Focus Shifts to Senate on Health-Care Reform

March 21, 2010 07:00 PM

Roger Bernard, Farm Journal Policy & Washington Editor

The focus on health-care reform now shifts over the U.S. Senate where that chamber will now take up the reconciliation portion (HR 4872) of the bill. The 219-212 vote in the House saw 34 Democrats join all Republicans in voting against the bill.

And several members of the Agriculture Committee were among those Democrats casting "no" votes. They included Chairman Collin Peterson (Minn.), Vice Chairman Tim Holden (Pa.), Mike McIntyre (N.C.), Stephanie Herseth Sandlin (S.D.), Bobby Bright (Al.), Frank Kratovil (Md.), Larry Kissel (N.C.), Travis Childers (Miss.), Walt Minnick (Id.) and Jim Marshall (Ga.)

And that approval has drawn mixed reactions from ag/rural organizations.

Ahead of the Sunday vote, the American Farm Bureau Federation (AFBF) made it clear they were not in favor of the package. A statement from AFBF President Bob Stallman signaled their opposition to the package was due to "negatives of new taxes, mandates, growth in government programs and overall cost far outweigh its benefits."

While the proposed framework for exchanges "may help address costs and is similar in concept to association health plans which we have supported for years," Stallman said the tax incentives designed to help small employers and individuals afford such coverage "are inadequate and temporary and their limited application will not adequately compensate employers for higher health care expenses."

The American Hospitals Association (AHA), which also represents rural hospitals, hailed the package. Rich Umbdenstock, president and CEO of the group, called the package an "historic and long overdue step was taken toward achieving that worthy goal. This bill, which we support, will make a real difference in lives of millions of Americans. Health care is at a tipping point and the shortcomings within our health care system can no longer be ignored." He added the bill "may not be perfect, but it expands coverage to 32 million people, enacts significant insurance market reforms and lays a solid foundation upon which we can continue to build."

National Farmers Union President Roger Johnson said the package will mean lower coverage costs, put more doctors in rural hospitals and will prevent insurers from barring coverage from those with pre-existing conditions. "The United States has a moral obligation to stop insurance companies from dropping coverage on ailing patients," Johnson stated. "Rural Americans are among the oldest in the population, and denying them the coverage they need based on preexisting conditions must be stopped."

Basics of the bill include a requirement for individuals to maintain minimum essential health coverage or pay a penalty of $95 in 2014, $495 in 2015, $750 in 2016 and indexed to cost-of-living adjustment for that calendar year thereafter (the reconciliation package altered that provision to put a flat penalty of $695 per household). For those under 18, the penalty will be one-half the amount for adults. There would also be a penalty based on a percentage of income that some uninsured people might end up paying. The reconciliation package would set that at 2.5% of household income vs. 2% in the original Senate plan.

Exceptions: religious objectors, those who cannot afford coverage, taxpayers with incomes less than 100% of the federal poverty line, Indian tribe members, those who receive a hardship waiver, individuals not lawfully present, incarcerated individuals and those not covered for less than three months during the previous year.

For employers with 200 or more workers, they would have to automatically enroll employees into the health plan they offer. However, employees could opt out if they have other insurance coverage.

Employers with more than 50 employees that do not offer coverage would be required to pay a $750 fee for each employee who receives a tax credit for health insurance through a state exchange. Those employers requiring a waiting period before an employee can enroll would pay a $600 per employee charge for a 60-90-day waiting period.

The reconciliation package adjusted this provision as follows: Employers with more than 50 employees who offer health benefits would face a penalty of either $3,000 for each employee (full-time or part-time) who receives a subsidy, or $750 per full-time employee, whichever would be less.

The fine would be figured subtracting 30 employees from the number actually employed at the firm. The package would also require employers who don't offer health insurance to employees to pay a fine of $2,000 for each full-time employee that receives a subsidy to purchase insurance through an exchange.

Insurers could also no longer use pre-existing conditions as a way to bar coverage, and in most cases would not be able to drop coverage on those who become ill.The bill also prevents lifetime limits on benefits and restrictions on annual limits.

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