The Tortoise and the Hare

One of my favorite Aesop Fables is that of The Tortoise and the Hare.  The metaphor is the reason I’ve collected turtles my whole life from all across the world.  I’ve always believed in the turtle (After all, I was known in high school as “the slowest guy in town”).  As you will recall, the rabbit rushes out ahead of the pack and decides to take a nap only to find the persistent turtle crossing the finish line when he awakens. The fable reflects what has been happening this week on Capitol Hill.  As the other House and Senate Committees rushed through their healthcare proposals, Senator Max Baucus (D-MT) and the Committee resolutely worked at hammering out their healthcare legislation. This week, Senate Finance began what is known as a markup, where bills are “marked up” with amendments and rewrites to the proposed bill.  On Wednesday over 564 amendments were thrown on the markup pile and the Committee began the slow, arduous process of going through each modification. 

Many changes and modifications were discussed this week ranging from lower penalties for those who don’t buy health insurance coverage, to weakening the effects of a tax on high-end insurance policies, to increasing government subsidies for citizens to purchase coverage, among many others.  But, the real test for Baucus and the White House came on Thursday when the $80 billion deal cobbled together last summer by the White House and the drug industry was challenged.  The lessons from The Dance of Legislation (a classic book written by Eric Redman in 1973on the legislative process) were evident.  Baucus defeated an amendment by Rockefeller (D-WV) and Schumer (D-NY) that would have unraveled the summertime deal by more than doubling the drug industry’s required contribution. Tempers flared, the lobbyists sweated, The White House made calls, and the drama ultimately ended in defeat of the amendment.   The drama will no doubt move to the Senate floor when the full Committee report is debated, but it appears at the moment that the votes are simply not there to see the surcharge increased.

Meanwhile, the big debate on the public option was put off until next week.  Everyone is lining up for this one which will likely begin on Tuesday.  At this point, it’s difficult to lay out the odds on the outcomes of the debate.  However, if I were in the game, I’d double down that the public option does not make it.  We will see some type of modification of cooperatives, and a trigger option will be included (let’s call it the Autumn Snowe Effect).  The so-called “trigger” would establish a non-profit government corporation which would offer a safety net insurance plan if affordable coverage is not available for at least 95 percent of state residents.  While the details are being debated, the trigger option seems to be gaining momentum from both sides of the aisle.

 While Snowe may ultimately hold off a positive vote on the Committee so she can continue to leverage the outcome on the Senate Floor, it’s clear she has become a major player in the ongoing debate.

My bet is that by Friday next week we see the emergence of a “New Gang” that includes members both on and off the Senate Finance Committee as players in the evolving debate.  With a likely defeat of the public option, the central emerging issue will be the employer mandate.  Affordability of health insurance is increasingly recognized as the most important issue to the American people.  So, the focus shifts from how to “manage” affordability to how we “define” affordability. 

It’s clear the initial Baucus modifications to his proposal were mainly focused on winning Democrat approval. As I reported last week, while some of his Democrat colleagues have been skeptical of segments of the bill, it now appears that all 13 Democrats are lining up to vote positive.  The addition of Snowe or perhaps one other Republican will clearly be the goal for the coming week…

Finally, despite the win by Pharma, the health insurance industry is still on the ropes.  In a joint letter this week from America’s Health Insurance Plans and Blue Cross Blue Shield Association, the Baucus plan was blasted with the organizations arguing that the “provisions would undermine the shared goals of achieving universal coverage and improving the affordability and quality of health care both for the uninsured and for those currently with coverage.”  The insurance industry is upset with two key modifications, one that increases a fee on insurance companies and another that limits the amount insurers are able to charge older people. So, expect further debate on this front as well in the coming week. 

Meanwhile, the Senate Democrats do seem closer than ever to reaching the magical 60 vote margin needed to pass a healthcare reform bill.  Governor Deval Patrick (D-MA) added to the mix by naming former Democratic National Committee Chairman Paul G. Kirk, Jr. to replace Senator Ted Kennedy (D-MA).  The newly placed Senator Kirk (D-MA) was a close associate of Senator Kennedy, and his support means the Democrats are now a step closer to passing comprehensive healthcare legislation.  Still, the highly controversial “reconciliation” procedure, which would allow passage of legislation with only 51 votes, is still very much on the table.  However, it would have clear implications for the healthcare debate as well as other issues that will come forward in the next several years.  On Sunday, Senator Bob Corker (R-TN) stated such a maneuver would undermine the positive discourse that is occurring between Republicans and Democrats.  He’s on target… 

So, it appears that the slow, steady pace of the Tortoise (Baucus and Team) is outdoing the rapid, unrestrained pace of the Hare (The House).  As a turtle collector (literally hundreds and hundreds of turtles from all over the world), I added to my collection this past week.  You can see where my sympathies lie…

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