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CWA and its allies are assessing strategy for health reform in light of the Republican win in the Massachusetts Senate election. The win denies Democrats enough votes to block a filibuster in the Senate, making it nearly certain that Republicans can block action on the current health reform bill.
"Over the next several days, CWA will continue to work with our coalition partners, other labor unions, and our friends in the House of Representatives to determine the best path for moving forward on any legislation," CWA leaders said in a statement. "CWA remains opposed to the Senate bill as it currently stands and will continue the work we have been engaged in over the past several weeks to ensure that any legislation addresses our members concerns. Until we determine the best course of action, our many grassroots programs around the issue have been put on hold."
CWA remains committed to fixing a broken health care system with a system that provides secure and affordable coverage for all Americans, is financed fairly, controls cost escalation, curbs abusive practices by insurance companies, and improves quality.
– 01/22/10
A Republican win in the special Senate election to replace Ted Kennedy in Massachusetts leaves an uncertain road for health reform. Without 60 votes in the Senate, the Democrats can't stop a filibuster, which could block action on a Senate-House compromise reform bill now taking shape.
It's unclear at this point how the Democrats will proceed. One suggestion is that the House could approve the version of the health bill already passed by the Senate, thus avoiding another Senate vote, then fix problems in the Senate bill later. That's a scary prospect for us, since the Senate bill contained a number of serious flaws, including the tax on high-premium health benefits.
We don't want to see the Senate bill passed with only a vague hope of fixing its problems.
Another suggestion is that the Democrats back off, on the belief that the Massachusetts results show the public doesn't want health reform. That's not good, either, and would represent a misreading of the vote.
The winning Republican, Scott Brown, supported the health reform bill which passed several years ago in Massachusetts, and which was similar to the bill being considered in Washington. What Brown argued during the campaign is that national reform wouldn't help Massachusetts, since the state reforms already meant less than 3 percent of the population there was uninsured.
Exiting polling by Rasmussen Reports doesn't support the idea that Brown's win was a referendum on health reform. While 56% of voters told Rasmussen that health reform was the most important issue in the election, Democrat Martha Coakley won among those health voters. Brown built his margin among voters who said the most important issues were the economy, taxes and national security.
Moreover, the Massachusetts election doesn't change the facts that make health reform necessary: Escalating costs. A system that leaves all of us a layoff from being uninsured. Medical bankruptcies when people – even insured people – get sick. Insurance companies that can deny coverage to people who need it. The highest health costs in the world, without the best results. Tens of millions without coverage.
"In the wake of Mr. Brown’s victory, the decision facing Democrats is not whether to start with a blank slate and try to write a bill based on both liberal health care ideas and conservative ones. They’ve already tried that," writes New York Times columnist David Leonhardt. "The decision is whether to expand insurance and try to control costs, despite the political risks, or whether that project will once again be put off until another day."
– 01/20/10
After many hours of negotiations with the White House and Congressional leaders - and continued pressure from our members - CWA President Larry Cohen and other labor leaders have been able to negotiate significant improvements in the proposed tax on high-cost health benefits.
"This is not the plan we would have written if we were the sole author, but just like contract negotiations there is another side to the table. And in this case there are three other sides: the House, the Senate and the White House," CWA leadership said in a statement. "We are proud that the improvements we negotiated protect both union members and members of the public. Labor unions have a long history of protecting all workers and this is another great example.
"More than any other union, CWA's leadership has really pushed this issue in the mainstream and online media, on Capitol Hill, and in building coalitions to help deliver the message that there's a better way to finance health care reform," the statement continued. "Our members mobilized. We made tens of thousands of calls and visits to the House and Senate. We should all be proud of what we have accomplished here."
The job, however, isn't finished. We need to see the agreement into final legislative language, which must be passed by both the House and Senate.
Improvements include:
- A delay until 2018 on applying the tax to collectively-bargained plans, allowing time to bargain for changes in benefits and wages.
- A higher premium level before the tax kicks in ($24,000 for family coverage, compared to $23,000 in the Senate bill).
- Exemption of dental and vision benefits, effectively raising the threshold by another $1,500.
