The first congressional panel to begin writing a healthcare reform bill last week voted largely along party lines to retain an employer mandate as the chief financing vehicle for universal coverage.
The move by the House Ways and Means health subcommittee kept alive President Clinton's preferred route to guaranteed coverage for all, though the panel started its deliberations with an alternative proposal drafted by the subcommittee chairman, Rep. Fortney "Pete" Stark (D-Calif.).
That initial victory was critical to the subcommittee's chances to eventually vote on and report a bill to the full Ways and Means Committee. But by late last week, the panel's seven Democrats were still splintered on key issues, such as whether to include federal subsidies to help small businesses defray the cost of a mandate.
Mr. Stark said providing such subsidies would be "like giving dog biscuits to a pit bull" because the small-business lobby was so opposed to a mandate that it would not support the proposal even if it cost businesses nothing.
Mr. Stark's proposal would require employers to finance at least 80% of the cost of insuring their workers. Unlike the president's proposal, though, his would create a new government program-Medicare Part C-for the poor, unemployed and current Medi-caid recipients, financed by a 0.8% payroll tax on all employers. The Congressional Budget Office estimated employer contributions for premiums would amount to a 96-cent increase in workers' hourly wages. The Stark proposal would offer no subsidies to help small businesses absorb the cost of a mandate, nor would it provide any long-term-care benefits.
Costs would be constrained by setting global budgets for the health industry. If providers failed to keep spending within budget parameters, Medicare-type fees would be imposed to force compliance.
The American Hospital Association, which along with other provider groups opposes the plan's cost-containment provisions, said it would put providers at risk for swings in the economy and lock hospitals into spending growth rates that are now at "historic lows."
Early in last week's deliberations, Rep. Fred Grandy (R-Iowa) offered an amendment to strike the employer mandate, putting the proposal to its first major test of support.
Rep. John Lewis (D-Ga.) called the Grandy amendment a "dagger in the heart of the bill" and was joined by other Democrats in saying it would gut the plan's financing for universal coverage.
The panel's ranking minority member, Rep. William Thomas (R-Calif.), countered that the mandate would drive a "dagger in the heart of small businesses." The amendment was defeated 6 to 5. Rep. Michael Andrews (D-Texas), fresh from defeat in his primary bid for the Senate, was the only Democrat to side with all of the panel's four Republicans in voting for the amendment.
A second major amendment, offered by Rep. Jim McCrery (R-La.), which would have capped the amount of the tax deduction for health insurance costs at the cost of the average plan in a given area, also was defeated 6 to 5.
The subcommittee met throughout the week in public sessions and closed-door meetings to negotiate changes to the Stark plan that would satisfy at least six of the panel's Democrats. That's how many votes Mr. Stark must deliver from his side of the aisle because virtually no Republicans are expected to vote for the plan.
The inability of Democrats to reach consensus, though, threatened to thwart the panel's efforts to produce a plan.
"I don't see how we can proceed with a provision on (universal) coverage without some type of help for small businesses," Rep. Sander Levin (D-Mich.) told reporters. He made the remark after three subcommittee Democrats had voted with three Republicans to set aside an amendment offered by Mr. Andrews to give $8 billion in subsidies to small businesses. The measure would have raised $12 billion through a $2-per-pack tobacco tax. Some of the funds would have gone to academic medical centers to fund their teaching expenses and to facilities deemed essential community providers.
Rep. Jim McDermott (D-Wash.), the lead sponsor of a single-payer plan in the House and one of those who voted to table the amendment, said it would have put the interests of small businesses and teaching hospitals before "the average person."
Later the same day, Mr. Levin retaliated by forcing a vote on amendments offered by Mr. McDermott, which would have lowered copayments and deductibles under the plan. Mr. McDermott had tried to withdraw the amendments to make changes in hopes of drawing more votes later on, but Mr. Levin objected and the measures were defeated.
The small-business subsidy amendment was revived the next day, when Democrats rescinded their previous vote and agreed to reconsider it.
Other amendments considered by the panel included:
The addition of outpatient and community-based mental health benefits with new limits on inpatient psychiatric care, offered by Mr. Stark. It passed.
The addition of home- and community-based long-term care, sponsored by Mr. McDermott. It was set aside for consideration by the full committee.
The panel was expected to continue consideration of amendments well into this week. Mr. McDermott has vowed to offer his single-payer plan for a vote. According to a congressional aide, Republicans will offer the president's plan as an amendment to force a public vote on it.
The congenial tone of the panel's deliberations was broken early in the week, when in the midst of a debate over a prescription-drug amendment, Mr. Stark questioned policy assertions by Rep. Nancy Johnson (R-Conn.), the only woman on the panel. He said the lawmaker "got her medical degree through pillow talk." The reference was to Ms. Johnson's husband, a gynecologist.
A furious Ms. Johnson, who is not a physician, shot back that she had earned her medical knowledge from "endless hours as a member of this Congress." She told reporters that the remark was "insulting and uncalled for."
Mr. Stark later publicly apologized, and Ms. Johnson accepted.