Patterico's Pontifications


ObamaCare: The Back Room

Filed under: General — Karl @ 9:36 am

[Posted by Karl]

The Democrats pushing a government takeover of the US healthcare system are now about where they thought they would be in July. It does not get easier from here. Sen. Maj. Ldr. Harry Reid is stuck having to come up with a bill merging the Finance Committee’s vapor bill and the Kennedy-Dodd HELP bill to bring to the floor under Rule XIV. He faces pressure from his Left, from which we can learn a bit about the state of play in the Democrats’ backroom.

Sen. Chuck Schumer is pressuring Reid to have the bill include the so-called “public option”:

“If he puts it in the final bill, in the combined bill, then you would need 60 votes to remove it. And there clearly are not 60 votes against the public option. And so we’re urging him to do that, and he’s seriously considering it.”

A source close to Reid e-mailed this response to ABC News:

“Perhaps Sen. Reid should consider giving Schumer the assignment to get 60 votes on the public plan of his choosing, since he says there is a groundswell of support for this idea.”

The Progressive Change Campaign Committee is calling on Reid to strip Senate Dems of their committee slots if they won’t agree to vote against a filibuster — and Reid’s spokesman, Jim Manley offered another snippy retort:

“Senator Reid is focused on crafting a health care bill that will overcome a Republican filibuster. Stripping Democratic Senators of their leadership titles is a decision that would be left up to the Caucus, not Senator Reid. In light of this reality it’s unlikely that the Caucus would ever go along with this idea.”

Liberals correctly note that GOP Senators cannot sustain a filibuster by themselves, which tells you that the Senate Dems have failed so far to reach unity on framework for the bill, especially on the “public option.” The statements also tend to confirm that every amendment to the merged bill will require a 60-vote threshold under whatever unanimous consent agreement brings the merged bill to the floor. So if the “public option” is left out of the merged bill, it will likely stay out — and vice versa.

We can get more clues about what may come out of the back room by looking at who will be in the back room. Reid will be there, as will Finance Committee Chairman Max Baucus (who does not think there are enough votes for the “public option.” They will be joined by Sen. Chris Dodd from the HELP Committee — which is interesting. The HELP Committee chairman is Sen. Tom Harkin, who replaced the late Ted Kennedy, and has been a vocal advocate for the “public option.” There will be White House players, including Chief of Staff Rahm Emanuel, Office of Health Reform Director Nancy-Ann DeParle, Office of Management and Budget Director Peter Orszag, Director of Legislative Affairs Phil Schiliro and White House-Senate liaison Shawn Maher.

And there will be… Sen. Olympia Snowe, who will bring her own agenda and tilt the negotiations in ways likely to give liberal Democrats heartburn. The decision to include her further signals the intentions of Reid (and likely the White House) about the shape of the merged bill, because now they have a Republican to blame for the compromises the moderate Democrats have probably sought behind the scenes. Indeed, Sens. Ben Nelson and Mark Pryor have adopted Snowe’s “wait and see” attitude toward any final bill, while Sen. Joe Lieberman says other centrist Democrats beyond the committee may also oppose a bill like the Baucus vapor bill. The moderate Dems likely will be with their party on most procedural votes but could hold out on the last one — to end debate and cut off a filibuster.

Snowe’s presence in the back room makes it more likely that the merged bill will drop the “public option” — or neuter it with a “trigger.” This will alienate roughly 30 Senate Democrats, the House Progressive Caucus (which claims a bill cannot pass the House without a strong “public option”), and their masters at Big Labor.

Snowe co-authored the amendment to the Baucus vapor bill reducing the threshold for the individual mandate penalty. Weakening the mandate is the issue that set the health insurer’s lobby on their multi-state, multi-million dollar campaign against ObamaCare. Yesterday, the Blue Cross Blue Shield Association dropped its own study claiming that premiums will rise up to 50% for individual policies and 19% for small group plans if ObamaCare passes.

In short, the inclusion of Snowe in the back room may offer Reid & Co. some cover to try to attract moderate Democrats. But that tactic did not visibly move those centrist Dems — and Snowe’s positions will alienate everyone from Big Labor to the health insurance lobby.

Reid’s headaches do not stop there. There is the small question of money to pay for the bill. The Baucus plan to raise $201 billion from a tax on high-premium insurance plans is a non-starter with House progressivesand Big Labor, and opposed by Sen. Jay Rockefeller (and Sen. Robert Byrd, in all probability), Sen. John Kerry, Sen. Lieberman and perhaps others — dependng on whether blue states get cut a special deal on the tax. Of course, the more special deals that get cut, the more money that will have to be extracted in other ways. As it stands now, about 87 percent of the revenue in the original Baucus proposal to finance ObamaCare would come from individuals with incomes of less than $200,000. Yet even moderate House Dems oppose Rep. Charlie Rangel’s (D-NY) supposed “millionaires surtax” because they know it would hit small businesses in their districts.

