House Democrats Oct. 29 introduced a revised $894 billion health care bill (H.R. 3962) that would expand coverage to 96 percent of Americans.

The 1,990-page bill, the proposed Affordable Health Care for America Act, would expand coverage by broadening the Medicaid program, providing premium subsidies to help individuals and families purchase coverage, and creating an insurance exchange that offers private plans as well as a public option with negotiated provider reimbursement rates.

“Today we are about to deliver on the promise of making affordable, quality health care available for all Americans,” House Speaker Nancy Pelosi (D-Calif.) said at the bill's unveiling.

The bill is based on the original House health proposal (H.R. 3200) approved by the committees with jurisdiction in July but also includes changes designed to provide better coverage, lower the costs of the bill, and win the support of the Democratic caucus.

In a preliminary analysis, the Congressional Budget Office said the bill has a projected net cost of $894 billion during the budget window of 2010-2019 for the coverage provisions of the bill and would provide insurance to 96 percent of legal nonelderly residents, up from about 83 percent currently.

To offset its costs, the bill would include a 5.4 percent surtax on high-income households with a modified adjusted gross income of more than $1 million, as well as draw savings from changes to the Medicare and Medicaid programs.

During a speech on small businesses' need for a health care overhaul, President Obama applauded the release of the bill as a “critical milestone.”

“They forged a strong consensus that represents a historic step forward,” he said. “This bill includes reforms that will finally help make quality insurance affordable. Importantly, this bill is also fully paid for and will reduce the deficit in the long term.”

Democrats have pledged to provide a 72-hour viewing period for the bill as well as a manager's amendment to it, meaning floor consideration will not begin until late the week of Nov. 2.

Republicans are not expected to support the bill, and House Minority Leader John Boehner (R-Ohio) slammed the legislation as a “government takeover of our health care system.”

“It's going to raise the cost of American health insurance. It's going to kill jobs with tax hikes and new mandates in it. And it's going to cut seniors' health care benefits,” he said at a press conference.

Access to Coverage.

As proposed, the bill would require individuals to obtain insurance coverage or face a penalty equal to the lower of 2.5 percent of their adjusted gross income above the filing threshold or the average premium offered through the insurance exchange.

To help those without employer coverage or with unaffordable employer coverage obtain a policy, the bill would create a health insurance exchange, where individuals and certain small businesses would be eligible to purchase policies. The newly released bill would allow larger businesses to enter the exchange more quickly than originally proposed.

In 2013, businesses with up to 25 employees could enter the exchange, compared with businesses with 10 employees in the original bill. By 2015, firms with up to 100 employees could enter the exchange under the new bill, with further expansion possible.

All policies offered through the exchange--and eventually all employer-based policies as well--would be required to meet minimum benefit standards.

The bill also contains a series of consumer protection provisions, with many of the changes rolled out sooner than under the original proposal.

Beginning in 2013, the bill would prohibit insurance companies from discriminating based on pre-existing health conditions. The legislation also would prohibit insurers from charging higher rates due to health status or gender, or other factors, and would permit premiums to vary based on age by a ratio of only 2-to-1.

Business Groups Criticize Bill.

A coalition of business groups criticized the bill and voiced their opposition in a letter to Pelosi and Boehner.

“The legislation falls short of the bipartisan goal of controlling costs and jeopardizes employer-sponsored coverage which now serves more than 160 million Americans,” said the letter, signed by groups including the American Benefits Council, the Business Roundtable, the National Business Group on Health, the National Retail Federation, and the U.S. Chamber of Commerce.

Specifically, the groups objected to the weakening of the Employee Retirement Income Security Act, the inclusion of an employer mandate, and a public option. They also said the minimum benefit standards for insurance policies would force employers to curtail other benefits and limit employer flexibility.

AFL-CIO President Richard Trumka, on the other hand, praised the bill for not taxing middle-class workers.

“The bill does not attempt to finance reform on the backs of the working middle class. In addition, the employer responsibility provision ensures a fair share of financing from employers and prevents employers from increasing costs for everyone by dumping people into subsidized programs,” he said in an Oct. 29 statement.

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The text of the bill and a summary are available, respectively, at http://op.bna.com/dt.nsf/r?Open=csaz-7xak79 and http://op.bna.com/hl.nsf/r?Open=sfak-7xasey, with more information at http://waysandmeans.house.gov/MoreInfo.asp?section=52.

Copyright 2009, The Bureau of National Affairs, Inc.