Congress, Catholics, Conservatives Gear Up for Saturday Night Showdown

Healthcare reform news: Reid is ready to force a reconciliation. Pelosi wants to combine the Senate and House bills. Catholic Bishops and the GOP want to stop everything. Ladies and gentlemen, more proof that making law is like making sausage.

Things to watch out for during the Saturday vote which will determine if the health care debate moves forward:

Major Differences

The Politico summarizes:

Senate Majority Leader Harry Reid introduced his health care reform bill yesterday and moved the debate into its final stage. After a year of multiple plans, proposals and programs we're down to two final, and very different, versions of reform. The House bill costs just over $1 trillion. The Senate bill weighs in at $848 billion. The Senate cuts Medicare spending by $491 billion and the House slashes it $571 billion. The Senate's public insurance option allows states to opt out of the program while the House has a more robust plan. And to fund reform, the Senate relies primarily on taxing high-end health plans while the House taxes the rich. And the gulf between the two bills is not likely to shrink as the bill moves through the Senate. If anything, the gap may widen if Senate moderates force Reid to make the bill more conservative. Besides the daily speculation about whether Reid has 60 votes to move a bill forward, which has been going on for weeks, the next power play to watch will be how Reid, Pelosi and the White House begin to move toward a bill that can pass both chambers and land with a victorious thud on the president's desk. Getting a bill passed through the Senate is difficult, but many insiders think reconciling the differences between the two bills could be hellacious.

Abortion

Now that Pelosi has reversed her stance on Stupak-Pitts, saying the amendment goes too far and embracing Reid's version, Catholic leaders and the GOP have come out swinging.

Catholic bishops are displeased:

A top Obama administration official on Thursday praised the new Senate health care bill's attempt to find a compromise on abortion coverage - even as an official of the U.S. Conference of Catholic Bishops said Sen. Harry Reid's bill is the worst he's seen so far on the divisive issue.

The bishops were instrumental in getting tough anti-abortion language adopted by the House, forcing Speaker Nancy Pelosi, D-Calif., to accept restrictions that outraged liberals as the price for passing the Democratic health care bill. [...]

Richard Doerflinger, associate director of the bishops' conference Secretariat of Pro-Life Activities, said Reid's "is actually the worst bill we've seen so far on the life issues."

He called it "completely unacceptable," adding that "to say this reflects current law is ridiculous."

Meanwhile, the Republicans found a new talking point:

House Minority Leader John Boehner's office has posted a long statement blasting the Senate health care plan, specifically targeting the abortion provisions with an accusation it levies an "abortion premium fee."

A Senate Democratic aide came back with the facts, pointing out that the prevision that Boehner refers to is for something else, and points to all the language in the bill that prohibits the use of public funds for abortion.

But Melissa over at Shakesville points out that Reid's additions are more of a Pyrrhic victory than anything else.

When Boxer's petition against the Stupak Amendment noted it "discriminates against women by taking away health coverage they already have-and tells women who participate in the new health insurance exchange that they can't even use their own funds to buy a policy that includes abortion coverage," I didn't imagine "let them use their own funds!" was going to be regarded as the best solution.

Silly me.

Meanwhile, D-Day notes that this compromise depends heavily on decisions made by the Secretary of Health and Human Services, as s/he "determines whether or not abortion services are being paid for with federal dollars" and "can choose whether or not abortion services are covered in the public option."

Not only are those wildly enormous decisions to leave in the hands of one person, but, as D-Day points out, "the executive branch may indeed be controlled by a Republican at some point in the future."

Cost

One of the major differences in the two plans is how it will be funded. The House wants to tax millionaires - the Senate bill wants to tax "Cadillac plans." However, taxing these so called plans may not be a good strategy. Politifact delves into the details of the Senate plan:

Under the Senate Finance proposal from Sen. Max Baucus, insurance companies would have to pay a 40 percent excise tax on health insurance policies that exceed $8,000 for individuals and $21,000 for families; they would pay taxes on the amount that exceeds those thresholds. We spoke with three economists on both the left and the right, and they all agreed that insurance companies will not simply absorb the new tax; they will pass it along in the form of even higher premiums. Employers will then try to avoid the new higher costs by buying cheaper health plans.

Finally, the economists agreed that if employers have to scale back on health plans, they will eventually pay higher wages as they seek to retain workers. At this point, disgruntled workers may say "Yeah, right," but the economists were adamant that it is the case. There are data that we won't get into now that back up their point.

Here's where the analysis that Palin mentioned by the Joint Committee, which is nonpartisan and advises Congress on tax policy, comes in: At the Senate's request, it tried to figure out the effect of the excise tax on federal taxes collected. Like the economists we talked to, the Joint Committee also believes that wages will rise if employers select lower-priced health insurance, and the government gets to tax those higher wages. So the Joint Committee created a series of tables projecting how much additional income tax would be collected over the next 10 years. By 2019, about 87 percent of those people paying higher taxes would make less than $200,000, according to an analysis of the preliminary Senate Finance proposal.

So here's what that means: If workers end up getting paid more, they'll also be taxed more.

Communications Workers of America also ran a separate analysis on what the 'Cadillac' plan tax would mean for workers:

"The Senate Finance Committee excise tax is not a tax on 'Cadillac' plans; it's a pick-up truck tax. It taxes plans that are of great utility to millions of working Americans, but it is bad policy based on wrong assumptions," said CWA President Larry Cohen. "Health care reform should be paid for by making employers who don't pay, pay. The House bill does it with an 8 percent payroll tax on employers who don't provide coverage."

CWA recommends the following strategies to avoid penalizing people who fought for better coverage, but are being lumped in with CEO packages:

Rather than impose a new tax on the middle class, CWA supports other revenue sources:

* Require most employers to provide coverage or pay an 8 percent penalty if they do not, as proposed under H.R. 3200 in the House of Representatives. This would raise $163 billion over ten years, according to the Congressional Budget Office (CBO). The Senate Finance Committee bill has no employer mandate.
* Levy a modest surtax on the wealthiest Americans – 1.2 percent of U.S. taxpayers – as proposed in H.R. 3200, raising $544 billion over ten years according to JCT.
* Limit the charitable deductions for individuals earning more than $250,000 and families earning more than $500,000, as proposed by President Obama, which would raise $318 billion over ten years.
* Enact a strong public health insurance plan option to compete with private insurers, as proposed under H.R. 3200, which would lower costs by about $110 billion. The Senate Finance Committee bill has no public option.

Of course, the real party starts Saturday night. Seeing that the last Saturday evening health care announcement brought us Stupak-Pitts, let's hope nothing new comes out of left field.

Live Pulse [Politico]
Pelosi Says Stupak 'Goes Beyond Status Quo', 'Optimistic' It Won't Stop Reform [TPM]
White House at odds with bishops over abortion [AP]
GOP Claims Senate Bill Forces Taxpayers To Pay 'Abortion Fee' [TPM]
Senate Health Bill Answer to Stupak [Shakesville]
Sarah Palin says health care reform will raise taxes on the middle class [Politifact]
CWA Excise Tax Study Finds that One-Third of Health Care Plans Still Will Be Affected By Senate Finance Committee Approach [CWA]

Related: Why the Health Insurance Excise Tax Is a Bad Idea [The Nation]