The national health care debate takes an important step forward this week as the Senate Finance Committee finally starts voting on legislation. But the bill unveiled by the Democratic committee chairman underscores how much hard work is left to be done. To his credit, Sen. Max Baucus found ways to lower the cost and reduce the federal deficit over the next decade rather than add to it. But that would come at an awfully high price: The bill would insure fewer people than other proposals, offer less assistance to the middle class to buy mandated coverage and fail to significantly rein in health care costs. And after all of those concessions, it still drew no immediate support from Republicans.
Like other proposals, the Baucus bill would bar insurers from rejecting people for pre-existing conditions and raising rates based on someone's health status. Every American would be required to have coverage or pay a penalty. Insurance marketplaces or exchanges would be established where consumers could shop for plans - but the controversial public option included in the House bills has been eliminated. Without the public option, there appears to be little incentive in the Baucus bill for insurers to more competitively price health coverage.
Legitimate questions have been raised over whether the public subsidies to help people buy coverage are generous enough. The House Democrats would subsidize individuals making up to $43,320 a year and families of four bringing in up to $88,200. But Baucus' bill would limit those subsidies to $32,490 for individuals and $66,150 for a family of four. Congress cannot force middle-class families to buy coverage without ensuring they are able to afford it.
While Americans would be required to have coverage or pay a penalty, the Baucus plan curiously does not require employers to offer it. Employers with more than 50 employees would have to cover government subsidies paid on behalf of their employees, but employers who currently offer health insurance coverage would be under no obligation to keep it. That would be a step backward.
Another concern is that the Baucus plan would not do much to rein in medical costs, according to the Congressional Budget Office. The proposed new health care cooperatives have more support in Congress than the public option favored by many Democrats. But the successful consumer-run, nonprofit cooperatives pointed to as models, such as one in Minnesota, have been built over many years and often employ their own doctors, lab technicians and pharmacists as a way to control costs. It is unrealistic to think that even with government financing that cooperatives will instantly crop up like mushrooms nationwide in a way that will give Americans a true alternative to for-profit insurers.
The Baucus bill is a mixed bag, but it is a starting point for the Senate. It brings into sharper focus the tension between controlling costs and insuring as many Americans as possible at reasonable prices. There naturally will be compromises as the legislation moves through Congress. But the focus should remain on available, affordable health coverage for as many Americans as possible - not on a plan that falls short and still fails to draw bipartisan support.