NAHU’s Washington Update

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March 5, 2010

Moving Forward, Like It or Not

Less than a week after the bipartisan health summit at Blair House during which President Obama asked both Republicans and Democrats to spend the next four to six weeks working cooperatively on health reform legislation, President Obama switched strategies in a nationally televised address,calling on the House and Senate to have an up or down vote on the comprehensive health reform bills already on the table within the next few weeks, stating, “I do not know how this plays politically, but I know it’s right.”
While President Obama never used the words “budget reconciliation” in his remarks, he and the members of his administration, as well as Democratic congressional leaders, appear to have endorsed the controversial budget reconciliation strategy to pass the legislation. However, in an interesting twist, they have abandoned they idea of passing a reconciliation bill first that includes all of the negotiated changes and deals to things like the Cadillac tax, as well as the bipartisan ideas the president keeps touting in his summary plan for reform. Instead, Democratic leaders appear to have agreed to attempt to have the House pass the original Senate bill verbatim first, then move forward with fixing what they can through reconciliation.

In some ways, this makes the reconciliation process a little bit easier for them, as there was much concern that going forward under the other method was both procedurally impossible and illegal, since you can’t amend a law before its actually signed into law. However, politically, the process is still fraught with peril (see reconciliation article below). President Obama has also called for an extremely aggressive timeline for this course of action, hoping to have the whole matter wrapped up before Congress leaves for Easter break in three weeks, with the House voting on the original Senate-passed legislation by March 18 before the president leaves for a trip to Asia. He’s also begun aggressively courting House Democrats for their votes. Speaker Pelosi and House Majority Leader Steny Hoyer both stated yesterday that the Obama time frame may be unrealistic, and that they will not necessarily rush a vote before Easter.

NAHU opposes both the original Senate-passed bill as well as the use of the budget reconciliation process to pass comprehensive health care reform legislation. While we strongly believe that our country could benefit from some affordable and responsible reforms to our private-market delivery system, legislation of this magnitude should not be developed and passed by a single political party.

Our members attending NAHU’s annual Capitol Conference in Washington will be meeting with their congressional representatives in person to spread this message, and we have been working in conjunction with coalition partners like business groups, other agent trade associations and the health insurance industry to promote sensible and bipartisan reform. We’re particularly targeting members of the House of Representatives who either voted “NO” on the original House legislation or those who voted “YES” but have indicated that they may not be able to support the Senate-passed legislation as it currently stands. Here’s a letter on this issue you can send today to your member of the House of Representatives and here is another one that you can encourage your clients, family and friends to send.

Reconciliation—How It Could Go Down

The process being finalized by the White House and House and congressional leadership would work, in theory, along these lines:
Democratic House and Senate leadership negotiate reconciliation language to make the Senate-passed legislation acceptable to members of the House of Representatives.
This draft legislation is sent to the Congressional Budget Office to receive a “score” and then released to the public.
The Senate-passed legislation (H.R. 3590), as it currently stands, which means the version passed on December 24, 2009 — not any discussed improved version with changes to the Cadillac tax or public financing of abortion language, etc. — is passed by the House of Representatives verbatim.
President Obama signs the original version of the Senate Bill (H.R. 3590) into law.
Senate Finance Committee reports out the reconciliation bill that includes the negotiated language to change the Senate-passed bill. Keep in mind that what the committee will be able to send to the floor are just changes would be allowable under the complicated budget reconciliation rules.
Senate passes reconciliation bill with 51 votes.
House takes up and passes reconciliation bill without amendments.
Speaker Pelosi sends the reconciliation bill to White House for enactment.
Problems and complications with this strategy/timeline:

