Last week Senate Majority Leader Harry Reid (D-NV) indicated Senate Democrats had come to a tentative agreement to include within H.R. 3590, the Patient Protection and Affordable Care Act, a Medicare expansion plan that would allow persons 55 and over to buy into coverage. However, recent reports indicate that after more "closed door" sessions among the senators, both the public option and the Medicare Buy-in option are on their way out of a final version of the bill in order to achieve the necessary 60 votes to pass the legislation.

The struggle over the options was not helped by Senator Joseph Lieberman's (I-CT) refusal to support either measure (see DM 10992). Senator Ben Nelson (D-NE) and the American Medical Association also have opposed this proposal. Dropping the options may be necessary for Senate Majority Leader Harry Reid's goal to have the bill voted on by the end of the year, despite the disappointment of more liberal members of the Senate. The possibility exists, however, that liberal senators will not support a watered-down bill, notably Roland Burris (D-IL). Burris has stated in the Senate "...until this bill addresses cost, competition, and accountability in a meaningful way, it will not win my vote."

One possible measure to garner support from the liberal wing was a proposal to require health insurers to spend a designated percentage of premium income on actual medical care. However this amendment may likely be scuttled as the Congressional Budget Office (CBO) has projected that the regulations would in essence be a government takeover of the insurance industry. The CBO's report states, "In CBO's view, this further expansion of the federal government's role in the health insurance market would make such insurance an essentially governmental program, so that all payments related to health insurance policies should be recorded as cash flows in the federal budget."

Nonetheless, President Obama has been working to get a consensus on the bill, trying for a vote before the end of the year. Democratic Senators met with President Obama Tuesday for a rally on the legislation the President called "very productive." Afterward, the President spoke publicly saying that the bill would not include "everything that everybody wants," but differences should not get in the way of the responsibility to solve the urgent issue of health reform for the American people.

This week the President's Council of Economic Advisers produced a report that has positive remarks on health care reform. The Council determined that by 2019, total federal spending on the Medicare and Medicaid programs will be lower than they would absent any reform. The long-run savings will be achieved through means including a reduction in wasteful spending, fraud, inefficiencies and abuse in both CMS programs. The Council also stated that from 2016 to 2019, the annual growth rate of Federal spending on Medicare and Medicaid will be around 0.7 of a percentage point lower than absent reform, and the reductions will help lower the growth rate of Medicare recipients' Part B premiums.

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