In sum, as Reid tries to bring a merged bill to the floor, the Baucus-esque proposal most likely to meet Pres. Obama’s demand that healthcare reform not increase the deficit runs smack into opposition from an array of interest groups, Senate liberals and the House in general, both on the “public option” and on how to finance the scheme. There will probably be plenty of smoke in that back room, mostly coming from the ears of the people trying to square circles in it.


32 Responses to “ObamaCare: The Back Room”

  1. This is why I don’t think Olympia Snowe should be trashed just yet by Republicans. The hard left is convinced that a majority of the country is in favor of single payer.

    Asked specifically about polling data showing the public option with strong national support, the conservative Democrat added, “I think that when people hear ‘public option,’ they hear ‘free health care.’ Everybody wants free health care. Everybody wants health care they don’t have to pay for. The problem is that we as government and business have to pick up the tab, and as individuals. So I’m not at all surprised that the public option has been sold as free health care. But there is no free lunch.”

    This is pretty foolish. For one thing, Mary Landrieu, as a senator, takes advantage of a very generous health care plan that lawmakers give themselves. “Everybody wants health care they don’t have to pay for”? I suppose that’s true, but it’s odd to hear the comments coming from someone whose coverage is subsidized by taxpayers.

    Well, I agree with him there but they are delusional if they think the public supports the public option as designed by Democrats. Maybe they will choose to kill the Baucus plan and fight the 2010 election on health care. That’s OK with me.

    Mike K (187f3b)

  2. Why is it that advocates of universal health care point to foreign examples like France or Japan and never domestic examples like Massachussetts or Tennessee?

    Michael Ejercito (6a1582)

  3. There is the small question of money to pay for the bill.

    — What question? They’ve already devised their backdoor method of paying for this monstrosity.

    Icy Texan (6fdd44)

  4. The Blue Dogs are staring electoral disaster next year if they allow the public option to pass (and Reid’s at the front of the herd) – I’m still involved in the National ad biz, and the rumors among the trades are that this thing is just beginning to get ramped up. It will be a staggering carpet bombing of unprecedented means, and they only need one constituency to effectively torpedo the whole enchilada. Middle class taxpayers, seniors, etc. – just make their day, please.

    Dmac (5ddc52)

  5. Good summation, Karl.

    SPQR (26be8b)

  6. We are indeed living in interesting times.

    That’s a curse, isn’t it?

    Patricia (c95a48)

  7. If this passes, the Democrats will lose congress.

    Zelsdorf Ragshaft III (57cae1)

  8. It’s so simple: The ONLY way to pay for it without raising the deficit is through the combination of cutting other payments and raising taxes . . . two things that The Messiah promised during the election campaign not to do.

    Is there a Hawaiian word for Indian Native-American giver?

    Icy Texan (6fdd44)

  9. I recall reading that Maine has a state funded “public option” that is bleeding through the eyes, and desparately wants a federal bail out so the sins of the Dems who inflicted it are not visited upon them.

    Don Meaker (9ceac6)

  10. You know Karl, your posts would be a lot more interesting if you cited the occasional reference. Just kidding, excellent and well-researched article, thank you.

    Gazzer (22ecdc)

  11. Don Meaker,

    I think you mean this post at NRO. Ironically, Snowe’s support for a weak mandate does not help Maine.

    Karl (f07e38)

  12. BTW, there are a couple of links in this post to the HotAir version of this post, in order to honor Pat’s boycott of the Politico. Just in case you were curious about the seeming self-linking.

    Karl (f07e38)

  13. The Bread and Circuses continue.

    SPQR (26be8b)

  14. Good thing Republicans are keeping their eye on the ball. There’s so much at stake.

    That Steve King homo is acting out issues with his gay I think. Republicans are such neurotic tools I don’t really understand what their value proposition is supposed to be aside from not being dirty socialists.

    happyfeet (71f55e)

  15. Right now the GOP isn’t even very good at not being dirty socialists.

    Rochf (ae9c58)

  16. Rush reported that Dingy Harry, in a Senate floor colloquey (audio played on his show), stated that the cost of the Baucus Bill is TWO-TRILLION-DOLLARS, and therefore, saving a few Billion on Tort-Reform is meaningless.

    AD - RtR/OS! (caade8)

  17. It’s about the patronage. Barry and his band of merry redistributors really can’t expand all the traditional Democratic vote and influence generating entities. They’re maxed out. Gotta expand by a takeover.

    glenn (757adc)

  18. In the paper today, I read that the Democrats are pushing a bill to raise payments through Medicare to doctors by approx $260 billion. Its a seperate bill so that they can continue to lie about the faux “deficit neutrality” of the reform bill.

