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Energy and Commerce Panel Approves Health Overhaul

By Alex Wayne, CQ Staff

July 31, 2009 -- The last of three House committees considering a health overhaul approved the bill on Friday night, setting up the legislation for a floor vote in September.

The Energy and Commerce Committee approved the bill 31–28. All of the committee's Republicans opposed the measure, and they were joined by five Democrats, mostly members of the moderate Blue Dog Coalition who say the bill would not do enough to contain the growth of health costs.

Four other Blue Dogs supported the measure, giving Democrats the margin they needed to advance it from the committee. But the Blue Dogs' support came only after two weeks of negotiations with the committee's chairman, Henry A. Waxman, D-Calif. Democrats on the committee did not strike a final deal until early Friday morning.

The Democrats who opposed the measure were Rick Boucher of Virginia, Bart Stupak of Michigan, Jim Matheson of Utah, Charlie Melancon of Louisiana, and John Barrow of Georgia. The latter three are Blue Dogs. Stupak opposes abortion and believes that the measure will lead to increased numbers of the procedure.

Under the agreement, the Blue Dogs won an amendment that would require a government-run insurance plan the bill would create, what Democrats call a "public option," to negotiate payment rates with health providers, rather than paying rates set at those of Medicare, plus 5 percent.

The Blue Dogs have complained that Medicare does not pay doctors and hospitals well enough in their mostly rural districts, driving providers to more urban areas.

The amendment also would cut the cost of the $1 trillion bill by trimming subsidies that would be provided to low-income people to help them buy insurance through a new, regulated marketplace called an "exchange."

Liberals on the panel who say the public plan is watered down by the Blue Dogs' amendment and that the cuts in subsidies will hurt the poor demanded two amendments of their own. One was a relatively noncontroversial collection of minor savings proposals, such as requiring the Centers for Medicare and Medicaid to simplify its administrative procedures through such steps as requiring claims for the programs to be submitted electronically.

But the second amendment would authorize the government to negotiate prices in Medicare's prescription drug program, something long opposed by drug companies and insurers who administer the program.

The drug companies and insurers say they already negotiate the drug prices seniors pay in Medicare. The negotiations are not public, however, and many Democrats have long suspected that insurers are not getting the best prices possible.

The second liberal amendment also would require that insurers offering plans through the exchange obtain permission from the government before they increase premiums greater than the rate of medical inflation.

The two liberal amendments specify that whatever savings they are able to produce would be dedicated to mitigating the cuts in subsidies for low-income people required under the Blue Dogs' amendment.

The Blue Dogs' amendment was adopted 33–26. The first of the liberals' amendments was adopted 32–26; the second was adopted 32–23.

Republicans ridiculed the Blue Dogs for negotiating what they said were relatively minor changes in the bill.

"You let the Blue Dogs in," Mike Rogers, R-Mich., said to Waxman, "and they got to choose the color of the lipstick on the pig. That's all you got."

Prescription drugs were the focus of several amendments Friday.

The committee adopted an amendment by Anna G. Eshoo, D-Calif., that would authorize the Food and Drug Administration to approve generic versions of costly biologic drugs derived from human proteins. Ordinary chemical pharmaceuticals have faced generic competition for more than two decades.

Eshoo's amendment, which Waxman opposed, would grant biologics manufacturers 12 years of exclusive use of their date before generic manufacturers could begin developing competitors.

Her amendment is identical to a Senate biologics amendment adopted on a bipartisan 16–7 vote earlier this month by the Health, Education, Labor and Pensions Committee. The industry wanted a 14-year period of market protection, while liberals such as Waxman wanted no more than seven years.

Waxman and Nathan Deal, R-Ga., argued that they did not think Eshoo's amendment would be effective at lowering the price of biologics or increasing innovation in the industry. Waxman, knowing that he would lose a vote, called for a voice vote on Eshoo's amendment and announced that it had succeeded. But Eshoo called for a recorded vote, prompting him to snap at her, "You promised me you wouldn't do that!"

The vote was 47–11.

The committee adopted by voice vote an amendment by Bobby Rush, D-Ill., that would prohibit brand name drug companies from settling patent litigation with generic competitors by paying them to delay marketing their products.

Democrats nearly lost one amendment vote when many Blue Dogs defected. The amendment, by Phil Gingrey, R-Ga., Roy Blunt, R-Mo., and Lee Terry, R-Neb., would have allowed anyone not enrolled in a group health plan, such as those offered by employers, to enroll in a health plan identical to those offered to federal employees.

As the roll call vote began on the amendment, Eshoo and Bart Stupak, D-Mich., both voted yes. That prompted Waxman to hustle down to their end of the dais and speak with them. Four other Democrats voted for the amendment, and several passed their votes, waiting until after the rest of the committee voted to state their positions.

Republicans heckled Anthony Weiner, D-N.Y., for voting against the amendment a day after he made remarks suggesting he would support such a proposal.

Eshoo changed her vote to no, and the amendment fell 28–31.

Weiner later offered an amendment that would have replaced the bill's coverage provisions with a single-payer health system, modeled on Medicare, that would cover every American. Several Democrats spoke in favor of the amendment, arguing it would be simpler than the House bill and that it would save the nation money.

But Weiner agreed to withdraw the amendment after Waxman told him that Speaker Nancy Pelosi, D-Calif., had promised him that supporters would be able to offer the measure as an amendment on the House floor.

Waxman and the committee's senior Republican, Joe L. Barton of Texas, agreed not to consider an estimated 45 to 50 amendments that Waxman described as minor. Instead, those amendments that are agreeable to both parties will be bundled into a separate bill that the committee will mark up in September, Waxman said.

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