Medical Device Daily Washington Editor
The three committees that wrote the healthcare reform bill for the House of Representatives began marking up the legislation committee by committee yesterday, leading off with the House Ways and Means Committee. However, there was little evidence of partisan comity, raising the risk for Democrats that any defectors in the party – an especially high risk given the opposition to some of the bill's provisions by members of the Blue Dog Coalition – might sink the bill.
Given the short time to review the bill, dubbed the America's Affordable Health Choices Act of 2009 (H.R. 3200), the committee's ranking GOP member, Dave Camp (R-Michigan), said the bill is far too immense to review in the 48 hours between its publication and the start of yesterday's hearing, adding that he doubted whether anyone with the exception of a few staffers had read the bill from beginning to end.
"I'm offering a motion this morning to give all members more time to understand this bill," he said, "to postpone this markup by one week." He said the markup by the House Energy and Commerce Committee is scheduled to last well into the week of July 20 and characterized the deadline of early August for passage of the entire bill as "arbitrary." Camp remarked that a delay would allow all members of the committee to review the legislation in order to "make sure the prescription is not worse than the disease."
However, Rep. Pete Stark (D-California), chairman of the committee's health subcommittee, moved to table Camp's motion, effectively scuttling the proposal. Stark's motion won on a 24-14 party-line vote.
Ways and Means Committee chairman Charles Rangel (D-New York) began yesterday's hearing by describing the date as "an exciting day ... as we tackle a problem" that he said has plagued nearly all Americans in one way or another over the years.
"Everybody has a horror story as to how their lives have been adversely affected by an insurance policy [or] a lack of an insurance policy," Rangel said. He also noted "many employees have been denied wage increases because of an increase in the cost of healthcare." He also mentioned job lock as an issue.
"It has to stop and it has to stop now," Rangel said of the effect healthcare costs have had on the economy. He said it is important that "all Americans have an equal playing field." Rangel indicated that he will hold the committee overnight if necessary to complete the markup.
Tom Barnhart of the Joint Committee on Taxation gave the committee a briefing on the Joint Committee's assessment of the bill, noting that H.R. 3200 "would create an additional tax on individuals who do not acquire health insurance for themselves or their qualifying children," which would come to about 2% of adjusted gross income. Barnhart said employers who do not provide minimally acceptable coverage would "have an additional payroll tax of 8% of employee wages," with "an exception for small businesses," specifically those making less than $250,000.
Barnhart mentioned a tax credit for small businesses of "up to 50% of the cost of coverage provided," for companies with 25 or fewer employees and an average wage or salary of less than $40,000. This would be phased out over increases in employees and average incomes.
As for the tax surcharges called for in the bill, Barnhart said "on Jan. 1, 2013, the rates on the first two steps," which are 1% for couples making $350,000 and 1.5% for couples making more than $500,000, "would increase to 2% and 3% respectively unless certain health cost savings targets are met." He said this threshold was pegged at $525 billion in savings, beyond which the increases for these first two steps would not be undertaken. However, "if total costs savings ... were projected to exceed $700 billion," the first two steps would vanish altogether, leaving only the 5.4% surcharge for couples making more than $1 million.
In a statement, Steve Ubl, President/CEO of the Advanced Medical Technology Association (AdvaMed; Washington) said the association "is concerned that some areas of the draft legislation, either directly or indirectly, would have a negative impact on patient care and innovation in medical treatments." Among the association's concerns is "comparative effectiveness research that is not transparent and that could focus on the cost of care rather than what is best for patients"
Ubl also said that comparative effectiveness research could lead to "centralized decision-making on access to medical technology, pharmaceuticals and procedures that could limit the choice of treatment options available to patients in consultation with their physicians."
Ubl also expressed the view that the bill would establish a "national device registry that is too broad, collects information with questionable utility and is redundant with existing FDA post-market authorities and initiatives." He also made the case that reductions in payments for durable medical equipment were "excessive."
Also commenting on the House bill was the U.S Chamber of Commerce (Washington). In a July 14 statement, the Chamber's president/CEO Thomas Donohue asserted that the surtax provision will hit owners of small businesses.
"The intention of this plan is to tax high income households, but the real victims would be America's small business owners," Donohue said. "Placing a big tax burden on the small business community would rob them of the resources they need to create the jobs that will lead us out of the recession," he said adding, "if there's one sure way to kill the goose that lays the golden egg, this is it."