Speaker Pelosi cannot find the votes. The original House health care bill passed 220-215, but with retirements and deaths in the House, that total is now 216-215. There are many House Democrats who have publicly stated in recent days that while they voted for the original House bill, they will not vote for the Senate-passed bill verbatim. Of particular concern are that at least 12 Democrats who voted YES on the original legislation will not support the Senate-passed language on the public financing of abortion. Speaker Pelosi will need to flip original “NO” votes on the House-passed legislation to yeses on the Senate-passed bill to achieve her goal, and many of the 39 Democrats who voted NO originally have already publicly indicated they will not support the Senate-passed bill either.
Reconciliation vote-a-rama increases public outrage at Democratic dictatorial legislative process.
The negotiated reconciliation bill procedurally cannot include many of the policy-related items House Democratic leaders insist they need to feel comfortable with the Senate-passed legislation, nor could it include many of the “bipartisan” changes President Obama keeps touting.
The Senate doesn’t even have to move forward with the reconciliation fix bill if it doesn’t want to or determines it to be too difficult, and the only way with their current majority structure the Senate can “fix” their bill is through reconciliation. Once the original Senate-passed health care reform bill is signed by President Obama, it becomes the law of the land, and there are no guarantees for House Democrats that their fix will actually happen, particularly if the process becomes a political nightmare for Reid. That’s why there is strong distrust between the two chambers.
CBO may not be able to score many provisions in the negotiated fix reconciliation bill until the House passes the Senate bill, as the score needs to be based on current law, not hypothetical law.
The Senate Finance Committee must report a reconciliation bill complying with the budget resolution of last year, which is still in effect. There is a 13/10 ratio of Democrats to Republicans, and since it takes a majority vote to report a bill, Democrats can only lose two votes. Democratic Senators Conrad, Lincoln, Wyden and Nelson, who have all publicly opposed the use of reconciliation in this manner at various points in the process, could be problems for the Democrats.
If and when the majority leader calls up the reconciliation fix bill, the clock starts ticking on the 20 hours of total debate time. Since reconciliation is privileged, motions to proceed, etc., are not in order.
During the 20 hours, points of order can be raised against provisions that only make policy and don’t have any budget effect (meaning that many of the changes House Democrats want, like the abortion language, could be stricken). The presiding officer, which could be the vice president, makes these rulings. If the VP wants to control the rulings in the favor of the White House, he can overlook certain rulings. It takes 60 senators to overturn a ruling by the presiding officer. As an insurance policy for complete control of the reconciliation process in the Senate, the vice president can spend as much time as he wishes presiding over the Senate chamber in his capacity as the president of the Senate.
After the 20 hours of debate, senators can still offer amendments and demand a vote. This process has been dubbed vote-a-rama and, in past cases, several hundred amendments have been filed and vote-a-ramas have delayed the final passage vote for days. But final passage requires only a majority vote, so nine Democrats could vote against final passage and the vice president would break the tie.
Interesting facts:

The reconciliation process has been used 22 times in the Senate. In those 22 times, the average is 67 YES votes. It is therefore safe to say that previous majority leaders have used the reconciliation process for the 20-hour time restraint it provides and not the requirement that it only takes a simple majority vote to pass.

The common opinion that reconciliation promotes the ideal of a “simple majority” ignores the very important reality that the U.S. Senate is not a majoritarian institution! You could have a super-majority of 82 senators on an issue whose constituents still do not amount to a majority of the United States population. So, there is really no basis for arguing the virtues of 50% plus one votes in an institution where votes are not correlated with population.

COBRA Subsidy Extension

Legislation to temporarily extend the federal subsidy of COBRA premiums, H.R. 4691, was passed by the House of Representatives on February 25, by the Senate on Tuesday and immediately signed into law by President Obama. The new law extends the COBRA subsidy eligibility period to March 31, 2010, from its previous expiration date of February 28.
Of particular note to your employer clients, this measure also creates a new class of eligible individuals for the subsidy. It provides COBRA and subsidy eligibility for those employees who first lost health plan coverage due to a reduction in hours and then were involuntarily terminated after the date of the act’s effective date. The involuntary termination of employment for those employees who were previously covered but lost coverage due to a reduction in hours is now a qualifying event, and that reduction of hours is now the start of a person’s COBRA coverage eligibility, not the involuntary termination. Notices will have to be provided to eligible individuals within 60 days of the date of involuntary termination date with information regarding this extension and special COBRA enrollment period. The new change to the law does not impact the length of the subsidy, which remains at 15 months. For more information, visit the DOL’s website.

In addition to this temporary extension, it is expected that Congress will consider a longer-term extension (possibly up to December 31, 2010) within the next month.

Capitol Conference 2010

Next Monday through Wednesday, approximately 700 NAHU members will be storming Washington and spreading our message in support of affordable, responsible health care reform. Our 20th annual Capitol Conference, New Directions: Setting the Course for Responsible Health Reform, will be held at the JW Marriott in Washington, DC. In light of recent developments, the timing of our meeting couldn’t be better. In addition to lobbying visits on Capitol Hill, attendees at the meeting will have the opportunity to hear from great congressional speakers like Senators Scott Brown (R-MA), Ben Nelson (D-NE) and Tom Coburn (R-OK) and House leaders such as Congressmen Mike Pence (R-IN), Charlie Melancon (D-LA) and Tom Price (R-GA). The meeting also will feature comments by noted pollster Stu Rothenberg, health economists Doug Holtz-Eakin and Len Nichols, and state health policy experts like Insurance Commissioners Joel Ario (PA) and Kim Holland (OK) and Executive Director of the Massachusetts Connector Authority Jon Kingsdale, among many others.
There is still time to sign up to if you haven’t already! You can register on-site, and there is a one-day option for just $175 if you are a local member and just want to stop in for one day. We hope to see you there!

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The Fort Worth Association of Health Underwriters is a local chapter of the National Association of Health Underwriters, a member organization that represents nearly 20,000 licensed health insurance agents, brokers, consultants and benefit professionals through more than 200 chapters across America.

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