece of revenue in both bills is the so-called "Tax on the Rich" in the House bill, which proposes a 5.4% surcharge on individual income above $500k and joint returns of over $1m. This raises $460 billion over ten years, nearly half the proposed cost of reforms. The Senate proposes an excise tax of 40% on the part of the premium that is more than $8500 for an individual or $23,000 for a family. That proposal raises only $149 billion. There are a dozen smaller revenue raising proposals in both bills to fill out the expected cost of about $100 billion a year over a ten year period. Ezra Klein points out that that would amount to about 5% of our total spending on health care in 2016.
My prediction: We'll see a little of both in the final version. The House could raise its tax on the rich to a million (the "millionaire" tax) and the Senate could decrease the tax on rich plans somewhat. Since the House proposal raises so much more revenue, the Senate would have to scramble to fill in the rest if it drops the tax on rich plans.
7. The public option -- The House has a weak public option. The Senate has none. This is, unfortunately, an easy one to predict.
My prediction: No public option in the final bill. However, there might be an expansion of the national nonprofit option in the Senate bill.
8. Undocumented coverage -- Neither bill allows federal subsidies for undocumented. The House bill allows undocumented folks to buy in the exchange using their own money. The Senate forbids it. So to keep Joe Wilson quiet, this one is also, sadly, easy.
My prediction: The Senate version wins. And the undocumented will continue to land in our emergency rooms and we will continue to pay for them one way or the other.
9. The final cost of health reform -- The House bill is more expensive than the Senate bill, but both come in under $1 trillion, give or take a few billion.
My prediction: The final bill will have a projected cost of $899 billion (coming in under the $900 billion that the President set as his goal)
10. When health reform will be signed into law -- end of January? Before State of the Union?
My prediction: Valentine's Day 2010 - Obama's big kiss to the American people.
Do you agree or disagree?