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Baucus: Finance Panel 'a Lot Closer' to Sub-Trillion Price Tag

June 23, 2009 -- Senate Finance Committee Chairman Max Baucus wasn't specifying how, but the Montana Democrat was firm in his declarations to reporters Tuesday that he’ll meet his goal of paring down the cost of a comprehensive health overhaul to below $1 trillion over 10 years.

Whether he will be able to do so this week — his GOP colleague Charles E. Grassley of Iowa said Baucus is shooting to finish his "mark" by the end of the week — is unclear. "We'll be ready when we're ready," Baucus said — repeating the mantra about timing he began intoning to reporters last week. “I’m not going to give an arbitrary date because it's just hard to know. We may even have to go back and get another CBO score or two.”

Grassley said the committee was making progress in its talks but did not elaborate. But other committee Republicans did not sound so sanguine.

A Congressional Budget Office (CBO) score last week putting a $1.6 trillion price tag on the committee’s overhaul package helped set off a wave of news reports that congressional Democrats are flailing about ineffectually in their efforts to assemble a package with any pretense of affordability.

But the committee is looking at a revised package that modifies subsidies to buy coverage and appears to be progressing thereby in lowering the price tag. The panel is "a lot closer. We’ll make it," Baucus said after emerging from a bipartisan negotiating session Tuesday morning with other committee members. Committee Democrats are tentatively scheduled to meet again Wednesday. Both committee Republicans and Democrats are scheduled to meet Thursday.

Baucus said his confidence is growing that the package he unveils will be bipartisan. Why? "Because there’s a good number of Republicans who understand the need to vote for meaningful comprehensive health care reform that will pass. A lot of Republicans know that this is the time. And they know that costs are going up at such a high rate that we must slow down the rate of growth. . . because if we don’t do it now when are we going to be able to have a chance again?"

Among the issues discussed at Tuesday’s committee meeting were: subjecting a portion of employer-paid health insurance premiums to taxation; how and whether to include a government-run insurance option or some variation; and how to deal with "free rider" employers who don't cover their workers and so drive up emergency room and other costs that providers shift back to employers offering health benefits.

Baucus suggested that bipartisan agreements on dealing with these controversial issues may be in the offing. "The comfort level of all the senators in the room is much better now on all those issues," he said.

But committee Republican Orrin B. Hatch of Utah sounded much more doubtful about progress toward bipartisanship in the committee. "There are a lot of different ideas, a lot of approaches, and I don't think we’re anywhere near to having a consensus," Hatch said. "One of the things that worries most people is how heavily are [Democrats] going to hammer the American taxpayer."

Hatch added that "I think the government plan is a non-starter." And on the issue of requiring employers to help pay the costs of health care for the poor if they do not provide coverage, Hatch observed, "That's a tough problem for most Republicans." He added that such a requirement would be a disincentive to hire low-wage workers.

However, GOP committee member Olympia Snowe appears to be seeking common ground with Democrats on the public plan controversy. She said she's negotiating with committee Democrat Charles E. Schumer about a public plan approach that would ensure availability of affordable coverage in markets where it does not now exist. Snowe indicated that such an approach — which has been referred to as a "fallback" mechanism offering some kind of public plan if private plan competition is lacking — could co-exist with establishing member-run health insurance co-operatives, an idea proposed by committee Democrat Kent Conrad of North Dakota as an alternative to a government-run insurance option.

Conrad said the costs of the bill "have come down quite markedly" in large part because of cuts in subsidies that would be given to lower-income Americans to buy coverage. Even with lower subsidies, 96 percent of the nation would have insurance under the Finance plan, Conrad said.

Conrad said the committee is reviewing four options on the issue of requiring employers to offer coverage or else help pay some health care costs. "That's one of the major areas still very much in discussion."

"The key is votes on the floor... Every single Republican is opposed to the public option, with one exception," Conrad said, referring to Snowe. "To get the votes, you've got to find some compromises." Regarding creation of co-ops as an alternative to a public plan, Conrad said some $3 to $4 billion in seed money would be needed.

Richard Rubin contributed to this story.

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