Final Senate healthcare bill released by Reid in drive for 60 votes

Senate Majority Leader Harry Reid (D-Nev.) has unveiled a final version of his healthcare reform legislation containing a plethora of changes designed to lock down the 60 votes he needs to pass the historic legislation on Christmas Eve.

The so-called manager’s amendment to the bill that has been on the Senate floor for weeks contains in its 383 pages new compromise language, with many of the provisions targeted to satisfy the demands of individual senators.

{mosads}Reid formally introduced the legislative language on the Senate floor Saturday morning, triggering a parliamentary delay tactic by Senate Minority Leader Mitch McConnell (R-Ky.), who insisted that clerks read the entire document aloud.

Despite the delay the bill reading will cause, Reid’s gambit strongly suggests that he has united his caucus of 58 Democrats and two independents behind a measure that would extend health insurance coverage to around 30 million people and make fundamental changes to the U.S. healthcare system.

The House passed its version of the healthcare bill last month. If Reid is able to keep his 60 Democrats in hand through a vote to approve the Senate bill scheduled for 7 p.m. on Christmas Eve, he will deliver a major victory to President Barack Obama. House and Senate Democrats would then confer during the holiday break and into January on the version that would go to Obama for a signature.

The release of the manager’s amendment marks a watershed moment for Reid’s leadership during the year-long process of drafting and debating healthcare reform legislation. Democrats have been stiffly divided on several crucial issues on ideological grounds with a handful of centrists objecting to key liberal priorities such as the creation of a government-run public option insurance program.

Numerous attempts to find a compromise acceptable to both camps failed, leading Reid to pin his hopes on siding with the centrists and counting on the liberals not to walk away from a bill that still strives for their primary goal of enacting a comprehensive healthcare reform bill that provides coverage to tens of millions of uninsured people.

Reid’s most crucial political compromise was on abortion, the biggest bone of contention for centrist Sen. Ben Nelson (D-Neb.), an abortion opponent who failed in his attempt to amend the bill on the floor with stronger language shielding federal insurance subsidy funds from paying for abortion services and rejected previous compromises offered by Reid and Sen. Bob Casey Jr. (D-Pa.), who both also oppose abortion rights.

After private talks between Reid, Nelson and other Democrats that ran late into Friday night, however, Nelson signed off on the new language and other provisions that cleared the way for him to support the healthcare bill. The language is complex but the biggest change is that states would be permitted to prohibit plans sold within their borders through the health insurance exchange from covering abortion services. “I will vote for healthcare reform because it will deliver relief from rising healthcare costs to Nebraska families, workers, rural communities and employers,” Nelson said.

The early response from abortion-rights supporters was positive, as Democratic Sens. Barbara Boxer (Calif.) and Patty Murray (Wash.) issued a joint statement saying they preserved the principle that women can use their own money to purchase abortion coverage through plans on the insurance exchange. Though the senators emphasized they preferred the original abortion language in the bill, “compromise was necessary to get a healthcare bill for the American people, and this compromise achieves that.”

“We said we would not accept language that prohibited a woman from using her own private funds for her legal reproductive health care — this compromise meets that test,” Boxer and Murray said.

Nelson also won a major concession on the proposed expansion of Medicaid to everyone with incomes below 133 percent of the federal poverty level. Nelson, along with governors of both political parties, expressed anxiety that the expansion would burden state budgets. Under the manager’s amendment, the federal government will cover more of the cost of the expansion than under the original bill, with special additional funding for Nebraska.

“Thanks to Sen. Ben Nelson for announcing his support for the Senate health care bill, making him our 60th vote,” Reid tweeted Saturday morning.

Nelson did not win every battle, however, as Reid preserved the CLASS Act language in the bill, authored by the late Sen. Edward Kennedy (D-Mass.), to create a voluntary federal insurance program for home- and community-based long-term care services.

No trace of the public option remains in the bill but Reid does offer new provisions to appeal to liberal senators, such as additional funding for Community Health Centers and the Children’s Health Insurance Program

In addition, the amendment includes even stricter health insurance regulations and consumer protections than contained in the underlying bill, such as guaranteeing patients the right to appeal coverage denials and additional limitations on year-to-year premium increases that will take effect before the insurance exchange launches in 2014.

The manager’s amendment also would require insurers to spend at least 80 percent of their premium income on medical claims and provide rebates to customers when they fail to meet that threshold.

The legislation still contains an excise tax on high-cost, so-called Cadillac health insurance plans, which is strongly opposed by labor unions and many Democrats but is backed by the White House and is one of the biggest revenue raisers in the legislation. Opponents of the tax are looking to the House-Senate conference committee to roll it back; the Reid amendment makes minor changes, such as exempting longshoremen.

The new language boosts the increase in the Medicare payroll tax that would hit people earning more than $200,000 and families earning more than $250,000 from 0.5 percent to 0.9 percent.

The bill also reduces an annual levy on medical device manufacturers and replaces an excise tax on cosmetic surgery with a 10 percent excise tax on indoor tanning salons.

Reid retained one proposal that emerged from negotiations between liberal and centrist Democrats: the creation of multi-state, nonprofit health insurance plans that would be negotiated by the federal Office of Personnel Management, which manages the Federal Employees Health Benefits Program, as an alternative to the traditional insurance plans that would be offered under the bill.

The new language also includes vouchers for some middle-income people to purchase health coverage on the new insurance exchange rather than from their employers if they earn too much to exempt from the individual mandate to buy insurance but not enough to qualify for federal subsidies. The so-called “free choice” provisions are based on a proposal by Sen. Ron Wyden (D-Ore.).

Small-business advocates such as Sens. Mary Landrieu (D-La.) and Blanche Lincoln (D-Ark.) – who, with Nelson, were among the toughest sells in the Democratic caucus – won a concession that would provide workers at small firms with more generous and more immediate financial assistance.

A group of freshman Democratic senators, many of them also centrists, won the inclusion of more aggressive cost-containment measures based on those already in the bill. Under the manager’s amendment, cost-containment pilot projects would ramp up more quickly and the Department of Health and Human Services would have greater authority to expand those programs without additional legislation.

Reid cut provisions from the bill that would have prevented a 21.5 percent cut in doctors’ Medicare fees and replace it with a one-year hike. The House-passed measure includes a fix for 2010, however, and the defense spending bill approved by the Senate Saturday postpones the cut, which would kick in on Jan. 1, for two months. Reid told reporters that physician groups requested the change on the grounds that they want a permanent fix to their payment issues enacted in separate legislation.

Walter Alarkon contributed to this report

This story was updated at 12:15 p.m.