Sen. Max Baucus Gets Debate Going on Capitol Hill with Health Reform Plan

With some economists projecting unemployment to be as high as 8 percent next year, it stands to reason that the nation’s hospitals will face another year of mounting bad debt expense, jeopardizing some operators’ ability to expand or forcing others to limit services.

President-Elect Barack Obama has said his first legislative goal will be to get Congress to pass an economic stimulus package that he hopes will create jobs, launch construction programs, provide a tax cut for the middle class and support his health care initiatives.

“We're gonna have to spend money now to stimulate the economy,” Obama told Steve Kroft of CBS’ “60 Minutes” Sunday during his first post election television interview. Obama said most economists and lawmakers agree that, “We shouldn't worry about the deficit next year or even the year after.”

To those viewers who hoped Obama’s statement about deficit spending means immediate action on health care reform, “I don’t see it happening in health care,” Joseph Antos , a health care policy expert with the American Enterprise Institute, told insideARM. “I can think of a lot of areas where you can spend more money and it will have more immediate results in terms of bulking up the economy.”

Antos said lawmakers also don’t want to put more money into a system many believe is inefficient.

“If we put more in now, we’re just putting more money into an inefficient system.  That will be the argument against it,” Antos noted.

Though health policy experts believe Congress may be a year or more away from attempting significant health care reform, make no mistake that the 89-page plan unveiled last week  by Montana Sen. Max Baucus signals that the health care debate has begun on Capitol Hill, said Brian Darling, director of senate relations at the Heritage Foundation.

Baucus, who chairs the Senate Finance Committee, laid out his dream plan calling for a mandate on all Americans to carry health care coverage.  The initiative goes further than Obama’s proposal and is supported by hospitals and many health care analysts who argue that universal coverage would stem the rising medical bad debt expense created from treating a growing uninsured and underinsured population.  Baucus’ plan also calls for an expansion of public programs and a ban against denying health care coverage to people with pre-existing medical conditions.

“It’s the first shot in the war on healthcare in Washington, D.C.,” Darling said. “Health care reform is very high on the agenda for Obama. [The Baucus plan] is clearly the marker that the Democrats are laying down, the direction they’d like to pursue in the health care debate.”

Health policy experts say some initiatives, such as an expansion of the State Children’s Health Insurance Program, won’t meet much opposition in the new Congress given that it would already be a reality if President George W. Bush hadn’t vetoed the bill. Investments in information technology also will be well received by both chambers during the first 100 days of an Obama administration.

A large overhaul of the system, however, will be difficult to pass and will require some compromise and consensus building with conservative senators who won’t support any plan that appears to move to far away from market-based approaches, Darling said.   Massachusetts Sen. Ted Kennedy has committed to being a key player in moving the reform debate forward.

“In the Senate, you need to get to the magic 60 threshold,” Darling said. “It’s why you’re seeing the Senator (Baucus) roll it out now to see if he can work out the 60 votes in the Senate.”

Richard Cauchi, health program director for the National Conference of State Legislatures, said many state lawmakers will want to be included in the debates.  Although health care reform activity subsided somewhat during the latter half of 2008, Cauchi said some bills will be introduced on the state level in 2009, even as legislators keep an eye on reform initiatives on the federal level.

“Many states will want to influence the federal debate and state bills, or state proposals, are a way of doing that,” Cauchi said.