Senators pare back subsidies in health care bill

updated 7:58 p.m. ET June 18, 2009

WASHINGTON - Key Senate Democrats are paring back subsidies designed to make insurance more affordable as they reach for bipartisan support on health care legislation.

An outline circulated Thursday by Sen. Max Baucus, the chairman of the Senate Finance Committee, also leaves open the possibility that there would be no direct government competition against private insurors.

Despite the cost-cutting, the proposal retains key elements of President Barack Obama's call for expanded health insurance. It requires most individuals to purchase coverage and forbids insurance companies from denying it on the basis of pre-existing medical conditions.

Still, initial congressional work on the historic health care overhaul is going so slowly that Sen. Christopher Dodd told colleagues: "I never suggested this was going to be warp speed."

Senators pushed ahead anyhow on what were supposed to be the easy parts of sweeping health care legislation. But they quickly found out that almost nothing about revamping the system is uncontroversial.

First up for the Senate Health, Education, Labor and Pensions Committee, which Dodd is heading in Sen. Edward M. Kennedy's absence, were amendments to improve quality and efficiency. But the debate quickly shifted to more contentious issues including the overall cost of enacting Obama's top domestic priority of reshaping the nation's health care system to bring down costs and extend insurance to 50 million Americans who lack it.

"You could end up with a bill that's easily headed to a $2 trillion price tag," complained Sen. Judd Gregg, R-N.H., as he offered an amendment that would require proof that various quality measures such as training and identifying best practices would actually save money.

The committee rejected his amendment, as Sen. Barbara Mikulski, D-Md., contended it would be "throwing sand in the gears."

An amendment by Sen. Orrin Hatch, R-Utah, would have limited the use of research comparing the effectiveness of various medical procedures — a hot-button issue for Republicans because they say it could lead to health care rationing. It, too, was rejected on a 13-10 party-line vote.

Retooling proposals
The committee was on its second day of work on a 600-plus-page bill, but the first day of real work after Wednesday's session was entirely given over to speechmaking. Dodd, a Connecticut Democrat, is leading the committee while Kennedy receives treatment for cancer.

Elsewhere in the Capitol senators on the key Finance Committee delayed their own voting session as they struggled to slash costs to under $1 trillion over 10 years.

Members of the Finance Committee, considered Congress' best hope of producing a bipartisan bill, were meeting behind closed doors Thursday for further negotiations.

Video   Can we afford to fix health care? June 17: Sen. Judd Gregg, R-N.H., talks about the government’s plans for health care reform. MSNBC

In the House joint draft legislation was expected as early as Friday from the three committees with health care jurisdiction — Ways and Means, Energy and Commerce, and Education and Labor — with hearings to begin next week. The committees are writing legislation that would require all Americans to have health care coverage, and establish a new public insurance plan to compete with the private market.

"I have every confidence we will have a public option coming out of the House of Representatives. It will be a level playing field. For us to have substantial health care reform, this has to be part of it," House Speaker Nancy Pelosi, D-Calif., said Thursday.

The public plan option, supported by Obama, could have a much tougher ride in the Senate where minority Republicans hold more sway and believe it could drive private companies out of business.

The Finance Committee, struggling with the public plan among other issues, was supposed to release draft legislation Wednesday and begin voting on it next week. But the committee announced that votes would wait, possibly until after July 4, as senators sought to retool their proposals to cut the cost by more than one-third, from an initial $1.6 trillion to less than $1 trillion.

Senators on the health committee were considering a lengthy bill plus 388 amendments, but with the most contentious issues — the public plan question and whether to require employers to cover their workers — still unwritten.

The legislation would create a new insurance marketplace where people could shop for coverage plans with help from government subsidies.

As written, it would cost some $1 trillion but still leave 37 million people uninsured, and Republicans are deeply skeptical. The health committee is scheduled to meet daily and was supposed to finalize the bill by the end of next week, but after Wednesday's session Dodd backed away from that deadline, saying he wasn't tied to it.

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