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Health-Insurance Bill Passes in Historic Vote     Permalink

Whatever else may be said of House Speaker Nancy Pelosi, she can count votes. After weeks of cajoling and threatening members, 219 Democrats and 0 Republicans voted for the health-insurance bill passed by the Senate on Christmas Eve. Against it were all 178 Republicans and 34 Democrats. This small margin (with four fewer votes it would have been defeated) was intentional as Pelosi wanted to allow vulnerable members to vote no so their opponents could not attack them for voting yes in November. Only 216 votes were needed for passage as four seats (Abercrombie, Massa, Murtha, and Wexler) are currently vacant due to the resignation or death of a member. The bill now goes to President Obama for his signature.

As of yesterday morning, Pelosi still didn't have the votes, so she was forced to deal with Rep. Bart Stupak (D-MI), who led a group of antiabortion representatives that wanted the bill to have very strong language making sure no federal funds were used to pay for abortions (despite the Hyde amendment already including this provision since 1976). In a side deal to placate Stupak, Obama issued an executive order that tells federal agencies to please obey the law. The executive order changed nothing except providing a fig leaf for Stupak to claim victory and support the bill. Many congressmen are like 10-year-old boys: being able to say they won is very, very important to them.

The NY Times has a nice map showing where the yes and no votes came from. Not entirely surprisingly, the yes votes came from the Northeast, the Upper Midwest, the Southwest, and the Pacific Coast. The Democrats voting no were nearly all from the South.

The House also approved a second bill that is de facto a conference report ironing out differences between what was in the House bill passed last year and the Senate bill. Normally, the procedure would be to have both chambers vote on the compromise bill, but that would not have worked now because since the election of Sen. Scott Brown (R-MA) in January, the Republicans have the votes to filibuster the compromise bill. So instead, the House passed the original Senate bill intact and then passed this "sidecar" bill to make changes to it, such as removing the "Cornhusker Kickback" (a special deal that has the federal government pay for Medicaid in Nebraska inserted to buy the vote of Sen. Ben Nelson) and similar provisions. The sidecar bill now goes to the Senate where it will be taken up under budget reconciliation rules, which call for a straight majority vote. No doubt the Republicans will attack the process by which the bill passed, but in reality, the Senate bill passed using the regular order with 60 votes and exactly the same bill passed the House with a small majority. The sidecar bill is expected to pass the Senate with a substantial majority, conceivably with all 59 Democrats and independents voting for it. The Republicans are expected to oppose it, which puts them in the odd position of defending the Cornhusker Kickback and similar provisions that will already be federal law at the time of the vote.

Some Provisions of the Health Bill Kick in Before the Midterms     Permalink

Both parties are going to make this bill the centerpiece of their Fall campaigns. The Republicans will attack it as socialism, but since they have been attacking everything the Democrats have done since FDR as socialism, it is not clear that is going to sway many independents. The one specific feature of the bill that they can attack with some expectation of success is the individual mandate. They will say: "The federal government is now forcing you to get health insurance." For the millions of people who desperately want health insurance and can't get it, this cry will sound very hollow indeed. However, it may resonate with healthy young people who think they will never get sick and never need insurance and may not like paying the fine ($750 and up) created by the new law.

On the other hand, while many of the provisions of the bill do not start before 2014, some of them kick in 6 months after the law takes effect, which means they will be in force by October, when the Democrats will highlight them in the run-up to the November 2 midterm elections. Among these are:

  • Insurance companies will be forbidden from denying coverage to sick children
  • Adult children can stay on their parents' policies until they are 26
  • Small businesses will receive tax credits to help them buy insurance for their employees
  • All new policies will be required to cover preventive care, including annual physical exams
  • The practice of dropping insured people when they get sick will be banned
  • A high-risk pool will be created to subsidize adults with pre-existing conditions
  • For seniors, some medicines will become cheaper and the donut hole will be reduced somewhat

These are all very tangible benefits that will help millions of people immediately. While almost everyone knows the Republicans think the bill converts the country to socialism, current polling shows that very few people are aware of the specific benefits the bill contains, such as the ones listed above. By Nov. 2, practically everyone will be aware of them due to the massive publicity the Democrats are going to provide in October.

It is far too early to tell what effect the bill will have on the midterms. That will only become clear much further down the line when people begin to understand what it is they are getting. Millions of people don't have a clue yet and that will change over the course of the next six months.

Court Challenges to the Health-Insurance Bill Loom     Permalink

It is virtually certain that there will be court challenges to at least one provision of the health-insurance bill: the individual mandate. Never before has the government required people to buy a product from a private company or face a fine. While all states require automobile drivers to buy insurance, the courts have ruled that you don't have a legal right to drive a car and that states can impose reasonable conditions when granting you this privilege. Health care is different since everyone has to buy insurance now.

Republican Attorneys General in Virginia, South Carolina, Florida, and other states are already preparing to file lawsuits declaring the individual mandate unconstitutional. Their argument will no doubt be that nothing in the constitution explicitly gives Congress the power to impose this mandate (although nothing in the constitution explicitly gives Congress to power to order airline passengers to have their seat backs in their full upright and locked position for takeoff and landing, either, and that seems to have survived). The fact that every other industrialized country in the world has a mandate will be brought up as an argument by supporters of the bill. Ultimately, when the case gets to the Supreme Court, it will be Justice Anthony Kennedy who makes the final call, as usual.

If the mandate is struck down, what next? A law saying insurance companies cannot refuse to take people with preexisting conditions without a mandate will mean that many people, often called the "young invincibles" will not buy insurance until they get into a traffic accident or get diagnosed with a serious disease. The result of millions of people adopting this strategy will be that relatively few healthy people will be paying premiums, forcing insurance companies to raise rates, thus driving out more people. The system will surely collapse then.

If Congress is not allowed to insist on an individual mandate, what is plan B? One possible idea is to change the law saying that insurance companies may not discriminate against people with preexisting conditions if they sign up for their insurance in the month of January. In other months, they may discriminate. For most people, who will already have insurance if and when such a court decision happens, nothing will change. But for the young invincibles, suddenly they have to rethink their strategy. If they have a car accident in June, or a suspicious lump is discovered in August, they will not be able to get medical care until next January. It changes the picture considerably.

Was the Republican Strategy Wise?     Permalink

After Obama's inauguration, the Republicans had a choice: work with him and try to get some of their ideas written into law or oppose him and try to destroy him. They put all their eggs in the latter basket and lost. There is no way Republican leaders can sell the passage of the health-insurance bill to their own supporters as a victory. It is a bitter (but possibly subsidized) pill to swallow.

Imagine what the political landscape would have looked like now if the Republicans had come with a serious approach to health-insurance reform based on the private sector and promised 100 votes in the House and 30 in the Senate if Obama would go with it. In his desire to be bipartisan, Obama would almost certainly agreed and Republicans would have reaped much of the benefit. The bill they could have supported was Wyden-Bennett, which junked the employer-based health-insurance system and required insurance companies to compete nationally for customers one at a time, the way car manufacturers, airlines, appliance manufacturers, magazine publishers, fast food chains, and most other large businesses do. In that bill, the role of government was very limited, basically to set the ground rules such as what the basic policy must cover and the policy must be available to anyone who wants it for the same price.

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