House Democrats tussling on taxes, exchanges in health bill negotiations

The Washington Post: "Worried House Democrats held a caucus-wide conference call Thursday to strategize about health-care reform before lawmakers return to Washington next week. ... With Senate Democrats barely able to muster the 60 votes necessary to pass their own bill and President Obama leaning toward the Senate's position on some key issues, House Democrats are increasingly concerned that they could be marginalized at the bargaining table." Of particular concern to the party's liberal wing is President Obama's position on preserving the 'Cadillac tax' on high-cost health plans. 

"Members also brought up the public option, abortion funding, immigration and employer mandates, as well as the antitrust exemption for health insurance companies. The House bill would strip that exemption and the Senate bill would leave it in place" (Pershing, 1/8).

Kaiser Health News explains that the "Cadillac" tax would hit individual plans costing more than $8,500 a year in premiums and family plans breaching $23,000. About 19 percent of Americans receiving coverage through their employers could be affected (Gold, 1/7).

The New York Times reports on the House pushback over the "Cadillac" tax. "Many House Democrats dislike the excise tax, which is also opposed by many labor unions because the tax would potentially hit a number of generous union-sponsored health plans. More than 150 lawmakers had signed a letter opposing the tax, though there was no indication yet that they were prepared to torpedo the entire legislation because of that provision."

Differences remain between the bills on another tax. "The Senate also includes an increase in the Medicare payroll tax for individuals earning more than $200,000 and couples earning more than $250,000. The main tax provision in the House bill is an income tax surtax on individuals earning more than $500,000 and couples earning more than $1 million" (Herszenhorn, 1/7).

BusinessWeek: "House lawmakers may agree to pay for the nation's health-care overhaul by adopting versions of Senate proposals to raise Medicare payroll taxes and tax health benefits for the first time, Democratic aides said." In addition, House leaders could also get rid of the high-earner surtax (Rowley and Donmoyer, 1/8).

The Hill: "The scope of the insurance exchanges has emerged as another key difference between the two chambers. The Senate established a series of statewide exchanges, while the House prefers a single, national exchange that they say would increase choice for consumers" (Zimmerman, 1/7).

CBS News: "On immigration, the Hispanic Caucus made it clear that they want the House language, which allows illegal immigrants to purchase insurance from the exchange, to be in the final product" (Thomas, 1/7).

In a separate story, The Hill reports that House Speaker Nancy Pelosi, D-Calif., addressed caucus concerns about her statement earlier in the week that she'd allow the Senate bill to be the starting point for negotiations. "But Pelosi insisted from the onset [of the conference call] that the House would not simply accept the Senate bill, despite the extremely fragile coalition that allowed a bill to emerge from the Senate" (Allen and Young, 1/7).

Roll Call: "Pelosi also told Members that despite press reports, no final decision has been made on whether to hold a formal conference committee on the bill, an aide said. Democratic staff and leaders will continue to meet around the clock, with the aim for more progress to be made before a Tuesday evening Caucus meeting, [Rep. John] Larson, D-Conn., said" (Dennis, 1/7).

CongressDaily reports that President Obama is about to step into the scrum again: He "is scheduled to meet with House members next week in what members termed a 'Democratic issues conference' Wednesday or Thursday. Rep. Raul Grijalva, D-Ariz., chairman of the House Progressive Caucus, said the president needs to come down harder for or against issues for the negotiations to get resolved." The Progressive Caucus plans to meet Friday to list all of it's final concerns on the bills (Edney, 1/7).

Obama is also slated to meet with union officials Monday "to discuss their concerns about a proposed tax on high-cost insurance plans that would help pay for his health care overhaul plan," The Associated Press reports. The union leaders are expected to include those from the AFL-CIO and the Service Employees International Union (Hananel, 1/7).