House Democrats' health plan skirts the cost

WASHINGTON - House Democrats yesterday unveiled draft legislation on health care that they said would cover virtually all of the nation's nearly 50 million uninsured as President Obama has promised. But they offered few details on how to pay for it.

In the Senate, two committees were getting bogged down, struggling to cope with a $1 trillion-plus price tag over 10 years. Their House colleagues simply steered away from costs and focused on the promised benefits of the legislation.

Republicans weren't cutting them any slack.

"I fear this plan will force tens of millions of Americans to lose their current health-care coverage," said Michigan Rep. David Camp, one of the top Republican lawmakers on health care.

The major provisions of the 850-page House bill would impose new responsibilities on both individuals and employers for coverage, end insurance-company practices that deny coverage to the sick, and create a new government-sponsored plan to compete with private companies. It also called for a new guarantee of subsidized health care for the poor.

The insurance industry said it had fundamental problems with the proposal, but it stopped short of declaring outright opposition.

House Democrats said they would not disclose how they intend to pay for their plan until later. Higher taxes on upper-income households appear likely, but broad levies - even a federal sales tax - are also under discussion.

Democrats are also aiming to raise about $600 billion in new taxes over 10 years to help pay for the measure. They would get the rest from spending cuts. Payments to drug companies are on the chopping block.

Rep. Henry A. Waxman of California, chairman of the Energy and Commerce Committee, said that drugmakers reaped a "windfall of billions of dollars" from the Medicare prescription benefit and that Congress wanted some of it back. At issue are seniors who had been covered under Medicaid, which requires rebates from drugmakers. Their prescriptions were switched to Medicare, which does not.

Behind the scenes, drugmakers are in discussions with the White House and key lawmakers to find savings of $75 billion over 10 years, sources said last night.

The Democrats' proposal drew praise from President Obama.

"This proposal would improve the affordability, availability, and quality of health care and represents a major step toward," he said.

The House news conference yesterday capped a week in which the health-care effort seemed to stumble at the starting line. A $1.6 trillion, 10-year cost estimate forced the Senate Finance Committee to delay introduction of its bill as members sought ways to scale it back. The Senate health committee, meanwhile, made little progress as it considered amendments to an incomplete bill.

Despite the fits and starts, the shape of the debate was growing clearer. On one side is the House Democrats' bill that would require all individuals to obtain health insurance and force employers to offer coverage to their workers, with exemptions for small businesses.

A new public health-insurance plan, strongly opposed by Republicans, would compete with private companies within a new health-care purchasing "exchange" where people could shop for coverage. Government subsidies would help the poor buy care, and seniors in the Medicare program would pay less for their prescription drugs.

On the other side is the House Republican plan, which would focus on trying to help small businesses and self-employed people find private coverage.

Searching for the elusive middle ground are a small group of senators on the Senate Finance Committee, which had to scale back its own initial plan when cost estimates topped $1.6 trillion. The result may be a bill that is more affordable but covers fewer of the uninsured.

The Finance panel also is looking at leaving a new public insurance plan out of its bill, instead creating nonprofit co-ops to offer insurance in competition with private companies. The co-ops could accept federal loans for startup operations but would have to repay the money.