    Democrats –> Deception. That’s the formula.

    SPQR (26be8b)

  19. SPQR,

    The doctor payment fix is actually worse. Not only is it dishonest from the standpoint you mention, it underscores the reality that Congress always fixes the doc payments. The CBO’s rules “score” the cuts that never happen as savings, even while stating that the CBO does not expect them to happen. If the SGR fix was made permanent, there is no way the healthcare bills moving thru Congress would be seen as bending the cost curve.

    Karl (f07e38)

  20. Exactly, Karl. Brazen lies are the foundation of the Democrats’ healthcare “reform”.

    SPQR (26be8b)

  21. Bending the cost curve is a phrase that just grates on me, kind of like when sportcasters say scoring the ball.

    Karl – Love your stuff, love it, but you never seem to mention that the costs are understated to the point of making this laughable. The prescription drug benefit was off by at least 3X, so far, and the original Medicare projections were off almost 10X.

    JD (59882e)

  22. Someone needs to ask Elmendorf again about all this accounting chicanery – no doubt his answer will be illuminating.

    Dmac (5ddc52)

  23. JD,

    The projection for Medicare was way off, not sure about the prescription drug benefit. IIRC, that projection wasn’t too bad, primarily bc you still have competition in the rest of the drug market. But if you can recall a source, I’ll try to track that down.

    In general, the reason I haven’t stressed the point is bc on the one hand, Congress only cares about the current CBO numbers working, and otoh, the polling shows that decent majorities already don’t believe HCR will cut the deficit. So I’m trying to dig deeper, though it’s not easy to find stuff the core readership here doesn’t already know.

    Karl (f07e38)

  24. Dmac,

    Hatch’s questioning of Elmendorf in committee was fairly amusing, as gallows humor goes.

    Karl (f07e38)

  25. Robert Laszewski has excellent coverage of many of the details of the emerging reform legislation. As Karl has shown, the politics are ugly. The policy smells even worse.

    Here is his post from Tues Oct. 13 on the absurd and phony CBO claim that The Senate Finance “Cadillac” Health Insurance Excise Tax Collects Almost Five Times More Revenue in 2019 Than It Does in 2013.

    Nonpartisan and unbiased CBO evaluations. As if.

    AMac (c822c9)

  26. Karl – Understood. I thought I read somewhere this week that the prescription drug program was pushing a trillion, if not past that. I may be mistaken. The broader point is that any claims to costs should be taken with a grain of salt the size of the Dead Sea.

    Didn’t Reid slip and say that this was going to cost 2 trillion?

    JD (c87796)

  27. AMac – How do they plan on collecting 5x as much in 2019 when those plans will no longer be available, or if available, not cost-effective to purchase?

    JD (c87796)

  28. JD – Partly, the CBO seems to assume that many sheeple won’t (or can’t) avoid paying the 40% excise tax. And CBO assumes that businesses that dump employees into the exchange/public/whatever option will boost the taxable pay of their insurance-shorn workers, leading to higher tax reciepts.

    Phase 2 of the Gnomes’ Underpants Plan comes to mind.

    Although, here’s a charming detail that’s escaped much notice: Health Savings Account contributions are counted towards the $23,000 Cadillac tax kick-in point.

    My family’s high-deductible, high-copay plan costs my employer and me about $12,000 this year (average for US employer-sponsored plans), and the HSA adds about $6,000. Premiums are rising at 15% to 20% per year. At 15%, premiums plus HSA would come to about $27,000 in 2013, well above the kick-in.

    Funny, my average plan rides like a Chevy. Thanks, Sen. Baucus, Sen. Snowe, and all your friends! How’s your insurance, by the way?

    AMac (c822c9)

  29. Why do they use Cadillac to signify great plans, when there are multiple types of cars that are exponentially better quality?

    AMac – Our family’s plan will be taxed from Day 1.

    JD (5b6053)

  30. This is a fantastic post, but the conclusion is not obvious to me.

    Everything, and I mean EVERYthing comes down to the Conference Report when the Senate and House bills are reconciled. The House will most definitely include public option, which means it is on the table in the Conference.

    The beauty part for Blue Dogs, or any other squeamish Dems is that a Conference Report is not amendable. It is take it or leave it, warts and all. They have the “out” that they had little choice – either some reform, or no reform. And just how many Blue Dogs do you think will be named by Leadership to the Conference?

    Anyone wish to bet me that the Senate wouldn’t have 50 votes for whatever comes out of the Conference?

    Ed from SFV (f8f689)

  31. Is Myron missing in action? Couldn’t he take the heat anymore with all his BS getting exposed?

    daleyrocks (d057d3)

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