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Panels Back Expansion of Insurance and Electronic Medical Records in Stimulus

By Alex Wayne and Drew Armstrong, CQ Staff

JANUARY 23, 2009 -- Two House committees approved legislation Thursday to expand Medicaid, extend insurance coverage for people who lose their jobs and provide $20 billion to accelerate the use of electronic medical records.

The health measures were part of a sweeping $825 billion bill that President Obama and congressional Democrats hope will help lift the nation out of economic recession. Republicans have castigated the legislation (HR 598) as a huge expansion of government that will not provide the short-term stimulus Democrats say is their goal.

In a markup session that lasted 12 hours and featured nearly 60 votes on health, energy and broadband expansion, the Energy and Commerce Committee approved the bill by voice vote, substituting it into the shell of another piece of legislation (HR 629). The committee opted to mark up the bill's health titles separately, approving the title on health information technology by voice vote, the titles on Medicaid by 32-11, and the title on insurance assistance for the unemployed by 32-12.

The Energy and Commerce markup actually threatened to go on much longer, but Democrats and Republicans worked out what Chairman Henry A. Waxman, D-Calif., termed a "gentlemen's agreement" to limit debate on each amendment to two minutes per side.

The Ways and Means Committee earlier approved the bill 24-13. The committee adopted two amendments affecting the health provisions of the bill, one by Chairman Charles B. Rangel, D-N.Y., and the other by Pete Stark, D-Calif., chairman of the health subcommittee. Both were adopted by voice vote.

Rangel's amendment made technical changes to the health provisions. Stark's amendment restored two sections of the bill that had been inadvertently deleted when the legislation was referred to the Ways and Means Committee, said his spokesman, Brian Cook. The sections prevent reductions in Medicare payments to hospices, medical students and long-term care hospitals.

The bill would also overhaul a program known as COBRA that allows people to keep their employer-sponsored health insurance when they lose their jobs. COBRA is considered underutilized because many families can't afford the premiums, which can be up to 102 percent of what workers and their employers jointly pay.

Under the bill, the government would subsidize 65 percent of COBRA premiums for up to 12 months. Additionally, people 55 and older or those with 10 years of tenure or more at their jobs would be able to continue COBRA coverage until they either find a new job offering health coverage or reach age 65, when they can enter Medicare.

During the Energy and Commerce markup, Republicans offered dozens of amendments to every title, almost all of which were rejected. One, from ranking Republican Joe L. Barton of Texas, would have put in place an asset and income test for individuals to qualify for COBRA premium assistance. Barton's proposal, which he referred to as "the Lehman Brothers amendment," would have barred people from the premium assistance program if they had more than $100,000 in income or $1 million in assets.

After Barton's amendment was rejected, Rep. Cliff Stearns, R-Fla., offered a similar amendment to bar anybody with an income more than $1 million. Waxman said that as long as there was an easy way to check incomes, he would agree to it.

"I think we just won one," said Stearns. The amendment was approved by voice vote.

One of the more controversial provisions of the bill is a section intended to encourage hospitals and doctors to more quickly adopt electronic medical records. Most health providers still use paper records, out of concern about the cost of going electronic as well as privacy restrictions.

Electronic records are thought to result in both increased efficiency, reducing health care costs, and reduced medical errors. Congress has been debating how to encourage use of what is known as health information technology, or health IT, for several years.

The bill would provide $20 billion for the government to create standards for the technology, implement electronic medical records systems for public insurance programs like Medicare and Medicaid, and pay private hospitals and physicians to do the same.

Taking a cue from the health IT section's Medicare portions, Republicans tried several times to use the bill as a vehicle to reform Medicare's physician payment system, which each year now demands deep cuts to doctors' payment rates as part of a cost-control formula.

The several GOP amendments would have either delayed future physician cuts, replaced them with a standard rate of inflation for medical costs or, in the case of an amendment offered by Rep. Michael C. Burgess, R-Tex., required Congress to fix the physician pay problem before doling out the billions of dollars in bonus payments to doctors and hospitals that are part of the health IT language.

"This vehicle is not the right place for fixing physician payments," said Waxman.

"If not this bill, what bill?" asked Rep. Phil Gingrey, R-Ga., arguing the point that Congress has typically waited until the last minute to solve the physician payment issue, adding it to one of a session's final moving pieces of legislation.

Democrats did agree to a "buy American" amendment offered by Rep. Tim Murphy, R-Pa. The amendment would require any health information technology bought with the government funds to be manufactured and sourced from the United States.

Under the health IT provision in the bill, hospitals would be eligible for payments of at least $2 million beginning in fiscal 2011 if they adopt electronic records meeting the federal standard. Individual physicians would receive up to $65,000 for going electronic.

Beginning in fiscal 2016, hospitals and physicians would face reduced Medicare payments if they don't use electronic medical records.

To strengthen privacy protections for patients with electronic medical records, the bill includes increased penalties for improper disclosure and prohibitions on some uses of the records.

Several different industry groups have written the Ways and Means and Energy and Commerce committees in opposition to the health IT provisions of the bill; of the eight Republican health amendments, half concerned health IT.

Many industry groups, including pharmacies and insurers, are particularly concerned that the bill's privacy protections are too restrictive and would prevent what they say are routine uses of medical records aimed at improving the quality of care.

During the Ways and Means markup, an amendment by Rep. Charles Boustany Jr., R-La., to strike the privacy language under the bill's health IT section was among those rejected.

The Ways and Means committee rejected eight health-related amendments offered by Republicans. Among them were proposals to allow seniors to opt out of Medicare and to require health providers to share information about their prices with the government and public.

The bill would also provide nearly $96 billion for Medicaid, including about $9 billion for states to expand the program to cover low-income workers who lose their jobs through 2010. The other $87 billion would be paid to states as increased Medicaid reimbursements, to help them close holes in their budgets.

Medicaid is a joint federal-state health insurance program for the poor; the federal government pays on average about 57 percent of the costs.

The Energy and Commerce markup threatened to turn contentious after Republicans offered amendments on birth control and immigrant eligibility for government programs, but the late hour and an agreement to limit debate seemed to hold any rancor in check.

A proposal by Rep. Joe Pitts, R-Pa., would have required parental notification for any minor that received contraception services under Medicaid, which are provided for in a state grant program in the bill. "I really don't understand what the expansion of family planning services has to do with stimulating the economy," Pitts argued. The amendment failed, 14-29.

"This is contraception, not abortion," Rep. Diana DeGette, D-Colo., argued back.

An amendment by Rep. Nathan Deal, R-Ga., would have kept in place a five-year waiting period for legal immigrants and new citizens to receive services under the State Children's Health Insurance Program, or SCHIP. In an SCHIP reauthorization bill (HR 2) that recently passed the House, Democrats removed the waiting period.

Waxman argued that five years was too long for children and pregnant women to have to wait for coverage. "It's stupid and it's morally wrong," he said. The amendment failed, 12–31.

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