WASHINGTON -- The legislative train of health care reform lurched out of the station on Tuesday as a key House subcommittee began debating a comprehensive proposal from Rep. Pete Stark, D-Calif.
Stark's proposal is just one of many, including President Clinton's plan, floating around Washington these days; there are surely more to come. And none of them will likely survive intact the assault that awaits them in a vast array of subcommittees.
Now that the health care debate has officially entered Congress, the challenge for biotechnology industry observers in the coming months will be tracking the fate of direct and indirect drug price control mechanisms as they appear, disappear and reappear in various guises through a succession of bills and proposals.
Stark, chairman of the Health Subcommittee of the Committee on Ways and Means, has kicked off a parliamentary process that is unprecedented in its scope and complexity. At least three committees of the U.S. House of Representatives have clear jurisdiction over health care reform: Ways and Means, Energy and Commerce, and Education and Labor. Meanwhile, two committees on the Senate side -- Finance and Labor and Human Resources -- have overlapping jurisdiction on the issue.
Before a health care reform proposal or bill even makes it to any of these five full committees, it will be hotly debated and probably rewritten by a subcommittee (see the following story for a list of committees and subcommittees with jurisdiction over health care reform). The tortuous process is a mystery to most Americans.
Committees and subcommittees are at the heart of the political and legislative process. They allow for an organized division of labor so that detailed and complex issues can be considered by small numbers of people before they are put before larger groups of legislators.
For example, Stark's proposal must gain the approval of a majority of the 11 members of the Health Subcommittee before it can advance to the full 38-member Ways and Means Committee. According to Chuck Ludlam, the Biotechnology Industry Organization's (BIO) vice president for government relations, it's uncertain whether Stark even has the votes to get his bill out of the subcommittee at this point. And even if he did, the bill could easily die from the blast of criticism and changes it will probably receive from the full committee.
Once a plan does claw its way out of a subcommittee to one of the full committees (or several of them at once), it is once again revised and approved. Finally, it goes before the full 435- member House. After more political wrangling, it is either passed or rejected. If passed, it is sent to the Senate side for a reinitiation of the entire process.
However, since both the House and Senate are working on health care reform bills, the more likely scenario is that the two bodies will have to hold a conference to reconcile their two different versions of health care reform. After a consensus bill is produced in conference, it will be sent to the president, who can sign it, let it become law without his signature or veto it.
At any point during this complex, Machiavellian process, individual provisions, such as a breakthrough drug committee to review the introductory price of drugs, can slip stealthily in or out of the legislation. And when it comes to price-control measures, which Ludlam said represent a potential stake through biotechnology's heart, the industry must be vigilant.
"We could win in both houses (the Senate and the House) and lose in conference. Or we could lose in both houses and win in conference," he said. In other words, it's not over 'til it's over.
Veterans of the legislative process say interested parties should keep their eye on core concepts, not specific plans. Forget Stark's or Clinton's plan; watch out for the fate of universal coverage, cost containment, alliances, employer mandates, benefit packages and caps on insurance premiums. Legislators will argue over which of these elements to include in any plan and how it should be implemented.
For the biotechnology industry, the structural and institutional manifestations of attempts at cost containment and the details of benefits packages (whether they will include a Medicare drug benefit and if it will be tied to required rebates, for example) will likely be the most relevant.
The other core concepts, which will doubtlessly generate controversy, may not have as much direct impact on the industry. For example, universal coverage could be a plus to biotechnology and pharmaceutical companies, bringing 37 million uninsured individuals into the health system as new potential customers. Mandates on employers to make sure their workers have insurance may have a limited impact on the industry since most biotechnology companies already pay for their employees' health insurance.
"The important thing for the industry in 1994 is that we resolve the health care reform debate one way or the other," said Ludlam. "We need a public death and burial of the issue because continued uncertainty is the worst thing that could happen."
-- Lisa Piercey Washington Editor
(c) 1997 American Health Consultants. All rights reserved.