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House to Vote on Medicare Bill Despite Ongoing Bicameral Negotiations

By Drew Armstrong, CQ Staff

June 20, 2008 -- The House plans to vote Tuesday on a modified version of a Senate Medicare bill, rather than waiting for ongoing bicameral negotiations to produce a deal.

House Majority Leader Steny H. Hoyer, D-Md., said House Energy and Commerce Chairman John D. Dingell, D-Mich., and House Ways and Means Chairman Charles B. Rangel, D-N.Y., had decided to move with their own bill after discussions with Senate Democrats had not yet produced a deal.

Hoyer said the bill the House will vote on Tuesday will not be fully offset.

Dingell and Rangel's bill will be based on legislation (S 3101) by Senate Finance Chairman Max Baucus, D-Mont. The legislation would avert scheduled cuts to Medicare's physician rates from taking effect for 18 months, replacing them with stable payments, including a 1.1 percent increase in 2009, according to a summary.

Baucus' bill has yet to pass the Senate, so the House will have to introduce its version as a new piece of legislation.

House Democratic said the House bill was an independent product, despite ongoing negotiations between Dingell, Rangel, and Baucus. However, those talks are still expected to produce whatever legislation ultimately become law.

The Senate remains the greatest hurdle for any Medicare legislation. The White House and conservative Republicans have used the chamber as a firewall to halt any bill that would cut private Medicare plans, known as Medicare Advantage.

The physician payment cuts are scheduled to go into effect July 1, and lawmakers are scrambling to clear legislation quickly to stop them.

The House package would be partially offset by cutting some bonus payments to Medicare Advantage in areas with teaching hospitals. Another offset would require a subset of the plans called "private fee for service" to form networks with health care providers, which would reduce future costs by slowing the growth of the plans. The plans are paid at a higher rate than traditional Medicare, and Democrats have long sought to cut them.

Proposed cuts to the bonus payments have not generated much opposition from Republicans.

Responding to the House proposal, a Baucus aide said, "Clearly, there's a lot that Senator Baucus agrees with. . . . Senator Baucus believes the bill deserves support and will watch the House vote with interest. It is important to end up with legislation that can pass both chambers."

The bill would rework several elements of the Baucus bill to cut down on the overall cost, deleting a $1.1 billion "Medicare Improvement Fund" and removing several provisions that would offer bonus payments to doctors, and other Medicare programs.

Concerns About Offsets
House GOP Whip Roy Blunt of Missouri expressed some reservations about the bill, saying concerns about the offsets could lead to "at least a veto-sustaining number on our side" voting against the bill.

The House proposal also addresses several Democratic policy priorities, including postponing for one year a Medicare program that would have forced suppliers of durable medical equipment to enter into a competitive bidding program as a way to cut down on government spending. The bill will not cut Medicare payments to providers of powered wheelchairs and oxygen supplies, according to the summary.

Other items include $4 billion over five years of spending on Medicare beneficiary programs, such as premium assistance and lower copayments for mental health services. Provisions to encourage electronic prescribing and to help pharmacies are included as well.

In the Senate, Baucus has been in private discussions with Finance Committee ranking Republican Charles E. Grassley of Iowa, to see what GOP members—who blocked a previous attempt by Baucus to pass legislation—might accept.

If the House moves a bill, it will put pressure on Senate Democrats and Republicans to reach an accord. A Senate aide said June 20 that Baucus and Grassley were close to a deal, but had not put a final stamp on one.

"Reports of a deal between the chairman and ranking member are premature," said an aide to Baucus.

A deal between Grassley, Baucus, and House Democratic negotiators could scuttle plans for the House vote Tuesday if the Senate appears ready to move quickly and send over a compromise bill.

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