What Was the Senate Health Care Reform Bill?

Question: What Was the Senate Health Care Reform Bill?

The Senate approved its version of the Health Care Reform Bill with a final dramatic vote on Christmas Eve. The Senate Bill must be harmonized with the House Health Care Reform Bill before it sent to Obama's desk.

There are significant differences between the two bills. The House bill contains stricter abortion language and a public option. The Senate bill has a tax on high-value insurance plans and does not have a public option.

Answer: The Senate Health Care Reform Bill would have allowed 31 million people to afford health insurance. However, 23 million would still be uninsured. Without reform, mandatory health care spending on Medicare is unsustainable. Medicare payroll taxes and premiums cover only 57% of current benefits. The remaining 43% is financed from general revenues. Because of rising health care costs, general revenues would have to pay for 62% of Medicare costs by 2030.

The bill would have cost $871 billion over 10 years. To help pay for the programs' expenses, it would have increased taxes on medical-device makers, drug companies, customers of tanning salons, and high value insurance plans.

The Council of Economic Advisors agreed that spending would initially rise to cover increased coverage. But, over the next ten years, it would have lowered Federal spending by .7%, thereby reducing the federal budget deficit by $132 billion.

The Senate Health Care Reform Bill would have:

• Required everyone to have health care insurance, but offered subsidies for those who can't afford premiums. It also would have expanded Medicaid.
• Employers who didn't offer insurance would have been levied a fine. However, small businesses were provided a tax break if they couldn't afford insurance.
• Prohibited insurance companies from charging more to people with serious illnesses or who are older.
• Made it illegal for insurers to refuse coverage for pre-existing conditions. This provision kicked in for children in 2010, and adults in 2014.
• Allowed people and small businesses to shop for insurance plans through a government-regulated exchange.
• Limited patients' yearly health care costs.
• Added an excise tax on high-cost insurance plans.

The Senate bill was most similar to the final Patient Protection and Affordable Care Act that was passed in 2010. For current status and a complete timeline, see Health Care Reform Timeline.

(Updated February 1, 2010)

The Senate Health Care Reform Bill originally proposed a system of nonprofit cooperatives. It differentiated itself from Obama's Health Care Reform Proposal, which offers a government-run insurance plan, similar to Medicare, to compete with the private market.

On October 26, 2009, Senate Majority Leader Harry Reid announced a government-run option to the Senate bill. It included extending Medicare benefits to those age 55 to 65. It was offered to states where there was a proven lack of affordable options from private insurers. States could choose to opt-out, if they desired. This option was dropped from the final bill due to opposition from the deciding vote, Senator Joe Lieberman.