The move away from comprehensive healthcare reform took another stride in Congress last week, this time led by a surprising force-political liberals.
The liberal proposal, in essence, was to scrap the reform plans already before Congress and pass a bill that would include insurance market reforms and extend coverage to 8 million to 10 million uninsured children.
The plan could have a better chance of passing by backing Republicans into a corner. It is strikingly similar to the plan introduced by Senate GOP leader Robert Dole of Kansas. By presenting such a modest plan, the liberals are forcing the Republicans to either join them or risk appearing like blatant obstructionists.
"From a strategy standpoint it is brilliant. If Republicans don't support it, then Democrats will say they never wanted reform from the start," said a provider group lobbyist who asked not to be identified. "I'm not sure if it will ultimately be good policy, but it is good politics."
"This is the kind of bill that could pass in the limited amount of time (in the congressional session) remaining," said Frederick Graefe, a healthcare lobbyist with the law firm of Baker and Hostetler in Washington. "It has the elements everyone agrees on; it is a necessary first step toward comprehensive reform."
The plan, whose supporters include Sens. Harris Wofford (D-Pa.) and Tom Harkin (D-Iowa), is called "Kidcare." It would cost $240 billion over a 10-year period, about the same as the Dole proposal and roughly two-thirds the cost of the bipartisan "mainstream" plan previously offered by a coalition of Senate moderates.
It would be financed through $70 billion in Medicare spending restraints over 10 years, a $1-per-pack tobacco tax and increases in Medicare premiums for beneficiaries with annual incomes of more than $80,000.
The Medicare cuts would come from extending the provisions in last year's federal deficit-reduction package. The provisions, which affect Medicare's annual inflation adjustment, include a 2.5 percentage point reduction in Medicare urban hospital payments, a 1 percentage point reduction in rural hospital payments, a 3.6 percentage point reduction in reimbursements for surgeons, and a 2.6 percentage point reduction in payments for other services-except those considered primary care, which were not cut.
While providers say they are concerned about any Medicare reductions, the cuts included in the Wofford/Harkin plan are less than those in the other healthcare reform plans before the Senate. For example, the plan introduced by Senate Majority Leader George Mitchell (D-Maine) would have cut $294 billion over 10 years. The plan unveiled by the mainstream group would trim $263 billion in anticipated growth in Medicare over the same period.
While Senate liberals worked on their plan, which would further reduce the scope of the Senate's reform efforts, the leading advocate of the most liberal reform plan in the House said last week that Congress should forget healthcare reform this year and start anew next year.
Rep. Jim McDermott (D-Wash.), the leader of the single-payer faction in the House, said the "relentless effort to retain a system of employer-based, private insurance led to endless complexity and confusion and delay that ultimately sank healthcare reform.
"No matter how original or clever, the president's proposal-not to mention all the other plans based on insurance purchased from private companies-was never going to work because it was just too complicated," Mr. McDermott added.
The Healthcare Association of New York State, in a letter hand-delivered to members of Congress, said incremental plans such as the one unveiled by the bipartisan mainstream coalition would be "worse than no reform at all."
According to HANYS President Daniel Sisto, most of the insurance reforms included in the incremental plans have already been implemented in New York as have other measures such as expanding subsidies to children.
"New York stands to gain little or nothing from these modest reform efforts," while suffering significant Medicare cuts, Mr. Sisto said.