- Agreement that the threshold will be pushed up further if health costs rise faster than expected.
- Adjusting the threshold for plans with large numbers of women and older workers - people for whom premiums are higher because they use more care. Also, the agreement preserves Senate-passed protections for plans that cover workers in high-risk occupations and for plans that cover retirees between the ages of 55 and 65 - two other groups with higher-than-average premiums.
– 01/15/10
The American Dental Association and the American Benefits Council, a group which represents large employers, have joined CWA in asking Congress not to tax health benefits.
The Senate included a tax on high-premium health plans in its health reform bill. Congress and the White House are now trying to merge the Senate bill with one passed by the House of Representatives, which does not include a benefits tax.
The benefits tax "would compel many employers to drop critical dental and other coverage to avoid the tax," Dr. Ron Tankersley, president of the Dental Association, the largest professional association for America's dentists, said. "It dismantles exactly the type of preventive, primary care that everyone agrees this country needs more of."
In a letter to Congressional leaders, the groups say that many plans will be taxed not because they offer over-generous benefits, but "simply because the plans include many older workers or retirees with higher cost health care needs, or are concentrated in locations with high health costs."
Joining CWA, the Dental Association and the benefits council in signing the letter were the Academy of General Dentistry, American College of Prosthodontists, American Academy of Pediatric Dentistry, American Association of Oral and Maxillofacial Surgeons, American Association of Orthodontists, Guardian Life Insurance of America, Hispanic Dental Association, Service Employees International Union, National Association of Vision Care Plans, and VSP Vision Care.
– 01/13/10
President Obama told labor leaders yesterday that he wants some form of tax on high-cost health benefits in the final health reform bill, but "he also signaled that he was willing to amend the proposal to 'make this work for working families,' " according to an administration official quoted by the New York Times.
CWA President Larry Cohen was among a dozen labor leaders who met with the president at the White House to press the case against the benefits tax.
"Mr. Obama and the union officials used Monday's session to search for a sort of compromise, said a union leader who was briefed on the discussion," the Times said. "This official, who said the tone of the meeting was friendly, said it was clear that there would be some sort of excise tax in the final bill, but that the president 'threw out some new concepts' in how it might be designed."
Earlier in the day, Richard Trumka, president of the AFL-CIO, had warned in a speech that the benefits tax could make union members less enthusiastic in supporting Democrats in upcoming elections.
Our pressure has helped create flexibility on the benefits tax. As the issue heads for a resolution in the next few weeks - possibly even in the next few days - we need to step up that pressure. The AFL-CIO is leading a national phone-in day tomorrow (Wednesday). Call 1-877-3-AFL-CIO (1-877-323-5246). Callers will to connected to their Congressional representatives so they can tell Congress we need health reform that:
- Does not tax our health care benefits;
- Requires employers to pay their fair share; and
- Reduces cost--the best way to do this is with a public health care option.
– 01/12/10
Members of the House of Representatives and independent experts continue to challenge the assumptions behind a proposed tax on benefits, according to recent press reports.
The Senate's version of the health reform bill includes a tax on high-premium health plans. The House's reform bill instead increases taxes on the highest-income earners with a so-called "millionaire's tax." The House and Senate are now attempting to work out a compromise bill, and the White House has supported including the benefits tax in the final bill.
"Health analysts recently questioned the assumption that the tax would target only the most lavish insurance packages, nicknamed 'Cadillac plans,' " the Washington Post reported. The Post cites research showing that many health plans have high premiums not because the benefits are lavish but because they cover older and sicker workers or serve regions with high health costs.
The Post also reports that some health economists do not believe that higher co-pays and deductibles - which would result when plans cut benefits to avoid the tax - will lead consumers to make smarter decisions about what care they really need. "None of these proponents has ever shown that patients are even capable of evaluating the clinical merits" of different treatment recommended by doctors, Uwe Reinhardt, a health economist at Princeton, told the Post.
And House Democrats continue to fight against the benefits tax, according to the New York Times.
