By Alexander Bolton - 12/04/09 08:53 PM EST
Senate Democrats will offer an amendment this weekend to curb the pay
of executives at health insurance companies that benefit from federal
subsidies, fueling the growing feud with the powerful industry.
Sens. Blanche Lincoln (D-Ark.), Frank Lautenberg (D-N.J.) and Robert Menendez (D-N.J.) have sponsored an amendment that would prohibit health insurance companies from deducting more than $400,000 in executive compensation per individual. The cap would apply to companies that earned 25 percent or more of their income from Americans who buy insurance from government-created exchanges.
President Barack Obama and congressional Democrats started the healthcare debate earlier this year by forming a tentative truce with the insurance industry but that now appears finished.
Democratic rhetoric against the insurance industry has become increasingly critical as the debate has progressed.
Earlier this fall, Senate Majority Leader Harry Reid (D-Nev.) pushed a proposal to revoke the anti-trust exemption that health insurance companies have enjoyed since the mid-1940s. Reid later backed off, however, and decided to not to include the provision in the Senate healthcare bill.
But other Democrats have set their sights on the profitable industry as lawmakers look for innovative ways to curb healthcare costs and avoid the perception that the pending Senate legislation amounts to a massive giveaway to healthcare companies. Some liberal critics charge the legislation would not do enough to curb the excesses of health insurance companies, especially if it does not include a government-run insurance program.
“By eliminating an enormous tax deduction that allows insurance companies to line the pockets of their executives, this proposal will raise about $651 million over the next 10 years, which will be required to go toward the Medicare trust fund,” Lincoln told reporters Friday afternoon.
Lincoln noted that if healthcare reform legislation becomes law, insurance companies would receive millions of new customers.
“Our amendment will make sure that premiums these new enrollees are spent on better care and not executive salaries,” she said.
Lincoln on Friday reiterated her opposition to the public option, which some liberal Democrats believe is essential to prevent the bill from becoming a multi-billion dollar giveaway to the insurance industry.
“I’ve been very clear, I don’t support a public option that is government-funded or government-run that puts the taxpayer at risk in the long run,” Lincoln said.
The Arkansas lawmaker said she would even oppose setting the public option to a trigger if the insurance program ultimately implemented would be controlled or funded by the government.
Lincoln said she was skeptical of the claims of other Democrats that a public option would be self-sufficient and would not rely on a stream of federal revenues.
“I haven’t seen the mechanisms that make that happen yet,” she said. “I will reassure you that I am going to look at everything and am going to judge it based on that. I’m going to judge it based on whether or not there is long-term risk to the taxpayer and whether government-funded and government-run.”