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House Democrats Consider a Medicaid Twist for Health Bill's Numbers Game

By Alex Wayne, CQ Staff

October 7, 2009 -- House Democratic leaders, desperate to cut the cost of a health care overhaul, are considering steps as drastic as increasing the size of the legislation's proposed expansion of Medicaid, lawmakers said Wednesday.

It turns out that covering people through Medicaid is cheaper than providing them subsidies to buy health insurance, according to the Congressional Budget Office (CBO).

"The irony is, what CBO is telling us is if you expand the number of people getting Medicaid, you reduce the cost of the bill," said Rep. Anthony Weiner, D-N.Y.

So Democratic leaders suggested to their caucus, in a meeting Wednesday, that they could increase the Medicaid expansion to cover people earning up to 150 percent of the poverty level, Weiner and other members said. Right now the House version of the legislation (HR 3200) would cover people earning up to 133 percent of the poverty level, or about $29,000 for a family of four.

The proposal to expand Medicaid is controversial. The program pays doctors and other health providers such low rates that many of them refuse to accept patients covered by the program. Increasing the number of people enrolled in Medicaid without improving its payments would exacerbate that problem.

"I have some concerns about that," said Allyson V. Schwartz, D-Pa. "Medicaid rates are so low in Pennsylvania."

Democratic leaders hope to soon settle on a combination of policies in the bill that will draw the support of most of their caucus, so that they can pass the legislation through the House "in the coming weeks," said Majority Leader Steny H. Hoyer, D-Md.

At Wednesday's meeting of the caucus—one of dozens that Democratic leaders have held since the beginning of the summer to discuss the health bill—Hoyer and Speaker Nancy Pelosi, D-Calif., began presenting ideas that the leaders hope can bridge vast policy differences between liberals and more moderate Democrats.

But Hoyer acknowledged that much work remains. "We're not in the home stretch yet," he said.

They seemed to have made little headway with moderates, in particular.

"This is one of the lesser productive caucuses that I've been to," Stephanie Herseth Sandlin said afterward. The South Dakota Democrat is a member of the Blue Dog Coalition, a group of fiscally conservative Democrats.

Sandlin complained that the caucus spent a great deal of time discussing how to structure a government-run insurance program that would compete with private insurers—a "public option"—even though it appears the idea will not be able to pass the Senate.

Democratic leaders, she said, talked about the idea in terms of staking out a "bargaining position" in a future conference committee with the Senate.

"This idea of trying to get 'bargaining position' really falls on deaf ears for a lot of us," Sandlin said. "This is about what's possible in both chambers."

Bart Stupak, D-Mich., another moderate, said he had heard nothing in the caucus meeting that would lead him to support the bill. And he said he did not sense that Democrats as a whole were moving toward a consensus on the bill.

"We're Democrats," he said. "We don't agree on anything."

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