- The Washington Times - Tuesday, June 9, 2009

Stirred by President Obama’s warnings of rising costs, Congress is shaping sweeping health care reform plans that could create a public health insurance program and a mandate that all Americans carry insurance.

Mr. Obama stepped up his role in the health care reform debate last week with a letter to Congress in which he said he “strongly” believes a reform plan should include the creation of a public option, a government-run program similar to Medicare that would provide insurance to those without a private insurance plan.

The country’s economic growth will stall under the weight of rising health care costs within just a few years, according to estimates from the White House’s Council of Economic Advisers. Left unchecked, health care costs would take up one-third of the American economy by 2040, according a recent report from the group.

However, reforming the industry, which accounts for 18 percent of the American economy, is a formidable challenge. There is little consensus on how exactly to do it — or how to pay for it.

It’s a debate poised to last through the summer — Mr. Obama has set a deadline of August — and it already has riled industry, political and other groups into action.

The Senate Health, Education, Labor and Pensions (HELP) Committee’s draft bill, circulated late Friday, includes the creation of a public option to operate alongside private insurers, plus mandates that all Americans carry insurance, with exceptions for the poor.

The HELP Committee’s bill is expected to be merged with a yet-to-be-released bill from the Senate Finance Committee. Its chairman, Sen. Max Baucus of Montana, said last week that he expects the Senate to pass a bill that contains a public option.

But the idea of a public option has all but dashed hopes, expressed by both parties, that the reform bill would be bipartisan.

Democrats say any real reform has to include a public plan because it would provide the best hope to contain costs and ensure everyone has coverage.

“The status quo is broken. We cannot continue this way. If we do nothing, everyone’s health care will be put in jeopardy,” Mr. Obama said in his weekend radio address. “What we can’t welcome is reform that just invests more money in the status quo — reform that throws good money after bad habits.”

Several Republicans in a letter to the White House released Monday said broad support of a health care reform plan is in jeopardy because of the president’s insistence on a government insurance option for the middle class.

Leaders of the finance panel, which has the best odds of producing a bipartisan bill, are working against a self-imposed deadline for moving the legislation through committee this month. But tensions have been rising since Mr. Obama recently affirmed his strong support for including the option of a public insurance plan.

“At a time when major government programs like Medicare and Medicaid are already on a path to fiscal insolvency, creating a brand-new government program will not only worsen our long-term financial outlook but also negatively impact American families who enjoy the private coverage of their choice,” said the letter, signed by nine Republicans on the Senate Finance Committee.

Republicans already have started shaping their defense against it, arguing that it would drive private insurers out of business and leave the public plan as the only insurer.

“Eventually, Americans would be stuck with government-run health care whether they like it or not. That’s when the worst scenario would take shape, with Americans subjected to bureaucratic hassles, hours spent on hold waiting for a government service rep to take a call, restrictions on care, and, yes, lifesaving treatment and lifesaving surgeries denied or delayed,” Senate Minority Leader Mitch McConnell said on the Senate floor last week.

Sen. Charles E. Grassley, Iowa Republican and ranking member of the Finance Committee, sounded frustrated after a meeting Thursday with members of both Senate committees. On Sunday, he posted a message on the Twitter Web site saying Mr. Obama is a “hammer.” “When you are a ‘hammer’ u think [everything] is NAIL I’m no NAIL,” he wrote, in part.

That’s just the first in a number of other issues still to be decided, including how to pay for a reform plan and whether there will be a mandate that all Americans carry insurance.

Mr. Obama has said any plan has to be budget-neutral and sustainable in the long term. Lawmakers have eyed the $133 billion in tax exceptions employers get for providing health care to employees.

Mr. Baucus has spoken out against taxing all employer plans but has said he’s interested in putting a cap on how much of the benefits are tax-free.

Mr. Obama criticized Sen. John McCain during the presidential campaign for suggesting the tax, but he has since backed off that criticism.

Some Republicans are onboard with the idea, too. A group of conservatives in the House and Senate have proposed a bill that would eliminate the employer tax break and give it to individuals to fund their insurance premiums.

Predictably, it’s not a popular idea with the industry.

Health Care for America Now (HCAN), an advocacy group largely made up of unions and associations, does not support taxing employer benefits.

“President Obama and more than 190 members of Congress have signed on to the HCAN principles for reform. Those principles do not include the taxation of health care benefits,” a spokeswoman said.

HCAN and other groups on all sides of the debate, including AARP and the Service Employees International Union, are speaking out, holding rallies this summer and rounding up members to contact their members of Congress.

Mr. Obama’s political group, Organizing for America, sponsored a series of public events over the weekend designed to gather grass-roots support for reform.

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