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Committee Announces Plan for Health-Care Reform


Thursday, Sep 17,2009, 2:26:21 PM   Click:

SEN. MAX BAUCUS (D) MONTANA: It reflects months of work and more than a year of preparation by our committee. It represents an effort to reach common ground and a real chance for health-care reform, and it is balanced, a common-sense bill that can pass the Senate.

Achieving real reform means that we need to hold insurance industry accountable, and that's why we're presenting this package, and that's exactly what this package does. It provides competition, holds insurance companies accountable and ensures Americans have real choices when they buy insurance.

Our package (ph) ensures choice and competition in the health insurance market so every American can find quality, affordable coverage that cannot be taken away. It protects those with pre- existing conditions. It's very important. It prevents insurance companies from discriminating and capping coverage, and it requires insurance companies to sell and renew a policy to anyone who applies, so long as the policy holder pays their premium in full.

Our package makes clear that if you like your doctor, your health plan today, you can keep them. It delivers affordable coverage to tens of millions of Americans and reduces costs and expands options for millions more. It increases the focus on prevention and wellness. It begins to shift the focus of our health-care delivery system for quality of care provided, not quantity of services provided. It protects Medicare and makes the Medicare program stronger, to ensure future generations can benefit.

For seniors, it lowers prescription drug costs dramatically. For small business, it establishes a new marketplace to shop for coverage and tax credits to help make benefits affordable again. In fact, the Congressional Budget Office estimates that our reforms will significantly reduce costs for individuals and group markets.

For the uninsured, our package guarantees immediate access to quality, affordable coverage. It is fiscally responsible. It reduces the deficit within ten years, and it controls health-care spending for the long run.

We have done everything imaginable to get the most generous, most affordable coverage that we could within President Obama's target of $900 billion.

There are honest and principled differences among all of us working for reform, and this package may not represent all of our first choices. But at the end of the day, we all share a common purpose. That is, to make the lives of Americans better tomorrow than they are today and to get health-care reform done, which means the time to come for action is now, and we will act. We will act to pass health reform legislation this year.

Next week the finance committee will do its part to help expand coverage. We will do our part to control costs, and we'll do our part to work closely with President Obama to deliver health-care reform for the American people.

I look forward to the efforts of my colleagues on the committee to make this an even better bill. I also look forward to working with leader Reid and Chairman Harkin and Dodd and the rest of my colleagues on the health committee, so we can merge, quickly, our bills with theirs.

This is a good bill. This is a balanced bill. It can pass the Senate. And I look forward to making sure that we have an even better bill that passes with even a larger margin. Thank you.

UNIDENTIFIED FEMALE: (UNINTELLIGIBLE) Actually delayed this much to the chagrin of the White House and the leadership who said that you wanted to have (UNINTELLIGIBLE) and how disappointed are you, and do you really honestly think that you will get the public...

BAUCUS: Yes, I -- I believe I have an obligation to work as diligently, as hard as I can, to try to get the most broad-based bill possible, because after all, the American people want us, I think, in Washington to work together, Republican and Democrats. They don't like all the partisanship that's going on.

And I also think a bipartisan approach is more durable; it's more sustainable. It will generally mean better policy.

So, I worked very hard to try to get that bipartisan support. And I think that we will get it. That is, I think that, certainly, by the time the finance committee in this room votes on final passage for health-care reform, there will be Republican support.

No Republican has offered his or her support at this moment, but I think by the time we get the final passage in this committee, you'll find Republican support.

This is a bill that should enjoy broad support. It is common sense; it is a balanced bill. I think this bill -- I know this bill will pass. It certainly is a bill that can pass. And the choice now is up to those on the other side of the aisle, whether they want to vote for it or not. We worked very hard to make this balanced, and that's really what it comes down to.

UNIDENTIFIED MALE: The bill doesn't provide a long-term fix for the SGR?

BAUCUS: SGR will be addressed by the Senate this year. There's not -- there's no doubt in my mind about that. I mean...

UNIDENTIFIED MALE: When you say aggressively, do you mean long term? BAUCUS: I can't address whether it will be one, two, three, five, six years or a permanent fix. Personally, I'd like to see SGR permanently fixed and reformed. And there's no doubt that we will in this Senate address the SGR.


