Senate Approves Sweeping Health Care Reform Bill

The Senate approved historic legislation early Thursday, Christmas Eve, that promises to provide health insurance coverage to some 31 million people and to change the way many Americans receive and pay for their medical care. The votes of 58 Democrats and two independent senators provided exactly the number needed to pass the bill, which now will have to be merged with the House health care reform bill, go back to both houses for another vote, and, if approved, go to President Obama for his signature. All 40 Republican senators opposed the bill.

No Congress and no president has come this far, though many have tried over nearly a century—Theodore Roosevelt, Franklin Delano Roosevelt, Harry Truman, Richard Nixon, Jimmy Carter, and Bill Clinton.

The nonpartisan Congressional Budget Office reported earlier that the Senate bill would help reduce the federal budget deficit over the next 10 years by $132 billion. It would require every American for the first time to have health insurance or face a fine. Those without employer insurance would be eligible to apply for federal subsidies and to shop for coverage in new state insurance exchanges. And the Senate leadership has publicly pledged that the final health care reform act will include, as the House bill does now, a measure to close the Medicare “doughnut hole,” the gap in Part D prescription drug coverage.

Like the House bill, the Senate proposal prohibits insurance companies from denying coverage because of preexisting medical conditions. It also prohibits companies from hiking insurance prices based on an applicant’s health or gender. Older people could be charged higher premiums than younger people, but no more than three times as much under the Senate bill and twice as much in the House bill. Both bills also forbid caps on how much care policies will cover. The Senate bill would cover 94 percent of legal residents under age 65, compared with the 83 percent who are now covered. The House bill would cover 96 percent. Both bills contain provisions for a voluntary government insurance program designed to help people with long-term care.

To help pay for extending health coverage to millions of uninsured Americans, the Senate bill—which includes a pledge not to cut guaranteed Medicare benefits—banks on $438 billion in savings in Medicare spending. Those savings come through reducing the costs of private Medicare Advantage plans and strictly controlling waste, fraud, and inefficiencies within the government program. The bill includes new powers for an independent Medicare advisory panel, which would be able to implement spending cuts if costs outpace savings in 10 years.

“Americans are dying from diseases we know how to treat and living in pain because it is too expensive to ease,” said Senate Majority Leader Harry Reid, D-Nev., on Tuesday. The bill, he said, will not only save lives, save money and extend Medicare for 10 years, it will “basically save Medicare.”

Improvements to Medicare

Aside from the pledge to close the infamous doughnut hole, the Senate measure would also improve Medicare by providing free preventive and wellness care, increasing home care options, and establishing bonus payments to reward medical professionals who provide the best quality care. The emphasis on incentives for quality care and the new wellness and preventive screening would give Medicare a new, active role as a health care advocate, not just a bill payer.

“Health insurance will be extended to tens of millions of people, and that puts us much closer to the standard of health coverage that exists among all the advanced industrial nations,” says Robert Binstock, a political scientist and professor of aging, health, and society at Case Western Reserve University School of Medicine in Cleveland. Binstock directed a White House task force on older Americans for President Lyndon Johnson, shortly after Johnson signed legislation creating Medicare and Medicaid. “This is clearly a major landmark achievement.”