Comparison of 2 Senate Committee Health Bills

October 14, 2009

Now that the Senate Finance Committee has approved its version of healthcare reform legislation, Senate Democratic leaders will merge it with a more liberal bill passed earlier by the Senate Health, Education, Labor and Pensions Committee.

Here is a comparison of the major provisions of those two bill.

INSURANCE MARKET REFORMS

* Both bills require significant insurance market reforms and would bar insurers from excluding people from coverage due to pre-existing conditions. They would limit annual out-of-pocket expenses for consumers and bar insurers from placing lifetime caps on coverage.

* The two bills would establish new state-based insurance markets for individuals and businesses to shop for coverage, known as “gateways” in the HELP bill and “exchanges” in the Senate Finance bill.

* The Senate Finance bill provides for a less expensive catastrophic medical plan for young adults 25 years old and younger. HELP bill provides for young adults up to age 26 to stay on their parents’ polices.

* Both bills set minimum benefit packages that would be offered through the “gateways” or “exchanges.” The two bills vary on those minimum benefits.

COVERAGE OPTIONS

* The HELP committee bill would set up a new government health plan, or “public option”, that would compete with private insurers. The plan would be financed through premiums and negotiate rates with doctors and other providers.

* The Senate Finance bill provides for the creation of nonprofit member-owned healthcare cooperatives.

* The Finance panel bill provides states the option of creating a new health plan for people with incomes between 133 percent and 200 percent of poverty.

* Both bills expand eligibility for Medicaid, the health program for the poor. HELP would expand it to include everyone up to 150 percent of poverty, Senate Finance would open Medicaid to everyone up to 133 percent of poverty.

MANDATES AND AFFORDABILITY

* Both bills requires individuals to obtain health insurance and impose penalties for those who fail to obtain it. Senate Finance bill phases penalties in over five years and has a smaller penalty on families that fail to obtain coverage.

* HELP Bill requires firms with more than 25 employees to offer health coverage to workers and pay at least 60 percent of the premium or pay $750 for each uninsured full time employee and $375 for each part-time worker who is not offered coverage.

* Senate Finance bill has no employer mandate. But firms with more than 50 employees would have to pay a fee to cover any tax subsidies for workers who obtain coverage through the newly created insurance exchange. The fee would be capped at $400 times the number of full time employees.

* Both bills provide a sliding scale of subsidies to help people with incomes up to 400 percent of the federal poverty level afford health coverage. The subsidies vary between the bills and the Senate Finance provides the aid in the form of refundable tax credits.

* The two bills provide aid to small businesses to help purchase coverage.

* Both bills create a temporary reinsurance program to help employers provide coverage for retirees between the ages of 55 and 64.

FINANCING

* Only the Senate Finance Committee has jurisdiction over taxes and the Medicare and Medicaid programs. Savings in those two government programs are estimated at $404 billion over 10 years.

* The Senate Finance bill also includes a number of revenue raising provisions including a tax on high-cost health care plans. The bill also incudes a number of new fees on insurance companies and other healthcare industries including pharmaceutical companies.

(Reporting by Donna Smith; Editing by Cynthia Osterman;)

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