BAUCUS: Well, that's a separate side issue. It's not -- SGR is really not part of health-care reform. SGR is basically what Medicare pays providers, especially doctors in this case, and we'll find a way to deal with SGR. That's not going to be an issue. We'll find a way.

UNIDENTIFIED FEMALE: Senator, several Democratic members have said that they have grave concerns about this bill, and they feel that you made too many concessions to Republicans. How concerned are you that you may not have enough Democrats on your committee to pass this bill?

BAUCUS: There's no doubt in my mind this is a very balanced bill that's going to get various -- going to get support. I've talked to Democrats. I've talked to Republicans about this bill, just intensively, and I can tell you that in those conversations, there are some who think I've not gone far enough. There are some on both sides of the aisle that think I've gone too far.

And this is basically within the framework that President Obama outlined in his State of the Union address and made it very similar to what he suggested. And, again, I talked to senators, Democrats, Republicans. Some think too much, too little. And I think I've come up with a good, balanced bill that can pass the Senate and that will work with all those senators.

Clearly, this is just the early stage. First there's committee here. There will be amendments offered. There's no doubt about that. And I expect some of them to be pretty good amendments, amendments that I will support. Then we've got -- then we'll merge with the health committee. And, you know, there's a lot -- it will be on the floor. I mean, there's lots of opportunities here to -- but stay within the confines of, you know, under $900 billion and trying to find a balanced approach here. And, again, some want more. Some want less. I think this is a very, very good beginning.

UNIDENTIFIED FEMALE: Senator, there was a statement that says the bill is deeply flawed and that it...

BAUCUS: I beg your pardon?

UNIDENTIFIED FEMALE: The head of ASCME has put out a statement that said it (UNINTELLIGIBLE) taxes health benefits and provides health plans that provide benefits for many middle-class families, in other words, the Cadillac tax that you talked about. Can you tell us how that came about, and how is it that you'll be sure that cost isn't going to trickle down?

BAUCUS: Yes, well, first, it's -- the president endorsed it in his message to the country. Second, it's a measure that -- that many of us have supported for some time or some versions of it. Senator Kerry in particular has been pushing that measure. And it's basically a tax, frankly, on insurance companies, and I think it's appropriate to get the fat out of the insurance companies.

You know, I'm frankly proud that this bill focused on those who profited the most under our health-care system, and I think they should be part of the solution.

And actually, well, without getting too deep in the weeds to answer your question, the Congressional Budget Office says that, frankly, the net result of all this will be a significant change in the way companies and their insurance companies provide benefits to employees. Namely, as a consequence of this, wages will be increased, offset otherwise paying health-insurance benefits, and frankly, that's going to increase taxable income of employees. And it's -- and they, therefore, give it, CBO gives it a positive score.


BAUCUS: It's also designed -- I'm glad you asked the question. It's also designed -- thank you very much -- for helping bend the cost curve. That's a main theories of it.

UNIDENTIFIED MALE: Do you have an estimate from the CBO on how much the bills cost? Do you have a statement from them on how many people the bill would cover in terms of the number of uninsured? (UNINTELLIGIBLE)

BAUCUS: That's been an issue that's been foremost in my mind every week, if not a couple, three times a week, because we don't want the coverage to get too low. If coverage gets too low, then we start to -- to no longer have the benefits of virtually universal coverage. Too many people who need insurance will go get insurance, if the coverage is too low. Those who don't want insurance, don't need it, the healthy, young, et cetera, won't. So you get kind of this death spiral phenomenon, if the coverage level is too low.

The more coverage is up, the more we have true insurance and the more that's going to help assure lower premiums for all Americans. I don't have the precise number right now. But it's -- I don't want to give you a number. It's in the mid-90s, mid- to low 90s. It's a concern of mine. It's a point I am going to be focused on throughout the committee and as we pass health-care reform.

UNIDENTIFIED FEMALE: You have said that you don't want Americans to lose their coverage; people who have it can keep it. Why not have a stronger employer mandate, then, because it looks like it would be cheaper for a lot of employers to just take the tax credit as opposed to...

BAUCUS: No, in an effort to get balanced again, in an effort to get a bill that can pass, we -- I decided that it made more sense not to have the actual mandate, but for an employer that does not provide coverage, that employer will have to pay a penalty for not providing coverage. To discourage employers from dropping coverage.

