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Historic Health Care Bill Passes

In a historic climax to a bitter year-long political battle, on March 21 the House of Representatives narrowly approved a Senate bill to overhaul the nation’s health care system. With President Obama’s signature, the bill immediately became law.

In the turbulent days leading up to passage, Obama and Democratic leaders contended not only with fierce opposition from Republicans, none of whom voted for it, but also with the reluctance of some House Democrats who objected to certain provisions in the Senate bill. In the end, these members agreed to approve both the Senate bill, by a 219-212 vote, and a package of changes to it that, at press time, is expected to pass the Senate.

The landmark legislation represents an achievement for Obama that other presidents—Theodore Roosevelt, Franklin D. Roosevelt, Harry Truman, Richard Nixon, Jimmy Carter and Bill Clinton—sought unsuccessfully for nearly a century.

The law will extend health coverage to 32 million uninsured Americans, penalize many employers who do not offer coverage and individuals who do not purchase it, provide subsidies for people with limited and moderate incomes, and bar insurers from rejecting people with preexisting conditions.

Provisions that take effect within a year include: banning insurers from arbitrarily canceling or limiting coverage; providing tax credits to small businesses that offer coverage; providing temporary insurance for people who have been denied it because of their health; allowing young people to stay on their parents’ insurance until age 26; requiring insurers to use a high percentage of premiums for benefits instead of profits and overhead.

The measure guarantees basic Medicare benefits and gradually closes the “doughnut hole” in drug coverage, starting with a $250 rebate this year. It also adds free preventive care and phases in cuts in government subsidies to private Medicare Advantage plans, which, with other savings from reducing fraud and waste, extends Medicare’s solvency by nearly a decade.

The cost of the reforms—$940 billion over the next 10 years—is paid for by measures that include reducing Medicare spending, levying a new tax on high-end “Cadillac” health plans and raising taxes on the wealthy. The independent Congressional Budget Office states that reform savings will trim the federal deficit by $143 billion through 2019.

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