"Representative Carol Shea-Porter, Democrat of New Hampshire, who spoke out forcefully against the proposed excise tax, said afterward that it could hurt middle class families," the Times said.
" 'I was standing up for my constituents,' she said in a statement. 'I have serious concerns about the excise tax proposal and the effect that it could have on middle class families in New Hampshire and across the country.' "
– 01/08/10
The people who like the idea of taxing benefits tell us not to worry - if our benefits are cut to avoid the tax, our wages will go up to make up for it. That sounds improbable on its face: If our boss can save, say, $3,000 on health premiums, is he going to turn around and hand us a $3,000 raise?
A new report from the Economic Policy Institute (EPI), released today, shows in data what many of us felt intuitively. Tracking wage rates and health costs from 1989 to the present, the EPI report concludes that "the trajectory of health care costs did not materially affect wage trends."
As for the idea that a tax on benefits could lead to significantly higher pay, "In no way can you expect this is going to lead to great wage growth," said Lawrence Mishel, president of the Economic Policy Institute and author of the report. Mishel spoke at a press briefing this morning.
Also at the briefing, Robert Reich, former secretary of labor and now professor at University of California at Berkeley, said taxing high-cost benefits could lead to "a real chance that many working families will be forced to cut back on the health care they need, thus defeating the entire purpose of health reform."
And Congressman Joe Courtney, a Connecticut Democrat who is leading the fight against the benefits tax, said the tax is "a plan that has great political risk for the Democrats." When taxing benefits was proposed by John McCain, he said, "the issue had tremendous potency on the campaign trail in 2008," and a number of recent public polls show 2-to-1 opposition to the tax among voters.
The benefits tax is included in the health reform bill passed by the Senate. The House of Representatives would finance reform instead by a "millionaire's tax" on the highest earners. CWA is asking members to write to Congress, urging support for the House version.
– 01/06/10
We've been telling you that differences between the House and Senate health reform bills would be resolved in a conference committee. Now, however, it looks as if Congressional leaders are instead using a less formal process - sometimes called "ping pong" - to come up with a single bill.
In the "ping pong" process, the two houses confer informally, and sometimes send amendments back and forth. Eventually, the two houses will have passed the same bill, without a conference committee. The ping pong is already under way; leaders of both houses conferred with the White House last night. The process is expected to take about a month.
For us, there's no difference whether there's an official conference committee or a less formal ping pong match. The point is this: Over the next few weeks, we'll either get a health reform bill that meets our needs or we'll get one with serious flaws.
That means the next few weeks represent our last chance to have our voices heard. CWA is asking us to write to our representatives in Congress, asking them to make the bill as good as possible.
We're focusing on two issues, and, on both, we think the House has the right approach:
- Taxing benefits. The Senate would slap a tax on high-premium health policies. This would hit many of our members and millions of working American families. The House has a better way to pay for reform: a so-called "millionaire's tax" on high-earning individuals.
- Making sure employers pay their fair share. The House bill would require employers (except for the smallest ones) to offer coverage to their workers or pay a substantial penalty. The Senate bill has no employer requirement.
– 01/06/10
Analysts are stepping up attacks ona the flaws in the tax on health benefits contained in the health reform bill passed by the Senate on Christmas Eve.
The debate is important as Congress prepares to convene a conference committee to work out differences between the Senate and House reform legislation. The House's bill doesn't tax benefits; instead, it finances reform by increasing the income tax for households making more than $1 million a year and for individuals making more than $500,000. CWA is asking us to write to Congress, calling for health care reform that doesn't tax benefits.
While the benefits tax is depicted as aimed at rich "Cadillac" benefits, "In fact, it's a tax that in a few years will hammer millions of middle-class policyholders, forcing them to scale back their access to medical care," writes New York Times columnist Bob Herbert.
The result of the tax, Herbert continues, would be "lower-value plans" with "higher out-of-pocket costs, thus increasing the very things that are so maddening to so many policyholders right now: higher and higher co-payments, soaring deductibles and so forth. Some of the benefits of higher-end policies can be expected in many cases to go by the boards: dental and vision care, for example, and expensive mental health coverage."