It's 400 for all employees, or it's the tax credit per employee that -- that an employer may otherwise drop. It's another example of the difficulty in trying to find the right balance here. That is, on the one hand, we want employers -- we want to keep our employer-based system, and we want employers to keep providing coverage for their employees.

And on the other hand, it's -- we've got to make sure that it's not too -- insurance is not too onerous for employees and the employer is not too easily dropped coverage. So, it's trying to find that penalty and the right balance that gets to an earlier question so as not to reduce coverage very much.

UNIDENTIFIED MALE: What kind of support is there amongst governors and state legislatures (UNINTELLIGIBLE)?

BAUCUS: You know, I frankly think that -- that this is pretty much resolved, that is, the Medicaid expansion. We, our Group of Six, had several conversations with governors, several conference calls, had one yesterday. And on the conference call yesterday with maybe a dozen governors, bipartisan, explained what the net result would be to governors under an expansion of Medicaid.

And essentially, when you factor in the F-map rates -- that is, how much Uncle Sam's going to pay, what portion Uncle Sam will pay -- for the expanded population, and when you factor in other matters such as increase of the drug rebate from, say, I think it's 15 to 22 or 23 percent, when you factor in CHIP Flexibility states will have, when you factor in some other provisions, on a net basis, on an average basis, throughout the country, states will see, according to the most recent calculations, 0.8, 0.9 percent increase in the state Medicaid obligations over the baseline. That is, over what they otherwise paid. Or definitely the baselines will cost the states on average 0.8, 0.9 percent.


BAUCUS: I can take a few more. I can take a few more.


BAUCUS: I always get that one. Sorry? Sorry?

UNIDENTIFIED MALE: Is there anything that would affect the position of (UNINTELLIGIBLE) in the bill?

BAUCUS: Well, we're -- a key point here, clearly, is delivery system reform. That's a key point of this bill, and regrettably in my judgment this has been lost in most of the national debate on health- care reform. That is, we have to begin to change the way that we're compensating providers in Medicare and Medicaid: away from paying on the basis of quantity and volume, more toward paying on the basis of value and outcomes.

And the more we can move down that road and the more quickly we can move down that road, the more quickly we're going to not only reduce costs, but -- this is an extremely important point -- also increase quality. I will underline that last point. It will improve quality.

If you look at all the integrated systems in our country now, and more of them are developing, because most folks know this is the right approach and where we should be going in health care today.

I don't care if it's Kaiser, it's Cleveland, it's Mayo, it's Intermountain, it's Geisinger. There's one in Montana, the Billings Clinic, where they're integrated; that is, the hospital and the physicians. In some cases the post-acute provider are integrated in the payment systems. They're finding that their quality has increased significantly, and its costs are lower.

So, we're building incentives in this bill to help groups to evolve into integrated systems, and that will get at the question of Medicaid reimbursement.

This is going to take time. This is not going to be accomplished overnight. But I do believe firmly that this is probably the most transformative, game-changing provision here. It will start to lower health-care costs. It will start to bend the cost curve.

There are provisions, too, that would accomplish the same objectives. But the underlying delivery system reform is, I think, just so critical for our country and...

UNIDENTIFIED MALE: When it comes to -- when it comes to the efforts to try to get bipartisan support, what realistically, do you think you need to do in terms of actual policy changes to get some Republicans on board with this?

BAUCUS: I just think it's continually talking, working with, exploring, probing, cajoling. It's just -- being creative about it.

This is probably one of the largest pieces of social -- social legislation in American history since the Depression. It affects everybody in our country. It affects everybody in many different ways. It is comprehensive. It is complex. It's just -- takes time to fully fathom, put the pieces together, to understand, and then make a suggestion to make it better.

I also believe, as firmly, that we have a moral obligation as Americans to pass meaningful health-care reform this year. You know, all of us here are not going to be here forever, you know? We have a moral obligation to -- when we leave this place, to leave it in as good a shape or better shape than we found it. Each of us in this room, each of us in this country, has that moral obligation.

And this is our opportunity, this is our moment, to help fulfill that moral obligation for our kids and our grandkids to have something better than we now have.

