WASHINGTON -- The Senate Finance Committee voted 14-9 on Tuesday to back a sweeping overhaul of the nation's health care system, clearing the way for a historic congressional showdown this fall over how Americans receive and pay for their medical care.
Thirteen Democrats and one Republican, Maine's Olympia Snowe, voted to approve the measure. It would require nearly everyone to obtain coverage, bar insurers from denying coverage because of pre-existing conditions, and make insurance plans easier to afford by providing lower-income consumers with financial help. It would cost an estimated $829 billion over 10 years and be paid for by taxes, fees and reductions in Medicare costs.
Democrats hailed the vote as an important milestone, the first time in memory that such a comprehensive health care revision has gone this far in Congress.
"This is our opportunity to make history," said Finance Committee Chairman Max Baucus, D-Mont.
President Barack Obama said the vote "has brought us significantly closer to achieving the core objectives I laid out early in September," but also warned "we're not there yet."
But a lot of disagreements remain, and Democrats said that Tuesday's vote, which triggers intense negotiations over the contents of final legislation, was only a step forward, though an encouraging one.
"I think in spite of a lot of problems that I have with it, I think the dialogue is now for real," said Sen. Jay Rockefeller, D-W.Va.
Republicans saw the vote as an ominous sign that they're barely being heard. Talks this summer between three Finance Committee Democrats and three Republicans to craft a compromise broke down last month.
"What could have been a strong bipartisan vote ... is now ending on another divided vote," said Sen. Orrin Hatch, R-Utah.
About the only suspense Tuesday involved Snowe, the moderate Republican who said she backed the measure "with reservations."
She liked its help for lower-income consumers, expansion of coverage and features that should make it easier for small businesses and consumers to shop for policies.
But, Snowe warned, the legislative process is far from over, and things can change. "My vote today is my vote today. It doesn't forecast what my vote will be tomorrow," she said.
Senate leaders and the White House will now merge the Finance Committee measure with another version of the legislation approved this summer by the Senate Health, Education, Labor and Pensions Committee. The merged bill could be ready for debate before the full Senate later this month.
The Finance Committee measure, which the nonpartisan Congressional Budget Office estimates would reduce the federal deficit $81 billion over the next 10 years, differs in one major way from the health committee bill: It lacks a government-run health insurance plan, or "public option" alternative to private insurance, which Obama and Democratic congressional leaders want.
Three committees in the House of Representatives have approved legislation that includes a public option. Those bills are being combined into one, and the full House is expected to debate the legislation later this month. Prospects for approval there look good.
"We don't intend to go to the floor without a public option in our bill," House Speaker Nancy Pelosi, D-Calif., has vowed.
The Senate, though, is torn. Three Finance Committee Democrats voted against the public option when the panel considered it last month, and Sen. Kent Conrad, D-N.D., proudly announced Tuesday, "There's no government-run health care plan here."
Sixty votes are needed in the 100-member Senate to overcome procedural hurdles, and Democrats control 60 seats. But as the Finance Committee's votes underscore, not all 60 Democratic senators support a public option, so final passage of legislation including one appears unlikely.
Senate leaders wouldn't say that, however, and indicated that some compromise could be in the works -- perhaps a plan to allow states to set up their own government-run plans, or a "trigger" mechanism that would allow a nationwide government-run system to be created if insurers fail to meet certain standards in the future.
"I favor a public option," said Senate Majority Leader Harry Reid, D-Nev. "We're going to do our very best to have a public option. But remember, a public option is a relative term."
Other compromises are in the works. Senators expressed concerns about whether constituents could afford the new system and over its impact on Medicare recipients.
"We've got a lot to do with respect to affordability," said Sen. Ron Wyden, D-Ore.
The Finance Committee bill would create a new system of co-ops, or nonprofit, member-run companies, that would organize on a state or regional basis, provide insurance to their members and contract directly with networks of health care providers. The government would use up to $6 billion to help the co-ops start up but wouldn't be involved in any decision-making.
The Finance bill has another unique feature: It would impose a 40 percent excise tax on most high-cost insurance policies. The House prefers an income tax surcharge on wealthier taxpayers; that got virtually no Finance Committee support, as senators expressed concern that small business owners would be hurt.
Most of the Finance bill is similar in both tone and detail to the other measures. It would make it simpler for lower- and middle-income families to buy coverage by providing tax credits for families earning up to 400 percent of the poverty level, or about $88,000.
There was some concern, notably from Snowe, that penalties for not buying coverage could be burdensome to middle-class families; Baucus cut his original proposed penalty in half, to $1,900, and amendments reduced it even further. Now it would be phased in between 2014 and 2017, reaching a maximum of $750 per adult.
As in the other legislative versions, the Finance Committee measure would prevent insurance companies from rejecting anyone because of a pre-existing condition or raising their premiums for that reason.
It would require most employers to provide coverage, or else pay a fee to the government to help others get coverage. And insurers would have to offer everyone a basic benefits package that included primary care, hospitalization and prescription drugs.
The bill aims to make coverage easier to obtain and less expensive by creating health insurance exchanges via Web portals that would show consumers all the available coverage in their ZIP codes.
Consumers wouldn't have to give up their current insurance, and insurers would be able to keep offering the coverage they now provide to those who already have it.
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