Studies show that the tax on high-premium plans wouldn't hit plans with rich benefits as much as normal coverage - such as that bargained for many CWA members - where workers happen to be older or living in an area where medical costs are high.
"I consider it ill-considered and unfair, a tax on people stuck in expensive plans because they belong to groups with older and sicker beneficiaries who use more health services; small groups generally; or who live in areas with expensive delivery systems. The idea that taxing those plans will somehow encourage people to reduce their utilization is wishful thinking that ignores who actually makes health care decisions - doctors, hospitals, drug companies, and other providers," writes analyst Merrill Goozner.
Supporters of the benefits tax say it will force insurance companies to hold down premiums to avoid the tax. But "there is no evidence that insurance companies can control costs better just by trying harder. The excise tax would not give insurers more bargaining power in dealing with hospitals, doctors and drug companies. It would not create new innovations in delivery systems. It would not generate credible evidence to 'manage' care," two professors who are experts on health law and policy, Timothy S. Jost and Joseph White, write in Roll Call.
Health blogger Maggie Maher offers a 'truth squad' review of the pro-and-con arguments.
Maher points out that "chronically ill patients don't make the decisions on big ticket items such as surgery, hospitalization, a battery of expensive tests, or a drug that costs $50,000 a year. Doctors and hospitals tell them what they must have to survive. Co-pays and deductibles will not make these patients more 'cost-conscious.' Cost-sharing will only give a distraught stroke victim another reason to worry."
Maher summarizes, "The problem is not that premiums are sky-high because insurance plans are too generous. Premiums only reflect the problem at the center of a healthcare system spiraling out of control: over-use of over-priced medical technologies, leading to run-away healthcare inflation."
– 01/04/10
The Senate passed a health reform bill early this morning, meaning the issue will go to a conference committee over the next few weeks to resolve differences with the House of Representatives version of the bill.
As the conference committee prepares a merged bill, CWA will be pushing for something closer to the House version, especially on the two key issues of a benefits tax and a requirement for all employers to pay their fair share for coverage.
Benefits tax: The Senate bill contains a tax on health insurance policies costing more than $23,000 for a family or $8,500 for an individual. Employers would cut benefits to avoid the tax, resulting in less coverage and higher out-of-pocket costs for millions of middle-class families. CWA has compiled studies and reports which demonstrate the flaws in the benefits tax. The House would finance reform without taxing benefits, instead increasing income taxes for families making more than $1 million a year and individuals making more than $500,000.
Employers paying fair share: The House bill requires all employers (except the smallest) to pay at least 65 percent of family premiums for their workers or pay a penalty based on payroll. The Senate bill doesn't have an employer requirement, although it does penalize employers whose workers get government subsidies. The Senate version could have the unintended consequence of discouraging employers from hiring workers from moderate income families.
Although the differences are important, the House and Senate bills have many similarities. Each would extend coverage to tens of millions more Americans, by expanding Medicaid for those near the poverty line and offering subsidies to buy coverage to families making as much as $88,000 for a family of four. Both prevent insurance companies from refusing to cover people because of pre-existing conditions or from cancelling policies when people get sick. Both limit the out-of-pocket charges faced by patients. Both would slow the rate of increase in Medicare spending and set up pilot programs to lower health costs and improve quality.
After the Senate vote, President Obama commented: "If this legislation becomes law, workers won't have to worry about losing coverage if they lose or change jobs. Families will save on their premiums. Businesses that would see their costs rise if we do not act will save money now, and they will save money in the future. This bill will strengthen Medicare, and extend the life of the program. It will make coverage affordable for over 30 million Americans who do not have it — 30 million Americans. And because it is paid for and curbs the waste and inefficiency in our health care system, this bill will help reduce our deficit by as much as $1.3 trillion in the coming decades, making it the largest deficit reduction plan in over a decade. "
The conference committee is expected to produce a merged bill in January. Both houses need to vote again on the conference committee bill.
Today's Senate vote again went along party lines, with all 58 Democrats and both independents voting for the bill and 39 Republicans voting against. (One Republican was absent.)
– 12/24/09
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