Baucus Puts Bill In Play

By ALLISON BELL
National Underwriter
September 16, 2009

Senate Finance Committee Chairman Max Baucus has released the eagerly awaited text of his version of the health reform bill.

The “chairman’s mark” – the America’s Healthy Future Act bill – would bar insurers from discriminating against people based on health status, denying coverage because of pre-existing conditions, or imposing annual caps or lifetime limits on coverage, according to Baucus, D-Mont.

Implementing the bill would cost about $856 billion over 10 years, but it would not add to the federal budget deficit, Baucus says.

In addition to promising to save money by fighting fraud and making the health care system more efficient, Baucus seeks to pay for some program costs by imposing a $2,000 annual cap on an individual's flexible spending account contributions, and, starting in 2013, levying "a non-deductible excise tax of 35% on insurance companies and plan administrators for any health insurance plan that is above the threshold of $8,000 for singles and $21,000 for family plans," according a summary provided by Baucus. "The tax would apply to the amount of the premium in excess of the threshold. The tax would apply to self-insured plans and plans sold in the group market, but not to plans sold in the individual market. The threshold would be indexed for inflation, and a transition rule would increase the threshold for the 17 highest cost states for the first 3 years."

The Finance Committee will begin voting on the bill next week, Baucus says. The committee expects to consider the bill during an open executive session Sept. 22.

“We worked to build a balanced, common-sense package that ensures quality, affordable coverage and doesn’t add a dime to the deficit,” Baucus says in a statement. “Now we can finally pass legislation that will rein in health care costs and deliver quality, affordable care to the American people.”

In addition to banning medical underwriting, the bill would create health care affordability tax credits to help low and middle income families buy private health coverage.

The bill also would create new health coverage tax credits for small businesses, and it would create Web-based coverage purchasing exchanges.

Rather than creating a government-run “public option” plan, the bill would “give consumers the choice of non-profit, consumer owned and oriented plans (CO-OP),” Baucus says.

Most individuals would have to own health coverage. Employers would not have to offer coverage, but many employers who did not offer it would have to reimburse the government for part of the cost of providing the health care affordability tax credit.

The bill would standardize Medicaid coverage for everyone earning less than 133% of the federal poverty level.

Other provisions would:

- Allow plans to vary coverage rates based on an insured's age, tobacco use and family composition.

- Encourage all of a patient’s doctors to coordinate care and reduce duplication and waste.

- Create incentives for health care providers to use electronic medical records and other health information technology.

- “Increase health care research so doctors know what care works best for which patients.”

- Cover the cost of annual “wellness visits” for Medicare participants and their doctors.

- Eliminate out-of-pocket costs for screening and prevention services for Medicare enrollees.

- Create incentives in Medicare and Medicaid for enrollees who participate in healthy lifestyle programs.

- Increase federal Medicaid funding for states that cover recommended preventive services and immunizations for enrollees at no extra cost.

- Provide free tobacco cessation services for pregnant women who are enrolled in Medicaid.