WASHINGTON -- The legislative train of health care reformlurched out of the station on Tuesday as a key Housesubcommittee began debating a comprehensive proposal fromRep. Pete Stark, D-Calif.

Stark's proposal is just one of many, including PresidentClinton's plan, floating around Washington these days; there aresurely more to come. And none of them will likely surviveintact the assault that awaits them in a vast array ofsubcommittees.

Now that the health care debate has officially entered Congress,the challenge for biotechnology industry observers in thecoming months will be tracking the fate of direct and indirectdrug price control mechanisms as they appear, disappear andreappear in various guises through a succession of bills andproposals.

Stark, chairman of the Health Subcommittee of the Committeeon Ways and Means, has kicked off a parliamentary processthat is unprecedented in its scope and complexity. At leastthree committees of the U.S. House of Representatives haveclear 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 andHuman Resources -- have overlapping jurisdiction on the issue.

Before a health care reform proposal or bill even makes it toany of these five full committees, it will be hotly debated andprobably rewritten by a subcommittee (see the following storyfor a list of committees and subcommittees with jurisdictionover health care reform). The tortuous process is a mystery tomost Americans.

Committees and subcommittees are at the heart of the politicaland legislative process. They allow for an organized division oflabor so that detailed and complex issues can be considered bysmall numbers of people before they are put before largergroups of legislators.

For example, Stark's proposal must gain the approval of amajority of the 11 members of the Health Subcommittee beforeit can advance to the full 38-member Ways and MeansCommittee. According to Chuck Ludlam, the BiotechnologyIndustry Organization's (BIO) vice president for governmentrelations, it's uncertain whether Stark even has the votes to gethis bill out of the subcommittee at this point. And even if hedid, the bill could easily die from the blast of criticism andchanges it will probably receive from the full committee.

Once a plan does claw its way out of a subcommittee to one ofthe full committees (or several of them at once), it is once againrevised and approved. Finally, it goes before the full 435-member House. After more political wrangling, it is eitherpassed or rejected. If passed, it is sent to the Senate side for areinitiation of the entire process.

However, since both the House and Senate are working onhealth care reform bills, the more likely scenario is that thetwo bodies will have to hold a conference to reconcile their twodifferent versions of health care reform. After a consensus billis produced in conference, it will be sent to the president, whocan 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 committeeto review the introductory price of drugs, can slip stealthily inor out of the legislation. And when it comes to price-controlmeasures, which Ludlam said represent a potential stakethrough biotechnology's heart, the industry must be vigilant.

"We could win in both houses (the Senate and the House) andlose in conference. Or we could lose in both houses and win inconference," he said. In other words, it's not over 'til it's over.

Veterans of the legislative process say interested partiesshould keep their eye on core concepts, not specific plans.Forget Stark's or Clinton's plan; watch out for the fate ofuniversal coverage, cost containment, alliances, employermandates, benefit packages and caps on insurance premiums.Legislators will argue over which of these elements to includein any plan and how it should be implemented.

For the biotechnology industry, the structural and institutionalmanifestations of attempts at cost containment and the detailsof benefits packages (whether they will include a Medicaredrug benefit and if it will be tied to required rebates, forexample) will likely be the most relevant.

The other core concepts, which will doubtlessly generatecontroversy, may not have as much direct impact on theindustry. For example, universal coverage could be a plus tobiotechnology and pharmaceutical companies, bringing 37million uninsured individuals into the health system as newpotential customers. Mandates on employers to make sure theirworkers have insurance may have a limited impact on theindustry since most biotechnology companies already pay fortheir employees' health insurance.

"The important thing for the industry in 1994 is that weresolve the health care reform debate one way or the other,"said Ludlam. "We need a public death and burial of the issuebecause continued uncertainty is the worst thing that couldhappen."

-- Lisa Piercey Washington Editor

(c) 1997 American Health Consultants. All rights reserved.