Tax News

CCH (cch.taxgroup.com) reports:

  Senate Finance Committee Chairman Max Baucus, D-Mont., told reporters on June 17 that he would not have his health care reform mark ready by the end of the week of June 15 as initially promised and raised doubts that he would hold a markup prior to the July 4 recess. Finance Committee Democrats have been scrambling to find ways to bring down the cost, estimated by the Congressional Budget Office (CBO) at nearly $1.6 trillion, to under $1 trillion.

  The Obama administration does not regard the Finance Committee's delay in drafting the bill as a setback, according to White House Press Secretary Robert Gibbs. The White House still believes that health care reform legislation can be done in 2009, Gibbs said at a press briefing on June 17. Noting that Baucus is working toward a bill that has bipartisan support and contains "cost-saving measures that are paid for," Gibbs said these are the same as the administration's goals. However, the administration, to date, has not called for additional taxes to finance a final health care package beyond its own proposal to reduce certain deductions for high-income taxpayers.

  Baucus initially downplayed the CBO figures, saying they are based on a plan that is two weeks old and has undergone significant changes since then. He emphasized that he plans to look for more savings through medical spending reductions and other offsets, rather than raising revenue outside of health-care-related matters. However, mounting pressure from Republican opponents to reduce the cost and to find ways to make sure that more people are covered under reform has left Baucus with the difficult task of once again trying to forge an agreement that will gain the approval of his party and appease the loudest GOP critics of the plan.

  As Baucus retreated from his initial deadline, Sen. Christopher J. Dodd, D-Conn., filling in for the ailing Senate Health, Education, Labor and Pensions (HELP) Committee Chairman Edward M. Kennedy, D-Mass., began marking up that committee's partially completed bill. That measure has also proved controversial as the CBO estimates pegged the price so far at over $1 billion, or approximately $6,250 per newly insured, and noted that it would only provide coverage for an additional 16-million individuals out of an estimated 46-million uninsured. Moreover, the mark remains incomplete, with scant language addressing how to pay for the health care makeover. The markup is expected to take two weeks.

  Meanwhile, a health care reform proposal offered on June 17 by Bipartisan Policy Center (BPC) advisors and former Senators Howard Baker, Thomas Daschle, and Robert Dole, received high praise from Baucus and Senate Finance Committee ranking member Charles E. Grassley, R-Iowa. "The proposal not only helps identify areas of clear agreement, it addresses critical reforms, such as tackling cost concerns and ensuring quality coverage while holding insurance companies' feet to the fire, "said Baucus. "It should encourage current members of Congress that former leaders of both political parties were able to find a compromise on even the most controversial health care issues and demonstrate that bipartisan reform may be achievable, "said Grassley.

  Gibbs said the BPC's report reinforces the president's main health care reform principles: "lowering costs for families, businesses and governments; guaranteeing choice of doctors and plans; ensuring quality and affordable health care for all Americans, and adhering to fiscal discipline that does not add to the deficit." The report is available on the BPC website at http://www.bipartisanpolicy.org.

  By Jeff Carlson and Paula Cruickshank, CCH News Staff