I began my statement by saying all the costs of inaction. They are just horrendous, the costs of inaction. We've got to get going here. And do you know what? I think most everybody has some sense there might be something to that. And I think a lot of my colleagues, both sides of the aisle, we're now talking specifically about the Republican side of the aisle. They get that, too, understand that, too.

And when -- this has a certain sense of inevitability this is going to pass. I think, with that, more and more people are going to think, oh, gee, first of all, it may be the right thing to do, at least make this effort. And probably, this is not too far off the track from what we need to do. So, let me work with it, see what I can do to make it better.

I fully believe, as I've said many times, at the end of the day, there's going to be Republican support for this bill.

UNIDENTIFIED MALE: (UNINTELLIGIBLE) ... policy changes you think will need to be made?

BAUCUS: You know -- I will. You know, I've said this several times, too. Essentially, we've debated this thing. We've met over 100 hours. I forgot what the total is. There are no real policy deal breakers. It's more getting more comfortable with what all this is.

And I think that's what this comes down to, is helping, working with it, making this -- helping centers in the country, the public, be more comfortable with what all this is.

I also think much of this has to be explained to the country with greater clarity, so people have a better understanding. And I say presume presumptuously, have a little higher comfort level. A lot higher comfort level.

Look it: there are millions of Americans today that don't have health insurance. Just think of that. We're going to provide an opportunity for all Americans to have health insurance.

There are millions of Americans today who have lousy health insurance. Pre-existing conditions, denial based on health status. No limit on out-of-pocket costs or recisions. Companies put limits on coverage, you know, how many dollars they'll pay out. We're stopping all of that. Just think of that for a moment. That's so important. And it's -- that's why I do think at the end of the day we're going to get significant bipartisan support and we're going to pass this.

Thanks, everybody, very much. Thank you.

FREDRICKA WHITFIELD, HOST: All right, you heard it right there. Senate Finance Committee chairman Max Baucus answer for health-care reform for America. Let's break down his proposal.

The first surprise is the cost: an estimated $856 billion over 10 years. That's quite a bit cheaper than Baucus himself quoted just yesterday.

It also makes health insurance mandatory for all Americans, offering tax credits to those who couldn't otherwise afford it. It sets up exchanges where consumers can shop for the coverage they want, and it expands and standardizes Medicaid, health care for the poor.

Probably the most controversial provision is for nonprofit member-owned cooperatives. In place of a government-run health plan to compete with private insurers.

Four other committees have already passed health bills, with no Republican support. The Baucus bill is the product of three months of work by the so-called Gang of Six, three Democrats, three Republicans. But even those Republicans have not yet signed on.

CNN's Brianna Keilar joins me now to gauge the prospects for bipartisan health reform. We heard from Baucus there that reiterated: you're right, no Republicans, as of yet, but he says, it's still early in the game.

BRIANNA KEILAR, CNN CORRESPONDENT: Could you sense how much, Fredricka, he really wants that bipartisan support? He really wants Republicans, certainly, to get on board here. And certainly he would have been happier today, I'm sure, if he'd had that Gang of Six and those three Republicans and those two Democrats standing by him, buying into this bill. But they haven't at this point. Although Baucus said that he expects by the time of final passage, there will be some Republican support.

That said, you know, you want to take a look at what Mitch McConnell, the top Republican, in the Senate came out today and said. He essentially blasted this plan, saying it will cut Medicare, and essentially, Republicans have said that seniors should be fearful because of that. And Democrats say, "No, we're squeezing savings out of the system. That's not really true."

But obviously, this is not -- this plan, even this plan that does not have a public option, the only draft or bill in Congress. It does not have a public option, a government-run insurance plan. It's not expected to get really wide, like really broad, support in the Senate among Republicans. The hope, though, is that for there to be a few, maximum, that's really the expectation, Fredricka.

But there's also the issue of Democrats. You know, there are a lot of conservative Democrats in the Senate, in the House, who need to be wooed, who need to be won over, and we're not sure that they are on board, at least with the concept of this plan at this point, Fred.

WHITFIELD: All right, Brianna Keilar, on Capitol Hill, thanks so much. Appreciate that.

So, this Baucus bill, as Brianna was just reiterating, does not have a provision for a public option, a government-run insurance plan. So, does that weaken the Obama administration's argument for a public option?

