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Baucus Forecasts 'Near Universal Coverage'

By John Reichard, CQ HealthBeat Editor

May 21, 2009 -- Senate Finance Committee Chairman Max Baucus raised eyebrows briefly Thursday morning when he told reporters that "we're not going to get 100 percent coverage" of Americans under health overhaul legislation. But in later remarks he amended that to predict "near universal coverage."

Asked to clarify his opening remarks at a "newsmaker" breakfast sponsored by the Kaiser Family Foundation, the Montana Democrat said that according to Congressional Budget Office estimates, the overhaul plan he has in mind would achieve coverage of 94 to 96 percent of Americans. "There are always going to be some people . . . you just can't find" to enroll, Baucus said, adding that "we're not going to cover undocumented workers. That's too politically explosive."

Uncertainty about the ability of Democrats to put together legislation financing universal coverage is coming to the fore as lawmakers confront the political difficulties involved.

The remarks by Baucus followed a day-long meeting of the Senate Finance Committee Wednesday that wrestled with financing expected to cost more than $1 trillion over 10 years. Committee members considered a wide variety of controversial funding methods ranging from taxing alcohol, soft drinks, and pricey health coverage to cutting Medicare payments to hospitals, but did not reject any, Baucus insisted.

Easing Baucus' task in putting together a financing package may be a study released Thursday pointing out that foregoing an overhaul would also add deeply to the nation's financial burdens and strike growing numbers of middle-class Americans particularly hard. The study shows that the status quo will not be easy to defend, either, said speakers at a forum sponsored by the Urban Institute.

Nevertheless, analysts wonder whether financing an overhaul will prove so difficult that Baucus will be forced to scale back expectations for coverage gains. That in turn would sow doubt about whether the insurance industry would guarantee coverage to all insurance applicants without charging them premiums based on health status. America's Health Insurance Plans, the nation's largest health insurance lobby, has promised to do those things but only if an "individual mandate" becomes law requiring all Americans to carry health insurance.

Asked whether "guaranteed issue" and rating revisions to exclude consideration of health status fall by the wayside if coverage isn't 100 percent, Baucus said "not at all . . . a key to this is everyone having health insurance." Baucus added that "without that, you get groups falling out. Then it's much more difficult to accomplish delivery system reform because we want the public and private providers to basically be working together ."

Baucus said "we're going to try to get as close as we can (to 100 percent coverage) and we're working hard to accomplish that." Universal coverage systems in other countries have fallen short of 100 percent coverage because of the administrative difficulties of enrolling literally everyone in a country.

Baucus did his best to describe the overhaul process as on track after a series of three meetings over the past few weeks in which he and the committee's top Republican, Iowa Sen. Charles E. Grassley, walked committee members through the complexities of an overhaul. Baucus said the panel will stick to its plans for a mid-June markup of health overhaul legislation. "We've not let anything slip," he said.

But at least some interest groups are beginning to rumble into action to defeat financing options on the table such as taxing sweetened drinks and capping the value of health insurance premiums paid by employers to employees. The beverage industry has voiced objections and labor unions in Oregon are launching an ad campaign targeting a proposal by the state's Democratic Sen. Ron Wyden to end the exclusion of employer-paid premiums from taxable income as a way to pay for universal coverage.

But Baucus is urging lobbyists to keep their cool, saying the committee is going to stick with consideration of a wide range of ideas and suggesting that while there may be some things that they don't like there may be others that they do like.

"Everything's on the table," he insisted. "Everything. All proposals. All ideas that groups may have are on the table. And they're going to stay on the table. We are going to discuss them. If anyone finds something on the table that he or she has a negative reaction to, I say suspend judgment . . . try to see if there's a way to get to 'yes.' Think about it. There might be a positive angle here.

"In addition, because this is so big, so complex, there are going to be a lot of trade-offs. One group might find it a little bit difficult here, that same group can find something positive over there. This is just so large."

While Baucus doggedly voiced confidence about the overhaul effort, Grassley said Wednesday that he does not see a consensus emerging on an overhaul. "There was a greater understanding of the issues we have," Grassley said. "There's a lot of members who still want some more understanding."

Baucus said no decision had been reached on several key aspects of an overhaul, such as mandating employer coverage or a timetable for phasing in to near universal coverage. He did say, however, that employers should participate.

Asked to what degree insurance revisions would be written into statute or assigned to some type of board to be developed later, Baucus listed a number of significant provisions that would be included in the legislation. They include minimum standards for benefits, a guaranteed issue requirement, a prohibition on excluding coverage of pre-existing conditions, the creation of an insurance exchange where people should sign up for coverage, conditions for buying and selling insurance within the exchange, and rating revisions. But "states will still be able to make a lot of decisions," he said.

Asked whether there might be a provision for a "fallback" government-run insurance option in areas lacking insurance options, Baucus said it is "on the table."

On his way in to Kaiser Family Foundation headquarters, single-payer advocates tried to confront Baucus about his decision to exclude them from overhaul discussions. They said Baucus ducked them by not getting out of his car until after it disappeared behind the closing door of the building's parking garage.

One of the advocates, part of a group called Single Payer Action, said he was among those in the audience arrested May 5 at a Baucus roundtable. He called Baucus "the senator for K Street," while another charged that Baucus is "taking hundreds of thousands of dollars from the drug and health insurance corporations."

Baucus was questioned at the press briefing about why the single-payer approach to an overhaul was not under consideration. He replied that it has no chance of passage and "we can't squander this opportunity. We can't waste capital on something that's just impossible."

Asked what approach he thinks has the greatest potential to control health costs, Baucus said reduction of geographic variations in spending. If medicine were practiced across the country the way it is in low-cost regions like the High Plains states, the health system could save $700 to $800 billion in spending and medical outcomes "will be better," he said.

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