Saturday, September 19, 2009

On Wednesday the U.S. Senate released its version of the U.S. healthcare overhaul that has recently been advocated by President Barack Obama.

The U.S. Senate Finance Committee released an 18-page summary of the 223-page bill that will, according to Senate Finance Committee Chairman Senator Baucus, cost US$856 billion over 10 years. The Congressional Budget Office estimates that the bill will cost US$774 billion over 10 years and will cover 94% of Americans. The Senate version was orchestrated by Senator Baucus, a Democrat from Montana. The bill was released without any Republican support from the committee. However, today, the bill received support from a bi-partisan group of Senators including the Republican Senator from Maine, Olympia Snowe and Independent Joe Liberman. If the bill’s passage is determined along party lines, Democrats will need at least one Republican Senator to avoid a possible filibuster in the Senate.

The proposal mandates nation-wide individual insurance by 2013 and omits a government-run insurance clause as is included in the U.S. House version; instead, the plan calls for non-profit healthcare cooperatives. The healthcare cooperatives would be provided with US$6 billion in initial funding to cover start-up fees and costs. Individuals refusing to obtain coverage can be charged up to US$950 annually with families fined up to US$3,800 per year. Small businesses will not be mandated to provide healthcare to their employees but those who do will receive tax credits. Also, insurances companies that have more expensive individual plans will be taxed for 35% of the amount that that the plan exceeds the federal individual threshold of US$8,000 or the family threshold of US$21,000. The bill includes clauses for protection against coverage suspensions due to illnesses and protections for individuals with pre-existing conditions. It will not pre-empt state laws on abortion and does not provide for abortion payments except in cases of rape or incest. The plan also mandates registration with the Social Security Administration as a means to avoid illegal alien use of the program.

The bill will reportedly be paid for by US$850 billion in spending reduction, taxes and fees to include reduction in Medicare benefits. The Senate Finance Committee is the last approval authority before the Senate or House bills can be considered for floor debate.