Health Bill Fate Shaky After Dems Lose Senate Seat

NU Online News Service, Jan.20, 3:54 p.m. EST

WASHINGTON–The fate of health care reform legislation appears to be hanging in the balance in the wake of the election of a Republican from Massachusetts to the Senate.

That victory by Scott Brown, winning the seat left vacant by the death of Sen. Ted Kennedy, trims the Democrats' Senate majority to 59, foreclosing their ability to shut down Republican filibusters.

According to several sources, rank-and-file Democrats in the House appeared to be balking at White House demands today that the House pass the Senate bill immediately and negotiate further changes through a reconciliation process.

The Republican leadership in the House is adding to the pressure by noting how divided rank-and-file Democrats in the House are over the Senate bill, according to these insurance industry and congressional sources.

The Council of Insurance Agents and Brokers in a note to its members today told them, "All eyes are now on the House Democratic caucus."

The CIAB message said that House leadership has been sparring with Senate leaders in recent weeks over differences that include, among others, income taxes, payments for abortion procedures, bill language, size of subsidies and administration of proposed insurance exchanges.

These items are the same issues cited by Rep. John Boehner, R-Ohio, the House minority leader, in a statement indicating how divided House Democrats are.

According to the CIAB, "There is enormous pressure now for House Democrats to cave on these issues and quickly pass the Senate-passed health care bill, which would send the legislation directly to the White House for the president's signature."

The CIAB note said it "is rumored" that this could be done with an agreement to later "fix" the bill through a Senate reconciliation process.

House Majority Leader Steny Hoyer, D-Md., noted that this was a very real possibility, but remarks from progressive members of his caucus indicate that achieving House passage will be a struggle, the CIAB note said.

Catholic bishops, who previously rallied anti-abortion Democrats to the dismay of some party colleagues, are vigorously urging House Democrats to oppose the Senate bill, the CIAB said.

"Additionally, some progressive Democrats who support a public option are saying that they, too, would oppose the Senate bill," the CIAB note said.

According to an insurance industry official in Massachusetts, the state's new Senator-elect Scott Brown did not work on insurance-related issues while serving in the state Senate.

The source said that he supported the Massachusetts health plan when it was introduced by former Republican Gov. Mitt Romney, "but has been an outspoken opponent of the current plan being considered in Washington even though elements of it follow the Massachusetts model."

Specifically, the official said, Mr. Brown's objection to the "Democratic Washington health care plan was more general, about [it being] too big, too many back room deals, the need to start over and consider more common sense, smaller reforms that have been advocated by many Republicans in Congress."

Insurance agents favor the Senate bill, but seek to lower the medical loss ratio mandates setting percentage amounts of revenue that insurers would have to direct toward paying claims.

They believe that would have the potential impact of reducing agent commissions. Agents are also pushing for language ensuring a state-based exchange, and preserving the industry's anti-trust exemption provided by the McCarran-Ferguson Act.