By Jeffrey Young - 02/22/10 05:43 PM EST
President Barack Obama on Monday unveiled his most detailed proposal yet to reform the U.S. healthcare system in a gambit to breathe new life into his signature domestic policy initiative.
The measure posted on the White House website Monday morning is intended as the starting point for the discussion at a bipartisan summit the president will host with Democratic and Republican leaders on Thursday.
“We view this as the opening bid for the health meeting,” White House communications director Dan Pfeiffer said during a conference call with reporters Monday.
Pfeiffer emphasized that the plan does not represent a compromise package negotiated between Obama and the Democratic leaders in Congress.
“This is the president’s proposal,” he said, adding that the compromises it contains were “informed by our discussions with the House and Senate leadership” after the Senate passed its version of the bill on Christmas Eve.
House GOP Leader John Boehner (Ohio) quickly blasted the proposal in a blistering statement that said Obama had “crippled” the credibility of this week’s summit by proposing the same government takeover of healthcare already rejected by the public.
“This new Democrats-only backroom deal doubles down on the same failed approach that will drive up premiums, destroy jobs, raise taxes, and slash Medicare benefits,” Boehner said.
Speaker Nancy Pelosi (D-Calif.) and Majority Leader Steny Hoyer (D-Md.) both welcomed the proposal in measured statements.
Pelosi said the new plan contained “positive elements” from the House and Senate bills.
“I look forward to reviewing it with House members and then joining the president and the Republican leadership at the Blair House meeting on Thursday," Pelosi said.
Hoyer described the proposal as a blueprint of ideas already “thoroughly debated and publicly examined.”
Obama and the Democratic leaders were very near to a final agreement before Sen. Scott Brown (R-Mass.) won a special election last month, depriving Democrats of the 60th vote they need to overcome a Republican filibuster.
House and Senate Democratic leaders are leaning heavily toward moving a legislative strategy under which the House would pass the Senate bill and both chambers would consider a second measure including the final compromises hashed out by Democrats via budget reconciliation rules that would enable the legislation to pass the Senate with a simple majority vote.
The White House is not endorsing any legislative approach, Pfeiffer indicated, but the proposals released Monday were written with reconciliation in mind.
He said the White House has made no determinations on which process to move forward with.
“The president expects, and believes the American people deserve, an up-or-down vote on health reform,” Pfeiffer said. “This package is designed to provide us the flexibility to achieve that if the Republicans decide to filibuster.”
The proposal keeps the Senate bill’s state-based health insurance exchanges and does not create a mandate that employers provide health benefits. It also includes an excise tax on high-cost health insurance plans.
But in nods to the more liberal House bill, the White House plan beefs up health insurance tax credits for low- and middle-income individuals and families. It also would close the so-called “doughnut hole” coverage gap in the Medicare prescription drug benefit and discards additional Medicaid funding for Nebraska, put in place to secure the support of Sen. Ben Nelson (D-Neb.), in favor of expanding federal Medicaid funding to all states. Obama also proposes expanding the "hardship" exemption from the individual mandate to obtain health coverage.
The proposals are short on ideas aimed at wooing Republicans, who have expressed intense skepticism about Obama’s stated intention to reach out to them. The package does include GOP-authored provisions designed to reduce waste, fraud and abuse in federal healthcare programs, however.
The total cost of the proposal is in line with the Senate bill, at around $950 billion over 10 years. That spending would be offset by Medicare spending cuts and new taxes. The bill would add about 31 million people to the insurance rolls and would reduce the federal budget deficit by approximately $100 billion over 10 years.
The enhanced tax credits and Medicaid spending would total about $75 billion over 10 years.
To make up the difference, the White House proposes higher fees for employers that do not provide health benefits, higher fees for individuals who do not purchase coverage and bigger cuts in subsidies to private Medicare Advantage plans.
The excise tax is scaled back to apply only to family plans above $27,500 and invididual plans above $10,200 -- beyond even the levels the White House negotiated with labor unions last month -- and would be postponed for five years, until 2018, for everyone, not just union members as originally agreed to.
The White House favors raising additional money by expanding the Medicare payroll tax on wealthier people to cover unearned income. The elimination of the Medicare drug-benefit donut hole would be partly financed by increasing pharmaceutical company fees by $10 billion, which would go beyond the $80 billion the industry agreed to give up. The plan also modifies the fees levied on health insurance and medical device companies.
This story was originally posted at 10:00 AM