Ezra Klein Must Read: House health-care bill likely to cover more, cost families less

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House health-care bill likely to cover more, cost families less, than Senate bill



The House of Representatives is readying itself to release three delicious flavors of health-care reform. One of the bills will have a public option trigger. Another will have a level-playing field proposal. And the third will have the Hardy's Thickburger of public options: Medicare rates plus 5 percent, national, the whole deal. They're even forming a commission of independent experts to build a new formula that addresses the concerns of rural and Pacific Coast members, both of whom feel that Medicare underpays their hospitals.

But that won't be the only difference among the plans. Because the strong public option saves more money, the bill will also be more expansive with its subsidies and generous with its coverage -- all while costing $871 billion, which is to say, less than the $900 billion marker the president laid out.

From what I'm hearing, the specifics will look something like this. The Senate Finance Bill gets to 94 percent coverage. The House bill will hit 96 percent. The Senate Finance bill spends a bit over $450 billion on subsidies to help people afford insurance. The House bill will spend more than $700 billion. The Senate Finance bill doesn't have an employer mandate. The House bill does. The Senate Finance bill funds itself by taxing family health-care benefits over $21,000. The House bill funds itself by taxing incomes over $500,000. The Senate Finance bill expands Medicaid. The House bill expands Medicaid by more. The Senate Finance bill costs $829 billion. The House bill costs $871 billion. And the rumor is that there are some other goodies in there, but I've not been able to confirm that yet.

The House bill, in other words, will cover more people at a more affordable cost to individuals. It can do this for a number of reasons, but the big one is that it saves a lot of money by including a strong public option and a real individual mandate. The combination of those two policies allows the government and individuals to pay a bit less while encouraging employers to pay a bit more. Its funding mechanism is a whole lot more popular than taxing health-care plans, but it will also do less to "bend the curve."

The end result will be to make the choices in health-care reform very stark. You can have more affordability and more coverage if you're willing to include a real public plan and an individual mandate. You can have a more popular funding mechanism that will confine itself to taxing the rich if you're willing to sacrifice a bit on cost control and deficit reduction. You can do more to help people pay for coverage if you're willing to do less to help industry stakeholders maintain their profit margins. These are not easy choices for legislators, and the politics of them are not obvious. But the fact that they are choices, and they can be made, is about to become very, very clear.

Photo credit: Brendan Hoffman/Bloomberg

By Ezra Klein | October 22, 2009; 5:05 PM ET

http://voices.washingtonpost.com/ezra-klein/2009/10/house_health-care_bill_likely.html