House Speaker Nancy Pelosi weighed in, speaking exclusively to CNN, and she says, no, but...

(BEGIN VIDEO CLIP) REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: If we are going to mandate health insurance for all Americans, if we're going to subsidize that health care for tens of millions of people, how can we give all of these new consumers to the health insurance industry with no accountability, no competition? And no real challenge for them to honor the reforms that we have in the bill. No, we're in pretty good shape on that.


WHITFIELD: All right, let's check in with our Josh Levs. He's doing some digging. Digging deeper into the Baucus plan and how it would affect you and me. So, let's talk about the cost first.

JOSH LEVS, CNN CORRESPONDENT: Yes, we'll start off with that. It's a good idea, Fred. You know, it's interesting to check out what's going on here.

I want to emphasize to everyone, you can see it our blog. In the newsroom, CNN.com/Josh or it's linked to YouTube, so CNN.com/Fredricka. We encourage you to check it out. This is just an initial read. It's 223 pages long.

But I want to show you some interesting provisions here about controlling costs about this. Check it out.

Issuers in the individual market, this says, could vary premiums based only on the following characteristics: tobacco use, age, and family composition. I find that pretty striking. No other things could change what it would cost in the individual market, except they do say it could cost a different amount in different regions of the country right there.

Now, check this out. They say that there will be a pretty simple way of understanding what your options are. Four benefit categories would be available: bronze, silver, gold and platinum. And it breaks down pretty well what would be entailed in each one.

Another thing I looked at, though, Fred, is also what it might cost small businesses. A lot of people concerned about that. When we get questions about health care, that's one of the biggest ones, small business.

And I want to show you here. It shows that there will be a tax credit for qualified small employer, for contributions to purchase health insurance for their employees. That's any business with fewer than 100 employees. So, they are offering these credits that they say would help some of these small businesses provide insurance for people.

A little bit there, Fred, about the cost in this potential bill, legislation.

WHITFIELD: All right. Another contentious issue was about illegal immigrants.

LEVS: Yes.

WHITFIELD: And abortion. Where are we on that?

LEVS: Right. Yes, we got a couple things on coverage, as well. Let's zoom back in. I'm going to need that camera to come back. Let's zoom back in here, because I want everyone to see a little bit more about what we have on those issues involving coverage. Let's check this out here.

This explains that all citizens and legal residents would be required to purchase coverage beginning 2013. But when we go down a little further, it talks a little bit about what would happen with verifying illegal immigrants. Take a look here. It requires verification of the following personal data: name, Social Security number, and the date of birth will be verified with the Social Security Administration.

Now, you might look at that as pretty typical, but there are those in Congress who argue this is not enough. More needs to be done to make sure illegal immigrants are not taking advantage of this.

And, Fred, you mentioned abortion. Let's zoom back down. I want people to see this, as well. It talks about what would happen with abortion. It says federal funds continue to be prohibited from being used to pay for abortions. unless the pregnancy is due to rape, incest or if the life of the mother is in danger.

But Fred, part of this, and what we'll be hearing a lot is it does not prevent private plans that take part in that system from providing funds for other types of abortions. So that is something we've heard argued in the past. We'll probably hear more about it, Fred.

WHITFIELD: All right. Josh Levs, thanks so much.

LEVS: You got it. Thanks.

WHITFIELD: Also, new developments in that murder on the Yale University campus. We now know how Annie Le died. More on this developing story right after this.

WHITFIELD: All right, some news just in, in the Yale murder case. The Connecticut medical examiner's office tells CNN that Annie Le died of traumatic asphyxia due to neck compression. In other words, she was strangled.

The M.E. had been holding off on releasing that information at the request of the New Haven police.

Meantime, the New Haven police do say that a person of interest in Le's murder has been released from custody. Yale lab technician Raymond Clark was brought in late last night for questioning. Investigators asked for a DNA sample, and he complied. A few hours later, they let him go. While all that was going on, the police knocked down reports that they needed a huge manhunt to find this man.


CHIEF JAMES LEWIS, NEW HAVE, CONNECTICUT, POLICE: We've known where he was at all along. He was exactly where we expected him to be when we served the search warrants tonight. We've been with him, you might say, since we took this case over, so we've always known where he was at. There's never an issue...

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