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No Senate Finance Deal Yet But Chairman Touts Latest CBO View of Health Bill

By Jane Norman and John Reichard, CQ HealthBeat

July 29, 2009 -- Senate Finance Chairman Max Baucus, D-Mont., said Wednesday a preliminary report from the Congressional Budget Office (CBO) shows that his draft health overhaul bill would cost less than $900 billion over 10 years, cover 95 percent of Americans by 2015, and be fully offset.

It was an assessment he called "encouraging," but other committee members cautioned that no deal is at hand on the complex overhaul. And Senate Minority Whip Jon Kyl, R-Ariz., a member of the Finance panel, flatly predicted that no formal markup would occur until after the August recess.

"There's not going to be a deal before September," Kyl said. "Look, I'm on the committee, and they're not sharing with me. But this is Wednesday, the week before we leave, and if you don't have something pretty nailed down by now, you're not going to have a product available for a markup, especially with what Max said this morning."

Nonetheless, both President Obama and Senate Majority Leader Harry Reid, D-Nev., issued statements Wednesday afternoon praising the committee's progress, along with movement in the House, where the Energy and Commerce Committee chairman struck a deal with some fiscally conservative Democrats though a markup was again postponed.

"I want to thank the members of both the Senate and House of Representatives for continuing their work on health reform to provide more stability and security for Americans who have insurance, and quality, affordable coverage for those who don't," said Obama. "I'm especially grateful that so many members, including some Blue Dogs on the Energy and Commerce Committee, are working so hard to find common ground. Those efforts are extraordinarily constructive in strengthening this legislation and bringing down its cost."

Reid said, "we are another step closer to producing a bill that lowers costs, preserves choice and improves the overall quality of health care."

Baucus spoke Wednesday morning after emerging from the latest round of negotiations involving five Finance Committee members—three Democrats and two Republicans. Sen. Michael B. Enzi, R-Wyo., has been part of the negotiations but did not take part in that meeting.

The group has been working for weeks to produce a bipartisan bill that would expand coverage to millions of uninsured Americans without adding to the budget deficit over 10 years or driving up health care costs beyond that time frame.

The bill put together thus far by the group would reduce the deficit in the tenth year by several billion dollars, Baucus said. He acknowledged that CBO's report "does not include resolution of several key issues."

That appeared to be an understatement.

Enzi said no deal is imminent. "We still have several areas where we haven't been able to come to a consensus. No deal is at hand and substantive issues, big and small, remain," Enzi said.

"Nothing is going to be resolved until everything is resolved because there are so many interrelated parts to it," he said.

Sen. Charles E. Grassley, R-Iowa, another negotiator, said that headlines stating that a deal is imminent are "very inaccurate" and much remains to be decided. "We're making some progress by inches," he said.

"You could have a hundred or 200 or 300 subsets of Medicare reform, and we've probably got 95 percent of them decided," Grassley said in a conference call with Iowa reporters. "So I say we're on the edge of having an agreement. But I mean, I'm saying out of the total number of things you've got to make decisions on, but the 5 percent that are left are very difficult."

He also said both he and Baucus have to discuss any proposal with their respective caucuses prior to public announcement of an agreement.

Sen. Kent Conrad, D-N.D., another negotiator, said: "We certainly made a lot of progress but there's a lot more to be done. It's very hard to judge how close because you get into things and then you send [for] CBO scoring, and you don't know when you're going to get it back. The timetable's really not in our control."

Conrad said the latest CBO estimate did not reflect a final agreement, but that lawmakers were getting close. "The range of options has been narrowed substantially. But there are still things outstanding," he said.

The total size of the package is not expected to vary widely from the estimate, if and when Baucus's group settles on a final agreement. "In terms of the dollar amount, [it] probably won't change much," Conrad said.

Conrad also spoke of the potential of consumer-run cooperatives to compete with private plans on an insurance exchange where consumers could compare and choose among a variety of options. This would be an alternative to a government-run public plan that many Democrats, including President Obama, strongly advocate.

"This [the coop approach] is a model the actuaries have told us would be very effective in a reformed market with 40 million new entrants," Conrad said. "They believe very quickly this kind of operation would have 12 million members. It would be the third largest insurer in the country."

Jeff Bingaman, D-N.M., said the talks will continue. He wouldn't predict whether a deal would be reached before the Senate leaves Aug. 7 for its summer recess.

"I think we're making progress when we meet," Bingaman said. "How it concludes, I can't tell you."

Another Finance Committee Democrat who is not a participant in the talks, John Kerry of Massachusetts, said he remains optimistic about reaching a deal.

"We need to get something to the floor out of our committee," Kerry said. "We'll keep working at it."

Grassley said, "we're trying to work through these things. And it takes time. And, you know, I don't want the press in on our meetings, but I'll tell you, my job would be a lot easier if we had press reporting on how much detail we're going into and how many sides to an argument and how many points brought up and how many counterpoints are brought up and how even members thinking things through change their mind before the debate is over."

Democratic Sen. Blanche Lincoln of Arkansas, a member of Finance, said, "I've always felt this is very possible" to come to an agreement on the overhaul and one that would be workable for small businesses. She and other Democratic senators appeared at a press event touting the benefits of the Democratic approach for small businesses.

"There are tremendous inefficiencies in our health care delivery system right now. We have to do something about those inefficiencies before we start throwing these taxing threats around," she said. "I think it can happen and I think we're very close to coming up with good solutions for that. And I think the American people want it. . .small businesses desperately want to provide health insurance."

She added, "we want to make sure that it's paid for, we want to make sure we are eliminating the inefficiencies that are long term as well."

Democratic Sen. Mary L. Landrieu of Louisiana, though, said anything like the surtax levied in the House proposal to raise revenue for the bill would be "very tough" in the Senate and "we have to be as light on the mandate to business as possible, as flexible as possible."

The bipartisan group met again Wednesday afternoon and Conrad emerged to say that the latest round of discussions was devoted to Medicare payment reforms, which he said CBO told senators were a key element for long-term change in controlling health costs.

"I think you'll find real enthusiasm for what's been put together," said Conrad. Examples include hospital value-based purchasing, primary care bonus payments, comparative effectiveness studies and a Centers for Medicare and Medicaid innovation center. However, he said "no" when asked if CBO had scored savings for those measures at more than $50 billion, though he said savings are greater after the first decade.

"It is hard to asses how close we are," said Conrad. "We made very steady progress but there are things outstanding." He said that affordability and Medicaid expansion are two items, "so that the governors are comfortable with what we are doing."

Sen. Charles E. Schumer, D-N.Y., appeared pleased with the meeting. "This was the best discussion we've had about cost cutting that I have been through. It was very encouraging," he said.

Bart Jansen, Kathleen Hunter and Richard Rubin contributed to this story.

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