Public Plan Option Likely to Be Included In Health Reform Legislation, Baucus Says

Senate Finance Committee Chairman Max Baucus (D-Mont.) said May 21 that some version of a public plan option likely will be included in health care reform legislation to be considered by the committee in June.

Baucus would not comment on what form a public plan option would take in legislation. But he told reporters at a briefing that despite opposition to the idea from health insurers, a public plan could be crafted that would be acceptable to Senate Democrats and Republicans.

“That’s a hot button,” he told reporters, referring to a public plan option in reform legislation. “I do suspect that a version will be there. By saying that, I don’t want to frighten people, particularly on the industry side, [that] ‘Oh, oh, Baucus said a public plan option [is going to be in a reform bill] and [so] the deal’s off,’ ” Baucus said.

“All I’m saying is there are ways to skin a cat; there are ways to find solutions. There are ways to do this ultimately in a way that’s acceptable.”

In a health reform policy options paper released May 11, Baucus and committee ranking member Chuck Grassley (R-Iowa) said a public plan could use Medicare payment rates, while another option would be to create a plan administered through third-party administrators. Yet another option would be to allow a public plan to be run by the states (89 DER K-3, 5/12/09).

The paper also included as an option not creating a new public plan but instead relying on a reformed and well-regulated market to ensure coverage.

Baucus said offering a public plan as a so-called fallback option, as was done in the Medicare prescription drug law, also is being considered by the committee.

Proponents of a public plan say it would provide increased competition to private insurers, helping to lower health care costs. Critics contend a public plan would be able to unfairly compete with private insurance plans.

Single Payer Out

Baucus once again reiterated that nothing has been taken off the table in committee discussions, with the exception of a single-payer health care system, which he said has no chance of being approved by Congress.

Lawmakers continue to discuss whether to cap the federal tax exclusion of employer-sponsored health care benefits and whether employers should be mandated to provide coverage to their workers, among other controversial issues, he said.

“Everything’s going to stay on the table, but portions will be modified and sculpted so that it’s still on the table but maybe a little bit different from a version that some may want on one side and some may want on another,” he said at the briefing, sponsored by the Kaiser Family Foundation, Families USA, and the National Federation of Independent Business.

Baucus said that while capping the tax-exclusion of employer-sponsored health care is a “volatile” issue, it would help curb health care spending because it would reduce the number of generous plans offered by employers, which he said would cut overutilization of medical services.

While no decision has been made about whether to include in a reform bill a mandate for employers to provide coverage, Baucus said there “should be standards for employers to participate.” But he said there likely will be exemptions for small businesses.

Health care reform legislation being drafted by the House Energy and Commerce Committee is expected to include a public health care plan option using Medicare payment rates and a “play-or-pay” requirement for employers to provide coverage for their workers (92 DER A-31, 5/15/09).
Baucus said the Congressional Budget Office has said a universal coverage bill would result in as many as 96 percent of Americans having health insurance. Auto-enrollment of individuals will be part of the legislation, he added.

The Finance chairman said reform legislation would not cover undocumented workers, saying adding such a provision to a bill would be “too explosive.”

Chances for Bipartisan Support

Baucus told reporters that he believes there is as much as an 80 percent chance that reform legislation produced by the committee will be supported by Senate Democrats and Republicans.
“I have been meeting with a lot of Republicans who really want to vote for something that passes,” Baucus said. “They know that it’s the right thing to do.”

The committee has held three all-day discussions in the past few weeks to discuss delivery system reform, expanding coverage to those without health insurance, and how to fund reform. Baucus told reporters he has been buoyed by the discussions because “senators are not posturing, they’re not grandstanding, they’re clearly trying to dig down and find the right thing to do.”

Baucus said the committee remains on target to consider health reform legislation in mid-June, adding he has asked committee members to allow staff to make decisions on some issues to help speed the process of bill development. Baucus said he expected the Finance bill and reform legislation produced by the Senate Health, Education, Labor and Pensions Committee “will not be that dissimilar” and should not be difficult to merge into one bill on the Senate floor.

Baucus has said he wants the Senate to pass health reform legislation by the August congressional recess.

By Steve Forbes